KEY POINTS:
After five years of fitful debate the Government has given up its attempt to control a wide range of health products - everything from surgical equipment to sunscreens and vitamin pills - through a joint licensing agency with Australia. The proposal, which appears to have come from the New Zealand side, was part of a general effort to extend and deepen our immensely valuable closer economic relations (CER). A few days ago Helen Clark called John Howard to say she had failed.
The defeat of the Government on this issue carries a lesson for all who want to advance international trade agreements. CER is vitally important to this economy and probably needs regular injections of vigour to ensure it remains as important to the larger partner. Creeping protection is always a risk when trade ministers relax, and harmonised rules and procedures for product safety can ease transactions between two countries.
But harmony should not be achieved at the expense of the more liberal trading partner. The complaint from many suppliers of herbal remedies and dietary supplements in this country was that the mooted transtasman regulatory regime would needlessly import Australian restrictions, adding to their costs and rendering it uneconomic for non-Australian manufactures to supply New Zealand's small market.
The Government's answer to the industry's concerns has not been reassuring. It has argued that tighter regulation is necessary not only on grounds of safety, which is perfectly reasonable, but for consumer information, a cause far more dubious in this case.
Ministers say many of these pills and potions make therapeutic claims that cannot be substantiated. Doubtless they do, but if they are not effective the reason is probably, as their critics point out, that their chemical or herbal qualities are extremely dilute.
If they are regulated for safety alone they will remain dilute and probably ineffective, except for their placebo value. But if they are regulated for safety and efficacy, like true medicine, they might be put out of business. Is that really necessary? These are not prescription medicines with potentially dire side-effects, they are natural substances mostly, and those who sample them are quite capable of deciding for themselves whether they make an appreciable difference to their health and comfort.
Many natural concoctions available in this country cannot be sold in Australia, where even dietary supplements are regulated as medicines. Here they are approved under the Food Act 1981 and subject to regulations issued in 1985 that set permissible dosages and labelling requirements. Some make dubious claims on accompanying pamphlets that are outside those controls. But the proposed joint arrangement looked more like the Australian regime to industry insiders of both countries.
Under pressure from its supporting parties the Government tried last year to have complementary medicines removed from the regulatory scheme but Australia would not agree. The Australians made remarkable efforts to sway the debate in this country. Their high commission lobbied National MPs urging them to support the Government's bill and even Foreign Minister Alexander Downer raised the subject in talks with National's leader, John Key.
The Australian economy is more regulated than ours in many sectors these days. Much of it seems petty and needlessly restrictive to New Zealand visitors and traders. We do not need to buy into it. Closer economic relations can surely survive separate regulatory regimes whenever we beg to differ.
