Speech: DANA Conference speechPrimary Industries
E aku rangatira, tēnā koutou katoa. Ka nui te honore ki te mihi ki a koutou.
Good afternoon everyone and thank-you Dennis for inviting me to be here today.
The National Government’s business growth agenda has six streams focusing on the inputs businesses need to succeed and grow: export markets, capital markets, innovation, skilled and safe workplaces, natural resources and infrastructure.
There are more than 350 BGA actions, of which more than half are complete or being implemented.
Our priority is to create the kind of business environment where industries, including forestry, can flourish.
This Government is working hard to negotiate free trade agreements.
Significant progress is being made in a number of negotiations, currently all of the forestry sector's 12 main markets either have a free trade agreement or are currently engaged in discussions.
This Government is also aware that many forestry companies operate across districts and regions, and find themselves up against a variety of RMA rules. This adds costs and creates investment uncertainty.
Officials are working collaboratively with stakeholders and local government to iron out inconsistencies.
This work has the potential to be a significant simplification of the planning rules, and to remove roadblocks to economic growth for the sector.
Today I am pleased to advise that the working group has reached agreement on a consistent set of planning rules for all eight of the forestry activities that were identified.
This is excellent progress and I thank those of you who have assisted.
Another example of us removing roadblocks and simplifying the process are the improvements I announced last week to the East Coast funding programme which supports landowners with erosion issues.
Unnecessary administrative requirements such as the covenant have now been removed, and payments to grantees will be sped up to reduce the need for bridging finance.
The funding programme is being renamed the Erosion Control Funding Programme to more closely reflect the purpose of the scheme.
Approximately $26 million remains available until 2020, so I hope these changes make the programme easier for landowners to participate.
Government’s long-term focus is to transition the forestry sector towards a future where demand for high-value wood products will increase domestically and in export markets.
In 2010, the Ministry for Primary Industries committed to work alongside the sector on its long term direction. The industry strategic action plan and the WoodScape economic assessment were the outcomes of this process.
WoodScape analysis showed that engineered timber products offer investors returns higher than 10 per cent.
The difference in value between a raw sawlog and a finished LVL beam or a CLT panel represents a significant opportunity for industry and the New Zealand economy.
However, there are issues with the uptake of engineered timber including supply chain blockages, skills shortages, information gaps, biases and fabrication capacity.
Officials are working hard with industry representatives to scope the issues and to address these.
A key piece of work is to update the timber structure standard NZS3603. An updated standard will give confidence to engineers and architects to design with engineered timber, and to building consent authorities to approve engineered timber designs.
The first phase is the adoption of the Australian standard with modifications to suit New Zealand conditions. I understand a draft of the standard is due to be considered by the committee by the end of February, and that consultation will follow.
The second phase will add new knowledge from commissioned research.
This will position the standard well to potentially create a joint trans-Tasman standard in three years’ time when the Australian Standards body next reviews its timber standards.
A new forestry Strategic Partnership Group is already bringing greater alignment between industry and government priorities.
Current priorities for the Group include joint government and industry work to ensure that the legality of New Zealand timber is recognised in overseas markets.
In July, Hon Steven Joyce and Hon Nathan Guy announced the third in a series of in-depth regional studies for the Bay of Plenty Region.
These studies are focusing on understanding the economic potential and barriers in key regions. The findings will support investment into the regions.
The first report was released in April for the East Coast, and the second is under way for Northland. Again, these are regions where forestry is a key industry.
Innovation is the particular focus of MPI’s Primary Growth Partnership (PGP). PGP invests in business-led market-driven innovation programmes that work across the primary industry value chain. The potential benefit to the wider economy is expected to be $6.4 billion per year from 2025.
The Sustainable Farming Fund (SFF) invests up to $8 million a year on projects that deliver economic, environmental and social benefits to our primary industries.
More than 90 forestry projects have been funded since 2000, valued at over $8 million. The 2015/16 funding round is now open, and it closes on the 10 October. I encourage you to look at regional or national projects, and put in an application.
The capability of the people in primary industries is critical to achieving industries’ strategies and goals. There is a lot of identified future skills requirements, and the need to promote careers in primary industries.
A recent study identified that by 2025 the forestry industry is expected to need an additional 15,100 workers with formal post-school qualifications (like certificates, diplomas and degrees).
Another 25,900 workers are required simply to replace those leaving through natural turnover.
Government-funded providers spent approximately $16.5 million between 2011 and 2013 on forestry-related tertiary education provision, including industry training. Funding is based on demand, so more is available if demand increases.
And in Budget 2014 an additional $83 million was allocated to tertiary education, including forestry tuition subsidies.
Increasing the level of training will go a long way to helping address safety issues and curb the high rate of turnover.
Ongoing improvements are being made to our roads. We seek to drive productivity and road safety by allowing more to be moved with fewer trips.
To encourage the uptake of High Productivity Motor Vehicles (HPMVs), around $45m is being invested over 3 years to deliver a 4,500 km strategic HPMV network.
In June this Government announced $212 million will be pumped into 14 regionally important state highway projects. Routes used by log trucks in Northland, Gisborne, Napier and Nelson will benefit.
Locally, this funding will accelerate the investigation and design of the 6.8km Rotorua Eastern Arterial. The project will reduce travel times and increase safety through and around the eastern suburbs.
I would like to end by reaffirming the importance of the forestry and wood processing sectors to New Zealand’s economy.
As all these activities show, this Government is supporting the sector on many fronts with sustainable initiatives to add value, and strengthen it for the future.
Thank you very much for your time today.
Nō reira, tēnā koutou, tēnā koutou, tēnā koutou katoa.