National Animal Identification and Tracing Bill — Third Reading 
Text is incorporated into the Bound Volume 
National Animal Identification and Tracing Bill — Third Reading 
[Sitting date: 14 February 2012. Volume:677;Page:377. Text is incorporated into the Bound Volume.] 
National Animal Identification and Tracing Bill 
Third Reading 
Hon DAVID CARTER (Minister for Primary Industries) 
: 
 I move  
That the National Animal Identification and Tracing Bill be now read a third time 
. Agriculture is a key industry driving our economy. We must maintain our reputation as world leaders in the production of top quality animal products. The Crown and industry have started to work together since 2004 to ensure that we have the quality information we need about livestock. In that regard I would like to acknowledge and pay tribute to the earlier work of Ian Corney who chaired the initial working-group. His absolute commitment is one of the reasons that this legislation is before the House tonight.  
The National Animal Identification and Tracing (NAIT) scheme will support the electronic recording of locations the people in charge of animals and the movement of animals between properties along with other attributes. With NAIT we can give assurances to domestic consumers and our trade partners that the product is healthy and disease-free. We can manage a disease more effectively and rapidly reopen markets if they are closed. Furthermore the NAIT scheme allows for other information to be held in conjunction with mandatory data and can further support improved productivity and on-farm management.  
The National Animal Identification and Tracing Bill sets out the legal framework for the collection of information on livestock and their location and movement history throughout their lifetime. It also outlines the governance arrangements and powers for the NAIT organisation that will manage the NAIT scheme. NAIT needs to be mandatory to be effective. The bill will support the introduction of the NAIT scheme scheduled for July 2012 for cattle and March 2013 for deer.  
It was agreed early on in the NAIT scheme’s development that the Government and the industry would share its costs as well as its benefits. The Government funded the building of the database and is to fund a continuing contribution of 35 percent of the system’s operational costs. The livestock industry groups have provided financial support during the scheme’s development and will do so once the bill has passed.  
During the bill’s passage through the House I have spoken about the history of the project and how we got to this point. Initially there was a substantial battle with Federated Farmers which were difficult and that led to unnecessary scepticism amongst many farmers. Thankfully with the new leadership of Federated Farmers realism now prevails. With the establishment of NAIT farmers now have the ability to manage stock at the level of an individual animal rather than as a herd. Farmers are able to invest in automated systems to weigh and draft animals according to the criteria that farmers themselves set rather than having to assess an animal’s condition by eye. Modern farming systems are able to provide labour savings and more accurate responses to market demand. I also expect the NAIT organisation to respond to the demands from its levy-paying farmers. Once the NAIT scheme is well settled and functioning the NAIT organisation and the Animal Health Board will begin to consolidate their governance and functions. I look forward to the efficiencies and cost savings that will result at the level of both individual levy-paying farmers and the livestock industries themselves.  
I am pleased that most of the parties represented in this House have recognised the importance of this bill and of the NAIT scheme. I tonight acknowledge the work of the previous Labour Government in developing the NAIT scheme and Labour’s ongoing support for the NAIT legislation. I also acknowledge the long-term commitment and dedication to a successful NAIT scheme by all the industry parties that have been involved in NAIT Ltd itself which is now in charge of delivering the scheme. I commend the National Animal Identification and Tracing Bill to the House. 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 Can I just start my speech by acknowledging the role of the Minister for Primary Industries in shepherding this legislation through. It is true to— 
Hon Clayton Cosgrove 
: “Shepherding”! 
GRANT ROBERTSON 
: You liked that Mr Cosgrove? Yes shepherding. I will come back to sheep in a minute actually as Mr Cosgrove often encourages me to do. But I do want to acknowledge the Minister for his leadership on this issue. As he noted in his speech this was something that began under the previous Labour Government. In particular on the day that the member for Wigram Megan Woods gave her maiden speech it is worth noting that Jim Anderton had a significant role in the development of the National Animal Identification and Tracing system. Mr Anderton saw as others involved in the agricultural sector did that a system of national identification and tracing that was consistent and was not the piecemeal system that we had would allow New Zealand to both avoid significant problems and costs and also embrace opportunities. Those significant costs have been noted throughout this debate. The fact that a major foot-and-mouth outbreak in New Zealand could cost this country in the region of $10 billion makes the cost of actually implementing a system like this pale in comparison and it is quite clear from the various times in New Zealand that we have had foot-and-mouth scares just what impact that would have on our exports. So the idea of an identification and tracing system stopping that or at least significantly limiting the impact of that is something that all New Zealanders and the agricultural sector should be pleased about.  
But also it is the opportunity that this provides that I think is one of the things that causes me to be really pleased to be supporting this National Animal Identification and Tracing Bill tonight in the House and that is the opportunity to be able to sell into markets across the world that are demanding more and more that they understand the origins of the produce that is being purchased. What this system allows us to do—to be able to trace as the Minister has just said to the individual animal; in this case cattle and deer—actually allows people to have confidence about the sustainability of the New Zealand farming system. People can understand exactly where produce comes from.  
Members will be familiar with the Icebreaker brand. This is something that Icebreaker has done magnificently well. Being able to provide Baacodes that people can scan that can link back to exactly where the wool for an Icebreaker product has come from is hugely significant selling into markets that are worried about sustainability concerns and that want to know that the product that they are buying comes from an ethical farm comes from a sustainable farm. This applies to produce as well. In the Committee stage of the debate I mentioned a project I have had a little bit to do with called Paddock to Plate—and Paddock to Plate— 
Hon Ruth Dyson 
: Horrible name. 
GRANT ROBERTSON 
: I still quite like it. 
Colin King 
: Pasture to plate. 
GRANT ROBERTSON 
: —but Paddock to Plate was a project that was about ensuring that the people who were really significant to the New Zealand economy—the supermarket buyers in the UK—would be able to say with certainty: “This is where this produce has come from. This is what we know about it.” I actually think you could take that further than just being able to identify and trace the cattle. What about knowing more about the land the pasture—for Mr King’s benefit—that was involved in the production of these goods. There is technology available now that can tell us about the soil content that can tell us about the way that grass is grown. Let us actually provide to consumers internationally the full picture of how New Zealand is creating a more sustainable farming process. 
Jonathan Young 
: The soil. 
GRANT ROBERTSON 
: The soil—indeed absolutely. This is exactly the kind of thing that consumers internationally are looking for. So that is why I regard this bill as a very good bill because what it does is provide opportunity for New Zealand to be able to take advantage of those markets where people are interested in ensuring that they are purchasing sustainable products. 
 There is some concern on this side of the House around the question of who is developing this technology. There is huge opportunity in this traceability technology and Sirtrack which was one of the organisations that was helping to develop this came out of Landcare Research and has been sold off. Now that is in some ways a good thing for the people who developed the technology but really we do have to ensure that we keep companies like that going inside New Zealand and to make sure that those companies that are developing that technology are supported and understood.  
It is true to say that this bill has had widespread support across the House as the Minister noted. I understand that in the earlier readings the only party to vote against it was the ACT Party. It was the only party. I have no idea why—[ 
Interruption 
] It is lack of freedom for livestock Mr Cosgrove that is the issue here—one law for all. It was discussed earlier in the Committee stage whether or not this would move beyond cattle and deer to sheep. That is the obvious next step and I know that the Minister has discussed that and said that it is a possibility. But it is true to say that there was reluctance from some in the farming sector to adopt this. It is unusual for the Minister in charge of this bill to be one to be pushing compulsion so hard. He is not a man who usually likes to support the idea of compulsion but in this case the Minister has seen the wisdom of the fact that we need a comprehensive system. If there is not a comprehensive system then we undermine the opportunities that I mentioned before and we undermine our ability to fend off accusations if there is something like a foot-and-mouth outbreak. As the Minister said the farming community the Federated Farmers did eventually come on board with this. I am sure Mr Anderton worked very hard on that in the initial stages and it was obviously carried on by the current Minister as well.  
The fact that we have these systems in place now in New Zealand also brings us into line with a number of our other key trading partners. We look at Australia where cattle are already using eartags from a traceability system. They are also looking in Australia at the lifetime tracing of sheep. So clearly New Zealand needs to continue to advance into that market— 
Hon Clayton Cosgrove 
: Careful! 
GRANT ROBERTSON 
: Mr Cosgrove is an expert on the lifetime tracing of sheep so he too will be able to contribute to the wisdom of following Australia in that particular area. I do think that it is important. This is about market advantage as much as anything for New Zealand and if other countries such as Australia are going into this area then we too need to do that when it comes to sheep.  
So it is with great pleasure that I support this bill. I do not think that it would be—[ 
Interruption 
] Perhaps some people would see it Mr Cunliffe as being unusual that the member for Wellington Central is taking such an interest in this rural issue. But the fact is this is about the New Zealand economy. This is about the strength of the New Zealand economy. It is about applying technological solutions that are developed in New Zealand to be able to establish our sustainability overseas.  
Hon David Cunliffe 
: Clean green clever! 
GRANT ROBERTSON 
: It is about a clean green and clever New Zealand—that is right Mr Cunliffe—and that is why I am very pleased to be able to support it. I look forward to the Government extending the process out further beyond dairy and cattle to sheep to create a fully comprehensive system of traceability from the paddock to the plate and to make sure that New Zealand actually can sell into those overseas markets and to be able to say proudly that we are a fully sustainable country and being able to prove that. 
SHANE ARDERN (National—Taranaki - King Country) 
: 
 I do not know where to start after that speech. I am suitably impressed I think I should say for a start. You know the member for Wellington Central either has Jim Anderton’s speech notes or he has been talking to the Hon Damien O’Connor—or maybe he has had some advice from Clayton Cosgrove. But I have to say that was a remarkably good speech from the new deputy leader of the Labour Party on this topic so I congratulate him on it.  
The issues canvassed so far are absolutely right. I think that Mr Robertson said that foot-and-mouth could cost New Zealand $10 billion; the last estimate I saw on that was that potentially it could cost $25 billion per year—not one off; per year. That would devastate the New Zealand economy if it were to happen at its worst possible impact. To be able to trace animals in the event of a biosecurity incursion regardless of what the incursion may be is an essential part of having integrity in the system around biosecurity. This National Animal Identification and Tracing Bill is the first step I guess you can say in moving forward into the 21st century technology in regard to doing that.  
The issues that were canvassed in the Primary Production Committee and through the submission process both in terms of the consultation paper that was put together first of all to form the bill and then the process as the select committee went through its work are the issues of retention rates in sheep in particular. That is the reason why the Government at this point has chosen not to have lambs or sheep included in the national identification regulations. So that issue has to be resolved and I think technology in time will find an answer to that. In fact some work has gone on in the US in recent years around implants. Now everyone throws their hands up in the air when you use the term “implant” but basically it is using the same kind of technology that has been used in New Zealand for registration of dogs but in a way that it can be inserted with integrity so that the device itself retains its reliability and also so it does not become a problem in further processing of the carcass of an animal which is quite a challenge.  
That is something that has been worked on. I think it will be overcome in time and when it is overcome then of course the problem with retention rates of tagging devices in sheep will be overcome and the cost then will be reduced substantially. So I think that is probably where we need to start cranking up the research.  
I notice that the Animal Health Board itself is likely to be the group—the instrument if you like the team of people—that will drive a lot of that work and potentially may be the owner and controller of the database in conjunction of course and in partnership with the Government because the integrity of that database is equally as important as anything else that goes with this whole keeping of traceability so that the integrity of the system is maintained.  
It is absolutely essential if we are going to be a First World exporter of high quality protein products particularly from animal production that we have traceability that will stand up to the scrutiny of the international markets. When you look at what is driving growth in—particularly—high quality production areas it is that traceability that the member for Wellington Central spoke of. He used the example of the Icebreaker brand and that is a very good example. But there are many others. If you look at some of the products that come out of our dairy industry now going into nutraceuticals and pharmaceuticals clearly the integrity or safety of that product is essential. Well the same will apply with meat products and other animal products that are produced on our New Zealand farms as we speak. So having a solid robust database using the best technology and using the best measurement systems—that is how you scan or read high numbers of cattle or sheep as the case may be in a timely and cost-effective way—is something that this system and this bill is enabling of.  
As we watch that develop I suspect we will see quite a bit of development around the different types of measurement systems and measuring devices. There was a lot of debate at the time of the select committee hearings on this—around the use of high frequency versus low frequency devices. The robustness of those devices was the thing in question. I guess the biggest challenge for the select committee was to make sure that the bill was able to adapt to whatever device the market and the farming users decided to use and not to try to second-guess what would be the best. It would appear to us that having the ability to be able to measure large numbers of animals in a simple way—and if you can just imagine for a moment Mr Assistant Speaker Tisch and I know you may have some experience with this yourself—being able to measure a whole flock of sheep or yard of cattle with a device that is able to scan that area within a reasonable proximity what a wonderful piece of technology that would be to be able to know how many you had in the yard for a start to know each individual animal by number and to know what the ages and various groups and sector groups of those animals were. Think about then being able to feed that information into a drafting system like the Protrack system designed by Livestock Improvement Corporation which I know you have a close family association with Mr Assistant Speaker. That would be a wonderful ability for farming so that you could actually draft animals as you wished by entering the data into a computer in a centralised place. Just imagine how that would simplify the handling of large dairy herds or large flocks of sheep or cattle for that matter. So those things will develop.  
As that happens what you will see is the commercial drivers for such a system will overtake the anxiety that some farmers have now about cost because there will be a financial benefit to them for doing it. Those were the big debating points that Federated Farmers raised in the early stages of the discussion and what they could see was just yet another cost being imposed on the farming sector without any real justification for that cost. So I think we have moved past that point now to where the advantages are overwhelming and most farmers who have been watching this debate and watching the technology develop are now much more receptive to it than they were perhaps 5 years ago.  
The other major issue of course is when we are signing up to international trade agreements to be able to go into those negotiations with a high degree of certainty that what we are about to sign up to will be able to be delivered with traceability back to individual farms individual animals with the safety standards in place. Recently remember the melamine scare in China which had the whole of the dairy industry shaking in its boots for a moment. We of course in New Zealand are able to say that this product comes from this production system it is safe it is reliable and it will not suffer the same fate as that did. It is with those types of issues in mind that it is my pleasure to support this bill through the third reading. Thank you. 
Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman) 
: 
 It is with great pleasure that I welcome the third reading of the National Animal Identification and Tracing Bill back into the House. It is about time I have to say. It started in 2004. My colleague the Hon Jim Sutton was actually in charge of the original development of this concept but it is right that the Hon Jim Anderton actually found the $10 million that the Government was going to contribute to the implementation of this scheme and then it was rejected by Federated Farmers. I have to say that was an outrageous abuse of a position by someone who ended up being an ACT candidate—that is Don Nicolson—who just campaigned against this for cheap political reasons in my view.  
Although there were some issues around the radio frequency and some of the technology the bottom line was that in 2004 we knew full well that we needed to have in place very quickly a proper system of traceability. We had been alerted to the inadequacies of our traceability systems through the foot-and-mouth scare on Waiheke Island. That gave us a hell of a fright and we thought we had better do something. We pride ourselves on being a very smart First World producer of food but the reality is that the countries that have these systems in place include Brazil Argentina Uruguay South Korea and Canada and we are just catching up. So it is about time it was passed through the House. As I said we welcome that.  
Can I just say that I would like to thank my colleague Grant Robertson for his speech. As acknowledged it was a very good speech from the member for Auckland Central— 
Hon David Cunliffe 
: Wellington. 
Hon DAMIEN O’CONNOR 
: Wellington Central sorry. I challenge National to put up their member from Auckland Central to see whether she knows as much about it. We hear lots of gibes and accusations from National about the depth of knowledge of rural issues in the Labour Party. Well that speech just goes to show that we do have widespread understanding of the dependence of both urban and rural New Zealand on one another. It was an excellent speech and I will be calling on his knowledge and support as we move forward in Government to put in place some wonderful policies.  
I think many of the points have been covered. This has been a long process. We do claim to be a producer of high quality safe and—now—traceable food. That is we will know where the food comes from. There are some examples of excellence within industries in this country be they meat or dairy where we know which cow basically contributed to which bit of butter or cheese. In meat there are fewer examples but none the less some of excellence in that area. Most of those exporters get a premium for their product and we want more and more of that as this country moves forward.  
I had a discussion tonight with some colleagues on whether we are still the producers of commodity products or whether we are moving up the value chain. Well we do want to move up the value chain and each step requires a huge amount of investment. This is a relatively small investment to move us quite a way up and compete with at least the countries that I named before because if we do not we simply will not be able to sell to them.  
One of the big issues and it is still one of the contentious things going on at the moment is the management of the database. I must mention this. There was some fear in the minds of some farmers driven by misinformation from Federated Farmers for the most part that this database was going to be used to calculate methane emissions and charge farmers etc. etc. It was just outrageous quite frankly and as I say was driven by a person who ultimately became an ACT candidate. That speaks for itself. But the database is important. We currently have two good databases—the Animal Health Board has one and the Livestock Improvement Corporation has another for dairy—and they operate pretty well. The question was whether we should merge those databases or create a new one and I think that there was concern from officials and from farmers that a new database would cost a whole lot of money and maybe was unnecessary. In the end that is what was decided and as long as people in NAIT Ltd and developing this do a good job hopefully we will end up with one good database that can be used by other sectors.  
Hopefully we can add in sheep and although sheep farmers might get spooked about that at the value of their ewes now getting up close to between $150 and $200— 
John Hayes 
: $300 in the Wairarapa. 
Hon DAMIEN O’CONNOR 
: Three hundred dollars? Any more? More on three three three—going four four no? I would suggest that in fact good quality sheep good quality livestock—cows deer—will be worth a lot of money. If we put our protein in the higher value brackets in the supermarkets around the world then we will want to know where those animals are their genetics whom they are traded to and whom they are sold to. It will become part and parcel of normal livestock and farm management in this country—that is full traceability of all our animals. We might even end up with all the dogs being microchipped but anyway that is another debate. My colleague in front of me will chuckle on that one but I am sure we will get to the point where every animal on a farm will have to be microchipped. We will have to know exactly where they are so we can prove that any disease or any possible infection can be signed off and we can tell our customers what they are getting when they buy that protein and they pay more for it.  
I am not going to speak for too long. I was disappointed when farmers turned their backs on the $10 million offered by the Labour Government at that time. The cost of implementation now has been estimated by officials going forward but the benefit has been calculated at close to $40 million—I think $38 million—per year. I think that would be a fair estimate. The rough annual cost is $6 million; it will cost $15.7 million to set up. Labour in power offered $10 million. I am not sure that that is the amount that the current National Government is going to give but none the less it is committed to implementing it and that is great.  
Before I sign off I say that the Primary Production Committee had a look at the issue of high and low frequency. We wanted to ensure that we were futureproofing whatever system was put in place and that we were not imposing an unnecessary cost or duplication of costs on either the farmers the saleyards the meat processors or anyone. The jury is still out I have to say so we have left the door open. I think it will be a low frequency system implemented first moving to a high frequency one; we are told the high frequency tag can hold more data and can be read at a greater distance.  
In terms of the things that Mr Ardern was talking about—knowing how many animals are in your herd where they are going and to what part of your farm—many farmers in fact now expect to know that. It is part of normal management systems. They are the most efficient farmers. They are at the forefront of technology and this will enable all farmers to potentially reach that high level of management. I must say and put on the record that with such technology I am sure we will be able through satellite management to have fenceless farming systems where animals will be encouraged to graze one part of a farm today and then another part tomorrow. There will be proactive management and stimulation through satellites. It all seems rather far-fetched but I would suggest that within 10 years we will be looking at those kinds of systems. If we are not then we will be falling behind other countries.  
In conclusion Labour supports this legislation. We initiated it in 2004 we offered to pay for it in 2008 and we welcome its passage through the House. This is a big step for New Zealand agriculture and it will give assurance to the customers who buy our food in the future—initially beef and venison but moving forward hopefully and taking in the others—that we know where the animals came from we know what they ate and that consumption will be absolutely safe. 
KEVIN HAGUE (Green) 
: 
 It is a pleasure to take a call in this third reading of the National Animal Identification and Tracing Bill. The Green Party has supported this bill at every stage moving through the House. It was covered by my portfolio in the last Parliament. It is now within Steffan Browning’s portfolio but he is unable to be here tonight. Other speakers in this debate have canvassed many of the advantages of the National Animal Identification and Tracing (NAIT) system and I just want to run very briefly through those that we see because some of those are the same that others see and others are some different ones.  
I guess the first one I want to highlight and I do not think anyone has mentioned this tonight is the usefulness of this system in the event that we encounter a food-borne human disease. I am thinking of something like bovine spongiform encephalopathy—mad cow disease—and other prion diseases that are spread through meat and where traceability of meat and meat products plays an incredibly useful role in best promoting human health. 
Others have mentioned a couple of the animal health issues. One example that has been mentioned tonight is foot-and-mouth disease. I think of what might happen in that disastrous biosecurity situation. Some colleagues may not like me mentioning this but let us say that one of those palm kernel shipments comes in from a country where foot-and-mouth disease is endemic and the bacteria is found in the soil that comes with that palm kernel and we face an outbreak in this country. Actually being able to trace the animals that may have been affected by an outbreak is going to be incredibly important for our economy as well as for dare I say it the animals themselves. 
The other important use in relation to animal-borne illness that occurs to me is around control of stock movement. In this country as we try to get the cap on TB in our animal herd actually having a tool that assists us with better control of stock movement—and NAIT will provide that—has to be a really helpful weapon in the armoury. So some really important benefits there. My colleague Damien O’Connor has spoken about some of the innovation and stock improvement for example that this new technology will facilitate. I think you will find that his musing is not far from the mark. I agree with him that actually that is the kind of technological improvement we will need to make to keep adding value to our products to continue to have an export agricultural economy.  
Traceability—and other members have spoken about this—is important as one of those value-add components to our agricultural economy. Simply exporting raw commodities is no longer the way our economy needs to go. The future for agriculture in New Zealand is around adding value to those products and again NAIT is one of the fundamental tools for achieving that. 
Someone has mentioned Icebreaker. I am a great cyclist and tramper and I decided long ago never to walk into the hills without being clad in Icebreaker. Indeed that is the choice that many people both in this country and around the world have made. It is a great example a great illustration of the kind of economic value that is associated with traceability. Certainly there is an international movement of consumers along the lines of that Paddock to Plate initiative that Grant Robertson spoke about earlier in this debate. They want to know where their food comes from and they are prepared to pay more to know that. That is the future for our food export industries. So it is part of our way of creating a higher quality export sector by adding value. 
On the flipside we have raised a number of concerns at different points in this debate. These are not concerns that cause us tonight to reverse our position and to oppose the bill. We support the bill. We believe the positive attributes outweigh the concerns. But I just think in this third reading it is appropriate to recap some of those issues that we were concerned about. The first one of those was the lack of consultation with the organics sector in the development of this bill. We believe that that was a significant gap and we hope that in the development of future legislation we will not see that kind of gap. I draw the House’s attention to the fact that the organics sector is already a part of our agricultural sector that has considerable experience in the business of adding value and in targeting those consumers who have a very great concern about where their food comes from how the animals were raised and what the conditions were like on that farm. So involvement of the organics sector should have been a really important thing that was done in preparing this bill. 
The second issue that I want to raise which we have raised previously in debates on the bill is around the governance group. To our way of thinking it has yet to be satisfactorily explained why the original intention of a Crown company or a Crown entity was abandoned and replaced with the governance group that now appears in this bill before us. We do not see a rationale that would justify that change and we do not believe that that has been satisfactorily advanced in the debate in this House. So that is a concern for us. It is more than something that is an academic or abstruse kind of concern because the nature of the entity changes its responsibilities. So a Crown company or a Crown entity for example would have obligations under the Official Information Act which this governance group may well not end up having. The Animal Health Board is a great example of where the model that is used for the governance of an operation can change that. In the consideration by the Local Government and Environment Committee of the performance of the Animal Health Board in the last Parliament one of the major concerns that was raised by submitters was around the opacity of the Animal Health Board and the difficulty that one had actually getting information out of that organisation. It is a needless problem and it is one that we could have avoided in this case. 
Our related concern is that in this entity that is not really an arm of the State we have also chosen to vest quite considerable search seizure and related powers and we have an abiding concern that the extent of those powers outweighs the nature of the problem that those powers are created for. We think that is a real problem. We have signalled that we will be watching the performance of this Act in practice to see whether problems arise and we will bring them back to this House if they do.  
Finally I want to just mention the very big feature we see in this bill—that is providing value for our export industries by providing consumers overseas with information about where their food comes from. It is about time New Zealand consumers had that same right. It is time for mandatory and comprehensive labelling of food in New Zealand. Thank you. 
COLIN KING (National—Kaikoura) 
: 
 It is fair to say that the bill as it stands has been well canvassed during its third reading. But I would just like to make one or two points before I sit down again. One concerns the complexities that we are facing as we implement this very worthy bill the National Animal Identification and Tracing Bill. One has to stop and think about the million or so cattle that are on lifestyle blocks and are going to have to come into this system. That starts to illustrate the complexity. We can start talking about sheep and already stud breeders are doing it with their high frequency identification systems. But we have just got to be mindful that it is appropriate that the introduction of the National Identification and Tracing Bill deals with cattle and deer—effectively cattle on 1 July 2012 and then deer on 1 March 2013.  
It is appropriate to give a bit of flavour with regard to the difference between the low frequency and high frequency transponders. The low frequency can be read only at about 1 metre and that is where that debate crept in with regard to the high frequency where it was possible to read the animal’s tags out in the middle of a paddock about 200 to 300 metres away. There is still a wee way to go before we actually see innovation around this area.  
I would imagine that we certainly do need to keep a very close eye on what the rest of the world is doing because we do sell to the 5 percent of the world that have the incomes to choose what they eat and are prepared to pay for it. So it is very important that we protect New Zealand’s food safety record and its credentials. They are at the platinum level and that is something we cannot take for granted. There is no doubt a lot of potential within the National Animal Identification and Tracing system and the farming technologies that will be applied in the future and I know that our farmers and our community of New Zealand are very quick in the uptake of modern technologies.  
That having been said this legislation is important. There is a view out in the farming community—or there was a view for a while—that if it was this good or that good why is the industry not driving it? One has to think a wee bit long and hard to answer that question but the answer is that there are a lot of people in the meat industry whose main financial drivers are not the meat. You have only to look at the dairy industry. There are hundreds of thousands of tonnes of beef going through to the market that come off dairy farms and their main driver and their whole breeding systems are geared around milk production and butterfat production—milksolids. So to give it the integrity and credibility that it needs from an international point of view it was important that we draw up this legislation.  
We have overcome those obstacles. I do not find anything overly offensive in farmers being concerned about costs being heaped upon them. They have to run very very challenging operations in challenging economic times and it is good to see that although this legislation is to be implemented it is during a time when farmers are able to see a bit of light at the end of the tunnel. This is very good legislation. It has been well handled by the Primary Production Committee members on both sides of the House and it is high time that it quickly passes into law. It is a pleasure to support this bill. 
RICHARD PROSSER (NZ First) 
: 
 As others have done I would like to congratulate some of the other new members of the House whose fine maiden speeches we were able to enjoy today. I am encouraged by the intellect and sincerity displayed by those members and I am looking forward to working with them over the term of this Parliament. 
I am pleased to speak to the House on this important piece of legislation the National Animal Identification and Tracing Bill. I rise on behalf of the New Zealand First Party. We are opposed to the passage of this bill in its present form. We have not had previous input into the construction of this bill or the debate subsequent to its introduction due to our party’s unplanned sabbatical from the House which I am pleased to say is now thankfully completed for all eternity. 
New Zealand First understands and fully supports the importance of the agricultural sector to New Zealand’s economy and way of life and we appreciate how critical the success of this industry is in terms of our exports and international reputation. It is indeed testament to that reputation that we as a nation have been able to maintain access to both our traditional and expanding markets over the past 8-year gestation of this bill in spite of our not having such a system of record as this bill proposes and which many of our trading partners have adopted themselves or are in the process of developing. Amongst them are Australia the United Kingdom Canada the United States of America South Korea Japan Argentina and many of the member States of Europe—the European Union. All agricultural nations live with the risk of animal disease and epidemic and their faith in our existing systems of inspection and assurance thus far is I am sure appreciated by the Government and industry alike. 
As a trading nation New Zealand must take all practicable steps to protect its borders and export base from unwanted threats and to be a responsible international citizen by ensuring that such threats do not leave our shores. It is true that the march of time and technology makes it likely that consumers and regulatory authorities alike in our crucial overseas markets may come to demand that even known suppliers with impeccable track records such as New Zealand choose to bring themselves into line with what is more and more becoming accepted as international best practice in terms of safeguards and accountability in record-keeping. It is worthy of note however we believe that the aforementioned countries have had incidences of foot-and-mouth disease whereas New Zealand by good management effective biosecurity and the grace of God remains thus far free of it. 
It is a reality that the maturing of what were ground-breaking technologies even a few years ago means that what may have been an arguably prohibitive cost when this bill was first proposed has become for the sections of the industry initially intended to be covered by it at least a far more financially acceptable proposition. Indeed the utilisation and further enhancement of the identification technologies in question by New Zealand will certainly contribute to the increasing accessibility of those systems quite possibly to the point where their employment in other sectors of the industry such as sheep is able to be made financially viable. It remains a pity as other members have noted that the disposal to overseas interests of New Zealand’s own leading supplier in this field means that this country will not be in a position to profit directly from any such expansion. 
 New Zealand First supports the promotion of measures that enhance the ongoing success and stability of our most important industries. However we would ask in addition whether New Zealand consumers are also to be afforded the reassurance of traceability as Mr Grant Robertson referred to earlier from paddock to plate. We hold some concern that certain meat products are currently imported into New Zealand from nations whose systems of recording and accountability fall far short of those that we employ even today and that in itself is without the benefits of the technology heralded as being the great advantage that this bill will supposedly afford both ourselves and our overseas consumers. 
But it is of concern to the New Zealand First Party that too great a reliance may come to be placed on this new technology at the expense of existing systems of record-keeping which are proven and which have served and continue to serve New Zealand well. Some aspects of the radio frequency identification chips in question as other members have alluded to are still in their infancy or developmental stages. Some may have crossover or interference issues with other high frequency radio equipment which is increasingly being utilised in farming today. We are concerned that a system based on radio frequency identification eartags will provide no tangible improvement in traceability over and above that provided by existing numbered plastic eartags once the animal has reached the stage in the processing chain where the head is removed from the body. 
However the use of radio frequency identification tags does open doors to the possibility both of counterfeiting once our product reaches certain less trustworthy foreign markets and of the theft and rechipping of stock. It is possible in fact that what appears on the surface to be a more high-tech and therefore safer and more secure system may indeed prove to be less so in both regards particularly when the human propensity for placing great trust in advanced technology is taken into account. I am reminded indeed of the response of a well-known criminal gang to the introduction of vehicle identification number plates some years ago in an attempt to prevent the resale of stolen cars. The motorcycle enthusiasts club in question availed themselves in reasonably short order of a supply of blank plates complete with an impressing machine the combination of which allowed them to continue their business with little interruption. In many cases the cleverer the intended system of security the easier and ultimately more persuasive are the means found to circumvent it by those with nefarious intent. 
New Zealand First does not support this bill for several reasons. In addition to the aforementioned we do not wish to see our farmers and consumers unfairly disadvantaged by any financial or compliance burdens placed upon them in the absence of a similar required standard being applied to comparable imported foodstuffs. In the light of the inherent weaknesses of the technology as it is proposed and the inevitable decline of the present system as it is progressively replaced we see the direction of the bill with regard to the mandatory adoption of the National Animal Identification and Tracing system as being precipitate. It is our view that this may be one occasion where the market should be able to speak in that demand from foreign buyers rather than dictates from our own Government should be the driving force leading the adoption of this technology.  
We are concerned that the introduction of microchips for deer and cattle may be beset by some of the same shortfalls that have been the experience of the introduction of microchips for dogs. It promises a great deal with little in the way of proven benefits comes at a measurable cost with no guarantee of improved return and carries the potential to weaken the existing system which even the bill’s authors agree will have to continue in parallel with the new methodology until such time as the application of radio frequency identification technology can be made economically viable for sheep and other stock animals outside of the two species initially specified. We would very much not like to see the implementation of a policy and a technology that seek and promise to reduce costs and improve performance but that in their application achieve entirely the opposite result. We oppose the passage of this bill in its present form and urge members from all sides of the House to do the same. Thank you. 
JONATHAN YOUNG (National—New Plymouth) 
: 
 I would like to just draw perhaps a backdrop behind this National Animal Identification and Tracing Bill of events that happened as we will remember some time ago particularly in the United Kingdom where the outbreak of bovine spongiform encephalopathy or what is called mad cow disease created such a furore amongst the industry there where 180000 cattle were infected and 4.4 million head of cattle were slaughtered during the eradication programme which is something that I think is a horrific thought to farmers and agriculturists here in New Zealand. The National Animal Identification and Tracing Bill will enable the establishment of a tracing system that will control and prevent animal disease and product contamination. This is an investment in current and modern technology that is going to protect an industry that is contributing over half of our annual export volume to the rest of the world.  
The global consumption of meat since 1961—and this is one of the major areas that this legislation will touch on—has tripled and it does continue to increase rapidly. It is fuelled by rising living standards in nations such as India and China. As consumer incomes rise there is the tendency to buy more protein. We understand that; we know that is why our exports and our commodities in this country have seen such a tremendous lift in recent years. Indeed people who live in developed countries consume four times as much meat as those in developing countries. You would be interested to know that since 1961 average consumption has risen from 56 kilograms to 89 kilograms per person per year in India and from 89 to 124 kilograms per person in the US according to the Food and Agriculture Organization. In 1961 the Chinese consumed only 4 kilograms of meat per person per year but that figure has reached over 55 kilograms and is still rising. So we see an international demand driving growth in this particular area in this particular industry.  
 It is incredibly important that management around disease prevention is hugely enhanced. We understand that nations that New Zealand competes with are progressing in these particular areas and current animal-tracing schemes here in New Zealand are falling behind the systems used by our trading partners. We live in a time of global opportunity in this particular area and it bodes well for us that we provide adequate information for responding to biosecurity risks and incursions so we do not place our market access at risk. The Food and Agriculture Organization reports that import bans on meat produced in disease-afflicted countries in early 2004 for example affected approximately a third of global meat exports or 6 million tonnes. This is the sort of thing that happens when disease or diseases can affect animals. From 2002 to 2006 alternating disease outbreaks and recoveries resulted in rapid shortages and increases in exportable meat supplies led to considerable fluctuations in international prices.  
The National Animal Identification and Tracing (NAIT) system is a very reliable up-to-date information system on individual animal locations and movements. It is going to enable New Zealand to respond quickly in the event of a biosecurity threat such as a disease outbreak or a food safety threat such as residues being found in animal-derived food products. Such a quick response will help limit the spread and reduce the economic impact of such an event. This is incredibly important in order to protect not just the economic well-being but also the social well-being of our country. These things are incredibly important. National wants to grow the economy in order to deliver greater prosperity security and opportunity to all New Zealanders. We want to deliver—and are delivering—longer-lasting solutions for our biosecurity and primary sector to boost productivity and to protect those exports. We are very proud of the history of supporting our primary sector and our rural communities.  
The NAIT system would enable rapid and accurate tracking of animals from birth to death for live export. I recall speaking to a manager of one of our food processing factories in Taranaki and he stated that if it came across a biosecurity threat it would instantly be able to identify not only the animal but where it came from and the animals that were associated with it that came from the same locality. That would enable it to very very quickly isolate that biosecurity threat. That not only protects all of the farms or the animals that live in proximity to that situation but it also stops unnecessary wastage because of doubt about where that biosecurity threat may have spread to. So it protects our economic base. Also with this sort of technology that is proven it gives a degree of confidence to our markets so they can continue to purchase our products knowing that we have a very strong system in place.  
The NAIT scheme is a partnership that started before 2004—we understand that and we have heard that this evening—between industry and the Crown recognising the public interest and the private good of identifying and tracing animals. Industry across the board is highly supportive of this bill. The NAIT scheme brings the New Zealand primary sector up to speed with those of most other agricultural producing nations that already have in place such schemes. It is effectively an insurance policy to support New Zealand’s uniquely high livestock health status and biosecurity infrastructure and can enable other attributes of livestock to be recorded to improve productivity and on-farm management. This is I believe a tremendous step forward that will enable our primary sector to have great confidence as it forges ahead and continues to have a dominant place in the world market. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 I begin the pleasurable task of speaking on the third reading of the National Animal Identification and Tracing Bill by acknowledging the Minister for Primary Industries the Hon David Carter. I want to express a little bit of disappointment in the House though having commended the Hon David Carter. He is exempted from this frustration.  
During the Committee stage of the debate—you Mr Assistant Speaker Tisch were actually present in the Chair at the time I recall—I mentioned to the Committee that David Carter and I had stood against each other in every election bar one since 1993 and I thought that may have been a record. I thought it was worthy of note. You know if it is in the  
Guinness Book of Records 
 we would both like to share that glory. I said to members of the Committee that actually I could not be bothered researching the issue. David Carter indicated the same lack of interest in researching it. We just want to take the credit. I asked some other members to take the time to do the work for us. You know not one single member has come back and said that David Carter and I hold the record in the New Zealand system for standing against each other. So we will just have to leave that at the moment as an unanswered question.  
In addition to that though the Hon David Carter did acknowledge former Ministers of Agriculture. That is not often done in this House and I think it was a good way to start the new parliamentary term particularly by acknowledging the Hon Jim Anderton who put a huge amount of effort into the initial stages of this work as did his predecessor the Hon Jim Sutton as well. The bill was as we have heard around in ideas stage only in 2004. It went through a lot of consultation. We had at that time an ACT takeover of Federated Farmers. Don Nicolson—oh the Hon John Banks is awake! You just have to say “ACT” and the eyes light up. That is good; he has remembered he is an ACT member of Parliament at the moment. One of your colleagues Mr Banks—Don Nicolson—was running Federated Farmers at the time. When he heard about this scheme to track animals he went ballistic. It was like a declaration of war on farmers throughout New Zealand and that raging continued until he became an ACT candidate. Fortunately for Federated Farmers he moved out of that position and fortunately for the good of the country he did not get elected to sit alongside Mr Banks in Parliament. But there was huge opposition at that stage; nevertheless the bill continued.  
David Carter picked it up it was referred to a select committee and from my reading of the Primary Production Committee report very rigorous consideration was given to this bill. I want to note particularly the chairman of the select committee Shane Ardern who has spoken earlier in this debate. My recollection of reading the report is that four members of that select committee who in my view—even though I was not on it but from reading the report—worked quite hard on the detail of this legislation are no longer in the House either through their own choice or the choice of the voters in their electorates. So I want to acknowledge my two parliamentary colleagues from Christchurch Brendon Burns and Jim Anderton also my colleague Ashraf Choudhary and National Party MP Sandra Goudie. They were on this select committee at the time; they are not here in Parliament any more. Obviously they cannot contribute in the debate and I think their work should be at least noted.  
We have looked at the content of the bill in some detail but the area that I think we have not looked to enough is the future potential of this legislation not just across deer and cattle which it will currently cover but across a much broader area: positioning New Zealand to be at the cutting edge and leading in what consumers actually want. I think it was Jonathan Young who just resumed his seat who mentioned this fact as well. I think more could be made of it. It is really important for the New Zealand economy that we are seen not to be following other countries—as we unfortunately are in this particular tracking process—but actually leading a response to what consumers want because they are the people who are going to make us successful or not. If we are not providing product in a way that consumers want and look to in the future—if we are not what they seek—we will have much harsher competition than we already have.  
What consumers want to know is where the product comes from. They want to know that it is safe they want to know if we are talking about meat that it has been raised in a way that meets their ethical standards and they want to know that it has not been raised in a way that causes huge damage to the environment. That point I think we miss out on quite substantially. We already do it in other areas. We do it in respect of apples. If you buy an apple overseas eat it and say “I think this apple is contaminated. I think it might have some residual spray on it.” you can take that apple in get it tested for the residual spray and our New Zealand marketers can trace the apple back not just to New Zealand but actually to the very row of the orchard that that apple came from. That can give overseas consumers huge confidence in the safety of our product and that is the sort of marketing that we could use for the National Animal Identification and Tracking system and apply it to what consumers will want now and in the future.  
My colleague Grant Robertson talked about a project that he worked on with the Hon Simon Upton some years ago at a very pleasant university in Dunedin Otago University doing what I think was a particularly tastelessly named project called Paddock to Plate—but as a vegetarian I would see that as a little bit tasteless. But actually it was very very substantial and good work that Grant Robertson and Simon Upton did and again it was looking at the traceability of various products and how that could be used to give consumers both within New Zealand but also overseas a higher level of confidence in the ethical standards the safety the security and the environmental standards of the product that they were eating. 
 We can do the same with Icebreaker. Icebreaker can tell you where the wool came from for any garment that you purchase from it and it says that is a huge marketing tool for overseas customers. And we know tragically that Fonterra is very well aware of the importance of being able to trace the source of its milk and milk products due to the disastrous situation that we had in China not very many years ago. So this is a model that is initially set up to provide just basic safety standards.  
We know how important this industry is to us. If we do have—and heaven forbid that we ever do have—an outbreak of foot-and-mouth disease or any other sort of disease within this farming area we will want to know as quickly as possible where each animal has been and any of these traceability elements are of course important to that. But from my perspective this is much more important in looking at future opportunities and the needs of consumers.  
Members of the House will recall last year or the year before a programme on television that has been quite harshly reviewed since its initial outburst into the conversation particularly in the social media. It snuck filming equipment in to a pig farm and exposed some of what we would call the more unethical practices in farming pigs. What every single consumer—according to reports anyway but jolly near every single consumer—of pork after that programme asked their butcher or their supermarket was “How are these pigs raised? Are they raised like in that dreadful programme on television?”. So even in the New Zealand context—where we are very familiar with our own farms we know the high standards that are kept on most farms and we are familiar with farming even if we are city-based people—having that familiarity raised an important ethical issue and people started saying “Where did this come from?”.  
In conclusion I am a little surprised at the contribution from Richard Prosser. I want to congratulate him on his election to Parliament—we need more Cantabrians boosting up the quality within this House—but I was puzzled at his contribution. I actually thought he said at the start that he was standing in support of the legislation and then he rapidly moved on to explain why he was opposed to it. I could not understand the logic. Well I actually could not find the logic in the argument that he presented to be honest. I do think that this is something that is— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I am sorry to interrupt the honourable member; her time has expired.  
JOHN HAYES (National—Wairarapa) 
: 
 Thank you Mr Assistant Speaker Tisch for the opportunity to speak tonight on this bill the National Animal Identification and Tracing Bill and I do so in support of the bill unequivocally. Reflecting on the comments from colleagues across the House and the importance that Jim Sutton and Jim Anderton played in initiating this bill I would like to inform the House that 2004 when these people had these very original ideas was the year that this sort of system was introduced in the European Union. It has a system called TRACES the Trade Control and Expert System which tracks movements of livestock both within the EU and from third countries into the EU.  
It is also worth reflecting that around this time the Australians had their own system. It is called the National Animal Identification System. It traces animals from birth to slaughter. The Australians do this because—as some members have already mentioned tonight—having a system like this improves access for Australian produce to export markets and also contributes to food safety.  
The Americans also have a system and I reflect on Damien O’Connor’s list of countries that he mentioned and that have systems like Argentina Mexico and Korea. All of those countries export into America. So if you want to do that you have really got to abide by American rules which cover cattle poultry horses donkeys sheep goats pigs and all other animals. It is worth reflecting that we are talking about just beef and deer in this legislation at this point but other countries manage to include all of their productive animals except household pets. 
 Of course Jim Anderton was the Minister of Agriculture who in 2004 said “Don’t worry about the productive part of the economy. Let’s microchip dogs.” and that caused a furore at least in my electorate. The goal in the American system is to be able to trace within 48 hours of identifying an animal that is unwell where that animal has been and how it has been moved and therefore contribute to disease control. So I support this bill because it is critical for our export markets and being critical for our export markets it is going to give us higher export returns.  
I would say to my colleague in the New Zealand First Party who was standing to oppose this bill and said we should be responding to market forces that this system already operates among many farmers in the Wairarapa in my electorate and particularly for exporting into the American market. Those farmers who supply traceable meat right back from an individual farm to the American market get a high premium for doing so. So the returns are already there for the innovative and progressive farmers who have introduced this system without legislation.  
I think it is really important that we encourage farmers to engage with traceability because if you are going to get a higher price for your product you are going to get a better return at your farm gate. If you do that then you are going to contribute to growing the economy and that is a clear priority of this Government. We want to grow this economy we want the boat to go faster and we want that because we want a better standard of living for everybody in this country. We will all benefit from that outcome.  
It is worth keeping in mind that this scheme will become compulsory for all farmers—myself included—for their beef animals on 1 July of this year and next year I think on 1 March for deer. I think it is probably inevitable that within the next few years we will see this scheme being extended to other animals in this country particularly those that we need to push into export markets.  
It is interesting for a second too to just recall the comments of my colleague in the Labour Party Ruth Dyson talking about apple traceability. She is absolutely right in what she is talking about but I have begun to get complaints from apple growers in my electorate who are complaining about the high cost of meeting biosecurity requirements in exporting products into the Australian market. Basically I am told it costs you $200 to get an 18 kilogram carton of apples through into the Australian market. That is the cost of meeting the biosecurity system.  
We do not want to get into that situation with beef and sheep meat exports and I think that this bill and the system that is being implemented is really going to be very cost efficient for livestock animals. It is going to increase the returns for export markets. That will benefit all New Zealanders and I have no hesitation in supporting the bill. Thank you. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 It gives me great pleasure to rise to take this call on the National Animal Identification and Tracing Bill noting that the MP for Wellington Central Grant Robertson previously took a call on the Labour side to underscore that our support for this bill reflects our caucus position right around the country. So as the member for New Lynn in west Auckland can I say that I am delighted to be able to support it too for a number of great reasons including that we have plenty of animals in west Auckland to trace. Just watch  
Outrageous Fortune 
 and you will know what I mean.  
Now we did challenge earlier the member for Auckland Central to take a call on behalf of National and we have yet to hear from her. We assume that National members in the inner city are similarly committed to this bill but we would love to hear from her too.  
It is a few years ago now that I visited the AgResearch institution at Ruakura and was able to see some of the early development of this project then based on the application of radio frequency ID tags to livestock. It was around 2004 when the then Labour Government first seriously kicked this off with AgResearch and it is a delight to see this now maturing to the point that we are passing legislation on a multipartisan basis today in the House.  
There are a number of really good reasons why we support the bill and I could not agree more strongly with the previous speaker Mr Hayes who said it is because we all want to see the boat go faster. We all want to raise New Zealand’s standard of living and we want to see our primary sector in particular increase in productivity and value. It delivers that because of quality assurance because of pest and disease management because of a brand premium and because of the basis of further innovation in the future. 
Debate interrupted.