CULLEN AGREES WITH LUXTON ON PRODUCER BOARDS

New Minister of Food and Fibre, Hon John Luxton said tonight that he was pleased that Labour Finance spokesperson, Hon Dr Michael Cullen agreed with him on Producer Boards

"Like the Government, Dr Cullen agrees that New Zealand Producer Boards have some essential functions that need support, " Mr Luxton said in response to a press release from Mr Cullen

"The Government is not anti Producer Boards, it is pro-increasing farmers incomes. Some functions of some of the Boards do assist to increase farmers and grower incomes and the Government we will of corse continue to support that." he said.

Mr Luxton said Dr Cullen also agreed with Government on another point. "A key objective of the Producer Board evolution is to remove the barriers to adding more value to our agricultural products and creating more jobs here for New Zealanders, particularly in the rural regions.

"It is pleasing that Dr Cullen appears to understand the importance of a " general economic strategy of adding value". Currently around 80% of our dairy produce is sold as commodity or to someone else to add and capture value through to the final consumer. By freeing things up a bit it will allow new investment, new ideas, new innovation and new trade opportunities that currently are outlawed, but will add value.

Dr Cullen was wrong about one thing though, Mr Luxton said. "The Government is not "hellbent of giving away the present powers of the Producer Boards". We simply want to evolve and build a profitable future from the current base," he said.

Mr Luxton said that Dr Cullen appeared at odds with the Labour Agriculture spokesperson who had since the 1980's realised that freeing up Producer Boards was a progressive move for rural New Zealand. "One says one thing, one another. What exactly is the Labour Policy?" he asked.

To apple growers in Hawke's Bay today the Minister again quoted the 1997 ENZA Annual Report, and CEO Gary Smiths comments on page 7 who said, "Its a hugely competitive market and international pressures are giving us two choices: we stay where we are - where things can only get worse - or we change, and change immediately." More.... But Mr Luxton said that the Government wants minimal disruption and will carefully and sensible move toward more commercial outcomes and removing dependence on an MMP Parliament to make some of the industry's decisions as at present.

"We want to ensure that growers assets are protected and that they might ultimately make their own decisions about such off farm investments now being made on their behalf," he said.

"ENZA does some things very well. We need to build on that existing base to ensure that growers incomes, assets and wealth grows into the future," he said.

Initial plans are due from all the Producer Boards in mid November. The Government will then care fully work through the proposals in the plans and sensibly continue the evolution process on from there.

"As ENZA says in the title of its 1997 Annual Report, "Its a new World". We now all need to work constructively and sensibly to meet that challenge.

I am pleased that Dr Cullen understands how important this evolution is to adding value toagrees with ," Mr Luxton concluded.