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Clear Mandate Needed In Wheat Insurance Referendum

25 May 2002

United Wheatgrowers is concerned it will not have a clear mandate to continue providing a compulsory crop insurance if responses to a referendum don't increase.

Growers around the country have been asked to vote on the continuation of a disaster relief insurance, operated by United Wheatgrowers, by 31 May.

At this stage about 30 per cent of growers have responded, says United Wheatgrowers Vice Chairman John Wright.

"The diaster relief insurance has been a key part of our business and we want to know if growers are for or against it.

"Referendums like this are a good litmus test to ensure we are providing a service that growers actually want but they only work if we get a good response - otherwise we could end up losing something that has been valuable to growers or keeping something growers don't want. A good response rate will give us a clear message," says Mr Wright.

United Wheatgrowers has been operating the disaster relief insurance since 1987 and under the Commodity Levies Act it must obtain a mandate to continue every six years.

"Growers have received $4.6m in disaster relief settlements - mainly as a result of frost and hail damage - since the programme was introduced 15 years ago.

"The insurance also covers crop damage as a result of fire, lightning, snow, flood and other eventualities like transport losses while in transit from paddock to farm or in temporary storage," Mr Wright says.

The disaster relief insurance currently costs growers $2.50 per tonne harvested and they are insured for $200 per tonne, covering the costs of growing the crop in case of disaster.

"We don't have a minimum claim or an excess and this programme costs substantially less than commercial alternatives," Mr Wright says.

Top-up insurance is available with commercial insurance companies for growers wanting to insure their crops for the full market value.

More than 1300 voting papers have been sent to growers throughout the country and they need to be returned by 31 May. Anyone who hasn't received a voting paper can contact the United Wheatgrowers' executive office - Brown and Glassford on Christchurch (03) 365 0881.

United Wheatgrowers is a growers' industry group that has operated in New Zealand since the 1930s.


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