"DEBATE TOPIC: FARMING IN THE NEW MILLENIUM - SHOULD GOVERNMENT INVOLVEMENT BE MORE OR LESS?"

Southland Federated Farmers Conference Debate Speech Invercargill Working Mens Club 20 July (check against delivery)

Ladies and gentlemen, Jim Sutton, Jerry Eckhoff, Gareth Morgan, John Wright, President Fiskie, delegates, members, guests, media.

I'm going to take the side of the debate which is that government's involvement should be one that aims to be less over time. This is where we see a very significant difference between centre-right and centre-left politics in New Zealand.

On the centre-right, we believe in less tax, less regulation, less government intrusion and less dependency on the state.

National believes that New Zealanders as mature adults, are able to take responsibility for themselves. In the same vein we should let business get on with its business of creating wealth and jobs.

It is interesting that those on the left of politics are those who tend to criticise politicians most of all and yet they're the ones who want more and more control and more and more of the economy run by politicians. They oppose deregulation and privatisation. They suggest "the state knows best."

They want higher taxes and they want ever increasing social services but they want their neighbour to pay.

The Labour/Alliance bloc want to exercise more control over your lives. Like parents of teenagers they are reluctant to let go.

They want to repeal the Employment Contracts Act so the union movement can revitalise itself. Another group of people that want to control our lives.

Remember the days when the milk flowed down the drain because of strikes organised by the unions in the middle of the spring, when the bobby calves weren't collected - again because of the strikes in the meat works. When the Inter-island Ferry stopped sailing each public holiday.

Now that we've got ACC out into the private sector lowering premiums for many employers, Labour want to re-nationalise it. To take regain political control. Nationalising private enterprise is an appalling signal to send to the rest of the world about New Zealand as a place to invest and create jobs.

I am unaware of any other party in the world proposing nationalisation as a policy plank!

As National looks to the new millennium with further tax reductions, in contrast we have a Labour Party wanting to increase taxes next year by $400m. They want to expand the bureaucracy and penalise farmers and business people.

Let's look at the success of less government over recent years.

Deregulation in the transport industry, the meat industry, the Employment Contracts Act, coastal shipping, electricity reform have all markedly lowered the costs of processing farm produce. Fuel price deregulation, the removal of tariffs and parallel importing restrictions, the list goes on.

All of these have significantly reduced the costs to farmers.

Let's look at the privatisation which also involves less Government.

Telecommunications has gone from costing the taxpayer millions each year through Government subsidies, to a competitive and profitable private sector, improved efficiency and a lowered cost structure.

Privatising forestry has created new rural investment and employment opportunities with the likes of Rayonier just down the road in Mataura.

Corporatisation of SOEs has also reduced the control of the Government and lowered costs. New Zealand Post sends mail far cheaper than it did a decade ago and now faces competition, again from deregulation.

Corporatising the meat inspection service in the last year has saved farmers $5 million a year in its first year.

Tight fiscal control or holding back growth in government spending means less government. It forces re-prioritisation of spending within existing baselines. This is far better than just increasing taxes which is the soft option that Labour and the Alliance always choose.

Tight monetary policy has seen inflation fall to its lowest since the 1930's. We now have the lowest interest rates in 30 years. Compare that with the 18-20% interest rates under the last Labour Government.

So what are the options for the land in the new millennium?

It's very very stark this time around. There is a clear choice.

More government from Labour and Alliance.

$800 million more in taxes next year. That's a whopping $700 more per household that has to be found - money that you and your family cannot invest in your family or your farm.

More resource management restrictions from the urban liberals of Labour and the Greens.

No sustainable beech forestry on the West Coast.

Nationalisation of ACC and up until last week they were even opposed to dairy farmers taking their own strategic moves to grow their business from $8 billion to $40 billion. The Alliance still opposes such choice. Unbelievable! Less government could see our roading and infrastructure start to focus on better investment decisions and rates dramatically reduce.

Less government could see further freeing up in the employment area.

Less government could see a lessening of local government's involvement in our lives and less government will see tariffs being totally removed in the next six years.

Contrast this with the parties of more government, the credit card promises to spend increased taxes on promoting their preferred industries.

Favouritism and intervention for a specially selected few. They advocate more spending on tertiary students starting out on their careers but not on others beginning their careers such as young farmers, sharemilkers, the local plumber, builder or electrician.

By spending more money on superannuation and on state house tenants at your expense.

More money on welfare, only paid for by more government and more taxes and less opportunity for farming in the future.

We've got to move away from more government and leave taxes with individuals to add value.

We need to have vision in a global marketplace. A marketplace that's borderless with capital, people and technology flowing without government restriction. A vision of less government.

At the same time Government must show leadership and prepare New Zealanders for a changing world.

Allowing the dairy industry to expand to become a world player based out of New Zealand. Preparing for the knowledge economy.

We need to seize the new opportunities for biotechnology and information technology and add value to our rural sector.

We need only look at the changes that have occurred in the wheat industry. From the old Wheat Board days to today's very highly focussed and specialised niche marketeers who are taking on the world with the highest technology.

The same is occurring in the wine industry.

The same is occurring in forestry where we see companies like Juken Nissho, the largest employer in three key rural areas of New Zealand, the East Coast, Northland and the Wairarapa, where they shift the value of export logs at $90 a cubic metre up into the realms of over $1,000 a cubic metre by repositioning in the marketplace and providing many jobs in the rural community.

Foreign investors providing jobs for New Zealanders and reducing trade barriers into their own countries.

We need to continue to challenge the role and accountability of all producer boards.

Less government grows jobs. So too does more investment.

Trade access becomes a very legitimate role of government and I have to say huge efforts go in to CER, to APEC and WTO.

And here we have the Labour Party and Jim Sutton opposed even to President Clinton visiting New Zealand because of his recent lamb agreement. Get real Jim, even Helen Clark told you to pull your head in over that one.

Whilst the US may be hypocritical in some of these decisions, overall we have to work within a framework of encouraging the breaking down of restrictions worldwide and there we need all the allies we can muster in a small country of just 3.8 million people.

The future is all about less government involvement and that can only be delivered from a party of the centre-right.

A Labour/Alliance bloc Government would harm New Zealand.

More government will see more interfering bureaucrats, more taxes, less choice and a return to the bad old days of borrowing to survive or even maintain the status quo.

Inspectors on your pay roll turning up to your farm each day is the vision of more government promised by the left.

We've seen growth averaging 3% per year in this economy over the last decade, well ahead of the less than 1% in the previous 15 years under the old style of more government. Don't mess with success!

Mr Chairman, there is only one solution.

There must be less government in the future and that can only come from a National led government. I rest my case.