Sage Eugenie: Appropriation (2015/16 Estimates) Bill — Third Reading Imprest Supply DebateText is incorporated into the Bound VolumeSage Eugenie: Appropriation (2015/16 Estimates) Bill — Third Reading Imprest Supply Debate[Sitting date: 18 August 2015. Volume:707;Page:5876. Text is incorporated into the Bound Volume.]EUGENIE SAGE (Green):Tēnā koe. As my colleague Jan Logie said this is not a Budget for all New Zealanders and it shows how much National has lost touch with everyday New Zealanders. It is building an economy that works for people who already have a lot. In my comments today I would like to focus on the primary sector because the National Government has really bet the farm on high international prices for dairy continuing rather than building a diversified and a research and development focused export sector. What we have seen with the slump in global dairy prices is that it has highlighted the major pitfalls in putting so many bottles in the dairy basket because we have seen farmers chasing after those high boom-time prices in 2007 and 2013 and we have seen the Government encouraging that with its very generous subsidies for irrigation in Vote Primary Industries. It is encouraging much more intensification and much more irrigation which leads to less resilience and more vulnerability to changes in world commodity prices. We see in Vote Primary Industries that some $142 million is allocated in 2015-16 to Crown Irrigation Investments and the Irrigation Acceleration Fund to subsidise irrigation. That compares with the just $70 million in 2015-16 allocated to the Primary Growth Partnership which is about promoting research and development product and market development and technology transfer.So what the Government is identifying as a priority in the primary industries vote is not what should be the priority for our primary sector because it focuses on a major sector of the economy being a price taker rather than a price maker and because it increases this drive towards a less resilient more intensive dairy sector that is very vulnerable to changes in world commodity prices. What we have seen is farmers go chasing after those boom prices and to do that they have piled on land they have got more cows they have piled on debt and they have got more irrigation. That means now that when the prices are slumped the rural communities are hurting hard. Yet what did the Minister of Finance say? What did he say in the House today? All he could say was that dairy-intensive provinces have to adapt quickly to market signals—completely overlooking the major hurt that rural communities are feeling in having to make that adjustment.What the Green Party would do would be to invest much more in research and development through a big package of tax credits and grants for research and development so that we look at increasing value in our primary sector and at diversifying and getting away from this reliance on dairy away from this reliance on China as the major market and away from Fonterra just thinking that it can continue to increase milk supply regardless of the cost that that has to our waterways and regardless of the unnatural focus that that is creating. This Government thinks in its economic plan that dairy prices are going to bounce back and everything will be fine. It has not got a plan B. It seems to think that we can just grin and bear it and wait for those prices to go back up again but it fails to recognise that there have been some quite significant policy changes internationally both to the production quotas in the EU and to domestic subsidies in the United States. That means that things may never be the same again for New Zealand dairy prices and that means that this hurt that we are seeing at the moment is likely to continue. It means major problems for the economy. The Reserve Bank has highlighted that when we have got 20 to 30 percent of dairy farms so heavily indebted it is potentially a significant problem for our economic stability. It is a major concern.The Government needs to step up and accept some accountability and responsibility. Sure it cannot control export prices but where it invests money through the Budget helps to grow sectors or it makes them decline. It should be investing much more in added value—that is not just investing in new products but in making sure that our products have a reputation overseas for coming from a clean green country for giving some integrity to that “clean green” brand and for marketing products that have a provenance and are products of integrity. That is not what we are seeing in this Budget when the Government is investing more in resource management yet proposing to gut the Resource Management Act proposing to weaken our regulatory framework and proposing to allow more water pollution by its permissive national policy statement. We need a strong regulatory framework to provide a strong environmental credibility to the products that we are marketing overseas and we need much more diversification in our primary sector and much more of a focus on value rather than volume and on increasing the range of products that we market. Thank you.