David Parker is weirdly relaxed about the pain involved in rethinking dairy

by Jane Clifton / 16 May, 2018
Environment and Economic Development Minister David Parker and Prime Minister Jacinda Ardern. Photo/Getty Images

Environment and Economic Development Minister David Parker and Prime Minister Jacinda Ardern. Photo/Getty Images

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Most people tread carefully around sacred cows, but David Parker is that most dangerous of politicians. He's in a hurry, and he has a list.

Parliament’s question time at this stage of the year is a lot like a family in the run-up to Christmas. Kids (the Opposition): “What’s the Budget/Santa going to bring us?” Parents (the Government): “Wait and see.” Kids: “But you promised us X and Y and Z!” Parents: “No, we didn’t. We said we’d see.” Kids: “You did so! It’s not faaaaaiiiirrr!” Parents: “Only a few more sleeps.”

The “kids” never stop nagging. How many more police? How much off doctors’ visits? How much for public broadcasting? Meanwhile, the “parents” are talking down the Budget spending leeway – “Money doesn’t grow on trees, you know.” And all the while they’re rationing out one Budget policy item after another – more money for Pacific projects today, a new family-violence programme tomorrow – as if the Budget were a sort of Advent calendar.

Given the long-range spin exercises that Budgets have become in recent years, we’ll have been told almost everything that’s in it before the official reading on May 17, when – lo and behold! – the Government’s books will be revealed as looking better than expected, permitting some lovely “jam tomorrow” surprises. There will be more teachers, more trade apprenticeships, more all-weather race courses, more toilets for freedom campers – but not for at least another 364 sleeps until the next Budget, or even the one after. The Opposition will be agreeably disappointed. “When we’re Santa,” they will howl, “we’ll give everybody a tax cut!”

When Grant Robertson delivers his first Budget, he’ll be uneasily aware that, just to his right, sits the man who could bedevil his second: Environment and Economic Development Minister David Parker has a sackful of policy grenades ready to chuck.

Parker is that most dangerous of politicians: he’s in a hurry, and he has a list. He recently let slip that this will be his last term in politics, and before he goes, he wants to get soil and water quality and river cleanliness sorted once and for all.

This week’s ructions about his expectation of forced reductions in cow-herd sizes would have come as no surprise to those who anxiously followed his strenuous expressions of opinion in Opposition. He’s hardly alone in saying that without reduced dairy intensity, we can’t clean up rivers or achieve better land use. But he seems quite alone in being relaxed about the pain involved.

As maximum river-nutrient (that is, pollutant) rules kick in, some farmers will have to reduce their herds simply because they had the rotten luck to have forebears who set up farms on easily polluted rivers.

Supporters and critics of the dairy industry agree that less intensity needn’t be dire. We need to increase our value-added dairy exports and decrease reliance on bulk milk powder. That’s where the serious growth lies: it’s less buffeting than being so reliant on commodity pricing, and the environmental degradation is now beyond dispute.

But it’s the same conundrum as we have with tourism. The high-value, long-stay, non-bulk end of that market is our most profitable and sustainable, but some major players, such as airlines, still see their primary interest as maximising bums on seats.

Set-price security

Farmers generally like and expect continuation of the current system, under which every drop of milk they produce gets collected and a set price is paid. But this is, by modern commercial standards, a very odd arrangement. What other producer or service-provider has a guarantee that irrespective of the state of the market, no matter how much they turn out, it will be paid for?

That’s the deal successive governments have stuck to, in exchange for consolidating the former Dairy Board farmers’ collective into the global player that is Fonterra. So successful has this arrangement been that for the past couple of decades we might as well have changed New Zealand’s name to “Cows R Us”.

However, critics – who include the present Primary Industries Minister, Damien O’Connor – argue that Fonterra isn’t nearly as progressive or nimble as it could be. Aspects of the 2001 legislation that allowed for the creation of the dairy giant may be locking the industry into lazy, unimaginative and counterproductive practices.

Parker, for one, believes dairy has crowded out other, better export opportunities, chiefly in horticulture. And unless there’s significant reform – which is to say fewer cows – the dairy industry remains on a collision course with the Government’s environmental aims.

So it’s an interesting coincidence that Parker’s cowmageddon talk has caught the public ear in the same week that details of a review of the dairy industry’s governing legislation, the Dairy Industry Restructuring Act, are announced.

No one is yet picking that the sacred “all milk picked up” rule will be abolished, but it could be softened. But the Government does now have the ability to herd dairy farmers with two virtual cattle dogs: the pollution rules and the legislation. One bites, but the other may not.

O’Connor has left the options open, with a tacit nod to independent dairy operators such as Tatua, which operate on a more orthodox commercial model than Fonterra’s, with impressive results.

The review will look at whether price-setting and the contestability of supply rules need to change, and at what might be stopping dairy from moving to sustainable, higher-value production and processing. That doesn’t leave much leeway for tip-toeing around the many elephants in this particular room – though it pays to remember that one of the jumbos is electoral.

A budding country party

Labour may have little interest in courting the farmer vote, but New Zealand First sees itself as a budding country party. Anything that discomforts the provinces causes a Beehive dilemma.

The rogue elephant in the room is Parker, a most tactless helmsman of politically challenging resource management reforms. He has criticised lifestylers in “McMansions” for objecting to development of housing or horticulture in their rural districts; he told opponents of his plan to tax bottled water at 1c a litre that if they carried on like that he’d make it 2c; now, asked to consider compensating farmers forced by the rules to reduce herd numbers, he says, “You don’t compensate people for not polluting.”

Mocking Parker’s aspirations for more horticulture, the Opposition has playfully queried the transfer mechanism for “cow-to-apricot conversion”. One can only too easily imagine Parker replying, “Via the dole queue if necessary!”

Politically, it may be time the Government tried a new cattle dog: more of O’Connor’s flanking and driving; less of Parker’s gripping and biting.

This article was first published in the May 19, 2018 issue of the New Zealand Listener.

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