Meat & Livestock News

Impact of Government Policies on New Zealand’s Sheep and Beef Farmers

Recent research by Beef + Lamb New Zealand (B+LNZ) highlights the considerable administrative and financial strain on farmers due to the influx of new and proposed environmental regulations. The study, conducted by BakerAg, delves into the cumulative effects of the Government’s environmental reforms on sheep and beef farms.

B+LNZ’s chief executive, Sam McIvor, emphasises the need for the Government to reconsider its approach, irrespective of the political party in power after the General Election. 

He suggests a halt on new rules, a review of existing and proposed regulations to ensure they are effective without imposing undue costs, and a comprehensive analysis of the overall impact of the reform agenda.

Kate Acland, B+LNZ Board Chair, acknowledges that while there is a need for continued investment in environmental enhancements, it should be directed towards evidence-based actions with tangible outcomes. She expresses concern over the current generic rules that impose substantial costs without evident advantages.

The report presents the financial implications of national and local government policies on four representative farms. These include escalating costs for consents for on-farm activities, with annual consenting expenses for some farms reaching $30,000. 

One farm even incurred a one-time resource consent fee of $220,000. All four farms had to bear a one-time cost of $15,000 for Freshwater Farm Plans and yearly expenses for revisions and audits.

Furthermore, the report indicates that while the expense of preventing livestock access to waterways will impact a limited number of farms, the costs can be substantial. For instance, one farm could face over $1.2 million in expenses for livestock exclusion.

McIvor points out that the combined effect of these regulations and their associated costs jeopardises the continued financial sustainability of farms. He cites an example of a farm that had to bear one-time direct expenses of $75,000 and yearly direct costs of approximately $88,000. 

This is significant, especially compared to the average Farm Profit Before Tax for that region, which stands at $174,800 for 2022/23.

Acland emphasises the importance of viewing the bigger picture. She notes that while each rule might seem minor, their collective impact is causing significant stress among farmers.

Over the last six years, more than 20 new regulations and reforms have been introduced or are slated for introduction, primarily focusing on climate change, freshwater, and biodiversity. 

Acland and McIvor call for the Government to adopt a more integrated and practical approach to policy-making. They stress the need for regulations that support farmers in their ongoing efforts to care for the land.

The report concludes by highlighting the red meat sector’s pivotal role in New Zealand’s economy, providing essential income and employment. 

However, the current policies adversely affect various farming communities, with potential long-term repercussions on the broader economy and society. B+LNZ urges the Government to reconsider its reform strategy to benefit the farming community.