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Much of the country is in the grip of a drought with garden watering restrictions in place, farmers fearing the worst and NIWA predicting the conditions to continue into April.

NIWA climate scientist Dr Jim Salinger said large areas of the North Island, from Auckland to the Wairarapa, have "extreme soil moisture deficits" and parts of the South Island - from Marlborough to southern Canterbury are the same.

However, some areas however have been soaked. There was flooding in the Horowhenua in early January that caused road closures and contaminated water supplies.

The Government annpounced today that it is calling a "national drought meeting" in Wellington on February 12 to look at the problems caused by sustained dry weather across most of the country.

Prime Minister Helen Clark said areas of high concern were in the upper Clutha, Lindis, McKenzie Basin, small pockets in central Otago, pockets in north Canterbury and Wairarapa.

She said MAF officials were following the situation very carefully and had commissioned more financial reports in areas that were worst affected.

In Hamilton a full ban on garden watering is in place for the first time in 20 years.

Record water consumption levels combined with the dry weather has forced the Hamilton City Council to put the ban in place and the situation is similar in other parts of the country.

"In Southland, they've formed a drought committee. That's unheard of," Dr Salinger said.

He said the warm dry conditions are here to stay.

"We really need a good soaking over several days," Dr Salinger said.

January has been a dry month with many centres in the North Island recording rain levels well below half the monthly average.

Auckland recorded 15mms while the average fall for January is 58ml. The situation was similar in Hamilton, Tauranga, Whakatane, Rotorua and Napier.

Across the country, the dry spells have forced councils to introduce water restrictions.

A total ban on hoses and sprinklers is in place in Thames with the local district council reporting low flow rates in the town's primary water source, the Mangerehu Stream. Bans on sprinklers and hoses are also in place in the towns of Pauanui, Coromandel and Tairua.

Water restrictions are also in place in south Taranaki where all forms of water irrigation, including urban, rural and commercial areas are banned. The council has asked residents to report breaches of the ban and leaks.

Tasman gardeners are feeling the pinch with watering allowed every second day. The council is meeting next week to decide if further restrictions will be put in place.

In Central Otago a sprinkler ban in Cromwell and Bannockburn has been lifted but residents are being encouraged to save water.

A restriction on irrigation is still in place with residents allowed to water every second day and Central Otago District Council utilities engineer Robert Lei said there has been rain in the region and more is forecast today.

He said there have been occasional reports of people wasting water or watering outside the designated time but "the police aren't cruising around". He said the council sends letters to people after a complaint is received and have not had to follow up with secondary warnings so far.