Position paper on irrigation released

Press, 5 March 1982, Page 14

Position paper on irrigation released

By

OLIVER RIDDELL

in Wellington

The Government has,released a position paper on irrigation in the hope that it will cool the heat being generated over the prospect of irrigation schemes taking water from the Rakaia River. The paper was prepared by the Ministry of Works and Development last year but, because some aspects of it did not satisfy the then Minister (Mr W. L. Young), it was decided not to publish it in an election year. Some copies were distributed to interested organisations for comment, and the new Minister (Mr Quigley) has decided to publish it generally for public discussion. The opinions and recommendations of the paper are not Government policy, but constitute the professional advice the Government received on aspects of irrigation. Under present policy, irrigation is generally implemented by one of two means —

through an approved community irrigation scheme or as an individual undertaking. Both National and Labour are committed politically to the poli-

cies embodied in the amendments made to the Public Works Act, 1975. Ah approved community scheme is usually promoted in accordance with the requirements of the act, including consideration of the scheme by the National Water and Soil Conservation Authority, reporting to the Government, and a poll of farmers. It must meet certain technical and cost benefit standards, and generally include at least four farm businesses. An individual scheme usually, involves work fully contained on one property.

Present Government policy for direct financial assistance applies only to community schemes. Its leveL varies between the different works constituting an irrigation scheme — headworks, off-farm distribution works and on-farm works. The National Party had no specific irrigation policy in its 1981 General Election manifesto. It had a detailed section in its 1978 manifesto which promised it would “continue to

provide funding for investigation and design of irrigation and rural water supply schemes to ensure multiple use of water in river development schemes and also to ensure that schemes acceptable to farmers are constructed concurrently with river developments.”

National also promised to promote a programme of construction of irrigation schemes, particuarly those involving water harvesting; to encourage and promote better floodway provisions and erosion control in all areas; and to support new. drainage schemes, together with river control schemes where these are economic and will result in increased production. The financing and payment of subsidies for the building of approved community irrigation schemes would continue with the Government being responsible for all works outside the irrigable area. The Government would pay one-half of the cost of all works within the irrigable area.

Finance would be available from the Rural Bank by way of mortgage for up to one-half of

the cost of approved fixed onfarm works — the half to.be met by the farmer. The Government’s half share would be in the form of a 10-year suspensory loan to be written off in 10 equal instalments. Irrigators would pay the full cost of normal operation and maintenance.

Blit the Ministry of Works officials’ working party found three distortions created by this policy. Two were over the on-farm works policy and one over headworks/ofi-'farm distribution works. The officials found widespread support for replacing the suspensory loan with a repayable loan (with interest concessions) made available to both private and community scheme irrigators. This would apply to both the distortion over the availability of the suspensory loan for on-farm works within the community irrigation schemes, and to the distortion over the list of items currently eligible for the suspensory loan. A proposal to include pumps, motors and mobile spray applicators in the list of eligible onfarm items for this loan did

not draw any adverse comment. The working party wanted the Government to adopt its recommendation for replacing the suspensory loan with a repayable loan for both distortions. The officials also, found no consensus on the desirability of eliminating the distinction between headworks and off-farm works and applying a common grant rate. They recommended that any decision on altering the financing of headworks and off-farm distribution works be ‘ deferred until the National Water and Soil Conservation Authority had received a report from its policy and planning committee. One recommendation of the officials was implemented by Mr Young. This covered consultations with interested parties before changes to policy were announced. But a recommendation suggesting a threeyear trial period for any changed policy has been criticised on a number of grounds. It is unnecessary, since the Government can ask for a review at any time, so the officials changed their minds and subsequently recommended that

this change not be adopted. But the three recommendations made on the distortions found in the operation of the irrigation policy could make a profound difference to the economics of any irrigation scheme if adopted. They would tend, overall, to reduce the cost of irrigation schemes to irrigators and increase their cost to the Government and/or water boards. Their implications are still being studied by those concerned.

Should the Goyernment feel required to end the three distortions found and act upon the recommendations, then certain things would follow. Because it is keen to reduce expenditure, and certainly not to increase it, the Government would seek even higher internal rates on returns on schemes than the 15 per cent it does now. This would reduce the work scheduled for increasing production through irrigation, which in turn has consequences for the Government’s plans to increase agricultural and horticultural production through (along with other measures) irrigation.