Speech to Association of Rural Veterinary Practices

Good morning, it's a pleasure to be here with you today.

I guess I should start by taking this opportunity to say thanks for the assistance your profession has given me over my farming career.

My early involvement establishing my cattle embryo transplant business in New Zealand means I employed a number of vets for many years, so I know your industry pretty well.

Since becoming Minister, I've seen more and more involvement from your profession as New Zealand, and international society, becomes more aware of animal welfare issues.

I've been asked to speak to you today about some of the challenges facing our farming sector. I will certainly do this, but I also want to speak to you about the opportunities.

A good starting point is to look at where we have come from, and the wider economy.

When this National-led Government came into office 18 months ago New Zealand was in recession.

Our first year was about getting us through that crisis and back into shape.

Last year's Budget focused on recovery. We wanted to come out of the downturn with as little damage as possible and certainly in better shape than most of our major trading partners.

Only a year later, and our latest Budget shows our focus is now on accelerating growth.

This is about securing jobs, attracting investment, and lifting the living standards of all New Zealanders.

The world doesn't owe us a living.

If this country really wants to catch up to Australia, we need a concerted effort by all New Zealanders.

Because so much of our economy is based on production and agriculture, you and I need to find a way to harness greater productivity and profit from farming.

I want to look now at three key areas the Government is pushing to ensure growth within the primary sector:

• tax reform;


• investment in science; and


• New Zealand's biggest natural advantage, water.

Firstly, let's look at tax.

Budget 2010 saw tax changes that constitute the most significant overhaul of tax rates in 25 years.

What we have done, in a nutshell, is to lower headline personal and company income tax rates, while at the same time broadening the existing tax base.

We are increasing indirect taxation, and are tightening up on the ways people have been able to structure their affairs to dodge the tax they pay.

By October, three quarters of all taxpayers in New Zealand will pay a top rate of only 17.5 cents in the dollar. This truly labels New Zealand as a low tax economy.

These changes to our tax system will lift New Zealand's long-term economic performance. The changes also contribute to our other goals, including making the tax system fairer and more sustainable.

Secondly, to ensure growth, Government is investing in science. Our future economic performance in New Zealand depends to a considerable extent on generating and using new ideas, particularly in agriculture.

Science is an area that has seen under-spending over the past two decades. We are committed to reversing that underinvestment.

Budget 2010 sees $321 million allocated for new research, science and technology initiatives over the next four years.

This new investment builds on our initiatives introduced last year - namely the Primary Growth Partnership which aims to transform great ideas into research, development, and ultimately products, jobs and growth. And the Domestic Agriculture Centre for Greenhouse Gas Research and the Global Research Alliance on agricultural greenhouse gases.

Thirdly, to ensure growth we must look at our greatest competitive advantage - water - or ‘liquid gold' as it was referred to in a recent KPMG report.

A huge amount of rain falls on our landmass compared with other food producing countries.

In fact we get three times as much as Australia on a per hectare basis.

But rain doesn't always fall in the right place at the right time.

The obvious answer to increased productivity is water storage and irrigation.

Up until now, the red-tape around projects has been so bad it has stopped progress.

This Government's first efforts have been to remove regulatory roadblocks and we are now well on track to advancing this agenda.

So far I have talked about the wider landscape, where we've come from, where we are at and some of the action the Government is taking.

I want to now focus on our future.

Our primary sector is hugely important to New Zealand, both in terms of export trade and image.

Our farmers, and the industries and professions that support them, including you vets, have a reputation for being innovative and sensitive to market opportunities and change.

We can no longer compete as a low cost producer, South America has seen to that.

Our future is as a producer of high quality, value-added product.

Our international customers are discerning.

They demand to know how the food and fibre they buy is farmed, and the environmental impact of our production systems.

New Zealand has a good story to tell - our pasture-based ‘free range' farming appeals.

New Zealand also has an ethical, principled and scientifically-based animal welfare system. It is highly regarded internationally.

We trade on this reputation.

I do become concerned when, the sheep and beef sector particularly is under some economic pressure, farmers shy away from calling the vet and miss the opportunity to get the right expertise.

I care for the way animals are farmed in this country and I link it to the fact that our overseas markets are watching every move we make in this area.

It is also why this Government allocated $8.2 million for animal welfare in this year's Budget, the largest increase in funding in the last decade.

I want to touch briefly now on the National Animal Identification and Tracing scheme, an initiative started by the previous Government and one that I know is essential to complete.

There are two purposes to NAIT.

One is to satisfy market demand and the other is to be better prepared in the case of a disease incursion.

International demand for lifetime traceability of individual animals is growing.

The European Union, Australia, Japan, South Korea, Canada, Argentina, Uruguay and Brazil have, or are developing, mandatory animal identification and tracing schemes that quickly provide reliable information.

NAIT will also improve our ability to prepare for, and respond to animal disease outbreaks.

When NAIT is fully operational the costs of a disease outbreak or product contamination will be limited.

I want to conclude by saying I understand the challenge the industry has in attracting vets to live and work in rural New Zealand.

Last year I implemented the Voluntary Bonding Scheme for veterinarians to address this issue

The scheme was originally aimed at practices in specific rural areas, and 20 vets were accepted in its first year.

From this year, as a result of feedback from vets, all practices that deal with production animals are now eligible. That is provided they spend most of their time working with these animals.

Four months into the second year of the scheme, a further 20 vets have so far taken up the opportunity to receive up to $55,000 by working with an eligible practice for three to five years.

As we move to the second half of this parliamentary term, I hope we've been recognised by users as a government of growth and action.

We have clearly established a growth plan and we've pragmatically taken action on a number of issues for a positive future.

By pragmatically, I'll give you an example.  

The Commercial Slaughter Code of Welfare came back from the National Animal Welfare Advisory Committee and sat on the previous Minister's desk; he sent it back to the Committee because he wasn't completely happy with the recommended exemption for Shechita.

It came back again unchanged. When it came to my desk I decided it had to be dealt with.

And now I have issued it - there are no exemptions.

In doing so, we may have upset a relatively small religious minority, and I do appreciate their strong feelings for this issue but frankly I don't think any animal should suffer in the slaughter process.

At the end of the day, my responsibility is to make decisions and move forward, and that's what I've done.

For my part I am committed to ensuring New Zealand farmers stay at the top of the global game.

Enjoy the rest of your conference and thank you.