Estimates Debate — Primary Sector

Members, we now come to votes in the primary sector, B.5, volume 9. The question is that Vote Lands and Vote Primary Industries and Food Safety stand part of the schedules.

Before I give Ian McKelvie the call, it is my intention to make a considered ruling following an inquiry by Jami-Lee Ross by way of point of order earlier, when he asked me to make clear the reasoning behind my asking chairs to give their speeches in a non-partisan manner. I have consulted with the determination of the Business Committee for Wednesday, 7 June this year and its agreements around the Estimates debate. At that, it agreed that the committee chairpersons would lead off each sector debate in order to set out the major findings of their committee. Those speeches do not count as part of that party’s allocation. In fact, for chairs who have made inquiries of me in this matter, I have made it very clear that they should be neutral and report the findings of the committee and not make a political speech, because that is something that comes in the Minister’s role, or as far as other members are concerned. So what I am going to do is reinforce my earlier ruling to make it clear that chairs of committees can have a second speech, if they so wish, and they can be as partisan as they want to at that stage, but for the first speech that will not be the case.

Thank you for that very sage advice, Mr Chair. I am, of course, completely impartial in this matter. The Primary Production Committee of this House is a pretty collegial select committee. I want to thank the members of that select committee for their participation during the course of this debate and during the course of the year; their input has been pretty significant.

Of course, we run the sector that is the backbone of the country. There are some 350,000 jobs in that sector. There is export revenue of $38 billion, and it is predicted to grow by 10 percent to $41 billion in the next year or two. I have never seen, in my time—and I suspect that our committee has never seen it in its time—this sector in such good heart, and I will go into that a little further. I also want to thank the Ministers Guy, Bennett, and Upston for their contribution to the select committee in the course of those discussions.

The total appropriation for Vote Primary Industries is $991 million. It is a significant amount of money, and I will detail where some of that goes, in a moment. There are some programmes in the course of that that take quite a significant amount of money on their own, and the Primary Growth Partnership process, which the Government has entered into over the last 8 years, has come up with some great successes. It has come up with some proposals that have not been such great successes, but that is the nature of science. That programme swallows up some $720 million, and the great successes have initially related to forestry and fishing.

Another really challenging issue for this sector is irrigation, and I would contend that there is a quadruple bottom line to irrigation around community recreation, the environmental factor, and the economic factor, and it is an issue that the Government has been grappling with for some time—and clearly the sector is grappling with it as well. It is an issue that I think we will do well in in the future. We have just got to get the settings around it correct.

Biosecurity is our Minister’s most important issue that he deals with, and he has acknowledged that on a number of occasions. The total spend in this area is of some $223 million. One of the big challenges for this area in the next year or so will be reviewing the import health standards, and, of course, those reflect directly on some of the factors that we are dealing with in the country at the moment because we do import seeds and quite a number of other things into the country—palm kernel being a big one, I suspect—and so there is a whole lot of stuff that needs to be done around that, and that will be reviewed in the course of the next year.

For fisheries, there is $30 million to upgrade and modernise the fisheries management system. This includes cameras and monitors on the fishing boats. We have seen a significant improvement in the performance of this sector as well. I think one of the really interesting things in this sector was the passing, some 3 years ago, of the foreign charter fishing vessel legislation, which, effectively, has tidied up a lot of our fishing industry and the vessels they use for that business.

Food safety is a very important factor that this committee deals with and the Minister deals with. It has got a lot of intricacies around it. It is hugely important to New Zealand’s agriculture sector and, in fact, to our export sector. It probably is almost the key, actually, to most of what we do.

Another issue that the committee deals with at length—and this Budget deals with at length—is animal welfare, which is a big challenge for New Zealand. When I say that it is a big challenge for us, it is an area that we have to get right. It is an area that is critical to our primary production exports, and I think we do pretty well with it.

Another topic raised during the course of this discussion was that of careers. We need some 50,000 more people by 2024 in this sector. There is a large number of what we might call foreign workers employed in the agricultural sector, particularly around horticulture and the dairy section, and so, consequently, the immigration settings of the country are very important to those sectors.

Forestry is another very important sector for New Zealand. We have got record levels of forestry exports right now, and the committee dealt with that in the course of the discussions. And there are two, I think, very topical issues—other than the biosecurity one—that the committee is dealing with now that relate to honey.

So that is a brief summary of what the committee has been up to in the course of the last year and what we dealt with during the course of the Estimates discussions. I thank the committee and the Ministers for their participation in that. Thank you.

I agree with the chair of the Primary Production Committee, Ian McKelvie, that we are a very collegial committee, probably the most so of the House. But I want to address the subject of biosecurity funding. The chair did mention that—as we know, from his many mentions of it—the Minster claims that biosecurity is his No. 1 priority. It is unfortunate that it is not the Government’s No. 1 priority and that funding for the biosecurity is manifestly inadequate in this vote as it has been in other votes.

The visitor levy, when that was brought in, was touted as being a great thing for biosecurity. And after much wrestling with the Government benches, we finally levered out of them the fact that it was actually just a replacement revenue stream for central government funding and not actually an increase. And that is a shame because just only in the last week the biosecurity doomsday clock ticked another minute closer to midnight with the arrival of Mycoplasma bovis in dairy cows in the South Island. We do not know how this disease got in. The suspicion is that it came in with either imported semen or embryos, which begs the question: was that a failure of the import health standard or was it the failure of inspection at the border?

We know that this Government’s approach to biosecurity is pretty much “Look, Mum, no hands!”—relying on intelligence, relying on profiling, relying on computer modelling, and relying on too few boots on the ground, too few inspections, too few actual physical inspections, and too little in the way of actual testing. This is unacceptable in a country where three-quarters of our foreign exchange comes from the primary sector.

Prior to that, we had the incursion of myrtle rust. Myrtle rust poses an enormous danger to our mānuka honey industry, amongst other things, yet the Government sat on its hands for 7 years doing nothing about the warnings it was given that myrtle rust was likely to arrive, the means by which it was likely to arrive, and the damage that it could do when it got here. In 7 years nothing was done in terms of forming a management plan—until last year, when a small amount of money was finally put forward for an initial study into what might be needed for a management plan. Again, with myrtle rust, we have to ask: was this a failure of the processes at the border? It is telling that all of the incursions that have been discovered so far have been discovered in nurseries, which points very strongly to the incursion coming in on infected plant material and being spread from there, from one nursery to the next. Our border is simply too porous and we do not put enough effort or enough resourcing into actually stopping and checking and testing and inspecting the things that come across our border.

The next major problem—well, we will talk about the doomsday itself at the end—that we are going to have to face is the brown marmorated stink bug. Now, the brown marmorated stink bug is a horrible pest. It is, according to the Ministry for Primary Industries report, which I have here, the kiwifruit industry’s second most unwanted biosecurity threat after fruit fly, and the risk of it entering New Zealand is now considered extreme. It would have no problem establishing itself in New Zealand, due to the highly conducive environment—the abundance of food and the abundance of host material. It could cause anything up to 30 percent loss of crop in kiwifruit orchards.

The methods by which it can arrive—will arrive, because of the lax approach that this Government takes to biosecurity and the lack of funding and the lack of resourcing that it applies to it. The advisory statement from the ministry says the stink bug could find its way into loaded containers for import into New Zealand. It is also spread through the transport of personal effects and housewares, and could find its way into luggage and mail, and yet we do not inspect 100 percent of goods, of mail, of passengers, or of luggage crossing the border. We inspect, at most, one out of four shipping containers. At some ports, on some days, it is as few as one in 100. It is totally irresponsible, and it is partly down to the fact that this Government simply does not resource biosecurity sufficiently, and the money that it does spend is not directed in the right way.

Of course, doomsday—this is kind of like Groundhog Day at the moment—when it comes upon us, will be in the form of foot-and-mouth. Because of this Government’s approach to biosecurity—because of its lack of proper resourcing and funding for biosecurity—this means that foot-and-mouth is a matter of when, and not if. When that happens, it will decimate our livestock industries and it will probably cost this country somewhere in the order of $20 billion. To my way of thinking, that warrants a little more genuine spending on biosecurity than what this Government appears to be prepared to do. Thank you.

It is a pleasure to follow on from the previous speaker, Richard Prosser, there, because I too am going to speak on what is the most important issue facing the primary sector at the moment, and it is one word: biosecurity. The Mycoplasma bovis outbreak that has been identified is a classic case of the Government’s inadequate management of biosecurity—in fact, inadequate management across the whole of the primary sector. In its classic wisdom, or lack of, it thought that it would throw all areas of responsibility into one organisation called the Ministry for Primary Industries (MPI), and that that would be efficient, and that would create cooperation, but what that has in fact has done is dumbed down the area of expertise and knowledge and passion that we need, particularly in the area of biosecurity and food safety.

When the restructure occurred, I had people contacting me saying: “I’ve left. I’ve gone from my chosen career in biosecurity because I feel we aren’t doing our job properly.” And, indeed, we have had a recent example of that massive failure. It is a failure in a number of areas. In fact, this afternoon I was contacted by someone who said a neighbouring farm of where we have the identified infection has not been contacted by the Ministry for Primary Industries. They had been contacted by National Animal Identification and Tracing, the organisation responsible for animal tracing, but they have not been contacted by the Ministry for Primary Industries to give them advice on a whole range of issues. This farmer is bringing stock back from a grazing property back on to their home property, right past the Van Leeuwen Dairy Group’s place, and the farmer does not know whether that is appropriate, whether it gives further risk for his or her operation, and whether it creates, I guess, a complication for the Van Leeuwen Dairy Group, because MPI has not knocked on the door of the neighbouring farmer and given that advice. Such is the level of failure at MPI and, in my view, of their ability to deal with these issues.

A number of years ago, the Auditor-General said that, actually, it was not up to management of foot-and-mouth if it came into New Zealand. So there was a review and an upgrade, we were told, of MPI processes. Now, when we have Mycoplasma bovis in the country, there are a number of questions. Firstly, how did it come in? MPI very quickly said that we may never know, which is an absolute acceptance of failure, and I do not accept that for a moment.

What we hear now is that there were symptoms of this in March. Persistent mastitis, resistance to antibiotics, and some of the classic symptoms of Mycoplasma bovis were present but not identified and pursued. Now, I am not going to make a judgment on whether that was with the farmer or with MPI, or the vets, or whatever, but to now be in the end of July before we finally have an admission that we do have this bacteria in the country—it has serious animal welfare implications from a farmer’s perspective. In fact, they are more serious than any foot-and-mouth. The issue with foot-and-mouth is, I guess, its infectious nature and that it can be blown in the wind. Mycoplasma bovis can spread beyond direct contact, through feed, or within a metre—so we are told from international experience. So MPI have been playing this down.

I do not wish to play it up, but I do wish MPI to be in a position to manage this adequately. In my view, there has not been sufficient funding going into biosecurity to meet the increasing trade across the border, in and out of New Zealand, and the increasing risks from the number of diseases that we know are present around the world. Just at a time that we were—and even the meat industry; God, that has taken them a while—starting to realise the importance of our biosecurity status, our relatively low level of diseases in this country, and the potential that that offers for us to sell very high-value products, free of any contaminants, into the world’s most discerning markets with customers who really want the finest protein in the world. When the meat industry gets it, but the Government does not, then we are in trouble.

The Government has to step up here. It has got to put more money into biosecurity. It has got give more independence to the agency—[Bell rung]—and that is why Labour has said, indeed, that it will put biosecurity and food safety out of MPI, to give them more authority—

The CHAIRPERSON (Hon Chester Borrows): You are supposed to ask for another call or stop there.

Oh, sorry. I just have not had enough speaking opportunities lately, but that is all right. Can I just say that on biosecurity, the Government has not funded enough into this area, is not committed to it, and now we are starting to pay the price. I could take another call in this area, but I have to say that the issue of food safety is one area.

We have a classic example of skewed priorities, I guess, within MPI. When we had inspectors rushing to The Duke of Marlborough Hotel in the Bay of Islands to stop the chef serving a medium-rare burger—an absolute outrageous food-safety risk, so we were told, or they were told. Those people would have been better off dealing with real food safety issues and dealing with real biosecurity issues. I think you would agree that we have just got to make sure—because I guess there will be an argument that there is never sufficient funding—with the funding we have, that we get our priorities right. Within MPI, under this Government, I think they have got them all skewed.

I applaud some of the good work that people do on the ground, but when we have got one big policy department forced together to make general policy directives or develop papers, without the level of expertise that we have seen in the past, people get despondent. I think we have lost some of the passion and commitment within the MPI because of the Government’s oversight and blind belief that bigger is better and that by throwing all these people into one big organisation, the Ministry for Primary Industries, that we are going to get a better deal for the farmers, for New Zealand, and indeed for our customers.

We have seen numerous examples in food safety where the ball has been dropped in the past. We hope that we do not have repeats of that for Fonterra or for any other organisation. We have got pressure now from within the meat industry to have self-regulations of meat inspection. I have had discussions with the industry. They want to engage. But I put it to them that, ultimately, the trust that our international customers put in Government oversight should be absolute, and that if we compromise the systems and leave the door open for, I guess, commercial opportunities or human failure, then we are all going to pay the price.

This one outbreak of Mycoplasma bovis may yet cost us hundreds of millions of dollars and it is only small mistakes that can do the same to our reputation in the area of food safety. In fact, our inability to accurately identify whether we had a major food problem meant that our reputation has been tarnished in the international area, particularly in China, and we are indeed trying to play catch-up from a food safety mistake.

I will not go on, other than to say that Labour believes there has been insufficient funding going into MPI, particularly in the area of biosecurity. We believe we need to up our game in food safety, and we have passed a couple of pieces of legislation to help in that process. But the funding has to follow. The Government’s determination to balance the books, to have its first, or indeed, maybe its second surplus Budget has come at a huge cost, not only in the areas of social responsibility across New Zealand but in the areas of biosecurity oversight. Practically every day now I am getting emails from people who are concerned about the process at the border, where there is a casual attitude, or indeed through the systems in industry, where I think we have a very high standard of outward export oversight. But we have an insufficient level of oversight for products coming into the country.

Officials are too quick to be trusting. If a foreign country exporting into New Zealand says that our systems are all OK, then they accept that. I think that is totally naive and puts us at risk. That was in the area of palm kernel expeller, or PKE as it is known. The Government, or its officials, denied that there was any possible contamination, and it was not until farmers actually showed them, with photos, that they took action to improve the import health standards.

We need to ensure there is sufficient funding into MPI to do the proper review of the import health standards. They have indicated that they are starting, and we need to make sure that when they do that, they do it properly.

Speaking to the primary industries and food safety, I will start by saying these Estimates had nothing in there for the organic sector. The food labelled as organic in the US is the fastest-growing label, showing a real need by consumers, a real demand, second only to non-GMO food labelling. Both of those are the fastest-growing food labels in the US, one of our primary markets, and yet there was nothing in the Budget for them. There was nothing around organics.

In terms of food safety, and everybody on the Primary Production Committee has heard very, very well about Biddy, the cheese producer with four cows, paying absolutely thousands per year for testing. I am pleased to hear that the new Minister for Food Safety appears to be hearing that call and there may be some reduction, because her food is absolutely safe. She had paid $26,000 in 6 months for just four cows, the produce from four cows, and that is nuts. But as a select committee, we all agreed we wanted to see some support there. We would like to see a more affordable regime for small producers. We recommended that—in fact, it is to the benefit of large producers if we make it easier on the small producers, who often come through with innovative ideas, and others can benefit from that innovation.

Another thing that came up in our discussions was around raw milk. The new raw milk regulations came in on 1 March 2016, and what did we get? An improvement, and increased access for consumers who want it? No. Because of that unnecessary stringency and over-the-top methods we have had a reduction, from 74 raw milk producers down to 24, although I gather there is a small increase coming up again. That was appalling. That food was not coming through as unsafe and this overprotection for an unsustainable dairy industry, by stopping people getting access to what is overall a healthier style of milk, was over the top. So that was very, very concerning. It was concerning for the Green Party.

I am with the other calls around biosecurity. The latest issue, with Micoplasma bovis that is coming in and the Ministry for Primary Industries (MPI) is saying it thinks it might not be able to trace it, or is almost talking failure from the start. The ministry did that with myrtle rust—talked it down, made it seem like it would be a failure, so if things went wrong it was a predictable situation.

I hope that this is treated like foot-and-mouth. This is a useful opportunity to test the resources of MPI, which says it is foot-and-mouth ready, and nail it—not hold it, not manage it, but nail it. Get rid of it. The ministry could have done that with Theileria, but what did MPI do? It mapped its progress through the country, and this is what we are seeing in case after case. Velvetleaf is another one where we are not seeing rapid enough change. We might get there; we might not. In my region, Chilean needle grass just carries on spreading, no matter there is an element of money going in, but never enough.

Biosecurity needs to be lifted up. I had a constituent get in touch with me, saying, “What’s this mud being imported from Korea?”—another foot-and-mouth country. We have imports that are not even necessary, and we could be doing so, so much better in terms of biosecurity; we must. Myrtle rust—I said to contain it. They only got around to containing it 9 weeks after I put that to them. The oysters—only after I asked questions did we even get an announcement that that disease was there. And then, we finally got some action. It would not have happened if I was not asking questions. The Green Party wants to see much improvement in biosecurity. I suspect that is my time up.

Mr Chair, I want to take just a very brief moment of your time, first of all, to thank Ian McKelvie and the team on the Primary Production Committee. It is a very good committee, very well led and chaired. The members of that committee, from all sides of the House, have a distinct interest in agriculture and horticulture. I think it is a very valuable committee in this Parliament.

I note that most of the speakers have talked about biosecurity. As food safety Minister I also want to talk about food safety and how important it is, and how the next generation of the New Zealand brand will be very much dominated by having higher food security and food safety standards that will underpin our products, so that customers will get the kind of quality product that they can trust. That is really important for a growing agricultural industry.

The other thing I just want to mention is the importance of trade. When we look at an industry that is worth about $38 billion this year and going up next year as well—and note the Opposition parties’ opposition to anything to do to grow that base of agricultural and horticultural export, by their opposition to trade policies. I think that is very destructive to a very strong industry that people work hard in. They put their whole lives and their family’s investment on the line, and politicians in this room play politics with that and go around trying to get votes from those communities while at the same time opposing the one thing that would actually assist them to grow their businesses. So with that, thank you.

I move, That the Committee report progress presently and move to consider the Land Transport Amendment Bill (No 2).

Progress to be reported presently.