Thursday, December 7, 2023

Budget must enable rural recovery

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More drought support, water storage and environmental and tertiary education funding should be top priorities for the Government on the eve of its 2020 budget, industry leaders say.
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Massey University pastoral scientist Professor Peter Kemp wants to see business support targeted at the primary sector.

It has stood up and survived through the covid-19 economic downturn and for the next 18 months will be the mainstay of the economy.

“I would like to see support in place for farmers and the wider processing industry that allows us to export.”

Kemp also wants money set aside for those affected by the drought, which he believes is an issue that has not had the publicity it should because of the impact of covid-19.

“It’s a devastating drought and it still hasn’t rained properly and I’m not sure there’s been the support.”

It also raises questions about what the country is doing for water storage. The Government has not favoured water storage projects and the drought is a consequence of that, he said.

He hopes the budget will contain funding related to the Government’s environmental reforms around freshwater and biodiversity to give clarity to farmers.

“I’m not in the delay them camp. We are going to get them anyway but for farmers certainty is always better than uncertainty.”

He hopes more money will be set aside to help the tertiary sector educate and train people interested in primary sector careers.

The training industry in the agriculture sector has had some problems in the past few years so it would be good to see some money injected into those training organisations.

“Our economy is still strongly dependent on the success of its primary industries and if it has to be up to the mark environmentally, then where’s the encouragement for people to take up those careers?”

Beef + Lamb chief insights officer Jeremy Baker said the Budget is an important step to get the economy back on track.

He sees exports, employment, productivity and the environment as the four areas he hopes the Government will focus on.

The sector is worth 11% of all exports and is going to be critical in the post covid-19 world.

While the Government will obviously want to spend money on sectors that are hit hard, investing in areas that will help achieve export returns is also critical, he said.

“It’s going to help us fund the economic development that we need.”

Skills and employment will be critical with the red meat sector employing 92,000 people.

“An investment in that area in skills and training will be critical. There are jobs available and so helping attract people into those jobs but also skilling them up.”

The sector has to improve its productivity but not at the expense of the environment and Baker wants investments in practical environmental work around freshwater and greenhouse gas emissions rather than blunt regulations.

“Regulations are one tool but not the only tool,” he said.

The drought has brought home the importance of water quantity and he hopes there will be funding set aside for water storage.

“A lot of the focus in the past has been using water storage to increase production but increasingly we’re saying that should be to enable or maintain production and also to maintain water flow.

“If we had a lot more water storage in Hawke’s Bay at the moment things would have been a very different situation.”

Local Government New Zealand president David Cull said the unprecedented scale of the covid-19 challenge requires an unprecedented response.

“It would be short-sighted to try to approach this as a standard Budget with the standard allocation of resources.

“What we do know is that with reduced tax incomes, greater borrowing and higher expenditure needed to keep the economy afloat, central government will need to prioritise spending and policies that were previously expensive before the outbreak of covid will be near unaffordable now. That doesn’t mean they shouldn’t be pursued but it does make prioritisation harder.

“Those in rural areas know better than most that we need to adapt to climate change-related severe weather events like droughts or floods. 

“Additionally, farmers are working to reduce their carbon footprints so I think there’s value in the Government keeping climate change in mind and prioritising low-carbon infrastructure and patterns of development when making investment and funding decisions.”

National Party agriculture spokesman Todd Muller said the Government will have failed rural communities and the primary sector if it does not significantly invest in water storage in the budget.

«Farmers and growers across the country have been experiencing the worst drought in living memory this season and their struggles have only been exacerbated by the impacts of covid-19.

“Water storage will help us build more resilient rural communities in the face of a changing climate and will help us unlock the untapped economic potential of regions like Northland.

“If we are going to be borrowing large sums of money that will need to be repaid by future generations of Kiwis then we must invest wisely in strategic infrastructure that will pay dividends for years to come.

“This Budget brings an opportunity to make a long term and strategic difference to the future of the country.

“We have seen scattered projects announced under the Provincial Growth Fund but it has been piecemeal investment here and there. What we really need is a well co-ordinated national strategy.»

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