One ministry – who’ll be minister?


State Services Minister Tony Ryall has confirmed the merger of the Ministry of Agriculture and Forestry with the Ministry of Fisheries to give one voice for primary industries.

“Ministers have agreed that the merger of these two organisations will deliver better results for New Zealanders by reducing back-office bureaucracy and lowering the cost of delivering government services.

“The merger is planned for 1 February 2012 to allow adequate time to engage with stakeholders, consult with staff and make the necessary planning and legislative changes.

“This merger is part of the Government’s ongoing programme to improve public services during times of increasing financial restraint and rising public expectation of service delivery.

“It will reduce duplicated and overlapping functions between the two organisations – and it will create an agency with better abilities to give support to primary industries.

It is expected that the annual savings from the merger will be at least $10 million, with further savings expected over time through merging corporate administration processes and rationalising accommodation. One-off costs of transition will be met from within existing baselines without impacting on service delivery.

Agriculture Minister David Carter says the move will give an efficient and co-ordinated voice for primary industries.

“Most importantly, it will provide integrated policy advice to better support the Government’s agenda for long-term economic growth from our primary producers. New Zealand’s future prosperity relies on the strength and productivity of our primary industries.

“The new agency will be better equipped to work with primary sector stakeholders, including iwi, local Government and international trading partners on regulatory, food and biosecurity issues.

“The merger will also reduce duplication and operational costs, and I expect a proportion of these savings will be shared with the sectors the agency works with to reduce the costs of doing business,” says Mr Carter.

Fisheries Minister Phil Heatley says the merger will lower costs and   create an agency with greater capacity and capability.

One voice, improved capacity, lower costs – what’s not to like?

The only question is, who will be the Minister?

Ministry of Primary Industry good start


A government has two main ways to influence the economy – by facilitating increased productivity and by reducing its own costs.

In his speech to parliament yesterday Prime Minister made a commitment to do both by improving efficiency and lowering the cost of the public service.

Front-line public services are the priority for this Government. We want to free up money for these services by reducing the costs of back-office and administrative functions.

We have already taken several steps to achieve that.

Since coming into office we have reduced the number of full-time equivalent staff positions in the core government administration by five per cent.

We began procurement reforms last year, and from the first four projects we expect to save around $115 million over the next five years.

We have also made progress in reducing the number of government agencies, for example; by bringing Archives New Zealand and the National Library into the Department of Internal Affairs; and by merging two science agencies to create the Ministry of Science and Innovation.

Even so, the government bureaucracy is still a long way from being a lean and efficient organisation.

The Government machine still consists of more than 80 Crown Entities each with their own Board, 38 Departments, more than 70 portfolios and more than 60 separate Budget Votes. The costs of running this machinery are still too high.

Clearly, there is more to be done to make the government bureaucracy smaller and better.

Therefore, I have asked for advice on further reforms to streamline and improve the performance of the government bureaucracy.

Amalgamating ministries or departments with a similar focus is one easy way to reduce overheads without compromising services.

TV1 said the Ministries of Agriculture and Forestry and Fisheries were likely to be turned into a single Ministry of Primary Production.

MAF used to stand for the Ministry of Agriculture and Fisheries. 

They have a lot in common. Bringing them back into a single super-ministry with forestry makes sense and will save money.

It would be a good start in the government’s programme to build better public services.

Which among the more than 80 Crown entities,  38 departments, more than 70 portfolios and more than 60 separate Budget votes offer similar potential for saving money and improving service?

MAF BIM paints mixed picture


The Minsitry of Agriculture Briefing for Incoming Ministers  paints a mixed picture for agriculture.

The BIM is 48 pages long and I’m not going to analyse it all, just give some thoughts on some of the matters raised.

The good news, for those of who wonder if primary production still matters is MAF’s reminder of the importance of agriculture, food and forestry industries to the economy, employment and social wellbeing and that they generate 64% of our merchandise export earnings.

They are the only major industries in which we have sufficient scale, market share and supply chains to be truly competitive in international trade. New Zealand is the world’s largest dairy and sheep meat exporter, and has some of the world’s most competitive horticultural and forestry industries.

Over the next 20 years, New Zealand’s food and fibre producing capability will become increasingly important. Globally, rising population and economic growth is expected to increase demand for agricultural and forestry products. At the same time land and resources, such as freshwater, available for food and fibre production worldwide is likely to decline.


Despite this favourable long-term outlook for New Zealand’s primary production sectors, our industries, environment and broader society face a complex set of challenges to reap future opportunities. These challenges are exacerbated by the current global financial crisis that continues to unfold with uncertain impacts and duration.

Among the challenges are an expected decrease in demand for our exports and difficulty getting credit and servicing debt.

Then there’s the importance of free trade:

For a small country lacking significant economic power, legally-binding multilateral trade and environmental management rules are important to achieve economic and environmental benefits not available by other means.

The importance of environmentally responsible practices was outlined:

The challenge is to develop integrated policies that provide incentives for the sectors to work towards a more sustainable balance in economic, environmental, social and cultural outcomes for the benefit of all New Zealanders. As resources become fully allocated and ecosystems reach the limits of what they can deal with, there are increasingly difficult decisions needing to be made that will impact on the practices of primary producers.

Water availability and quality are also pressing issues and improved water management – of both quality and quantity are an urgent priority.

In 2002/03, irrigation was estimated to contribute around $920 million net GDP “at the farm gate”, over and above that which would have been produced from the same land without irrigation. Since then, the area of irrigated agriculture and horticulture has increased by about 25 percent, from 480 000 hectares to around 600 000 hectares.

Theoretically there is a further 1.9 million hectares of land capable of being irrigated. However, most of the recent increase in irrigation is sourced from groundwater, which has generally reached or is quickly approaching allocation limits in most parts of the country. Further irrigation development, particularly on the eastern side of New Zealand as climate change impacts, will require water storage and distribution systems to deal with fluctuating water availability.

Currently only about four percent of all the freshwater that flows toward the sea is extracted. In Canterbury, where most irrigation occurs, just one percent of allocated water comes from storage infrastructure.

Storage is the best way to make use of water for irrigation with the least impact on river ecosystems because it takes the water at high flows, which generally is during the spring snow melt, or during and after heavy rains, and stores it to use when it’s dry.

But not everyone accepts this or wants it in their backyard so getting resouce consent is a long and expensive process.

RIP Rural Affairs Ministry


Rural Women president Margaret Chapman is upset that the Ministry of Rural Affairs is to be axed.

Rural issues extend well beyond agriculture, and in the past the Minister of Rural Affairs has had an important role to play in monitoring and overseeing a wide range of policies affecting rural communities.


“The Minister of Rural Affairs has had an over-arching role, ensuring the rural perspective was factored into health, education, transport, power and land access policies, to name a few,” says RWNZ National President, Margaret Chapman.  “Rural Women New Zealand has also worked with the Ministry to develop a rural impact assessment tool to ‘rural-proof’ government policy.”


Absorbing the Rural Affairs role into the Ministry of Agriculture threatens to dilute its effectiveness and lead to policies that fail to take into account broader rural needs at a time when vibrant agricultural businesses and service industries rely on strong communities to support them.


“It is vital to provide for the needs of the rural workforce to continue to grow this important sector in the New Zealand economy,” says Ms Chapman.

I agree that rural issues extend well beyond agriculture but we don’t need a separate Ministry with all the associated costs to recognise that.

The Ministry may have ensured the rural perspective was factored into many policies. But that doesn’t mean they wouldn’t have been anyway or that the Ministry of Agriculture won’t be at least as effective an advocate on rural issues.

And the rationalisation needn’t stop with Rural Affairs.

Kiwi Polemicist has a list of 60 Ministries. That seems excessive so given the dire economic outlook a cull would be in order.

Women’s Affairs, Senior Citizens and Youth Affairs would be good places to start, not because there aren’t issues which affect people in these groups, but I don’t believe they need separate ministries to address them.

I’d also be tempted to axe the Ministry of Disability Issues or merge it with Health.

The then Minister of Social Welfare, Roger Sowrey, was asked about a separate ministry of disabilities at an IHC conference in the late 1980s. He replied that while a dedicated Ministry ensured that an area received attention it also provided other Ministries with an excuse to ignore the issues because they were another Ministry’s business.

That’s a valid point. All Ministries should have regard for the affect their policies on everyone and if they did we’d get better policy at a lower cost.

Nat’s ag policy announced


National’s policy of voluntary bonding of doctors, nurses and midwives will be extended to rural vets.

This is one of the initiatives announced by agriculture spokesman David Carter  when he released the party’s agriculture policy today.


 It is envisaged that the cost of such a scheme would be in the order of $1.5 million in the first year, rising to $3 million in the second, and $4.5 million in the third year. The costs will be met by achieving savings within the existing funding for the Ministry of Agriculture & Forestry.

Related initiatives include:


 * Consider the establishment of rural scholarships to encourage more students from rural backgrounds to study veterinary science.

* Work with Massey University, NZVA, veterinary professionals, and the wider rural sector to address the structural problems contributing to the rural veterinary shortage.


National will also take a less less bureaucratic approach to the funding of research & development.


Unlike Labour’s Fast Forward Fund, National’s policy locks in a consistent funding regime that doesn’t have the uncertainty attached to it that Labour’s model does.

National is committing $210 million to R&D over the next three years, while Labour is projecting a spend of about $135 million. National will wind up the Fast Forward Fund and:

* Establish an international centre for research into greenhouse gas emissions from livestock, at the cost of $20 million a year.

* Increase funding within Vote RS&T for primary sector and food research of $25 million a year.

* Increase funding for research consortia in the primary and food sectors of $25 million a year.


Tenure review has been a source of growing anger among pastoral lessees so National’s more balanced approach is welcome:


National is also supporting the principal of Tenure Review, but believes a new approach is needed to restore confidence in the process and ensure that the intent of the Crown Pastoral Land Act is fulfilled. National will:


* Implement voluntary, good-faith negotiations between run-holders and government.

* Ensure that the setting of high-country rentals is tied into the earning capacity of the farm property and is such that run-holders can continue to maintain properties at an acceptable level.

* Recognise that high-country run-holders can be as effective in their stewardship of the land as the Crown

The full policy is here.

Solid growth ahead for primary sector


The Ministry of Agriculture & Forestry  is forecasting sunny times for the primary sector over the next five years in spite of a stormy outlook for domestic and international ecnonomies.

The 2008 Situation and Outlook for New Zealand Agriculture and Forestry (SONZAF) 2008 report , expects international demand for food products to keep key commodity prices buoyant for the next five years.

MAF says while traditional Western markets are slowing, this is expected to be offset by continued growth in fast-developing Asian economies such as China, India and other developing and oil exporting markets.

“Individual sectors all face their own challenges, but overall the combination of strong commodity prices, growing global food demand and new market developments – such as the China FTA signing – presents positive opportunities for the primary sector over the next five years,” MAF Director-General Murray Sherwin says.

Challenges at home include the 2008 drought, which continues to have a significant affect across the sectors. In the meat sector, this has resulted in wide-spread de-stocking that will lead to falling beef and lamb export volumes next year.

Export returns, most noticeably in the meat, kiwifruit and forestry sectors have also been eroded by the high New Zealand dollar. And high fuel and fertiliser costs have undermined improved commodity returns. The economic outlook in some of the key markets, such as the United States, is also constrained.

Lamb and beef prices are improving and the outlook is brighter in both sectors than it has been for sometime, Mr Sherwin says.

Beef export earnings, for example, are projected to increase by more than 40% over the forecast period.

Based on Treasury assumptions of easing exchange and interest rates, MAF also expects farm gate returns to be boosted.

This is encouraging – but the low dollar which increases returns also increases the price of major inputs including fertiliser, fuel and machinery.

Ag class report


The Ministry of Agriculture and Forestry’s five year primary sector report card will be released tomorrow.

The  Situation and Outlook for New Zealand Agriculture and Forestry 2008 report  (Sonzaf) forecasts the trends and performance for the next five years.

While it’s looking ahead,  Owen Hembry  looks back:

And as for some recent performances, here’s the report card:

Well done Dairyton, keep up the good work, go to the top of the class.

Meatly, you’re full of ideas and have plenty of promise but you need to focus lad, focus.

Wineston, well done, results worth celebrating but don’t pop too many corks because your studies will get harder.

Woolley, very industrious, A for effort but poor results, put your cap on straight and don’t forget about the point of your assignments.

Paua project waits five years for funds


An East Coast paua hatchery was forced to wait five years for a grant from the Ministry of Agriculture’s Sustainable Farming Fund.

The SFF approved the $230,500 grant in 2002 but the money wasn’t paid over until November last year.

National’s agriculture spokesman David Carter  attributes the delay to “bureaucratic ineptness”.

The grant was for the development of a commercially viable paua production system. The project was to study yellow-foot and virgin paua so seed stock production methods could be developed; to develop a selective breeding system across these two species and common paua to provide superior stock; and to test and develop a recirculating sea water system.

The applicant, Te Runanga o Turanganui a Kiwa, wrote to MAF, MAF’s director general, the Minsiter of Maori Affairs and Agriculture Minister Jim Anderton seeking answers.

Carter has obtained an internal memo  which states:

” ‘all failings – and there has [sic]been many of them – were at MAF’s end’ and that it was ‘extremely embarrassing’ for MAF.”

The Minister should also be embarrassed but as Phillipa Stevenson points out at Dig ‘n’ Stir he avoided the issue when Carter questioned  him in parliament this week.

Five years of ineptness deserves more than obfuscation. Does nobody in government know how to say, “sorry we stuffed up”?

Hat tip: Dig ‘n’ Stir

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