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The Government's proposed freshwater reforms will have significant implications for New Zealand's food and agribusiness sectors, with a likely impact on production costs, operational complexity and future land-use development opportunities says Rabobank.

As they stand, the proposals are unnecessarily harsh and would have a detrimental impact on the rural sector, which is already facing pressures from regulatory change the bank said in its submission this week to the Ministry for the Environment.

Rabobank supported the Government's goal of improving the quality of New Zealand's freshwater and reducing pollution entering waterways from cities and farms, said the bank's chief executive Todd Charteris.


"We also support the relevant Ministers' stated goals of ensuring the pace of change is
manageable and that appropriate transitional support is in place" he said.

"However, for the reasons outlined in our submission, we are not confident the proposed freshwater reforms, in their current form, will achieve those stated goals in a fair and balanced way".

Listen to Rowena Duncum's interview with Rabobank's Todd Charteris on The Country:

What Rabobank said in its submission on the Essential Freshwater discussion document:

In its submission, Rabobank said New Zealand food and agribusinesses have proven themselves to be resilient, innovative and adaptable.

"They are among the most successful and efficient food producers in the world, they are
fast adaptors of new technology, they operate without subsidies and are a long distance
from their main markets".

"At the same time, our farmers and growers have made significant strides forward in
improving the management of freshwater on their properties – and this is often played
down or overlooked in some quarters."

In its submission, Rabobank said the proposals most relevant to farmers and growers
included the introduction of more stringent nutrient bottom line requirements, new national practice standards and interim controls on land use intensification.

"Our assessment, based on direct feedback from our clients and wider industry conversations, is that the overall impact of the proposed freshwater reforms on the New
Zealand farming community will be significant.

"These impacts will vary considerably from farm to farm, depending on location and
farming system. For some, meeting these new requirements will represent a major
challenge and come at a considerable cost".


Rabobank described the proposals as both complex and demanding, with the consultation timeframe being extremely tight during a busy time in the farming calendar.

"In addition, these proposals must be seen alongside the cumulative impact of other
regulatory proposals currently affecting the food and agribusiness sector".

Overall, these series of reforms represented a substantial challenge for farmers and
growers said the bank.

"The proposals also appear to underplay the significant progress many farmers and
growers have already made in improving freshwater management on their properties
and in stepping up their environmental sustainability practices".

"From Rabobank's perspective, we remain committed to supporting our food and
agribusiness clients, along with their communities, through these and other challenges.
In doing so, we recognise the importance of this sector to New Zealand's wider economic success and future prosperity."

A thriving food and agribusiness sector was vital for both New Zealand's national economic progress and the continued wellbeing of the country's rural communities. The reputation of New Zealand farmers and food producers was among the most successful, competitive and efficient in the world and should be both welcomed and celebrated, Rabobank said in its submission.

"Therefore, we encourage the Government to ensure implementation of the proposed
freshwater reforms does not lead to a substantial land use shift away from farming and
horticulture, and towards non-food producing forms of land use such as forestry.

"Specifically, given that New Zealand is a large net exporter of food and agricultural
products, Rabobank urges policy makers to recognise and protect the role New Zealand
plays in contributing to global food security and sustainability.

"It would make no sense, for example, for a supply gap created by a reduction in New Zealand food production to be filled by products from countries with less environmental integrity".