Budget treats farming industry harshly

Waimarino Bulletin, Volume 2, Issue 25, 20 November 1984, Page 10

Budget treats farming industry harshly

The farming industry was treated harshly compared to other sectors in the recent Budget, said Mr Peter Elworthy, President of Federated Farmers in Wellington last week. He said, "the Minister of Finance has defended the removal of farm assistance by claiming that the benefits of the Budget measures will become apparent in about 1 8 months. In the meantime many efficient farmers, particularly hill country farmers, will face an increasingly difficult task in simply meeting their interest and other payments." "We will be talking to the Ministers of Finance and Agriculture on measures to assist these farmers in the short term."

"Farmers will remain sceptical that the Government can reduce New Zealand's inflation rate to below that of our trading partners over the next one or two years. Although the Government has taken a number of useful steps, it did not go far enough in the Budget in reducing the Budget deficit." "In fact Government expenditure is projected to increase by 9% during the year and the deficit to remain at an unacceptably high level of $2.7 billion. Far more determined efforts should have Ijeen made to reduce Government expenditure rather than simply shifting the cost out to the user." Mr Elworthy said "now that meat producers are to pay for an increasing proportion of the costs of the meat and other inspection increases, they will demand to be closely involved in how the service is administered. There is ample evidence to suggest that significant cost reductions can be made and these will be pressed for." "Similarly, as most of the past Government assistance to the farm sector has been to compensate the industry for inefficiencies and high costs in the servicing sectors, the industry can be expected to strongly oppose any proposed increases in charges

for these services. "The introduction of the family care measures and the necessity to share the burden of adjustment fairly must mean very Mow wage increases in the forthcoming wage negotiations. "If this can be achieved the Minister's hope for an

expansion in export income and with it economic and job growth could be achieved. If not, New Zealand will condemn itself to a long period of further economic decline, even higher unemployment and low real wages," concluded Mr Peter Elworthy.