Were Fonterra And the Government in Collusion?

Just four days after the General Election the true state of the dairy industry is revealed – returns for milk that the New Zealand economy is reliant on have slumped.

“Questions need to be asked by New Zealand voters on why they were not informed about this serious decline before Election Day,” says New Zealand First Leader, Rt Hon Winston Peters.

“The drop in payout is a $5 billion hit to the New Zealand economy and 2 per cent off nominal GDP.

“It appears the government and Fonterra joined forces to keep the facts hidden from voters?

“Taxpayers had a right to be fully informed about the state of the economy, and any impacts it may face. After all, they are the ones called upon for cash relief when farmers are affected in droughts, floods, etc.

“We went into the election knowing there had been a setback, with a revision in the price down to $6 per kilogram of milk solids.

“At the time the Prime Minister put this down to the volatility and fluctuations in dairy prices, but as Prime Minister he must have been briefed on the forecasts, and the global markets. With an election around the corner, he was not forthcoming with the true state of the economy.

“It is not just a bit hit for farmers, especially those with new conversions and large mortgages. The plunge will have huge repercussions in the regions - when the farmer is worse off spending dries up and rural businesses and towns are the first to feel the pinch.

“And why did Rabobank, a leading rural lender, wait until the first working day after the election to release a survey showing that almost half of our dairy farmers expect the performance of farms to worsen in the next year and that rural confidence is at a two-year low.

“New Zealand First has been warning that the reliance on milk and log exports into one market – China – would have serious repercussions. But the National Government has had its blinkers on, talking up a rock star economy and ignoring reality.

“When the Prime Minister said New Zealand is “on the cusp of something great” New Zealand First trusts this is not what he meant.”

ENDS

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