Bill English challenged by farmers over stopping Labour and its proposed water tax

National leader Bill English has been challenged by farmers at a public meeting today to do more to stop Labour and its plans for a water tax.

English faced questions about what his party was doing to counter Labour's "populist" campaign following a speech to a National-friendly crowd in Ashburton.

The audience of around 200 included his wife Mary and son Bart, and the heads of farming and irrigation lobby groups. On every seat was a leaflet from Irrigation NZ which said "We don't support a water tax".

In a half-hour speech, English railed against Labour's "ridiculous" plan to charge a royalty on water and made a spirited defence of farmers' environmental initiatives.

He also accused Labour of deliberately creating an urban-rural divide to increase its vote, saying they were trying to tap into what they thought was an "anti-regions" feeling among voters.

The speech was well-received by the audience at the Ashburton Events Centre, which was about two-thirds full. But supporters expressed clear frustration and fear in a question and answer session afterwards.

"You're talking to the converted here," said one woman in the audience.

"Labour are running a real populist campaign here ... It's a lolly scramble with Labour giving free education, free this, free that.

"What's National doing to counter those simple messages and populist voting that Labour is working on at the moment?"

English was defensive in his response: "I know that actually solving a problem is a bit boring these days. And knowing what you're doing is fairly uninteresting and doesn't sound uplifting.

"We are just running on reality, on the facts."

Another member of the audience said National should "go on the attack" on the last weeks of the election campaign.

"If we are going to go down - and I hope we don't - that we go down fighting.

"Because I can assure you, I am not going to be happy about paying a water tax."

English responded: "We will do better than that. We are going to win fighting."

Ashburton would be one of the regions most affected by a water royalty because the farming industry is heavily dependent on irrigation.

Irrigation NZ chair Nikki Hyslop, whose organisation hosted the Ashburton event, said she was "frustrated" with the urban-rural divide which had developed in this election campaign.

Her organisation's leaflet warned that a water royalty would create new costs of $41 million a year in Canterbury and could lead farmers to intensify their farms to cover the higher costs.

It cited a survey of its members which found 27 per cent of farmers would have to lay off staff or reduce their hours because of the new costs, and 40 per cent would need to increase their stock to pay for the water tax.