Productivity vital for future profitability

The future of agriculture is the future of the New Zealand economy, Agriculture Minister Jim Anderton said today.

Mr Anderton told the Rural Contractors’ Federation conference in Christchurch that, unlike any other developed country, we depend on our land-based industries to deliver a first world standard of living.

“Agricultural and horticultural exports comprise two thirds of our overseas earnings. Our forests, our dairy, our wool, our meat and our fruit, and countless processed products derived from our primary industries, are the backbone of our economy.

“Our primary industries are putting high-quality cars on our roads and planes in our skies, complex medical equipment in our hospitals and plasma tvs in our homes. Everything we buy from the rest of the world has to be paid for by our sales to the rest of the world. And our sales are dominated by the primary sector.

“When we look around at the industries with the scale, sophistication and international connections to substantially increase New Zealand's economic performance in the future, they are our primary industries. They are the lifeblood of our economy.”

Mr Anderton said maintaining this depended on us continually lifting productivity.

“Productivity improvements come from innovating and improving our knowledge and skills. One of the top issues employers in all our primary industries have been telling me about is the difficulty they have finding staff with the right skills. It's a constraint on their growth.”

He said the Government had taken this on board and was tackling the generation of under-investment in skills and training in agriculture and many other sectors.

“In addition to training, we need to promote the attractions of the rural lifestyle. We want our agricultural sector to have a positive image in the wider community − including the growing urban community − so that bright young people and their parents and advisers will think about joining the sector.

“I know this will be an issue for rural contractors. I think it’s easier to attract skilled staff when we can promise thriving rural communities which offer a future for young families.”

Mr Anderton said it was hard to attract skilled young people to a career based in rural areas when those communities were being left high and dry.

“One of the reasons I wanted a Kiwi bank was because rural communities were being stripped of services so that even bank branches disappeared. People used to tell me that Kiwibank would never succeed. But look at it go now! Half a million customers and still going strong.

“And it helps to make rural communities stronger too. (The same people, by the way, also used to tell me that ‘apprenticeships’ was a dirty word and they got the government out of industry training.)

“The government is helping through initiatives like Kiwisaver. When businesses like farms struggle to offer a competitive retirement scheme to their staff on an individual basis, now we have a simple, flexible scheme that should help you compete for skilled talent.”

Mr Anderton said talent and skills brought rewards to the individuals who could prosper because of them. And they brought even more rewards to us all as a community because higher incomes followed improved skills.

“When we look to the future of agriculture, we are looking to one where productivity is rising because of rising skills. We are also looking at a future where productivity is rising because of our investment in science and research in the sector. We are looking at a future where we have an edge in global markets because we create and sell premium products efficiently.

“The government's vision is for an innovative, high-skill, high-value economy that is strongly connected to global markets. When I look at the future of agriculture, I believe we are a long way towards achieving our ambition in this sector. And we can look at the future with considerable confidence.”

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