Source: https://oag.govt.nz/2006/maf/part3.htm
Timestamp: 2019-08-26 01:58:15
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Part 3: Implementing the Import Health Standard for Sea Containers from All Countries — Office of the Auditor-General New Zealand
Ministry of Agriculture and Forestry: Managing biosecurity risks associated with high-risk sea containers
Part 3: Implementing the Import Health Standard for Sea Containers from All Countries
Part 2: Managing the biosecurity risks associated with sea containers
Part 4: Risk profiling of sea containers
Part 5: Biosecurity clearance for high-risk sea containers
Part 3: Implementing the Import Health Standard for Sea Containers from All Countries Ministry of Agriculture and Forestry: Managing biosecurity risks associated with high-risk sea containers. https://oag.govt.nz/2006/maf/part3.htm https://oag.govt.nz/@@site-logo/controller_ag_international_400x37.png
Ministry of Agriculture and Forestry: Managing biosecurity risks associated with high-risk sea containers.
our expectations;
the Sea Container Import Health Standard and auditing requirements;
compliance with the Sea Container Import Health Standard; and
relationship management and communication.
We expected:
the Ministry to have fully implemented the Sea Container Import Health Standard;
there to be adequate incentives for complying with the Sea Container Import Health Standard;
the Ministry to be adequately enforcing the Sea Container Import Health Standard; and
the Ministry to have strong relationships with industry stakeholders.
The Sea Container Import Health Standard and auditing requirements
The Ministry issued the Sea Container Import Health Standard in September 2003, and planned to fully implement it by 31 December 2003. The standard states that all systems and facilities associated with the clearance of sea containers are subject to audit.
The Ministry has not yet fully implemented the required auditing.
In September 2005, the Ministry released a document called the Requirements for the Audit of Sea Containers (the Audit Requirements document).
Under the Audit Requirements document, 1% of all sea containers will be routinely and randomly selected for audit. Once selected, Ministry staff will:
verify that the documentation for the container is correct;
carry out a 4-sided inspection of the sea container to check for external cleanliness; and
verify the internal compliance of the container (checking its cleanliness, that the packaging material and goods are consistent with that declared, and that any wood packaging meets the requirements of the Import Health Standard for Wood Packaging Materials from All Countries).
The Ministry started the documentation check in October 2005. However, all the aspects of the Audit Requirements document will not be fully implemented until at least July 2006 because the Ministry cannot yet recover from the industry the costs of checking the external and internal cleanliness of sea containers. The costs cannot be recovered from the industry until the Biosecurity (Costs) Regulations 2003 have been amended.
We understand that Ministry staff involved in amending the Biosecurity (Costs) Regulations (the cost recovery team) were approached after the Sea Container Import Health Standard was revised, and asked to set up the funding arrangements. The cost recovery team had just finalised the 2003 amendments to the Biosecurity (Costs) Regulations 1993, and had not accommodated the changes required for the revised Sea Container Import Health Standard into this amendment. The Biosecurity (Costs) Regulations 2003 are being further amended, and changes that incorporate the revised Sea Container Import Health Standard are expected to be made in July 2006.
Until all aspects of the Audit Requirements document are fully implemented, the Ministry will not have all the information it needs to identify areas where improvements could be made. This includes information relevant to risk profiling sea containers. For example, the audit may detect undeclared wood packaging in certain sea containers, and this information could be used to better identify the sea containers likely to contain undeclared wood packaging.
The delay in implementing all aspects of the Audit Requirements document has meant that the extent of poor practices (such as the provision of inaccurate documentation) cannot be determined.
These delays also mean that incentives for industry compliance with the Sea Container Import Health Standard have been weakened. Full implementation of all aspects of the Audit Requirements document should provide stronger incentive for industry compliance because, where non-compliance is detected, future imports will be subject to increased inspection and associated costs. To avoid the extra inspection costs, importers are expected to demand that exporters improve the cleanliness of containers and the accuracy of their documentation.
Internal audit of the implementation of the Sea Container Import Health Standard
In 2004, Biosecurity NZ conducted an internal audit of how the Quarantine Service was implementing the Sea Container Import Health Standard.
The internal audit report made several recommendations for improvement. Biosecurity NZ and the Quarantine Service have a relationship agreement which states that all important actions and recommendations from internal and external audits shall be acted upon within the specified deadlines.
The Quarantine Service and Biosecurity NZ met in October 2004 to discuss the actions required after the audit. Many of the audit’s recommendations had already been addressed. However, the Ministry has yet to act on some recommendations, particularly those requiring amendments to the Sea Container Import Health Standard or the Ministry’s procedure documents. Not amending the Sea Container Import Health Standard and procedure documents has implications for staff operating under those documents (see paragraphs 5.18-5.22).
Compliance with the Sea Container Import Health Standard
We looked at how the Ministry ensures that the Sea Container Import Health Standard is complied with.
The release or delivery of sea containers to importers can be delayed if documentation is not in order. Because delays incur costs for the importer, this is an incentive to ensure that the correct documentation is provided to the Ministry. In addition, an importer may be charged for any inspection, cleaning, or fumigation of the sea container. This is an incentive to ensure that the sea container is free from contamination when it arrives in the country.
The Ministry employs a small team of investigators in its Enforcement Group within the Quarantine Service. The team investigates offences under the Biosecurity Act 1993 such as:
the unauthorised movement of uncleared goods;
providing false or misleading information to Quarantine Service staff;
failing to comply with a reasonable direction or requirement made by Quarantine Service staff; and
moving sea containers off the wharf before the Quarantine Service provides authorisation for the container to be moved.
An investigation can result in prosecution, a warning, or education. The most common result of an investigation is an educational letter sent to the subject of the investigation, or no action being taken. In 2005, 4 prosecutions were approved, and 2 more were pending approval. We were told that the Enforcement Group cannot keep up with its current investigation load.
Providing a destination for sea containers
The Sea Container Import Health Standard requires the Ministry to be provided with documentation specifying the destination of the container once it leaves the wharf, which must be an approved transitional facility.1 However, customs brokers or importers do not have to enter a code for specific transitional facilities into CusMod2 when they electronically enter the information.
This means the Ministry cannot ensure that sea containers are taken to a transitional facility for unpacking and checked for contamination by an accredited person, as required by the Sea Container Import Health Standard.
We recommend that the Ministry of Agriculture and Forestry enforce the requirement of the Import Health Standard for Sea Containers from All Countries for importers to provide information on the destination of a container once it leaves the wharf.
Enforcing the requirements of the Sea Container Import Health Standard
As we reported in 2002, there have been calls to introduce instant fines for non-compliance with biosecurity requirements for sea containers (similar to the infringement notice for passengers who fail to declare risky goods on arrival declaration forms).
The Ministry of Justice has advised that instant fines for New Zealand importers for incorrect sea container quarantine declarations would be inappropriate, because importers have no control over the state of the sea containers and the processes by which they are packed by an overseas exporter.
However, when the Ministry becomes aware that some sea containers have been moved off the wharf without permission, or that there has been unauthorised movement of non-cleared goods, the Ministry would be able to identify the person responsible for the breach of the Biosecurity Act 1993. In such circumstances, it would be possible for the Ministry to take action against the person.
We were told that there is abuse of the system, and a lack of respect for the Ministry, because the consequences of non-compliance are not a sufficiently powerful deterrent. In our view, it is important that the Ministry maintains tight control over the release of sea containers from the wharf, and maintains the ability to track where the sea containers are going to be checked that they are free from contamination. In our view, the Ministry needs to secure greater compliance with the Sea Container Import Health Standard.
We recommend that the Ministry of Agriculture and Forestry investigate and implement measures to secure greater compliance with the Import Health Standard for Sea Containers from All Countries.
Consistency in enforcing the Sea Container Import Health Standard
The Sea Container Import Health Standard requires a quarantine declaration to accompany all sea containers. The Ministry’s procedure document for the biosecurity clearance of sea containers3 states that any sea container not covered by a quarantine declaration is to be considered high-risk, and treated accordingly (that is, inspected, fumigated, accompanied by an official certificate, or subject to an equivalent system).
The Ministry has not consistently upheld this requirement. The internal audit carried out in 2004 (see paragraphs 3.12-3.14 ) found that, depending on the worksite, Quarantine Service staff were lenient to various degrees towards importers when they failed to present a quarantine declaration. Responses by different staff when a container arrived with an incorrect or absent quarantine declaration included:
no penalties for not producing a quarantine declaration;
6-sided inspections and supervised unpacking of the container when the importer failed for the third time to produce a quarantine declaration; and
occasional enforcement action, requiring a 6-sided inspection and internal check of packaging and internal cleanliness of the container.
The authority of the Sea Container Import Health Standard has been undermined because the Quarantine Service has not consistently enforced it.
3.28 In June 2004, in response to the internal audit findings, the Ministry introduced a category of “medium risk” for some sea containers that did not have a quarantine declaration. Rather than a 6-sided inspection, “medium risk” sea containers are to undergo a 4-sided inspection. The Ministry needs to ensure that this new requirement is consistently applied.
We recommend that the Ministry of Agriculture and Forestry ensure that processes are consistently followed for dealing with sea containers that arrive without a quarantine declaration or with an incorrect quarantine declaration.
Relationship management within the Ministry
The revision and implementation of the Sea Container Import Health Standard put pressure on the relationship between Biosecurity NZ and the Quarantine Service. For example, there was tension about the amount of involvement and consultation between Biosecurity NZ and the Quarantine Service.
In our view, there are lessons to be learned from the revision and implementation of the Sea Container Import Health Standard – particularly the need for more open communication between Biosecurity NZ and the Quarantine Service.
After the experience with the Sea Container Import Health Standard, Biosecurity NZ and the Quarantine Service signed a relationship agreement which states that:
Biosecurity NZ shall ensure that the Quarantine Service has as much advance notice as possible of changes to border management strategies and technical specifications, to enable appropriate resourcing decisions, procedure preparation, and training;
Biosecurity NZ shall ensure that the Quarantine Service has enough funding to enable the efficient delivery of services to Biosecurity NZ specifications;
Biosecurity NZ shall, except in emergency situations, ensure that the Quarantine Service has enough time to plan and implement new or revised border specifications; and
Biosecurity NZ shall consult fully with the Quarantine Service when preparing or reviewing all technical specifications and import health standards.
We were told that the relationship between Biosecurity NZ and the Quarantine Service is continuing to evolve, and the 2 groups are trying to work more collaboratively.
This improvement is evident in the consultation undertaken by Biosecurity NZ about the auditing requirements for sea containers. Quarantine Service staff and industry stakeholders told us that they considered this consultation to be significantly better than that for the revised Sea Container Import Health Standard. Quarantine Service staff told us that their concerns about the proposed Audit Requirements document were taken into account.
In our view, it is very important that Biosecurity NZ and the Quarantine Service continue to build an effective working relationship. It is important for Biosecurity NZ to understand the need for the Quarantine Service to be involved in matters that will affect the Quarantine Service’s work. Similarly, to support any proposed changes, the Quarantine Service needs to be provided with information explaining the rationale for those changes. The agreement between Biosecurity NZ and the Quarantine Service contains sound principles for building this relationship.
Relationships with industry stakeholders
Effective management of the biosecurity risks associated with sea containers requires the co-operation and support of industry stakeholders (such as customs brokers, freight forwarders, port companies, and shipping companies). Maintaining good relationships with these industry groups is an important part of ensuring the successful implementation of the Sea Container Import Health Standard, and managing the biosecurity risks associated with sea containers.
Relationships with industry stakeholders are managed by both Biosecurity NZ and the Quarantine Service. The relationship agreement between Biosecurity NZ and the Quarantine Service sets out clearly which agency takes the lead in inter-agency and inter-government relations, but not which of the 2 groups is responsible for dealing with industry stakeholders, and about which matters.
Biosecurity NZ administers consultative committees, such as the Shipping Biosecurity Consultative Committee (which meets every 6 months to discuss operational and strategic policy issues). Biosecurity NZ may also deal directly with industry groups, such as shipping companies and port companies.
The Quarantine Service regularly deals with industry stakeholders on operational issues. Industry stakeholders (particularly port companies) made a number of positive comments to us by about their day-to-day working relationships with the Quarantine Service. Some industry stakeholders felt that the Ministry was improving the way that it involved stakeholders.
The Quarantine Service employs a Stakeholder and Agency Liaison Manager, whose role is to maintain effective and meaningful relationships with stakeholders. There is no person with a similar position in Biosecurity NZ.
The Quarantine Service also communicates with customs brokers and accredited persons through informative and entertaining newsletters. We consider them a useful means of communicating with industry stakeholders.
Some industry stakeholders we spoke to believe that the Ministry needs to engage more with industry groups. They considered that it is important that industry stakeholders are provided with information about the rationale behind any changes, and that the policy (Biosecurity NZ) and operational (Quarantine Service) arms of the Ministry should work together more. In our view, it would help if Biosecurity NZ and the Quarantine Service worked together to discuss strategic policy and operational changes with industry stakeholders.
Day-to-day communication with industry stakeholders
Some industry stakeholders we spoke to mentioned that not having one point of contact when dealing with the biosecurity clearance of sea containers was frustrating. They also mentioned that it was difficult to make telephone contact with Quarantine Service staff.
A project has been approved to centralise the Quarantine Service operations in Auckland. It is envisaged that this new worksite will process sea container clearances for all of New Zealand, to ensure consistency.
Some stakeholders were frustrated that the documentation needed to clear sea containers had to be sent by facsimile to the Quarantine Service, and considered that this was not an efficient way to transfer information. In our view, the Quarantine Service’s information technology capacity is outdated, and does not meet its business needs.
In Auckland, a project is under way to replace paper-based facsimile machines with technology that can store and archive facsimile messages in an electronic format. This technology is expected to significantly reduce or eliminate paper copies, and the need for the Quarantine Service to manually enter the information.
1: A transitional facility is a place approved in accordance with section 39 of the Biosecurity Act 1993, for the purpose of inspection, storage, treatment, quarantine, or holding of sea containers.
2: In our 2002 report, we noted that risk profiling could be improved by the introduction of an integrated information technology system. The New Zealand Customs Service and the Ministry have worked together to provide an integrated system. Customs and biosecurity information on sea containers can be entered into CusMod by customs brokers or importers when they are making their customs declarations.
3: Process Procedure 32: Clearance of imported sea containers.
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