SOME OPPOSITION TO NEW POTATO BILL

Press, 26 August 1977, Page 16

SOME OPPOSITION TO NEW POTATO BILL

South Island potato growers are reported to be unhappy about some aspects of the Potato Growing Industry Bill, which has been introduced in Parliament and referred to a select committee for submissions.

Under the bill the composition of the existing Potato Board would be changed. This is a controversial matter. The new board would be known as the New Zealand Potato Growers’ Board. There is also provision for registration of potato plantings, which would be a contribution to more accurate industry information. The board is also given the power to administer a minimum quality standard scheme, something which the industry has sought and on which there is no disagreement. The present board comprises three grower representatives (two from the South Island and one from the North), three merchant representatives and a Government representative who also represents the interests of consumers. The new board would have six grower representatives out of its membership of nine, but three of the grower representatives would be main crop growers and three early crop growers. A main crop and an early crop grower would be elected from each of three wards — the Auckland province; the rest of the North Island and Nelson and Marlborough; and the rest of the South Island. There would also be one representative of the New Zealand Agricultural Merchants’ Federation and one representative of the New Zealand Fruit and Produce Merchants’ and Auctioneers’ Federation and the Director-General of Agriculture, or his nominee, who would also represent the interests of the consumers.

The division of grower representatives into early and main crop growers is seen as a retrograde step, particularly when it is feared that their interests might differ. It is contrary to a single industry concept and of board members being elected to represent the best interests of the whole industry. The present Potato Board is understood to favour four wards — two in each island — with a single grower representative being elected from each.

The early and main crop growers are understood to differ on the existing board’s compensation scheme, under which growers holding surplus potatoes at the end of the season have received a compensation payment.

The so-called early crop men — it is said today many are now really main crop men too — are opposed to the compensation scheme with its levy payments because while they have sometimes had to pay levies to the Potato

Board, as well as to the Fruit and Vegetable Growers’ Federation, they have not been recipients of payouts because they have not had surpluses to dispose of. It is argued, however, by South Island interests that the payment of compensation on South Island surplus potatoes has avoided their being forced on to the North Island market at the expense of North Island growers. Thus the northern men have benefited, too, if indirectly. South Island growers have, however, recently voted in favour of suspending the compensation scheme for the coming year. While in the past it has been used as a tool to encourage people to remain in production when prices have fallen, and has lately been at nominal level as production has tended towards overproduction, South Island growers have not given away the scheme completely and it could be reinstated again.

There is also some concern about the provisions in the new bill for handling the accumulated funds of the present board, which before the current season were standing at close to $900,000. This year it looks as though a surplus of some 10,000 to 15,000 tonnes could attract the present $2O pay out under the scheme, which would substantially reduce the funds held for this purpose. The bill talks about $750,000 being transferred to an investment fund to be called the Potato Surplus Disposals Account, with the interest only being used for disposing of surplus potatoes. In fact, the amount for transfer could be substantially short of the figure mentioned and the interest on this would not provide much compensation, at least in the early stages of the life of the new board. However, it is possible that withdrawals might be made from this fund with the approval of the Minister of Agriculture and Minister of Finance. Another matter for concern is that there is no provision for replenishment of the fund, which is clearly in line with the thinking of the North Island growers, who see no place for the scheme.

However, South Island growers see no reason why the fund should not be handled by the board as has been Hone in the past. The intention of the legislation is that all plantings of 0.2 ha or more should be registered, with a register being kept of plantings. There is provi-

sion for a registration fee of up to $lO per ha, but it is believed that somewhere about $6 would probably be sufficient to sustain the operation of the board. A person other than a grower producing potatoes for sale, who grows 0.2 ha or more is still required to register, but is excused from the registration fee. The registration of plantings is seen as part also of the proposal to introduce a minimum quality standard scheme, under which growers’ produce would in some way be identified — perhaps by a number. This in itself is seen as a step in the direction of producing a better quality product.

It is hoped that in some degree at least the bill will be amended before it is taken further.