Make food regulations fair and affordable for small businesses

Our vision for a thriving food industry is one where there is an abundance of small, locally owned and operated food producers and mobile food/drink businesses offering a diverse range of choices at reasonable prices. This would support regular markets and community events that transform our public spaces into community spaces of music and cultural vibrancy; play, laughter, connection, and warm full bellies.

One of the greatest barriers to running such businesses is the resourcing (cost, time and energy) required to comply with food safety regulations. Currently, the logistical, administrative and financial burden of registration and certification is the same for all domestic food businesses, regardless of size. A small coffee cart that only operates at a few summer events each year pays $500 - $1,000 annually in compliance costs, depending on region. While a large restaurant - such as a fast food outlet - pays the same amount even though it has exponentially higher revenue from being open all day on most (if not all) days every week and so can easily absorb these costs. High regulatory costs for small food businesses to operate impede their economic viability and their ability to remain competitive.

Furthermore, due to loss and lack of government funding, MPI recently released a proposal to charge all domestic food businesses a new annual levy of $132 plus an $11 collection fee for expanding five of its existing services (including rules setting; oversight; and education) and adding three entirely new services (nationwide interventions to raise performance; national monitoring programmes; and systems auditing). Because the fee is charged on a “per site” basis, mobile food businesses that prepare food in a kitchen and sell food from a vehicle (e.g. food truck or cart) would end up paying double the levy while a fixed premise, like a large restaurant, would only pay the base fee.

The new levy would be the third annual fee food businesses have to pay to retain their registration to legally trade in food and would also be “growing annually in line with inflation assumptions”. . As with the existing regulatory fees structure, charging the same levy for all businesses - regardless of size or revenue - means a mobile food vendor that only operates one morning a week will have to pay the same fee as a McDonald's restaurant that is open all day, every day of the year. For small food businesses, such as mobile food vendors and coffee carts, the current regulations are already too cumbersome and costs beyond sustainable. They will never benefit anywhere close to enough to justify these additional costs, let alone the current costs and requirements of compliance.

The full, 52-page proposal is available here: https://www.mpi.govt.nz/dmsdocument/60877-Proposal-to-maintain-and-expand-New-Zealand-Food-Safetys-regulatory-services-under-the-Food-Act-2014-Food-Act)

Based on past experience, we also believe Food Safety NZ has been excessive and inefficient with its spending of funding for services and are concerned that increasing funding will lead to greater inefficiency of spending with no benefit to small food businesses.

Small food businesses have many unique benefits including: supporting local economy; supplying a more diverse and unique range of food that is made locally from ingredients that are local, fresh, and wholesome; allowing innovation; creating competition (which encourages lower food prices); supporting community and fundraising events (such as school fairs); adaptability and flexibility. The Covid pandemic specifically highlighted the value of food markets and mobile food vendors, where the ability to shop outside was an important option to avoid spreading disease.

The current food safety system favours large businesses and promotes an industry where small, unique and community-oriented businesses struggle to survive and will gradually disappear resulting in a monopoly of large, homogenous food businesses. The change will not be immediate and obvious, but it will be very significant and detrimental to our well-being and quality of life. We already have plenty of examples where large, multinational businesses have dominated over and replaced small, local businesses.

Whilst food safety is important, it is also vital that regulations and fees are not so burdensome that the viability of small food businesses is undermined. Especially as inflation and high costs are already making it challenging for these businesses to stay afloat. The costs and requirements to comply with food safety regulations for small food businesses need to decrease significantly and more accurately reflect their level of risk and the revenue they are able to generate so they can continue to support vibrant, connected and sustainable communities.