Sugar Cane Growers Fund (Amendment) Bill No. 20 of 2016

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1 Sugar Cane Growers Fund (Amendment) Bill No. 20 of 2016 Introduction The 1 Sugar Cane Growers Fund Authority was established by Act No.9 of 1984, enacted by the Parliament of Fiji on 26 July It is the successor to the Cane Price Support Fund and the Stabilization Fund. Its functions are generally to provide financial assistance to growers to improve cane farming efficiency and living standards and to assist farmers in times of disasters. The name has been changed to Sugar Cane Growers Fund by Amendment Act 12 of According to the Explanatory Note, the Fund provides loans to sugar cane growers for any of the following purposes: (a) Purposes which, in the opinion of the Board Management of the Fund ( Board ), will increase the production of sugar cane; (b) Purposes which, in the opinion of the Board, will improve efficiency in the planting, growing, harvesting and transportation of sugar cane; (c) The carrying out of work which the Board considers necessary or desirable to rehabilitate farms, buildings and other installations damaged, destroyed or affected by floods, cyclones, droughts or other natural disasters; (d) The carrying out of work which the Board considers necessary or desirable to establish sugar cane farms and to construct buildings and other installations on those farms; (e)the carrying out of work which the Board considers necessary or desirable for crop diversification; (f) The making of provisions, to such extent as the Board considers necessary, for the personal family needs of growers during periods of financial distress or hardship; (g) To enable cane growers to participate in commercial ventures which, in the opinion of the Board, are intended to benefit the cane growing industry. 1 Sugar Cane Growers Fund: accessed on 5th May

2 During the introduction of the Bill on 28 April 2016, the Hon. Attorney-General stated that: [ ] the Sugar Cane Growers Fund (Amendment) Bill was tabled in Parliament on the 25 th of April, to amend the sugarcane growers existing Sugarcane Growers Fund Act, to align the provision of the Sugar Cane Growers Fund Act to the change proposed by the reform on the Sugar Cane Industry Bill. These two laws actually go hand in hand, it is more of a consequential amendment because of the new Sugar Cane Industry Bill that has been tabled. [ ] Objectives, scope and intent of the Bill The Sugar Cane Growers (Amendment) Bill intents to amend the Act to align the provisions of the Act with the changes proposed by the Reform of Sugar Cane Industry Bill Summary of provisions Clause 1 of the Bill provides for the short title and commencement of the amendments to the Act. Clause 2 of the Bill amends section 4 of the Act by deleting subsection (4). Section 4 of the Act deals with the functions of the Fund Authority which is to provide loans to sugar cane growers for the purposes set out in Section 4, subsection 1. Clause 3 of the Bill amends section 5 of the Act to allow the Board to invest money standing to its credit on such terms as it may determine or as otherwise directed by the Minister. Section 5, subsection (4) of the 2 Principal Act states: (4) The Board may invest money standing to its credit and not immediately required by it in such shock, bonds, debentures or other securities, and on such terms and conditions, as it may determine. The clause in the Bill amends Section 5 of the Principal Act by deleting subsection (4) and replacing it with the following: (4) The Board may invest money standing to its credit and not immediately required by it, in stock, bonds, debentures or other securities, on such terms and conditions as it may determine or as otherwise directed by the Minister. 2 Sugar Cane Growers Fund Authority Act: s%20fund%20authority%20act accessed 5 th May

3 Clause 4 of the Bill amends section 8 of the Act to remove the reference to the Higher Salaries Commission which no longer exists and to provide for the remuneration and allowances for members of the Board in accordance with the Higher Salaries Commission (Revocation) Decree Section 8 of the Principal Act states: Remuneration, etc., of members of the Board 8.--(1) A member of the Board shall receive from the Authority, in respect of his services as a member of the Board, such remuneration and allowances (if any) as the Minister may, after consultations with the Board, determine. (2) Subsection (1) has effect subject to the Higher Salaries Commission Act. Clause 4 of the Bill deletes Section 8 of the Principal Act and replaces it with the following: Remuneration and allowances of members of the Board (Cap. 2A.) 8. A member of the Board shall receive, in respect of his or her services as a member of the Board, such remuneration and allowances in accordance with the Higher Salaries Commission (Revocation) Decree Clause 5 of the Bill amends section 14 of the Act to ensure that the Board acts in accordance with policy instructions issued by the Minister in writing. Section 14 of the Principal Act states: Directions by Minister 14.--(1) The Minister may, after consultation with the Select Committee, and such other persons as the Select Committee may determine, give directions in writing to the Board with respect to the exercise of its powers or the performance of its functions. (2) The annual report of the Fund Authority shall set out all directions given by the Minister under this section. Section 14 of the Principal Act is amended by deleting subsection (2) and inserting the new subsections after subsection (1). The deleted and added subsections of section 14 are highlighted in bold below: Directions by Minister 14.--(1) The Minister may, after consultation with the Select Committee, and such other persons as the Select Committee may determine, give directions in writing to the Board with respect to the exercise of its powers or the performance of its functions. 3

4 (2) The annual report of the Fund Authority shall set out all directions given by the Minister under this section. [deleted by the Bill] (2) Subject to subsection (3), in the performance of its functions and exercise of its powers under this Act, the Board shall act in accordance with general policy instructions issued to it in writing by the Minister. [new subsection added by the Bill] (3) If, in the opinion of the Board, any such policy instruction is likely to adversely affect the finances or securities of the Fund, the Chairperson shall make a written report to that effect to the Minister. [new subsection added by the Bill] (4) The annual reports of the Board and the Fund shall set out all directions and policy instructions issued by the Minister under this section. [new subsection added by the Bill] Clause 6 of the Bill amends section 17(3)(c) of the Act by extending the limitation of the application of section 17(1) of the Act. Section 17 of the Principal Act states: Security for loans 17.--(1) Subject to subsections (2) and (3), the repayment to the Fund Authority of money lent by the Fund Authority under this Act to a cane grower is a first charge on all proceeds due to him, or to any other person, on the sale of cane grown by him notwithstanding any written or other law, or any agreement between the cane grower and any other person. (2) The repayment to the Fund Authority of money lent to a cane grower by the Fund Authority under this Act and secured under subsection (1) shall not take precedent to - (a) the repayment of any advances or other payments of whatsoever nature made to the cane grower or on his behalf by the Fiji Sugar Corporation Limited pursuant to a contract of general application under the Sugar Industry Act or the master award under the Sugar Industry Act; or (Cap. 206) (b) the repayment of money lent to the cane grower pursuant to the Loans (Cane Crop Rehabilitation Scheme) Act. (3) Subsection (1) shall not apply except to a loan - (a) of $1,000 or less; (Cap. 208.) (b) repayable, in the normal course of events, over a period of 10 years or more; and (c) bearing interest at an annual rate of 8% or less, and which does not provide for further advances or for increases in the rate of interest beyond an annual rate of 8% but is otherwise on terms and conditions normally applicable to loans in their repayment. 4

5 The clause amends Section 17 of the Principal Act by deleting subsection (3)(c) and replacing it with the following (highlighted in bold): (3) Subsection (1) shall not apply except to a loan - (a) of $1,000 or less; (b) repayable, in the normal course of events, over a period of 10 years or more; and (c) bearing interest at an annual rate of 8% or less, (c) provided for those purpose set out in section 4(1), Clause 7 of the Bill amends the Principal Act by deleting all references to Sugar Cane Growers Council everywhere it appears and replacing it with Council of Sugar Cane Growers. Clause 8 of the Bill amends the Principal Act by deleting all references to Sugar Industry Act everywhere it appears and replacing it with Reform of Sugar Cane Industry Act Other interest groups Groups that may take an interest or could potentially be impacted by the Bill are: Sugarcane famers Ministry of Sugar Fiji Sugar Corporation (FSC) Sugar Research Institute of Fiji (SRIF) Sugar Industry Tribunal Sugar Cane Growers Council South Pacific Fertilizers Ltd Sugar Cane Growers Fund Workers in the sugarcane and related industries Sugarcane workers trade unions 5

6 Further information Sugar Cane Growers Council: Fiji Sugar Corporation Annual Reports: Disclaimer This briefing was prepared to assist consideration of the Bill by Members of Parliament. It has no official status. Although every effort has been made to ensure accuracy, it should not be taken as a complete or authoritative guide to the Bill. Other sources should be consulted to determine the subsequent official status of the Bill. 6

7 Annex A - [title] 7