Meat industry reforms proposed by Mr Quigley

Press, 18 May 1984, Page 3

Meat industry reforms proposed by Mr Quigley

By

MICHAEL HANNAH

in Wellington

Private competition to break the Meat Board’s monopoly and an overhaul of the Government’s role in the meat industry have been proposed by the member of Parliament for Rangiora, Mr D. F. Quigley. In a speech to the Veterinary Association’s annual conference in Wellington yesterday, Mr Quigley outlined several dramatic reforms he would like to see in the meat industry.

These covered the role of the Meat Producers’ Board, and of the Ministry of Agriculture and Fisheries, but also ranged over wage rates, hygiene standards, marketing expertise, and protection.

At the heart of Mr Quigley’s speech, however, was a plea for more competition in the industry. Attacking the Government’s decision last year to endorse a centralised marketing structure for the meat industry, Mr Quigley said the value of competition far outweighed any apparent argument in favour of “single-desk” selling by the Meat Board. “How that board could expect to do better than experienced exporters is a mystery, because, as no man is an island, so too can no country become an island in the world of commerce.” he said.

There was little justification for choosing a particular market structure solely on the basis of trying to overcome a problem of weak selling.

“No-one would deny the right of producers to form co-operatives on a voluntary basis for the mutual advantage of members,” Mr Quigley said. “However, it is a very different story when every producer of ’ a particular commodity is compelled to join a compulsory organisation in which, in theory, each has his say, but where in practice nearly all lose their right to choose and to make their own decisions in respect of marketing,” he said. He advanced the proposition that because New Zealand led the world in the production of dairy products and sheepmeats, it did not necessarily follow that it led the world in marketing.

Much more professionalism would be required than had been demonstrated in

the past in analysing individual markets. “What our export industries need, and New Zealand needs, is a competitive private sector,” he said. The minimum ingredients for success were: • To have one body with responsibility and accountability. • To provide stable conditions to encourage investment; • To oblige those who dealt with a product to do so at the risk of their own profit margin, so that they had an incentive to perform; • To provide adequate price signals between consumers and producers; and • To provide appropriate competition for product acquisition. Where statutory authorities had a right to trade, they should only be allowed to do so in competition with other trading interests. “In this way the respective performance of the various boards, including the Meat Producers’ Board, and their private sector competitors can be compared,” Mr Quigley said. Turning to the processing sector, he maintained that processing facilities were under-utilised and labour costs had made them completely uncompetitive. Moves to become involved in further processing appeared more designed to maintain employment levels than to match new products to the demands of overseas market places. Mr Quigley suggested that extending the killing season would provide poten-

tially large financial and social benefits, including rationalisation of works, better capital use, mobility of specialist staff, and better co-ordination of stock buyers and stock and station agents. Mr Quigley also attacked the authority held by the Ministry of Agriculture and Fisheries as too great. “Inordinate” attention to hygiene regulations had diverted attention away from securing access to overseas markets, and had placed too much authority in the Ministry to override sound management and industrial relations priorities. The Ministry’s objectives, he suggested, should be examined to ensure its regulatory role was not confused with trade and promotion; and that decisions vital to New Zealand’s export interests were not regulated to a low level of policymaking. Hygiene regulations based on aesthetic considerations were also challenged by Mr Quigley. He said that consumers had never been asked whether they wished to pay the increased meat price resulting from the elimination of less attractive meat, or whether they would prefer to have such meat available at reduced prices. Moreover, a case could be made for selling such meat in New Zealand, provided it was correctly labelled. “In this way we would be meeting overseas requirements, but demonstrating that we believed some of them were unnecessary,” said Mr Quigley.