Last week, the Government announced a “Fresh Start on Freshwater Policy”.

Basically, they want to accelerate irrigation, including here in Hawke’s Bay (as we explained in our last post), while offering up a soft noodle of a National Policy Statement on fresh water management as a sop to the broad public that might be concerned about water quality. Ministers Carter and Smith seem to be banking on the assumption that most of the public won’t know the difference between firm regulation and toothless exhortation when it comes to limiting intensified land use.

Once again, farmers are blessed … this time with $435 million in welfare subsidies — with the inevitable effect of intensified land use (i.e., more dairying in most cases) — while those who care about the environment and sustainability get weak guidelines, not firm or demanding rules, and a laughable-in-size $15 million (over the next two years) contestable freshwater clean-up fund.

What a deal!

Said Environmental Defence Society Chairman Gary Taylor: “The disproportionate scale of proposed investment in irrigation versus clean-up is a worry. Irrigation schemes will provide for a large expansion of dairying, an industry whose diffuse water quality impacts are uncontrolled in most regions, and whose greenhouse gas emissions are exempt from the emissions trading scheme. Government funding should not be used to pollute.” [Download EDS Statement here.]

The inevitable effect of subsidizing intensified land use via irrigation is intensified stress on the environment, specifically, waterways — where, nationally, already nearly half of our monitored rivers are unsafe for swimming and that two-thirds of our native freshwater fish are threatened or at risk.

This is the scenario that will play out further in Hawke’s Bay as we look towards irrigating 40,000 more hectares, with our weak-wristed, pro-intensification Regional Council as the only ‘defender’ of our region’s waterways. And their sorry record on that front speaks for itself.

Environment Minster has yanked the teeth out of the draft National Policy Statement that was recommended by the Board of Inquiry he set up to review water issues, as well as a National Land and Water Forum that represented some 58 diverse stakeholders.

What teeth did he extract?

As the Green Party’s Russel Norman put it:

“This Government has taken a sound draft policy and removed the parts that would have made the most progress towards cleaning up our river and lakes … Nick Smith has removed the provision from the draft NPS which requires a resource consent, as a discretionary activity, for land use intensification. This is despite the fact that nearly every report on water quality identifies land use intensification as the main cause of water quality decline in New Zealand.”

Norman notes that a 2010 article by the National Institute on Water and Atmosphere says that our declining river water quality is undoubtedly associated with the intensification of pastoral farming and the conversion of drystock farmland to dairy farming, particularly in Waikato, Southland, and Canterbury.

“Despite the evidence, Nick Smith has taken out provisions that will force regional councils to regulate land use intensification,” said Dr. Norman.

EDS’ Gary Taylor adds:

“The key concern is that the National Policy Statement, which will become law shortly, has been watered down from the version recommended by the Board of Inquiry last year … it will not on its own achieve the step-change improvement in water quality sought by the Land and Water Forum and EDS. The NPS needs to be reinforced with a complementary National Environmental Standard that would define water quality limits. There appears to be no clear commitment from Government to that next step … the bottom line is that we need clear national guidance for freshwater management as recommended by the Land and Water Forum. Regional councils need direction from government or our streams, lakes and rivers will continue to deteriorate.


Tom Belford

P.S. You can find all the pertinent Government documents here, including the National Policy Statement, which takes effect in July.

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  1. I spoke at a water forum recently and expressed my views: if someone is using water as an economic input in order to generate a financial return, then they should pay for it.

    Also on the "$435 million in welfare subsidies" re the water strategy; the whole dairy industry paid just $26m (yes, you did read right – twenty six million dollars) in tax last year. In the last full tax year, the government received more tax from the mining industry than from the whole primary production sector (including dairying, drystock, hort, viticulture, aquaculture, forestry). Farmers leverage themselves to the hilt, expense everything therefore avoiding tax whilst increasing the capital value of their farm on the back of the PAYE salaryman. When they sell at a profit due to the increase in capital value, they once again don't pay any tax. You gotta ask "is this fair?".

  2. Stuart Nash taking a swing at farmers for 'avoiding' tax, and insinuating they're ripping off the PAYE worker, deserves challenge.

    Every expense a farmer incurs in running his/her business is deductible, the same as any other business. That is fair.

    When interest rates are high, and commodity prices low, many farmers are forced off the land. Some find suicide their only option. Is that fair?

    Most Kiwi farmers are hardworking grafters who love their land and prefer to see their farms stay in the family.

    Sure, some play the system and cream capital gain when they sell up, but so do multiple house owners, and people who buy land and do nothing with it, until values rises, then they sell.

    If Stuart wants to argue for a capital gains tax he should widen his net and include all who gain through capital appreciation, and not just farmers.

    If he's pointing the finger at unfair tax advantage then he should direct at himself, because he is part of the cabal of high earners who benefited most from the last tax cuts, which are costing us $120m a week in borrowed money from offshore. Is that fair?

  3. Really Mr Nash, as revenue spokesman for your party, you should do better than your statement above! I am not an apologist for the dairy industry in any way, but I can't let your assertions go unanswered.

    Firstly you seem to have some problem with farmers claiming legitimate farm working expenses – all businesses pay tax on their NETT income. Secondly you have taken a "snapshot" of the last full tax year 2009 – 10. Most will remember that this was a year of devastating drought for the major dairying regions, and we were warned at the time that most farms would run at a deficit for the year due to decreased production and supplementary feed costs. This in turn leads to decreased tax income for the Govt – but surely as revenue spokesman you understand this?

    I suspect you are being a tiny bit naughty in your post!

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