Meat & Wool New Zealand not to raise beef levy

MEAT & WOOL NEW ZEALAND
MEDIA RELEASE
DATE: 5 September 2007

Meat & Wool New Zealand not to raise beef levy

The Board of Meat & Wool New Zealand has today decided not to increase the beef levy after considering the results of the annual levy payer consultation round on the organisation’s proposed work plan for 2007-08.

Chairman Mike Petersen said the Board has listened to farmers at 14 meetings conducted around the country, and has taken note of the comments received from 767 submissions.

“There is clear support for the proposed work plan, including increased promotional work alongside New Zealand exporters, and from the exporters themselves to match Meat & Wool New Zealand levy funding.”

“Since the consultation document was developed in May, an updated financial position has shown that we can avoid the need to raise levies and still deliver programmes of merit to farmers.”

“However, it is likely that there will be some shortfall of funds this year and the following two years, which the Board considers would be better funded by using some of the New Zealand Meat Board reserves, rather than coming to farmers for levy increases.”

Following today’s Board meeting Meat & Wool New Zealand will now submit project applications to the New Zealand Meat Board for reserve funds to cover any shortfall for the 2007/08 year.

Mr Petersen said the Board noted that carry-over sheep meat levy funds from previous years will not be available to continue current activity beyond next year.

“Meat & Wool New Zealand has considered that reserves should be used for key projects which will benefit the industry without any further call on farmers to lift levies between now and the August 2009 referendum. Farmers will be consulted next year to support ongoing use of New Zealand Meat Board funds to carry the organisation until the referendum.

He said although the Board received a mandate to increase the beef levy, consideration of the poor prices received over the last two years determined that levies should not be increased at this time while reserves can be drawn upon.

“We have been encouraged by the feedback from farmers in this year’s consultation round,” he said. “The level of engagement far exceeded that from any previous consultation round.”

Mr Petersen said the Meat & Wool New Zealand Board was given a mandate from the consultation process to implement the work plan as described in the consultation document.

“Once we reviewed the updated financials and identified further cost-savings and re-allocations, we recognised that the organisation can achieve the proposed work plan without the need to increase the beef levy.”

During the consultation round, levy payer support was sought for increased beef promotion in Asia in a 50:50 joint venture programme with New Zealand beef exporters, and levy expenditure proposed for ongoing and new activities in areas of Market Access, Market Services, Farm Research and Adoption, Skills and Education, and Environment.

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