What will water announcement mean for farmers?

National's primary industries spokesman Todd Muller. Photo / George Novak

While both urban and rural communities can agree on the importance of healthy waterways to New Zealand, it will still be difficult to balance agriculture's environmental impact and also sustain a strong economy. With that in mind, the Government's water policy announcement on Thursday will be anxiously awaited by many farmers wondering if it could affect the way they farm.

National's primary industries spokesman Todd Muller spoke to The Country's Jamie Mackay about his concerns that the Government's ideas of what is good for the environment may be bad for farming.

Mackay: Todd Muller, the floor is yours. How bad is this going to be for farming? Or maybe I should rephrase that question. How good is this going to be for the environment?

Muller: The key thing, actually, that doesn't get covered in this conversation, and I'm sure will not be covered on Thursday, is the fact that the Government's own data says that, with the exception of one metric, there are more New Zealand rivers and streams improving their water quality than deteriorating.

That's the Government's own data. It was announced last year. It hardly got any coverage because it doesn't fit the narrative and, of course, we heard yesterday, DairyNZ coming out as part of the Water Accord, talking about the huge investment that's gone on-farm to improve that. Farmers out there would know this, they've spent the money themselves.

So the ironic part of this conversation, is that New Zealand water quality is improving.

Does it need to improve further? Of course it does. We all understand that. That water is a critical resource for our businesses and for our country, whether you're in rural New Zealand or urban New Zealand.

So yes of course, let's have a conversation of what's needed to improve it over time, but what I suspect is coming is an ideologically driven view that purity is best [and] that's where we need to pitch the country in terms of water-quality outcomes.

If it means less dairy - that should be celebrated. If it means less opportunity for sheep and beef farmers to move their farms if they want to, to any other land-use choice apart from forestry, that should be celebrated, and there will be no acknowledgement, at all, of the economic impact that will have for this country.

Mackay: The cause isn't helped by Martin Taylor from Fish and Game running around ... saying dairy's only 3 per cent of GDP [and] if we get rid of it or reduce it, it's not going to make much difference. He's missing the point. I don't know whether he did economics at university but the key number here is not 3 per cent of GDP, it's the fact that dairy alone accounts for 28 per cent of New Zealand's exports and the primary sector equates to 60 or 70 per cent of our export income.

Muller: Yes if you include forestry into that, it's over 70 per cent. You're quite right. Exports are about 25 per cent of GDP, so he's sort of approached the conversation, really in a philosophical view, that exports are nice to have but not particularly needed, and if you can wind back a sector like dairy for the holy grail of pure water everywhere, again that should be something that should be aimed for.

I thought he did himself a disservice, bluntly. He's supposedly the mouthpiece of Fish and Game. I would expect a far more considered, reflective acknowledgement of what farmers have done and in particular the importance of working with them over the next 10, 20, 30 years.

Dismissing dairy's contribution to the New Zealand economy is something that we can all willingly accept, and I quote - get rid of, or seriously reduce - I think is naive to the extreme and I'm sure there are people out there who write out their annual cheques to Fish and Game wondering what on earth they're doing.

Mackay: Well, maybe farmers need to vote with their boots when it comes to Fish and Game in terms of funding it and also remember that farmers give free access to anglers and duck hunters and people who want to access their land without question, maybe that needs to be reviewed.

Muller: Well, possibly, but the key election that I want the farmers to be focusing on voting with their boots is the next one. Making sure that the backsides of Labour, Green and New Zealand First feel it.

Mackay: Well, let's have a look at this proposed new water policy. We're stabbing in the dark a wee bit here, but we have had a clue, Damien O'Connor on Q&A a couple of weeks ago, when asked by Jack Tame how much this will cost farmers, he said "1 to 2 per cent". You raised the issue in the House the other day - 1 to 2 per cent of what?

Muller: Yes, well he took a couple of goes to answer that. The first time he said that was just a guesstimate based on his own farming experience and he thought a significant proportion, and I quote, of farmers wouldn't have to pay anything.

Well I think that's going to be shown on Thursday to be complete nonsense.

On the second question he said 1 to 2 per cent of gross income. All your listeners will quickly be able to work out what that means to them.

But the key point, actually, was that was a stab in the dark. When he was posed that on television, he was basically lunging at something that made it sound semi-credible.

I think what's going to be shown on Thursday is a fundamental challenge to the way we farm in New Zealand.

As opposed to a conversation which I think should continue to happen within catchment, with farmers and other urban and provincial impacts on water, what do we collectively do over 10, 20 or 30 years to improve catchment, and what do we do on-farm to lessen our impact, we're going to have an outcome from this Government which is going to severely curtail farmers' ability to farm.

Mackay: Who's going to get it in the neck on Thursday? Is it going to be the farmers in Canterbury who are heavily reliant on irrigation because we know some of the contentious issues around nitrates in drinking water there. Or will it be the farmers in Southland who are having real issues around winter grazing at the moment?

Muller: I think they'll all get it in the neck to some degree. I think farmers in areas that perhaps haven't got a regional council ... to the level where they need a consent to do any changes in land use. I think they're going to be the hardest hit would be my guess, Jamie.

But all farmers are going to be caught in an approach which says we need to drive harder for a more pure water-quality standard across the country.

Secondly, the activities that we do on farm in an intensive context will all need to be consented. That is going to put huge pressure on farmers' balance sheets to be able to manage their farm forward over the next 10, 20 years.

Because, depending on how hard they go with some of these targets, even if you are best practise and so is your neighbour, and there are a lot of farmers in the catchment - how can you collectively get down to a pure water quality without a few of you going out of business?

And how are the banks going to roll through this over the next 10 to 20 years? I'm worried about that. I think they've sent the signal they want to reduce their exposure to rural debt, not increase it.

This is a serious, serious conversation that we need to have as a country and it's not just a rural one, Jamie, it's an urban one.

They're going to have to spend significant amount of infrastructure on their cities to improve it and how many local candidates are standing in the elections saying - vote for me, I'll lift your rates and put in an extra improvement in your waterways.

Almost none - it's going to be a big conversation.