Turei Metiria: Oral Questions — Questions to MinistersText is incorporated into the Bound VolumeTurei Metiria: Oral Questions — Questions to Ministers[Sitting date: 08 March 2016. Volume:711;Page:9422. Text is incorporated into the Bound Volume.]4.METIRIA TUREI (Co-Leader—Green) to the Minister for State Owned Enterprises: Does he support Landcorp’s recent decision to significantly reduce its dairy footprint?Hon TODD McCLAY (Minister for State Owned Enterprises): Yes I welcome the business decision by Landcorp to revise its land use programme at the Wairākei estate. I would note that Landcorp’s current dairy footprint would not be reduced but that there would be a focus on alternative uses for the remaining former forestry land it leases there. In the Government’s regular meetings with Landcorp we have asked the company to lift its financial performance and to ensure that it is profitable and productive. However specific investment decisions are for the Landcorp board to make.Metiria Turei: Did the Minister then make a mistake in his answer to questions last year when he told my colleague Catherine Delahunty that he stood by Landcorp’s initial plans for large-scale dairy conversions given his Government’s plan to see the dairy industry double by 2025?Hon TODD McCLAY: From memory that was not exactly my answer but I certainly stand behind Landcorp and the Landcorp board as far as its business decisions are concerned. It was correct that about a year ago the Government asked it to look at all of its business models including the appropriateness of investment when it came to Wairākei. I would note that it is absolutely its decision to make. I welcome this decision just as other decisions when it comes to dealing with the financial performance of Landcorp.Metiria Turei: Does the Minister think his Government’s strategy to intensify dairying in New Zealand is coming undone when the Government’s own dairy farmer Landcorp is significantly reducing its dairy footprint for economic and environmental reasons?Hon TODD McCLAY: No.As opposed to the view of the Greens it is not the Government’s intention to nationalise farming in New Zealand. It is the private sector that makes these decisions every day. It makes them based upon indications that come both from pricing overseas markets and from the very successful job the Government is doing in signing up and negotiating free-trade agreements. What I would say to that member however is that Landcorp is not significantly reducing its dairy footprint; it has merely made a business decision that there are other uses at this time for the land it has yet to convert at Wairākei.Metiria Turei: Does the Minister disagree with Landcorp Chief Executive Officer Steve Carden who says he is concerned about leaving legacy environmental issues in sensitive water catchments and will the Minister now lobby the Minister for Primary Industries to place a wider national moratorium on dairy conversions in sensitive water catchments as Landcorp Chief Executive Officer Steve Carden is concerned?Hon TODD McCLAY: I have not seen those comments from the chief executive officer but in my ongoing discussions with the chair and the board I have indicated to them that it is the Government’s desire that they meet the rules and requirements that regional councils set when it comes to land use and particularly the protection of water. This Government has a better record than any other Government when it comes to these issues and I do not need to lobby my colleague the Minister for Primary Industries. He is up and down the country on a daily basis talking about the importance of farming and the importance of the economy.Metiria Turei: Does the Minister then disagree with Steve Carden when he said “The days of New Zealand continuing to expand its dairy footprint are largely coming to a close.” and how will this change the Government’s plans to double dairy production by 2025?Hon TODD McCLAY: No the Government—the Crown as the owner of Landcorp—has a direct relationship with the governance there; and of course that is the board. Every year we set out our obligations our expectations to it. As far as the chief executive officer is concerned when he speaks it is the same as any other farmer in New Zealand I suppose about their view of farming in New Zealand. Fundamentally my view of where Landcorp sits today is that we want it to be low risk we want it to return to profit and we want greater dividends returned to the Crown so that we can build schools and provide hospitals and good law and order.David Seymour: How does the Government ensure that its ownership of farms does not reduce its incentive to be a strong environmental regulator?Hon TODD McCLAY: That is a very good question. As Minister for State Owned Enterprises my role is to ensure that the board is focused on the outcomes that the Government wants from it and I mentioned them earlier: to be low risk to manage its debt well and to return increasing dividends and profits to the Crown so that we can invest them in other areas on behalf of New Zealanders. But what I would say is that we expect Landcorp—as with all farmers—to take its environmental obligations seriously. I actually see that it does that.Metiria Turei: Is the Minister confident that Landcorp’s change of direction away from intensive dairying will be enough to prevent it going the same way as Solid Energy?Hon TODD McCLAY: Well I think the member is oversimplifying what it is that Landcorp has announced. It has announced that it has found in one particular area of the country other land uses on top of the significant land use changes around dairy that it has made. Ultimately it is a decision for it—a business decision—as to how it uses the land that it has under its control and I support that.Metiria Turei: Does he understand Landcorp’s decision as a win for our rivers and lakes and a win for our economy and why is it that he thinks that Landcorp is willing to protect New Zealand’s rivers and lakes from dairy cow pollution but the Government is not?Hon TODD McCLAY: No there is just no evidence in that claim on the part of the Greens and what I would suggest to the member is that her coming across as a supporter of farming is almost the same as her supporting you know a very reasonable debate in this Parliament. The thing about Landcorp is that in our view they are farmers. It is not for the Government to interfere in their everyday business decisions when it comes to farming. But I repeat my earlier answer: this current Government has a very strong record when it comes to environmental standards around water and the balance that we have with the farming industry.