A new research report published by the Ministry of Agriculture and Forestry highlights the need for the new Rural Affairs portfolio, Rural Affairs Minister Jim Sutton said today.

The report, The Influence of Social Factors on the Future Performance of the Primary Production Sectors, paints a gloomy picture of rural New Zealand during the last Government's regime as farming families faced significant challenge within their farming businesses and local communities with little Government support.

Generating adequate farm profits is the most important issue for farmers. The report, which reviews 14 MAF studies from 1993 till 1998, says that farm income and farm financial viability is the key driver of the rural sector. Many of the MAF studies say that if the financial situation is good, then most other issues are less of a problem.

The report says significant and increasing stress levels are found among farmers, with several studies indicating rural people are near breaking point. This is related to financial stress and has implications for the future, as farming is seen as a less desirable occupation.

Access to services and population decline are significant and linked issues raised in the report. Lower populations have reduced the critical mass available to support services.

However, Mr Sutton said, the report also highlighted the success of community initiatives and the significant contribution made by rural people in their communities.

Mr Sutton said the consequences of Government policy could have big impacts on rural communities and it was important for them to have a voice in Cabinet.

MAF had worked hard to ensure that it was involved in any policymaking by other departments that might affect rural people, he said.

The latest Current Economic Situation report, published by MAF, showed some of the financial burden on rural communities was likely to lift, with major agricultural, horticultural and forestry exports forecasts extremely positive, Mr Sutton said.

The CES report tipped pastoral export value to rise 17 per cent during the next five years, horticultural export value to rise 22 per cent during the same time, and forestry export value to rise 40 per cent during the same time.

Agricultural sector revenue not including forestry” was forecast to rise 13 per cent, from $12.10 billion from the year ended March 2000 to $13.70 billion in the year ending March 2005, reflecting growth in dairy, fruit, and deer.

Over the same time, contribution to GDP was forecast to rise 18 per cent to $7.1 billion, and agricultural sector income” for taxation purposes” to rise by 22 per cent from $3.47 billion to $4.24 billion.

Mr Sutton said that financial relief for farmers and its flow-on effect to rural communities and provincial New Zealand would provide a window of opportunity to tackle some of the problems in rural communities highlighted in the new MAF study.

New technology could relieve some of the isolation suffered by farming families and rural communities, but there were issues of telecommunication provision that needed to be resolved. These were being looked at by MAF now.

He said the Labour-Alliance Government was committed to strengthening rural communities. The rural sector was the foundation of export growth and its success would rub off on the whole country.

The two reports “ The Influence of Social Factors on the Future Performance of the Primary Production Sectors and the Current Economic Situation” are available on the MAF website: www.maf.govt.nz

Office of Hon Jim Sutton

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