Eckhoff Gerrard: Wool Industry Restructuring Bill — First Reading 
Eckhoff Gerrard: Wool Industry Restructuring Bill — First Reading 
[Volume:607;Page:4256] 
GERRARD ECKHOFF (ACT NZ) 
: 
 Those woolgrowers who have tuned into the radio broadcast of Parliament tonight— and I think there will be quite a few of them—will be thanking God that at long last the machinery is being put into place to get rid of a producer board that has cost this country millions. The Wool Board’s ineptitude has lost it credibility right throughout the world. It has given very little back to farmers yet we were forced to contribute to the structure through the levy payments. I say again that farmers will be delighted to hear that this bill is at last before the House. 
I would also like to pay tribute if I may at this time to my former colleague and friend I hope—Owen Jennings. As the then President of Federated Farmers during the time when he was really active in farmer politics he pushed for the end of the Wool Board at a time when very few others had even thought about it. Owen Jennings along with a number of us suffered the poisoned shafts of derision from time to time from those people who said farmers needed the huge protectionism of the Wool Board’s structure and needed a board to look after them. Farmers were told they could not possibly manage their own industry and that they needed the huge structure called the Wool Board to do that. 
I say to those people that they should just look at Merino New Zealand today. It is the smallest group of woolgrowers in this country with the smallest number of kilos of wool yet it has been highly successful. Why is that? It is because its members have applied very strong controls and have disciplined themselves. They produce a top-quality product and—amazing thing—they have actually gone out into the marketplace to sell their wool. One will see merino breeders in London in Italy and throughout the major markets of the world selling their outstanding product. That is something that never really happened under the old producer board structure that we called the Wool Board. 
I say again that it was Owen Jennings who had the vision in those early days to ensure that at least the machinery was started to change the structure. He brought to farmers’ and woolgrowers’ attention the need to put aside the old worn-out structures that were returning nothing but were costing us hundreds of millions of dollars. Reports came out almost yearly until finally the McKinsey report came along. Most of us thought it was yet another report that was costing $5 million or $6 million. But by that time the farming community—the woolgrowers—had had enough. They were prepared when the vote finally came to accept the recommendations of the McKinsey report. 
But in reality it was a fait accompli. The board was finished. The board did not perhaps know it but it was finished as far as growers were concerned. They were presented with a referendum which essentially gave “take it or leave it” options: to leave the board in place for another 10 15 or 20 years or to accept the recommendations of the McKinsey report. Essentially that is what happened—96 percent of those who voted were in favour of dissolving the Wool Board. That was no surprise. 
But as a number of speakers have already said this evening facets of the McKinsey report concern a large number of woolgrowers throughout this country. I was rather surprised to hear Larry Baldock bring to the attention of the House the concept of setting aside about $60 million to set up the biotechnology companies that will take the wool industry forward again. There is no question that biotechnology will take the industry forward. We have products like Karatec that the Wool Board says will really have a wonderful future. The board has finally got the scientists involved and they have developed a product that may be one of the saviours of the wool industry. 
However we have set up at huge cost biotechnology companies when there are already existing structures there that we could contract out to thereby ensuring that we are not investing in bricks and mortar and not—as we will do—dragging in our own people but using the absolute expertise of people like Diana Hill. A molecular biologist from Dunedin she is the best in world as I am sure Dr Cullen knows and she is an outstanding scientist. People like her have the facilities and just need the dollars and I am perfectly certain that within a relatively short space of time they would advance the cause not only of the woolgrower but also of the sheep industry as such. 
The reality is that this is the end of the Wool Board but I do not for a moment believe that it will be the end of the wool industry once we have finally demolished that structure. As we know other mechanisms are starting up already. Within the industry the mercantile firms—they were once known as the Wrightsons the Williams and Kettles and the Pyne Gould Guinnesses—are setting up structures now that will ensure that the farmers have plenty of markets to sell to. They are getting out there and they are selling. The market demands that those people do not stay at home but that they go out and show the world the product that we actually have. So as I said earlier there are real concerns. 
Another aspect that is of concern is that the current directors of the Wool Board are still to be left in place to oversee their own demise. There is real concern at that. A number of farmers have rung me and asked why we do not just get the receivers in. That is a good question. I recognise that there are statutory requirements that the board is obliged to fulfil. There will be liabilities—and they will funded—that the Wool Board will have to ensure are met but I cannot see any reason that a statutory receiver could not do the same sort of thing. But there is a perception and other speakers have alluded to it that once the board gets involved in its own destruction it will drag that out as long as it possibly can. 
I was the only politician who was at the last hurrah at the Wool Board’s last annual meeting in Invercargill. In his address the chairman referred to an article that he had read that morning in the  
Southland Times. 
 He said it was horrendous that there was a dreadful article that attacked the board and its contribution to woolgrowers over the years whereupon the agricultural editor of the  
Southland Times 
 stood and said he was not responsible for it. That is when I stood up and said I was delighted to inform the chairman that I was there and that the article had come from me. I also received a round of applause and had my hand shaken by all the farmers there and received some very funny looks from Bruce Munro and some of the board members and of course the delegates who had been paid to attend. 
There were about 130 people at that meeting and I guess there would have been no more than 30 farmers there. If we wanted to encapsulate the contribution of the Wool Board that meeting would have been about it. It has been one of self-fulfilment if one likes—of ensuring that the structure is there. Proceedings were sort of “hail fellow well met” at the annual meeting but nothing was actually achieved. We had all sorts of accountability provided from all sorts of accountants who pored over the returns from woolgrowers over the years. The accountants said they had accounted for things and had poured $100 million into one area and $20 million or $30 million or whatever it was into another area. But when we asked them about performance we received rather bland stares at a time when farmers were looking at receiving $2 a kilo. That has risen to $3.50. Well whoop-de-doo! There is a heck of a lot of upside to go for woolgrowers as far as the crossbred production is concerned. 
I also make mention of my own situation as a mid-micron grower who was told by the board and told by the McKinsey report that I have no future. I received the best prices I have ever had after listening to those experts tell me there is no future for such growers. There is always a future in every industry if people are prepared to go out and find it. Thank goodness the woolgrowers at long last are doing that themselves.