NZ Farmer - Farmers welcome signal Labour's watered down its water tax

New Prime Minister Jacinda Ardern appears to have watered down the controversial irrigation tax, although farmers are still concerned about the overall direction of the new government.

Speaking on Radio New Zealand, Ardern said Labour was "absolutely committed to cleaning up rivers, but [Winston] Peters took a strong view on the mechanism we were choosing to use."

Before the election, Labour proposed a royalty on farmers of one to two cents per 1000 litres on irrigation water.

Federated Farmers president Katie Milne said it was hard to say how farming would be affected until specific policies were seen.

"It's good to see the water tax is off the table, we accept farmers have got to do their part in addressing pollution but so do cities."

If the water tax was to be dropped, the incoming government might target the Crown Irrigation Investments fund, which provides seeding money to kickstart irrigation schemes.

National committed to provide up to $400 million over the life of the scheme, of which $131m has so far been spent. Labour has indicated it might not continue the subsidy.

"That's a key and the argument that if you put on irrigation you will milk more cows is not true, you could be talking about plant proteins, if we haven't got the infrastructure to provide that we will be behind the eight ball," Milne said.

Environmentalist Dr Alison Dewes said she was confident the government would work on cleaning up rivers but would use different mechanisms such as ecosystem health targets.

Milne said farmers would also be concerned if they could not get immigrant workers.

"Immigration is a hard one, because we struggle with getting skilled Kiwi workers, and it's the same for tourism and construction.

"Regions need to be supported and workers are desperately required which is why we started that dairy apprenticeship scheme," Milne said.

She was comforted to a degree by both Labour and NZ First's emphasis on wanting to assist regions.

However, she warned against changes to labour laws and a return to the "old days when goods would get held up at ports".

Labour has promised a major shakeup of primary sector administration, with a new Primary Industry Council and a chief agricultural adviser.

Following disquiet over the ability of the Ministry for Primary Industries (MPI) to manage its myriad functions, Labour intends to split biosecurity and food safety functions away and create an independent regulatory agency or agencies.

Both Labour and NZ First had policies to strengthen forestry, with the setting up of a special institute in Rotorua. 

One of National's policy planks was to sell about 100 Landcorp farms to young farmers in a buy following lease arrangement. Both Labour and NZ First have opposed the move.

Milne said the issue was "not a big deal", although the idea had been a positive one.

Former Primary Industries Minister Nathan Guy had served the agriculture sector well. It was hard to say who the new minister might be, she said.

 - Stuff