Friday, 4 May 2007

Competition for meat inspection?

United Future agriculture spokesperson Gordon Copeland today announced that following negotiations with the Government, private sector organisations may, in the future, be able to provide export meat inspection services in competition with the Crown.

"This has all arisen in the context of the State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill which was reported back to Parliament today by the commerce committee," said Mr Copeland.

"At the moment red meat inspection services are provided solely by the SOE Asure New Zealand Limited but AgriQuality Limited (also an SOE) recently signalled their intention to explore the possibility of breaking that monopoly.

"The Government has acted to prevent that happening because of the likely redundancy costs involved and has decided, instead, to explore a merger between the two SOE's.

"However this will result in a monopoly in relation to red meat inspection services which is an outcome that United Future is not prepared to live with.

"Any monopoly is bad and this one removes any incentive to restrain costs which will simply be passed on to farmers.

"To overcome that problem United Future has negotiated with the Government the addition of clauses to the Bill stipulating that

a) three years from enactment date, the Commerce Commission will review the position to ensure that prices charged conform with the general principles of the Commerce Act and;

b) that the New Zealand Food Safety Authority will be authorised to continue to negotiate with New Zealand's trading partners for the competitive supply of export red meat inspection services by private sector organisations.

"Should those negotiations be successful the Government will then permit competitive tendering to occur for those services.

"This will ensure that costs to farmers are minimised through competition between Government and private sector providers to the benefit of New Zealand's vital multi-billion dollar meat exports."

Mr Copeland explained that an amendment would be made to the Bill at its Committee stage in his name, which will be supported, by both Labour and National.

"This is another example of MMP working and the important role that smaller parties can play in our democratic process," said Mr Copeland.

ENDS

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