23 Jul 2009

Planned meat, wool levy increase slashed

3:22 pm on 23 July 2009

Meat and Wool New Zealand has significantly reduced proposed levy increases and trimmed spending in some areas, as it seeks farmers' support to continue for another five years.

Sheep, cattle and goat farmers will vote in August on renewing the levies on which Meat and Wool relies for the bulk of its funding to cover activities ranging from research and development to meat promotion.

After months of consultation that included more than 70 meetings, the organisation has released the final plan farmers will vote on.

Meat and Wool New Zealand chairman Mike Petersen says the organisation has responded to the concerns that farmers have raised, especially about levy increases, and these have been scaled back in the final plan.

For sheep meat, the organisation is proposing a stepped levy increase from 40 cents per head at present, rising five cents per head per year, capped at 60 cents per head in the fourth year.

For beef, which attracts a $3.60 levy at present, the proposed rise would be 20 cents per head per year, capped at $4.60 per head in the fifth year.

A decrease in the wool levy is proposed, from the current levy of 5.25 cents per kilo to four cents per kilo for the first two years and three cents per kilo for the next three years.

Mr Petersen says Meat and Wool New Zealand has trimmed $4 million from both its research and market development budgets.

It is proposing to supplement research funding with $26 million from Meat Board reserves in the hope of attracting matching support from the Government's new Primary Growth Partnership Fund.

Meat and Wool will be asking meat companies to contribute more to meat marketing programmes.

Mr Petersen says the organisation is also responding to farmer feedback by proposing some limited support for wool marketing development, which has been lacking since the former Wool Board was wound up.

Mixed reaction from farmers

Federated Farmers meat and fibre chairperson Bruce Wills says Meat and Wool NZ appears to have listened to farmers' concerns. He also supports the proposal to use reserve money to bulk up research and development funding.

However, the scaled back levy and spending proposals still do not satisfy a lobby group campaigning for farmers to vote "No" in August's referendum.

The group wants to restrict levy-funded activities to research and development. Its spokesperson, retired Southland farmer Murray Turner, says Meat and Wool's spending needs to be reined in a lot more than it is proposing.

The lobby group wants levies knocked back to 15 cents a head for sheep, $1 for cattle and two cents a kilo for wool.