Plain language law

New Zealand law explained for everyone

Food Act 2014

Provisions relating to recognition, territorial authorities, administration, and enforcement - Cost recovery

198: Principles of cost recovery

You could also call this:

"Paying for food safety services: how the government charges you for costs"

Illustration for Food Act 2014

When the government administers the Food Act 2014, you pay for some of the costs. The Minister and the chief executive must try to recover these costs. They do this by charging fees or levies to people who use the services. The Minister and the chief executive consider some important criteria when deciding how to recover costs, as outlined in section 199. They think about fairness, efficiency, and transparency when making these decisions.

The government should only charge you for the actual costs of providing a service. They must also be open about how they calculate these costs. Before recovering costs, the government usually consults with people who will be affected by the decision. They give you time to provide feedback and make sure you have enough information to understand the issue.

The government can set fees based on average costs or potential costs. They can also consider indirect costs, such as costs that affect a group of people who use a service. The government does not always have to charge each person exactly what it costs to provide the service to them.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM2996310.

Topics:
Health and wellbeing > Food and water safetyBusiness > Industry rules
Previous

197: Costs, charges, and expenses incurred, or

"Who pays when someone else does the council's job?"

Next

199: Methods of cost recovery, or

"How to get back costs when providing a service under the Food Act 2014"

Part 4Provisions relating to recognition, territorial authorities, administration, and enforcement
Cost recovery

198Principles of cost recovery

  1. The Minister and the chief executive must take all reasonable steps to ensure that the direct and indirect costs of the Ministry in administering this Act that are not provided for by money that is funded by the Crown for the purpose are recovered under this subpart, whether by way of fees, levies, or otherwise.

  2. In determining the most appropriate method of cost recovery under section 199, the Minister and the chief executive must take into account, as far as is reasonably practicable, the following criteria:

  3. equity, in that funding for a particular function, power, or service, or a particular class of function, power, or service, should generally, and to the extent practicable, be sourced from the users or beneficiaries of the relevant functions, powers, or services at a level commensurate with their use or benefit from the function, power, or service:
    1. efficiency, in that costs should generally be allocated and recovered in order to ensure that maximum benefits are delivered at minimum cost:
      1. justifiability, in that costs should be collected only to meet the actual and reasonable costs (including indirect costs) of the provision or exercise of the relevant function, power, or service:
        1. transparency, in that costs should be identified and allocated as closely as practicable in relation to tangible service provision for the recovery period in which the service is provided.

          1. Costs should not be recovered under this subpart unless—

          2. there has been appropriate consultation with persons or organisations that the chief executive considers representative of the interests of persons likely to be substantially affected by the exercise of the power; and
            1. the persons involved have been given sufficient time and information to make an informed contribution.

              1. Subsection (3) does not require consultation in relation to specific fees or charges, or the specific levels of fees or charges, so long as the fees or charges set are reasonably within the scope of any general consultation or any consultation carried out for the purposes of section 379 or 380.

              2. A failure to comply with subsection (3) does not affect the validity of any regulations made for the purposes of this subpart.

              3. This section does not require a strict apportionment of the costs to be recovered for a particular function or service based on usage.

              4. Without limiting the way in which fees or charges may be set under this subpart, a fee or charge may be set at a level or in a way that—

              5. is determined by calculations that involve an averaging of costs or potential costs:
                1. takes into account costs or potential costs of services (that are not directly to be provided to the person who pays the fee or charge but which are an indirect or potential cost) arising from the delivery of the service to a class of persons or all persons who use the service.