MILK processor Norco has been dumped as the primary milk supplier to NSW north coast hospitals and replaced by foreign-owned company Dairy Farmers.
The decision by NSW Health’s procurement provider Healthshare to award the contract to Dairy Farmers, based in Queensland, has outraged dairy farming suppliers between the northern border and the Port Macquarie-Hastings and Macleay regions.
Dairy Farmers is owned by Kirin Holdings, operating out of Japan. The contract will supply milk to more than 16 north coast health and medical facilities including Port Macquarie and Kempsey.
NSW Health Minister Brad Hazzard reportedly said Norco’s bid for the contract, which equates to the supply of 300,000 litres of milk per annum, did not offer an economical price for taxpayers.
Norco board chairman Greg McNamara said the company was not prepared to negotiate the price of their tender at the expense of local farmers.
“We try to pay the best price to our farmers and we were not prepared to go in cheaply and undercut the contract because that has impacts down the line on them,” Mr McNamara said.
Norco represents 211 north coast dairy farmers, including those based in the Hastings and Macleay, employs 830 staff and has factories in both Raleigh and Labrador.
The company is fully farmer-owned and the last large dairy co-operative remaining in Australia with a local history spanning 110 years.
In the last financial year, the co-op received 222 million litres of milk from its suppliers.
“The community support we have received over this demonstrates people care about Australian companies,” Mr McNamara told the Port News.
“We are disappointed by the NSW government’s lack of support.
"It goes to show a lack of understanding by the people who make these decisions about the impacts on our farmers.
"The government has no concept of how important people see this.”
Mr McNamara will join Lismore MP Thomas George in Sydney on Thursday, May 17, in the hope they can discuss the decision with Mr Hazzard.
He has called on Port Macquarie MP Leslie Williams and Oxley MP Melinda Pavey to show their support for local farmers on the mid north coast.
“This decision will have an overwhelming result and a financial impact down the line,” Mr McNamara said.
The company hopes the Minister can review Norco’s submission.
“Norco can supply this contract at a fair price that supports our farmers," Mr McNamara said.
"We won’t negotiate a cheaper price but we offer a higher standard.”
NSW Labor has moved a formal notice of motion objecting to the Berejiklian government’s decision to end the contract.
NSW Shadow Health Minister and Shadow Minister for the North Coast, Walt Secord, moved the formal motion in the NSW Parliament’s Legislative Council on May 15, calling on Mr Hazzard to reverse the decision.
“We have the world’s best milk produced on the North Coast by the world’s best farmers from the world’s best cows; and the state government decides to buy its milk from across the border rather than from just up the road,” Mr Secord said.
Member for Port Macquarie Leslie Williams said despite the decision, most of the milk products purchased by NSW Health are sourced within the state.
“Whilst there has been a change of supplier of milk to NSW health facilities in northern NSW, I am pleased to advise that 95 per cent of the milk products purchased by NSW Health are processed and packaged in NSW using NSW milk sourced from a co-operative of NSW farmers,” Mrs Williams said.
“NSW government procurement guidelines mean products for health facilities are supplied, wherever possible, via local franchisees.
“Local businesses are supported throughout their supply chain, including locally sourcing fresh fruit and vegetables for health facilities.”
The Health Services Union (HSU) said the decision to shift the contract interstate to a foreign-owned company is a blow for local dairy farming communities.
HSU Secretary Gerard Hayes said the decision to abandon Norco was disappointing, as north coast health workers and hospital patients wanted to support their local economy.
“The dairy industry has played a huge role on the north coast for many years,” Mr Hayes said.
“By turning its back on the local milk supplier, the state government has again shown that it has a tin ear to the needs and concerns of the local community.
“We’ve even heard reports of patients refusing to drink the hospital milk unless it’s Norco.
“Health workers are calling on local National Party MPs to overturn this decision, and to make sure local milk is provided in hospitals and health facilities throughout the Northern Rivers and the north coast.”
The HSU has launched a petition to overturn the decision which will be presented to the state government. Supporters can sign it at www.megaphone.org.au/petitions/local-milk-in-local-hospitals.
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