LUXTON CONGRATULATES DAIRY INDUSTRY FOR BOLD INITIATIVES

Food and Fibre Minister John Luxton today congratulated the Dairy Board at their AGM for the industry's bold approach to reform.

Mr Luxton likened the industry's restructuring negotiations currently in progress, to half time of a very important rugby game saying he was watching from the sideline as the dairy industry made the most important decisions of a lifetime.

"We've all played our hearts out this year. It's flashed past like 40 minutes. We've staggered off the field happy that we have played a brilliant game, but knowing, close to exhaustion, that where we're at, is only half time. Every atom of our work and our achievement to date remains dependent entirely, on the quality of our performance in the second half."

Last year, at the Government's invitation, the industry presented Ministers with a plan to deal with the structural problems it is facing.

"We welcomed this approach because the dairy industry matters a great deal to New Zealand. At the request of dairy industry leaders we have passed a new Dairy Industry Restructuring Act that sets out the regulatory framework that will apply to this industry, if they decide to go ahead with this plan."

Mr Luxton said it was up to the industry to address its ownership and structural issues. The special export privileges of the Dairy Board were contentious but under the industry's plan they should no longer be an issue.

"With a new commercial structure ensuring critical mass at a higher level than anything we had in the past to provide strength in global markets, there would no longer be a role or need for the old statutory mechanism. In a bygone era, it served its turn superbly. In the 21st century, by contrast, if you think about the changing markets, it's no longer a benefit. It's a hindrance."

"The international dairy industry has been changing very rapidly in the last 12 months. Our big competitors around the world remain able, too often, to move faster, more decisively and to better commercial effect than our own industry. Existing structures and restrictions prevent the dairy industry from expanding to match the pace of some of its competitors," Mr Luxton concluded.