Grant Robertson’s refusal to rein in spending and take meaningful action to dampen inflation is piling pressure on primary industries, National’s spokesperson for Rural Communities Nicola Grigg says.

“This Labour Government has unleashed unprecedented levels of spending in last week’s Budget, with more than $9.5 billion in new spending forecast this year alone. To put it in context, they are now spending 68 per cent more, or an extra $51 billion per year, since coming into office.

“This out of control spending is putting huge pressure on the economy and is driving inflation to a record 30-year high, with the cost of farm inputs rising by 9.8 per cent since the March quarter last year.

“This week we saw another 50 basis point jumps in the OCR, the first back to back 50 point increase since the OCR was introduced – which has never happened before and will effectively double interest rates compared with last year.

“A farm carrying $4 million in borrowings that sees a 100 basis point increase in their interest rates has to pay an additional $40,000 a year in interest costs.

“On top of that, there are more than a dozen new law and regulatory changes being piled onto farmers by the Government, so it’s all starting to add up for our rural communities.

“Agriculture Minister Damien O’Connor’s Budget 2022 press release announced a $1 billion spend on primary industries, but this really needs close scrutiny. It is full of vague waffle like $118 million for ‘advisory services’ to ‘support farmers’, $40 million for Stuart Nash’s ‘transformation’ of the forestry and wood processing sectors, as well as $32 million for Meka Whaitiri’s fund to crack down on farmers with increased compliance, enforcement and on-farm inspections.

“The cost of doing business on-farm is sky-rocketing. For this sector to continue to carry the New Zealand economy during these turbulent times, the Government needs to rein in spending on compliance and ‘advice’ and, instead, cut costs for the most productive sector of this country.”

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