Govt close to help for sheep farmers

Press, 8 February 1986, Page 11

Govt close to help for sheep farmers

PA Wellington Sheep farmers will get Government assistance that will at least match the $lO million the wine industry is getting to tear out surplus vines, says the Minister of Agriculture, Mr Moyle. The president of Federated Farmers, Mr Peter Elworthy, who has criticised the Government for giving handouts to grape growers when it had refused pastoral fanners short-term help, said Mr Moyle’s promise was irrelevant The Government’s announcement .in December of the wine industry subsidies came after its economic statements. The statement included the removal of import duties on many goods, tax changes and escape routes for hard-pressed farmers, but offered no immediate relief. Mr Elworthy said the Government was inconsistent and was showing a lack of evenhandedness. “We find that on both counts the Government is culpable in our view - inconsistency as far as policy was concerned and unevenhandedness when we had been promised transitional assistance nine months ago and were then told it was not forthcoming for reasons of principle.” he said.

Having decided not to help mainstream agriculture, the Government went on to deal generously with the wine industry’s overwhelming problems and without much consultation and communication, he said. Mr Moyle said the Government was on the verge of helping sheepfarmers. “Every industry requires different forms of assistance,” he said. “The meat industry has a huge indebtedness the Government is looking at. “I don’t want to emphasise that debt but I can assure you that the treatment that the sheep industry is getting - although it will be different • is not less by any means than what has been given to the grape industry,” he said. A Government decision is pending on the future of the $B5O million debt sheepfarmers have run up over the last three years in the Meat Board’s price stabilistion accounts. Industry observers expect the Government to wipe the debt to give the board a clean slate now that its three-year monopoly over lamb and mutton exports has ended. Recovering the money from farmers would be difficult at the moment, they point out. Mr Elworthy said Mr

Moyle’s suggestion was not relevant because the debt was a problem of the past. Mr Moyle said handouts were the best way of tackling the wine glut because it was a domestic surplus rather than an export stockpile. “It is the dramatic idea that you are paying somebody to rip some vines out: that sense of high drama is perhaps a little bit different from the approach in the sheep industry,” he said. “But I emphasise the fact that one is a domestic industry where you have a finite market while the forces affecting the meat Industry are largely those forces outside of New Zealand,” he said. Mr Elworthy said internal costs rather than marketing problems had increased the meat industry debt. Farmers were not asking for handouts but they wanted the short-term help that Mr Moyle had promised competent farmers who were put at risk by the Government’s economic policies. “Mr Moyle has accepted publicly and privately, to us, that this is a responsibility that the Government will take on board but we have yet to see that promise fulfilled,” Mr Elworthy said.

He said he favoured a partnership between the Rural Bank and private sector lenders to ease interest rates. He said the Government should give the bank enough money to cope with that extra burden.

He has written to the Minister of Finance, Mr Douglas, to complain about the wine industry package because of the Government’s treatment of traditional farmers. He awaits a reply. According to a Government official, the package emerged after wine companies impressed on the Prime Minister, Mr Lange, the extent of the industry’s surpluses. Small companies were beginning to be hurt by a problem that was not of their own making. The four biggest concerns - Montana, CooksMcWilliams, Corbans and Penfolds - started a price war last year to clear their stocks and expand their share of the market. Medium-sized companies, which had just begun selling wine in casks and had no overproduction problem, were soon under pressure to lower their prices. Villa Maria and Delegats went into voluntary receiveship towards the end of the year.