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Farmers face $1b bill to meet new freshwater requirements

By Pattrick Smellie

Sept. 5 (BusinessDesk) - Government proposals to radically improve the quality of New Zealand’s freshwater resources look likely to cost farmers at least $1 billion over 10 years.

Environment and Agriculture ministers David Parker and Damien O’Connor released a swag of documents from the government’s Essential Freshwater policy review at Parliament this morning.

The discussion document on a new National Policy Statement on Freshwater Management details proposals that would:

Impose immediate “tight restriction” of agricultural land use intensification ahead of all regional councils having new freshwater plans in place no later than 2025;
Require all farms to have a “farm plan with a freshwater module”, although it remains to be determined whether such plans should be mandatory or the extent to which farm plans can or should be used for auditing and compliance with new freshwater standards;
Immediate action to reduce nitrogen loss in a range of at-risk catchments across the country;
Much more stringent rules for the exclusion of stock from waterways than those applied in the dairy industry’s Clean Streams Accord, including deeper setbacks from waterways, fencing or control of stock into waterways under a metre wide, and applying stock restriction more widely than just to ‘in-milk’ dairy herds, as has tended to be the case to date;
New controls relating to winter grazing and feedlots;
Requiring any vegetable-growing operation wanting to increase its production to get a resource consent.
The discussion document puts an estimated $600 million price tag on stream fencing and other stock exclusion measures, not including voluntary riparian planting, $100 million for the establishment of 28,000 farm plans, and $1,500 every two years for compliance audits.

Further costs include an annual cost of between $500 and $5,000 to undertake water quality measurement using the Overseer software that is currently one of the main tools.

“We know that a number of farmers feel under pressure” said Parker. “That’s why we’re giving them time to adjust.”

A $229 million package to help with land use change, including farm environment plans, was announced in the 2019 Budget.

The document gives an estimated annual average cost for a lowland dairy farm at $9,350, rising to $14,850 for a rolling hill country sheep and beef farm, and $9,200 a year for a vegetable growing operation.

The proposed tight controls on intensification will apply “so that it can only occur where there is evidence it will not increase pollution”, the discussion document says.

It proposes that restrictions apply to “increases in the area of in irrigated pastoral, arable or horticultural production above 10 hectares”, including any conversion to dairy-support or dairy, and any conversion of forestry to pastoral farming.

Increases in areas given over to forage cropping beyond the area in intensive winter grazing in the past five years would also be restricted.

“For any of these activities, a resource consent will only be granted if the activity does not increase nitrogen, phosphorous, sediment or microbial pathogen discharges above the enterprise or property’s 2013-18 baseline average,” the document says.

Accompanying reports from Maori, local government, and farming and environmental advocates show Maori advisors take the most conservative approach to further degradation of freshwater and tension with farming interests about the role of farm environment plans.

For example, a majority of the Freshwater Leadership Group – involving both farmers and enviromentalists – “hold the view that the regulatory regime for the implementation of rules and policies must not be delivered through farm environment plans.”

Concerns related to a slow-moving, resource-intensive process involving “unproven” and “possibly inappropriate development of enforcement and natural resource management to commercial entities.”

There were also concerns about transparency of disclosure and “confusion and dilution of responsibility where the regime has multiple levels of auditing.”

The document also outlines a fast-track process to ensure that regional councils get their new water plans in place by 2025 after many indicated they would need until 2030 to put new measures in place.

Today’s announcements apply only to water quality and do not make recommendations relating to how water should be allocated in the future.

The issue cannot advance until the government solves one of the country’s most vexed issues – creating water rights for Maori following both court findings and last week’s Waitangi Tribunal report on water allocation for Maori.

“To resolve these issues, we’ve got to get the balance right between providing water and discharge allowances for people with existing developed land with the needs of people with undeveloped land, which belongs disproportionately to Maori,” said Parker.



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