Meat Board Amendment Bill — First Reading 
Meat Board Amendment Bill — First Reading 
[Volume:630;Page:2361] 
Meat Board Amendment Bill 
First Reading 
Hon JIM ANDERTON (Minister of Agriculture) 
: 
 I move  
That the Meat Board Amendment Bill be now read a first time. 
 At the appropriate time I intend to move that the bill be referred to the Primary Production Committee for consideration and that the committee present its final report on or before 27 July. 
The Meat Board Amendment Bill clarifies the provisions within the Meat Board Act 2004 regarding the allocation of access to meat export quota markets. The bill will uphold the original objectives of the Meat Board Act 2004. But by removing potential ambiguity in the original drafting the legislative framework will ensure that the Meat Board can continue its longstanding practice of allocating quota to producers of export-qualifying meat who are registered meat exporters regardless of whether they currently export meat products. 
The bill also clarifies the fee collection powers of the board. Once again this is to remove a potential ambiguity to make it clear that the board may charge fees to applicants for quota whether or not they have exported meat. I wish to make it clear that the bill does not modify the original objectives or intent of the Meat Board Act 2004 or the policy of the Meat Board in regard to the allocation of meat quotas or the charging of fees. The sole aim of the bill is to remove potential ambiguity and thereby improve business certainty for all market participants and for the Meat Board which is the administrator of the meat quota allocation. 
The bill then is technical in nature and limited in scope. In these circumstances I anticipate—hopefully anyway—that the committee’s consideration will be of shorter duration than usual. 
Under the Meat Board Act 2004 the Meat Board allocates monitors and manages all tariff quotas for meat of New Zealand origin. These quota markets in the European Union and the United States enable New Zealand meat products to enter those markets on preferential terms with low or zero tariffs. Our meat industries are very much dependent on export markets. Around 83 percent of lamb production and 87 percent of beef production is exported. Approximately half of all New Zealand’s meat exports go to the European Union and the United States tariff quota markets. I must say to the House that when I was speaking to the National Farmers Union in the UK recently I found that farmers in Britain were a bit gobsmacked to hear those figures and find out how export-oriented our agricultural sector is. 
Quota access is of significant value to the industry obviously and to the economy. The viability of New Zealand’s meat industry depends to a significant extent on sustainable access to these preferred markets. Since at least 1997 the Meat Board has allocated quota on the premise that meat industry participants who produce export-qualifying meat and hold an export registration certificate are eligible to receive quota—whether or not they are currently exporting meat products. Export registration certification is easy to obtain and does not limit the number or type of exporters. The amendment bill will reaffirm the Meat Board’s approach to quota allocation which will ensure that the financial benefits associated with New Zealand’s preferential access to quota markets will potentially be widely available to industry members. That is the point of the original Act which this amendment bill will clarify. It includes some 30000 sheep beef and dairy farmers as well as those involved in the meat-processing and exporting sectors of the meat industry. 
Although the New Zealand public may not fully recognise the economic and social importance of our land-based industries the Government—and I am sure many members of this House—see the primary sector as critical to both our economic and social well-being. New Zealand primary industries collectively provide two-thirds of our export goods. Primary industries therefore provide the foreign exchange to pay for imported goods and to maintain our living standards. Put simply New Zealand’s social and economic well-being is dependent upon the success of our primary industries. There will be no First World health education environmental or even infrastructural systems unless those sectors of industry are successful in New Zealand’s interests. 
Over the last 15 years productivity growth in agriculture forestry and related industries has outperformed the rest of our economy. Again that is a fact I do not think many New Zealanders fully appreciate. Although the New Zealand economy recorded relatively modest average productivity growth of around 1.3 percent during that period our primary sectors averaged productivity growth of 2.8 percent which is more than 100 percent of the national average. Other manufacturing industries achieved just 1.1 percent. Those are remarkably successful figures. 
The meat industry makes a significant contribution to the New Zealand economy in terms of its contribution to the gross domestic product employment and export earnings. From 1986 to 2002 the contribution of agribusiness to New Zealand’s economic performance rose from 14.2 percent of GDP to 16.5 percent. So rather than those industries being a set of sunset industries they are in effect a set of sunrise industries that we should be very grateful to have on our books. In the year ended June 2005 $4.6 billion worth of meat products were exported which accounted for around 15 percent of the total value of merchandised exports from New Zealand. 
The New Zealand meat industry is a high-performing and very productive sector by international standards. It has continuously improved its productivity over the last few decades. The industry has also achieved significant product development over the last 30 years. In 1971 90 percent of export lambs were sent overseas in carcass form; today it is less than 5 percent. Many of us will remember times when freezing chambers around New Zealand were full of frozen lamb carcasses which were then rendered down for pet food or fertiliser. 
The profitability of sheep and beef farms over the last 5 years has been very good. We need to build on those successes if we are to confront the challenges our economy faces. Some of those challenges of course are the need to harness our creativity the need to join global networks and work together to maximise our potential the need to be customer focused and the need to adapt to the rapid changes of the global economy. To achieve those things we need a competitive domestic meat industry. By clarifying the quota allocation and fees provisions in the Act of 2004 we will promote business certainty in the meat industry and thus maintain the meat industry’s substantial and positive contribution to the well-being of all New Zealanders. I commend the bill to the House. 
Hon DAVID CARTER (National) 
: 
 National will support the Meat Board Amendment Bill going to the Primary Production Committee. New Zealand’s access to the quota markets has been hard-earned by this country over decades and it is of huge economic value to our economy. So we look forward to the submissions we will receive on this bill and I as chair of the select committee look forward to bringing the bill back to the House in a position where it can then be passed into law. 
The original Act to which we are moving the amendment is the Meat Board Act of 2004. I was told at a meeting last Monday of the need to make the amendment. I was contacted by the Minister’s office and I was briefed in confidence about the issue. On this occasion I thank the Minister very much for arranging the briefing. It gave us a chance to understand exactly what the bill was about. I also take this opportunity to say that there will be times when a Minister needs to brief members of Parliament who are not part of the Government in strict confidence and I implore members of Parliament to always treat that confidence carefully. It would be a very difficult situation if members were to treat that confidence lightly—it would make it very difficult for a Minister to be in a position then of being able to brief a member of the Opposition on a matter. So I appreciate the Minister’s involving National in that briefing. 
As I understand matters the reason for this legislation relates to the possible ambiguity of the 2004 Act. At this stage I make no judgment at all about whether the Act as passed in 2004 is in fact ambiguous. Suffice it to say that I accept the advice given by the officials through the Minister that there is indeed an issue around that. The process now allows any party interested in the matter to make a submission to the select committee and we will then consider the points of view raised. 
 I recall the issues quite well at the time of the 2004 consideration when the select committee grappled with the issues of access to meat quota. If I recall the issues correctly there were two significant issues that we needed to get our heads around as a select committee. One was a mechanism that did allow any new entrants to ultimately have some access to the quota markets. From my point of view on that select committee I was keen to ensure that there was a process by which a new innovative company establishing itself in the market here in New Zealand as a processor of meat suitable for any of the quota markets at least had an opportunity to ultimately get access to those markets. I cannot see any legitimate argument for the quota markets to be closed off on some historical basis and restricted to those people who had previously been there. If that was to happen the only thing we would successfully do from a “New Zealand Incorporated” point of view is stifle the necessary innovation still required in the meat industry. 
The second issue that I recall we grappled with at the select committee was an issue whereby if any particular participant had access to the quota market and it looked as though towards the end of any particular season the participant had not used that market to the fullest extent possible then there had to be a mechanism by which quota could be traded between the players. I fully accept that argument again on the basis that at the end of the day this Parliament should be concerned about the way that “New Zealand Incorporated” can maximise the benefits of those quotas. So in my mind there clearly needed to be a mechanism to allow an end-of-season adjustment between the players involved in the quota markets. 
I have no doubt that when this bill is before the select committee all the parties who have an interest in access to quota markets will be given a chance to come and air those issues again. As the chair of that select committee I am sure that I speak for the other members of the select committee many of whom were not sitting on it at the time of the 2004 election when I say that all members of the select committee who do work well together will have the opportunity to revisit this matter via the submission process. I am sure that all the arguments presented by submissioners to the select committee will be discussed and well and truly examined in the select committee process. 
I note that the Minister has given us a 27 July deadline and then asked that we hopefully progress this matter quicker than that. I can almost guarantee that we will be able to do that. The select committee workload at this stage is not very busy. In fact at the select committee today I took the opportunity to try to bring more work before the committee. I was taken by the comments of the Associate Minister for Economic Development the Hon Dover Samuels when he publicly raised the issue of the lack of progress in aquaculture. He said he was quite happy to work with members of the select committee to see whether we could assist the Government out of a bind that it has obviously got into whereby past legislation has absolutely gazumped further development in aquaculture. 
I put it to the select committee today that maybe the Hon Dover Samuels was indeed a man of his word and would be prepared to work with us to see whether there was a way to fill in some of the spare time we have on the select committee initiate an inquiry and assist the Government. I was absolutely staggered I must say when the Hon Dover Samuels then voted against us initiating that select committee inquiry. I guess from the point of view of the Hon Jim Anderton that does just clear the desk and give us plenty of time to look at these issues and call for submissions. Hopefully I can get this bill back into the House as quickly as possible—and substantially before the 27 July deadline. 
I look forward to working through the issues on the select committee which now includes as a member Colin King member of Parliament for Kaikoura. On looking through the notes we have I realise that it had previously slipped my mind that he was a director of Meat and Wool New Zealand and therefore a director of the New Zealand Meat Board which examined these quota issues right up until his recent resignation. So among the many experts we have around our select committee we will have Colin King member of Parliament with an absolutely intimate knowledge of the discussions that have occurred within Meat and Wool New Zealand and within the New Zealand Meat Board about the way the legislation has been working. In fact from the point of view of a former director of Meat and Wool New Zealand we will know whether the board itself had any concerns or whether the officials and thereby the Minister are the ones with the concerns. 
R Doug Woolerton 
: I need someone to reflect my intimate knowledge. 
Hon DAVID CARTER 
: Indeed Doug Woolerton interrupts and says we need someone to replace his intimate knowledge of the industry. That is true. 
It still defies belief that Doug Woolerton was taken off the Primary Production Committee. After years and years of valuable service the New Zealand First leader the Rt Hon Winston Peters told Doug Woolerton the party no longer wanted him to make a contribution to New Zealand agriculture and therefore he was taken off the select committee. As a reporter said to me not 2 hours ago that particular committee must be one of the select committees in Parliament that truly does not reflect MMP. It has four National members of Parliament and four Labour members of Parliament. None of the smaller parties are represented on that select committee at all and I say that is a shame for the select committee. 
I will finish by taking the opportunity after talking about the valuable contribution we expect from Colin King to acknowledge in the House today his replacement on the board of Meat and Wool New Zealand: Andrew Fox a well-known North Canterbury farmer. He is also a director of PPCS Ltd so I am not sure which particular camp he will be in when he appears before us at the select committee. But I take this opportunity to congratulate Andrew Fox on his election to Meat and Wool New Zealand; I sure he will make a valuable contribution to it. We look forward to the bill coming to the select committee and I assure members of our complete cooperation in order to get it back here as quickly as possible and in good shape. 
Dr ASHRAF CHOUDHARY (Labour) 
: 
 I will take a brief call in support of the bill. 
Hon David Carter 
: Oh do 10 minutes. 
Dr ASHRAF CHOUDHARY 
: I thank David Carter. He has been a good chair of the Primary Production Committee of which I am a member and I am delighted that his party will support the bill at the select committee. I look forward to a good discussion there. I say to Doug Woolerton that we do miss him. He was a good member of that select committee in the last Parliament and we miss him. 
This is a very small bill that is really more of a technical nature. It is important that this issue should be fixed. It is important that all the meat we produce in this country is properly exported. This bill will ensure that we allocate access to quota markets to meat industry participants who hold export registration certification whether or not they currently export meat products. This bill removes any potential ambiguity and thereby improves business certainty for all market participants and the Meat Board at any stage of our meat quota allocation. The bill will ensure that the financial benefits associated with New Zealand’s preferential access to quota markets will continue to be available to the wider New Zealand meat industry optimising positive economic outcomes in the domestic market. With those few words I support this bill. 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 I also rise in support of this bill going to the Primary Production Committee. It is important that that important select committee—the most powerful committee in Parliament I would suggest—look at the bill. But the question that remains of course is this: how come so soon after the legislation was passed in the first place we are back considering these amendments? I guess that in the fullness of time the officials may be able to explain that but what I think it demonstrates—and the Minister certainly touched on it in his opening comments—is that things are not always as black and white as some of our officials and some members of Parliament might think. So I say to the select committee of which I am not a member—I was at one stage but not at the moment—that it should make sure that it goes through the detail with a fine-tooth comb so that we are not back here having to amend it again. 
It is important that Meat and Wool New Zealand—the Meat Board as has been referred to in the bill—has the ability to manage the quota. The reason for that is that we have markets overseas that have taken years to build up. The Minister of Agriculture noted in his comments how important those markets are to the social and economic well-being of New Zealand. I agree with him entirely and I thank him for his comments. In fact I was heartened to hear them from the new Minister. The Minister was of course in the Lange Government for a little while—the very Government that said this was a sunset industry and the sooner 8000 farmers walked off the land the better. So I was heartened to hear the Minister say—and it is obvious to anybody who spends more than 30 seconds studying these industries—how important they are to New Zealand. 
As the Minister said 87 percent of beef is exported as is 88 percent of lamb. That makes New Zealand unique. Nowhere else in the world would one find an economic producer of protein-based land-based products where the export content of what is produced is as high as that. In fact in most cases the exact opposite is the case. Mostly one finds that 80 percent 90 percent or up to 95 percent of what is produced in a country is consumed in that country whereas New Zealand has to go out into the world compete against huge multinationals and succeed. So I thank the Minister for the initiative of making sure that the quota management system is handled well. 
Not too many New Zealanders actually know what such industries do and what this industry is about. The New Zealand Meat Board—operational name Meat New Zealand—exists to further the interests of New Zealand’s 32000 meat producers. I got these figures from the parliamentary Bills Digest but I suspect that the figure of 32000 is too light. I suspect that it is bringing meat producers down to trade names rather than individual farmers or producers. I suspect that the figure is too light but I am able to be challenged on it. I know that there are 70000-odd farmers in New Zealand and I also know that the dairy industry which one would not consider to be linked with this is 40 percent of the meat industry. So it is a meat producer even though its main income would be registered as being dairy-product producers. So I challenge that figure. I have no facts or basis on which to challenge it I just suspect that it is wrong. 
The board is there to manage the interests of those producers and it is funded through a levy on stock slaughter. Its main purpose is to develop and enhance market access. That is its main purpose. I have to say having just attended a recent meeting with a large number of my colleagues—in fact I think 32 National caucus members attended the meeting which was a very good meeting—I was heartened to see just how strong the leadership in that industry is and where it is going. 
Russell Fairbrother 
: Where were the rest? 
SHANE ARDERN 
: The member opposite interjects. We have heard a lot recently about National members interjecting during question time. I know that some people are annoyed by how many National members are here now. I hasten to add that it particularly annoys the Rt Hon Winston Peters who I know can only ever round up two or three of his own team to support him at any one time. But the fact is that there are 48 National members here and 32 of them were at the meat and wool meeting just recently. So I say to the member that we are 100 percent behind this industry and this process. This industry produces $4.6 billion and we overlook that. This industry is often dusted off as some insignificant group of cow cockies from the back of the hills somewhere. 
R Doug Woolerton 
: How much? 
SHANE ARDERN 
: It is $4.6 billion. The Minister said that this economy is very dependent—I would go so far as to say almost totally dependent—on these land-based industries. So we cannot place too much emphasis on the importance of this kind of legislation. The New Zealand Meat Board has a particular role in the regulation of market access and that is what this amendment is about. We cannot have ambiguity in the market about who controls the quota. We must have tradability and we must have the right regulations in place. I was heartened to hear the chair of the select committee the Hon David Carter a very good colleague and obviously the Opposition spokesman on agriculture say it is hugely important to make sure that that tradability is maintained. I agree with him entirely. 
It is also important however to make sure that the quality of the product exported to those markets measures up to the standard that is put forward in the quota access. If we do not have those quality assurances in place markets can be damaged beyond repair very quickly. Any ambiguity in respect of what meat should be exported to a tariff market and how and when is absolutely untenable. If that exists in our Act then we need to fix it. I am sure the select committee will carry out its work very diligently and the Minister will pass the bill through the House. 
Can I finish by saying that this industry is built on the backs of hard-working mum and dad farmers out there in New Zealand. It is not built on the backs of bureaucrats or officials or structures based in Wellington and we often forget that. We talk in lofty language about the significance of some of these structures but we forget that we need the producers out there battling away every day to make sure that the product—which it is undisputed is the best in the world—is produced efficiently. 
That I guess is why it is so important for the Government to provide the right infrastructure for those people to get on with it. In recent times we have seen a Government that has started to take us down the track of losing sight of those basic fundamentals. The fact that we must have competitive access to markets is part of it. It is absolutely important. But the other side of the equation is that we must have a Government framework in place that allows those hard-working farmers in New Zealand who produce this product—the most efficient farmers in the world; the people who produce the best product in the world—to get on with that job and not be tied up in all sorts of brain-dead regulation that spills out of this place and throws up a roadblock in their faces. 
One of the things that we learn about this industry the moment we look at it is that it has gone from being a bulk commodity almost 19th century industry—part of the first Industrial Revolution as it were—to being a very high-tech value-added industry. I say to the House today: watch this space. If members have a look at some of the new developments within the meat industry and at some of the new initiatives around wool development pasture development and meat development they will find that this industry has a strong future. And it will still be a leading industry in this country for three four or five generations despite the fact that most of the Government’s energy—and I am not talking just about the current Government; it is not a political statement—goes into putting all sorts of barriers in its place. I say to the Government that it should take a look at what makes this industry efficient get out of its road and let the industry get on with it. 
R DOUG WOOLERTON (NZ First) 
: 
 New Zealand First supports the Meat Board Amendment Bill because we believe in exports and we believe in making right everything that will assist our farmers to export to foreign countries where every single barrier—both tariff and non-tariff—that can be put up against our exports is put up. We must make sure that we have the legislation right to enable our people to go about their business because there are men and women who work their butts off around the world on our behalf to make sure we gain entry into these countries. It is all very well to be talking about getting the beef off the farm and about what should happen with shipping and all of that sort of thing but unless we can make the regulations work that enable us to enter these countries on favourable terms we are fighting against the weather as we say in farming. It just will not happen. I was going to use another colloquial term but I thought I had better not. 
I think it is also right to remember as this legislation is passed through the select committee that this industry is constantly changing. As previous speakers have said the industry has gone from being a commodity industry—mainly carcasses shipped overseas—to being an industry dealing in all sorts of finer meats packaged meats fancy cuts etc. I am absolutely positive that the select committee even without my presence will make a good job of this. I am alarmed to hear that only Labour and National are represented on it but nevertheless I am sure that under David Carter’s able chairmanship this bill will be progressed quickly. 
I personally do not think it will be quite as easy as one would imagine it should be. I think that this will be shall we say an unexpected chance for people who did not think they were heard properly the first time to come along and have a second bite of the cherry. I am sure the experienced members of the committee realise that. When we take meat into another country or any produce into a quota market in another country that is seen as a privilege enjoyed by members of meat-processing industries and so on. There are always new entrants to the processing industry—and Mr Carter referred to this earlier—who want to push the barriers. They say we should be able to export without going through this bureaucratic nonsense without going through the Meat Board and without having to rely on these sorts of regulations. 
 It is very difficult but necessary to keep those people in some sort of order and to say: “Hang on sunshine first these criteria must be met then we will look at your applications.” Again as the Hon David Carter said one does not want to stifle enterprise but that has to be balanced against—excuse the language—stuffing up the markets that have been put in place by previous generations. 
There is also a change down on the farm in this industry led from the markets to have what we can call “from the pasture to the plate” tracking. Great sophistication is entering the farming and production chain in the way of tagging and electronic tagging in order to follow one single beast from a farm right through to the supermarket counter and on to the plate. I commend the industry for that because it is a huge undertaking. I must just say being a little bit controversial that that is one reason why I cannot understand the outrage of farmers towards the so-called chipping of dogs. In every other part of their industry the chipping or electronic tracking of animals is right at the forefront of what the market is wanting. It wants those animals tracked from the paddock to the plate so it is rather naive and quite unbelievable for farmers to say that there will be a big industry built around tracking dogs. That is nonsense because the whole industry is involved in that process as we speak and the chipping of dogs will be seen as just another addendum to that as time goes on. 
As mentioned by Shane Ardern this is a huge industry and it is one that we in New Zealand First take a great deal of interest in. If we are looking to address our balance of payments problem in this country—brought about by too much consumption and not enough exporting—industries like this are the only places we can look to for the sort of bulk money that we need to address those balance of payments deficits. 
Everybody knows that a small percentage increase in a big industry will be what produces the dollars rather than rushing around looking for the silver bullet as in the new industries that have years and years of start-up time and are simply incapable of doing the job. So it is the land-based industries that will help this country with its balance of payments deficit it is the land-based industries that sustain our standard of living and it is those that we must protect. 
I do not have much time like many farmers—or in my case ex-farmers—for ticket clippers. Mr Ardern mentioned those. We see far too often people who are to one side commenting and involving themselves in discussions on this industry. They are not directly involved in the industry they do not take the risks and they do not put up the money but they have all sorts of ideas about how these things should work. In my experience they are very big on talking about getting a share of the industry. They always want to get their foot in the door. They always want to take a percentage of the profit without taking a percentage of the risk. It is bills such as this that are designed not necessarily to keep those people right outside of the door but certainly to make sure that they serve their time before they come in the door. We certainly understand that aspect of the industry. 
I just close by commending the Minister of Agriculture Jim Anderton. Like Shane Ardern and the Hon David Carter I well remember when perhaps the Minister was on the other side of the fence from where he is now. I commend him on a speech he made in England—I think it was in Birmingham. I do not know how many farmers there are in Birmingham but that is where the conference was held. He made the point that within a few hundred kilometres of that conference centre were something like 80 percent of the serious customers of the British market who ate that sort of produce. In our case we are many many thousands of kilometres away yet we are still able to compete with them unsubsidised by the good efforts of our mum and dad farmers who have been spoken about before. I commend those people. New Zealand First supports this bill. It is essential that it be passed. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Hopefully it is no secret to those of us gathered in the House today that Maori tangata whenua have earned their livelihoods through the spilling of blood on abattoir floors throughout the country over many years. Indeed my first holiday job was at Gear Meat Processing at Petone feeding the chain and picking up mountain oysters. Minister Horomia would no doubt confirm that they are delicacies in his area of Tolaga Bay on the East Coast. My honourable colleague from the north Mr Harawira also did his training in the freezers and on the gut floor of the now-closed Moerewa freezing works. He considered himself at that time not a freezing worker but a meat processor and now of course he is a parliamentarian. Our co-leader Dr Pita Sharples prepared the sheep for slaughter. He was in the shearing gangs that produced fodder for the works. Our other co-leader as this House will well know was an amateur vet. She was involved in the artificial insemination of her dairy herd the bobby calves of which ended up in the meat-processing industry. 
 So for the record the Maori Party has 100 percent involvement in the meat sheep and dairy industries. Almost 32000 are employed in meat processing and manufacturing many of them tangata whenua. What I am saying should not in any way diminish the contributions of other people—the farmers and former meatworkers who are also present in the House. I mihi to them all. Tena koutou. 
The industry operates major plants in Dargaville Karaka Waitoa Paeroa Te Kauwhata Tirau Te Puke Horotiu Te Kuiti Taumarunui Waitotara Waipukurau Takapau Oringi and other locations—locations where coincidentally there is a Maori workforce to support the kapata kai the food cupboard of Europe. Of course there are all the other locations where meatworks have been closed. They exist no longer and we must never forget the impact of the devastation of the closure of the meatworks such as Tomoana and Whakatu in which hundreds of families felt the impact of poverty unemployment and alienation. 
Meat industry products account for about 17 percent of New Zealand merchandise I am told. The figures are astounding really. Between 1998 and 1999 91 percent of lamb 83 percent of beef and 79 percent of mutton were exported overseas. In real money terms as I understand it New Zealand exports more than $4 billion of beef sheepmeat and goat meat with 65 percent of it going into quota markets that rely on country-specific tariff quotas. 
This bill is another example of legislation being posited as standing as a model for Aotearoa meeting its international treaty obligations relating to quota markets. The question must be again asked in this Chamber about how the Meat Board Amendment Bill honours the obligations the Crown has to Te Tiriti o Waitangi. This House should be aware that both the courts and the Waitangi Tribunal have determined that the principle of partnership includes the obligation on both parties to act reasonably honourably and in good faith. Indeed the courts have also found that an aspect of the obligation to act in good faith is the duty to make informed decisions through consultation. The Waitangi Tribunal has emphasised the value and appropriateness of consultation in upholding and strengthening the Treaty partnership. 
Yet what do we have here? Maori meatworkers we have contacted in the very recent past—in fact this morning and yesterday—about this bill have absolutely no idea that it is even on the Table. But it gets worse. It seems that the bill which the Minister is promoting as “optimising positive economic outcomes in the domestic market” has not even been passed through the hands and by the eyes of stakeholders in the industry. Meat Industry Association of New Zealand policy adviser Dave Harrison said that the bill had taken the organisation by surprise. The media reports him as commenting: “ ‘The bill’s been a bolt out of the blue for us … It was done without consultation—we haven’t had a chance to form a view on it.’ ” So the Maori Party has to ask whether this is another case of policy change by stealth. 
Although we were told that access to quota markets will be kept open to all registered meat exporters regardless of one’s previous export history the question has to be asked as to why the Meat Industry Association did not know about something of such fundamental importance to its core business. More important why did Maori meat producers not know about this change? Maori produce 15 percent of New Zealand’s total meat for goodness’ sake! Multiple-owned Maori incorporations also tend to be among the country’s biggest farms in stock-number terms. Collectively Maori are the largest natural grouping of pastoral farmers in New Zealand—farming an effective area of 720000 hectares and growing. Some impressive initiatives have also been pioneered by Maori in the meat industry. We recall a group of Maori entrepreneurs who bought a third of the shares in the Richmond meat plant from the Meat Board. They subsequently sold two-thirds of their stake to Dunedin-based PPCS. 
Maori meatworkers have traditionally formed part of the backbone of the meat industry itself. They are men who because of the conditions they worked under aged before their time. However within the industry itself important steps have been made to demonstrate consultation with tangata whenua and I make particular mention of the Federation of Maori Authorities which almost a decade ago lobbied for and won legislative changes laying down voting procedures for the Meat Board and the Wool Board in order to encourage greater Maori participation in those two industries. The one farm one vote system was changed to a system based on production that recognises the greater size and productivity of Maori incorporations. The Federation of Maori Authorities says that this new system has generated greater Maori participation in the sense that more people are registering voting and attending board meetings. 
This determination by the industry is a very positive move that we would like to see replicated in the Meat Board. We recognise the contribution that Maori professionals such as Wayne Walden and Gina Rudland had in their membership of the Meat Board. 
The bill amends the 2004 Act to clarify that the Meat Board may allocate access to quota markets to meet industry participants who hold an export registration certificate whether or not they currently export meat products. I want to raise here the possibility that an opportunity could exist if Maori meat producers take advantage of it to form an entity to enable them to enter the meat export market. Is this an opportunity for indigenous marketing in relationships with countries such as Bolivia Colombia and Venezuela? It seems slightly ironic that while as I understand it AgResearch is currently right in the middle of a 12-stop tour of the North Island to encourage Maori dairy meat and wool farms to realise their potential and increase productivity here today we have a timely and significant opportunity to do exactly that. One wonders whether AgResearch is talking to the Minister. 
The whistle-stop tour is aimed at doubling Maori farm productivity from its current $800 million to $1.6 billion by the year 2020. We are not happy that yet again a significant piece of legislation is being processed on the shop floor as it were without the robust consultation that we suggest is desirable for any policy change. 
We will however support this bill through to the select committee to enable the Meat Industry Association meatworkers the Federation of Maori Authorities Maori meat producers AgResearch and other key players to have a say about how to strengthen the historical backbone of our primary industries. 
GORDON COPELAND (United Future) 
: 
 I rise to take a call on the first reading of the Meat Board Amendment Bill and immediately signal that United Future will be supporting this bill—I expect not just through the first reading but all the way until it becomes the law of the land. As I mentioned in my general debate speech yesterday my own involvement in the industry—peripherally it must be admitted—was in the early-1980s. It was not just in the restructuring of the meat industry but in its total reformation. 
Shane Ardern mentioned it was a 19th century industry. I tell him that it was actually a colonial industry. About the only thing that New Zealanders owned in the meat industry was the meat itself. The meat was grown here processed mainly in British-owned freezing works shipped on British-owned ships across to the other side of the world went through British-owned wholesale markets then sold through British-owned retail markets. 
Shane Ardern 
: Vestey’s. 
GORDON COPELAND 
: Vestey’s in particular and by the time it reached the British housewife there was a mark-up of over 90 percent on what the farmer back in New Zealand got. That is colonial economics. 
We have moved on and it has been a great success. As I said I was one who was peripherally involved as a consultant in those days on that reformation and I am absolutely thrilled that all these years later we have such a successful and flourishing industry. In fact meat exports are 20 percent of New Zealand’s total exports. 
I remember when I lived in London in the 1970s my wife would go to the supermarket and ask for New Zealand lamb. She was told it was in the deep-freeze and when she opened the deep-freeze inside was a piece of stocking net and all one could see through the stocking net was fat and that was a leg of New Zealand lamb. [ 
Interruption 
] Unprocessed. It was amazing to me that we sold much lamb because one had to be motivated to buy that stuff. 
R Doug Woolerton 
: There’s definitely been a transformation. 
GORDON COPELAND 
: The transformation now of course is enormous in the way in which our meat is packaged cut and marketed. It is just a brilliant success story and long may it continue. 
The reason we support this bill is that it will continue the principle of free and open markets for meat exporters from this country. Te Ururoa Flavell who has just resumed his seat speculated that maybe Maori could form a cooperative meat exporting company and I said straightaway “Why not?”. They should go for it because the opportunity is there and under the present rules according to which particular set of lawyers one talks to—and Te Ururoa may not be aware of this background—some legal opinion says that in order to get access to quota markets one has to be exporting meat whereas the clear intention of that Act was no one can register as a meat exporter and become a new meat exporter. When one thinks it through if we stuck with the present position we would be closing the market to new entrants. 
I recommend to the House that if members ever have a spare night they should take out a video called  
Tucker: The Man and his Dream 
. It is a true story that happened in the early 1950s in the United States where the motor vehicle industry excluded a new player a man who was a brilliant innovative person. Eventually that led to America losing its dominance in motor vehicle manufacturing and surrendering it to the Japanese and the Germans. Members will remember the days when people used to joke about Harley-Davidsons and that the only reliable thing about them was that they were good for spare parts. The whole industry went downhill in terms of quality and so forth because no new blood was coming in. It became a closed shop. The last thing we need in the meat industry is to have a closed shop like that. We must remain open to new people coming in with new ideas innovation and energy which will ensure that we continue the very successful run we have had over the last 20 or so years in developing this fantastic industry. 
The other thing we have to remember is that while many of New Zealand’s international competitors—that is meat producers in other countries—can rely on a large domestic market in New Zealand our small population does not give us that luxury. Therefore it is remarkable that we have done so well. In fact the figure I have here is that 83 percent of all beef and veal produced in this country is exported. I think the comparable figure for mutton is 88 percent. This is a New Zealand success story and one that we should celebrate and encourage. That of course makes it even more important that we ensure we do have free competitive markets and that is all about allowing new entrants to get a foothold in the door so that we can bring the new blood that I mentioned into the equation. This is a great bill and we are delighted to give it our support today. 
COLIN KING (National—Kaikoura) 
: 
 I rise in support of this bill. I would imagine that in the first instance many in the House might consider that I rise to declare of a conflict of interest. However when I was elected to this position as the member for Kaikoura I resigned my position on the Meat Board and therefore congratulate my successor in the northern South Island ward Andrew Fox a farmer from Scargill. He will do a wonderful job and he will have some interesting challenges ahead of him having been a serving director of PPCS. 
Given that we are talking about the Meat Board Amendment Bill I point out that at this particular time farmers are probably more interested in how the ram is joining with the ewes and what sort of lambing percentage they will have and they are still smarting over the fact that the Government decided there would be a microchipping process for all working dogs. Interestingly for 5 years now where I come from in Marlborough the council has been running two categories of dogs. It has a category for working dogs numbering 2500 and it has a category for non-working dogs numbering 6500. To register a working dog costs $15 and to register a non-working dog costs $45 representing the number of times the dog pound has been used by non-working dogs. There were 192 occasions in the last 12 months none of which were working dogs. 
I will get back to the Meat Board Amendment Bill. It is technical in the sense that the word “ambiguity” has been used. I would prefer to use the word “clarify” to reinforce the express purpose. 
When we talk about these details it has to be borne in mind that there is a huge history behind this quota management mechanism. A lot of it started as far back as 1882—when Mount Tarawera was blowing up—with the first shipment out of Port Chalmers of frozen meat. What grew out of that was a relationship that connected New Zealand to England because we were able to supply frozen meat which was very innovative at the time on the shoulders of and out of season to the lamb crop and meat crop over in the UK in the northern hemisphere. That being the case we built up a market because in fact we were complementing the existing home market by being able to supply lamb all year round. So that started way back in 1882. It was actually a wonderful thing for the sheep industry because up until that stage it was purely reliant on wool and rendering down the tallow of sheep. That shipment going out of Port Chalmers was a marked leap forward for the economy of this country. 
The Meat Board does not have all that long a history but it has quite a chequered history in the sense that at one stage about 1985 it marketed in a single-desk manner everything to do with meat in New Zealand. It was an abysmal failure and we have heard from other speakers today that the industry itself was controlled from England and there was no New Zealand ownership. Even what New Zealand ownership eventuated in the early stages was particularly shaky. We think of the Waitaki situation that occurred post-1985 and how the farmers had to put their hands back in their pockets again to put together models and structures of companies that would serve their interests best. They succeeded hugely especially in the South Island where they put together cooperatives in which farmers are shareholders and are able to capture value back to themselves. So successful have been the South Island cooperatives that when we look around today we see that one meat company PPCS owns 52 percent of the meat industry. It has paid for that with shareholders’ money and it is doing remarkably well. It is still capturing value back to itself. It was interesting that the Maori Party speaker talked about the business that was done by a group of Maori in taking over 16 percent of Richmond shares and selling them on to PPCS. I would say that that was the winning of the battle for control of Richmond by PPCS. So that is just of historical interest. 
Moving forward I just want to draw members’ attention to the Bills Digest that we were given. It concerns me a little bit that when we look under the heading “New Zealand Meat Board” in the “Background” section we see that it talks about participants in the meat export industry—as my learned friend Shane Ardern refers to 32000 meat producers. Well that is pretty comfortable. I have to take exception though with the mechanism that it states the Meat Board is actually funded by. It states that the board is funded by a levy on stock numbers slaughtered. In broad terms one could just about let that pass but it is not factually correct. The management of the quotas—the quota allocation system—is paid for by those participants who actually operate and move that meat over to the European or US markets. So I would like to see that corrected. I am sure the Meat Board would be horrified to think that it is still spending farmers’ money in managing the quota and I am sure that Federated Farmers’ Meat and Fibre Producers’ Council Chairman Ian Corney would be surprised to see that the Bills Digest actually says that when in actual fact he has been beavering away over the last 2 years to ensure that the meat companies actually pay their share in administering that quota. So let us just bear that in mind and look for some correction. 
I will mention two very important dates. In 1997 there was the move to put some controls management and accountabilities back on the Meat Board so in fact there was more attention given to what farmers’ and the industry’s expectations were. At that particular time the board was reinforced; it stopped being a producer board and actually became an industry board. That is when we got meat industry directors around the table. I believe that that was a very smart move because unless the industry is running in tandem with the producers there is no way to ever be sure that the best value is effectively being captured for the product in the quota market to be brought back to this country. So that has been very good. 
Where are we today? Well the 2004 Meat Board Act has been enacted and we are back here again to clarify some of the details. Anything that comes out of this process will not be changing anything because it is not broken. The process that has been run does have a new-entrance allocation situation. It has very very strict criteria for new entrance. My advice for people going into the meat industry is that instead of trying to get a minute or minuscule part of the quota they should get their mates together put their hands in their pockets flesh out the millions of dollars and buy an existing business because to actually gain significantly out of the new-entrance allocation is very hard—although in saying that I have to pay tribute to a particular individual inside the Meat Board who is about to retire Graeme Harrison. He put together and built up a remarkable organisation that is now called Anzco Foods Group. He benefited to use his own words greatly from the assistance of the new-entrance allocation aspect of it. 
I do not find that we will have too many difficulties working with this process. I welcome it as did the Meat Board itself when it heard that this bill had come before the House. I believe it took the board by surprise as well. A point we want to bear in mind is that the Crown owns the quota. Companies do not own the quota. A unique aspect of our quota into the European Union—there are 1200 quotas into the European Union—is that we manage them within New Zealand and on that basis we are able to capture the quota rent back to the New Zealand farmer industry and nation as a whole. Studies done at Lincoln University have established that the value of that quota is in the region of some $300 million annually. So it is very important that whatever we do we do it in a very level-handed manner and welcome people’s opinions. 
I am perfectly relaxed to see what does come out as a result of the process of this bill going to the Primary Production Committee. Having been a shearer and the son of a meatworker I am truly honoured to be on the Primary Production Committee and I am grateful for this opportunity to speak in support of the Meat Board Amendment Bill. 
Bill read a first time. 
Hon LIANNE DALZIEL (Minister of Commerce) 
: 
 I move  
That the Meat Board Amendment Bill be referred to the Primary Production Committee 
referred to Primary Production Committee 
 and that the committee present its report on or before 27 July 2006. 
Motion agreed to.