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Rough Passage Expected For Producer Board Bills

The government is planning to push through three significant bills reforming the Kiwifruit, Apple and Pear and Dairy boards over the next four sitting days, however the passage of the legislation is not expected to plain sailing.

This morning the proposed Dairy Board reforms received another set-back with news that Dairy Board Chairman John Storey has lost the election for his seat on the New Zealand Dairy Group board.

Mr Storey - arguably the architect of the reforms - had earlier said that he would resign from his position at the head of the Dairy Board if he lost the election. However he is not obligated to do so, and it is probably reasonable to expect considerable pressure to come on him to remain in place till the latest round of consultations is complete.

This morning the Dairy Board was referring inquiries concerning Mr Storey's future to the Dairy Group communications team.

Dairy Group spokesman Graeme McMillan told Scoop that he did not yet know what Mr Storey was planning to do. Mr Storey was scheduled to speak tomorrow at the Dairy Groups AGM, he said.

In the election for the Dairy Group board position Storey faced opposition for the first time in 20 years on the Dairy Group board. His vanquisher, Jim van der Poel, is a young farmer from the same area as Mr Storey who is backed by a group of concerned dairy farmers widely believed to be led, and possibly directed, by former long serving Dairy Board Chairman Sir Dryden Spring.

Last year after a lengthy period of behind the scenes ructions John Storey succeeded Sir Dryden at the head of the Dairy Board.

The significance of Storey's loss cannot be underestimated and will cast a shadow over the dairy legislation expected to be progressed under urgency later this week - probably on Thursday.

The Labour Party informs Scoop that it intends to support the report back of the Dairy legislation but that they will seek to have it referred back to a Select Committee for six months to allow the issues to be more thoroughly canvassed. Labour's agriculture spokesman Jim Sutton has said that he regards the "break-neck" pace of the reforms alarming.

ACT meanwhile says it will also support the report back and passage of the legislation which means the government should have the numbers to progress the bill.

ACT agriculture spokesman Owen Jennings says the Dairy Board bill, "represents progress toward a more profitable, efficient industry."

"However," he added, "ACT has strong concerns about whether the mega- cooperative is the most desirable commercial option."

Mr Jennings told Scoop ACT was also concerned about the "invidious position of sharemilkers who do not have an adjustment clause in their contracts, and the extremely poor quality consultation and communication especially in some regions.

On the Kiwifruit and Apple and Pear Bills Mr Jennings said: "ACT will support that report back of the Apple and Kiwifruit Bills but intends opposing some provisions in the house and will be seeking changes.

"These changes are needed to achieve a more commercial approach and greater equity for those seeking consents to export outside of the monopolies."

Speaking during question time yesterday Food and Fibre Minister John Luxton played down the Commerce Commission's reservations concerning the mega-coop proposal for the dairy industry.

On Friday the Commerce Commission issued its preliminary view on the mega-coop proposal saying in effect that it did not think it was a great idea, either for farmers or for domestic dairy consumers.

Mr Luxton stressed that the legislation as proposed was simply enabling legislation and before the mega-coop proposal went ahead it required both approval from the Commerce Commission, and approval from a 75% majority of shareholders in each of the co-operative dairy companies.

Scoop understands Dairy Industry leaders are anxious the legislation be passed as quickly as possible to remove the considerable commercial risk involved with uncertainties.

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