King Colin: Meat Board Amendment Bill — In Committee 
King Colin: Meat Board Amendment Bill — In Committee 
[Volume:633;Page:4717] 
COLIN KING (National—Kaikoura) 
: 
 It is a privilege to follow the Meat Board Amendment Bill’s progress through Parliament. It was with great pleasure that I sat on the Primary Production Committee along with the other members. It was great to see how we worked as a team. I acknowledge the deputy chairperson of the committee Ashraf Choudhary who has just spoken. It was interesting to challenge ourselves around our thinking to test our thoughts and to come up with what we are convinced is the appropriate answer. 
For just a moment or two I would like to take members through the situation that makes the Meat Board so significant. The board originated in 1947 and it has been a strong conduit in a significant market that will be 125 years old in 2007 which is Export Year so it is quite significant. There are 1200 quotas into Europe and by and large those quotas are administered from the country in Europe where the quota ends up. But New Zealand manages this quota on its own shores and it does so with a huge degree of international responsibility and care. On that basis we capture the value of that administration back to the industry. 
 One of the interesting aspects around the mechanisms used by the Meat Board that are governing the urgency of this bill being passed into law is that companies with quota used to have to return 3 percent of their quota annually so that there was also the opportunity for new entrants to come on board and to be able to create an environment for innovation. That 3 percent might not sound an awful lot but a big company that had built up good relationships with its clients in overseas markets over a 10-year period was giving away 30 percent of its market share. So that gives an indication of the sensitivities that exist around the meat industry. The review process undertaken recently by the Meat Board which looked at historical data and the usage of that new entrants allocation decided to reduce that percentage back to 2 percent because according to historical data only 1.8 percent was used. There is a large amount of consultation with the industry and one of things that has ensured the importance and maintenance of the New Zealand Meat Board as a brand overseas is the way it embraced the industry at a time when there were certain views that the producer board had long passed its used-by date. 
Overseas if one were to go to Brussels one would find that the organisation operating there is known as the Meat Board whereas here the farmer organisation that sits alongside the Meat Board is now known as Meat and Wool New Zealand. The amount of quota utilised comes under scrutiny annually. It has to be monitored on a very very progressive basis so that when we get to the end of the year which is the last day in December we are sure that we have landed in the country of quota origin the maximum amount of that quota. In the case of the US market we are talking about a beef quota of about 214000 tonnes and in the EU market it is 227000 tonnes. It is no mean feat to be able to manage that and maximise the return back to the industry. 
Looking at the bill it is significant to notice that it was during the Uruguay round of the World Trade Organization work on free-trade agreements that we were given the privilege of managing that quota. The quota belongs to the Crown and on that basis of it belonging to the Crown it is very appropriate that the Crown has chosen a mechanism that allows the industry to capture that value. I acknowledge my colleague Nathan Guy; we talk about farms a lot. There is no doubt about it that when farmers are making good returns they get out their cheque books and spend that money and that does an enormous amount of good for the rural economy.