Measures To Lift Effluent Compliance

Media Release
6 March 2009

FONTERRA ANNOUNCES MEASURES TO LIFT EFFLUENT COMPLIANCE

Fonterra today announced new measures to assist its farmer shareholders meet Regional Council rules for effluent management. The new Effluent Improvement System has the explicit goal of cutting significant non-compliance by 50 per cent by August 2011.

Fonterra plans to re-direct staff resource to help in providing advice to the minority of farmers who have been identified as needing support. The company is also introducing a milk payout deduction system for those who receive an infringement notice or prosecution for an effluent offence from a Regional Council.

Barry Harris, Chair of Fonterra’s Sustainability Leadership Team, said the new measures are being introduced because progress on effluent management is one area that continues to let Fonterra and its farmers down, threatening the image of New Zealand dairying and access to natural resources.

“Most of our farmers, despite complex rules and changing expectations, have made excellent progress in establishing robust effluent management systems,” said Mr Harris. “But others are experiencing difficulties in complying with Regional Council regulations and that level of non-compliance remains much too high.

“Despite our work in recent years with farmers, industry partners and Regional Councils, some 11 per cent of our farmers still seriously breach Regional Council regulations,” said Mr Harris. “For practically everyone in our industry, those levels are unacceptable.”

Fonterra will have its team of Sustainable Dairy Advisors, with assistance from Area Managers, provide the ‘Farm Enviro Walk’ diagnostic tool (a trouble-shooting check list, developed by DairyNZ, to identify problems that might result in non-compliance). Fonterra, with the support of its Shareholders’ Council, is also introducing an effluent grading deduction system, for those persistent non-complying farmers.

The 2009/10 season is designed to give farmers the time to become familiar with the new system with emphasis on advice and the issue of an “advisory deduction”. It will also allow those farmers who struggle with Regional Council effluent rules to seek help and advice before financial deductions apply.

Farmers who then are subject to enforcement action from Regional Councils will incur a financial deduction from the 2010/11 season. This will be through a two-tier system: with a deduction of $1,500 being incurred for infringement notices and $3,000 for prosecutions. Farmers who spend that amount, or more, on improving their effluent management system, will be able to offset that sum against their expenses.

Fonterra’s major focus will continue to be on advising and assisting farmers who may be struggling to meet the required environmental standards, and to help all farmers minimise dairying’s impact on the environment. Mr Harris said the company is committed to doing everything it can to help farmers achieve acceptable levels of compliance by the August 2011 deadline.

“By implementing a tougher effluent management system we are not taking over the enforcement role of the Regional Councils,” said Mr Harris. “Instead, we are taking the steps needed to improve compliance rates, minimise dairying’s impact on the environment and protect the integrity of New Zealand dairy farming’s reputation.”

ENDS

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