Farmers Hit Hard By Compliance Costs

27 September 2005

Farmers Hit Hard By Compliance Costs

Reducing compliance costs must be a high priority for the incoming government, said Don Nicolson, Vice President of Federated Farmers of New Zealand.

"Three years of results from the Business NZ-KPMG Compliance Cost survey show that small business continues to be hammered by compliance costs," said Mr Nicolson.

According to the 2005 survey results, released today, firms with fewer than five staff face compliance costs of more than $3,600 per employee, 14 times higher than for businesses employing more than 100 people.

"This is a staggering difference but not surprising given that small business - unlike big business - can't absorb compliance costs into overheads.

"While tax and employment are important to all businesses, regardless of size and sector, the compliance cost survey confirms the high priority farmers place on lowering compliance costs.

For example, the survey showed an urgent need to lower compliance costs in areas such as health and safety in employment, the Resource Management Act, local government, food safety, border control and biosecurity, and hazardous substances.

"Survey respondents from the primary sector were almost three times more likely than all survey respondents to pick the RMA as a high priority," Mr Nicolson said.

"This should be no surprise to government, which has acknowledged that primary industry is more likely to be exposed to the RMA. However, the government failed to fix the RMA's primary sector problems in the most recent RMA amendment.

"Most businesses never deal with the RMA but once they do it becomes a nightmare and rural landowners are the most exposed. The RMA must be fixed.

"The survey results also show mixed perceptions of council performance and it is clear that implementation of the RMA by local authorities must be improved.

"Given the critical importance of small business to economic growth and employment, particularly in rural and provincial New Zealand, farmers will want the new government that takes shape in coming weeks to ease the burden of red tape and regulation that is strangling small business," Mr Nicolson said.

ENDS

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