Budget 2024
What was in it for the rural sector?
On 30 May 2024, the Minister of Finance, Nicola Willis, presented her first Budget. The government is focussed on rebuilding the economy, easing the cost of living, delivering better health and education services, and restoring law and order.
Of course, within all those subsections, there is an underlying reliance on agriculture, the highest contributing sector to our economy. So, what did the Budget provide for the rural sector, and is there anything that farmers can look forward to over the next three years?
Drilling down to detail
After the Budget was presented, the Minister of Agriculture, Todd McClay said, “It places our trust back in farmers and growers by cutting public spending and reducing red tape, while also driving the efficiencies required to increase value and place the sector’s success at the forefront of New Zealand’s economic recovery.”
Practically speaking, the government intends to do that by:
• Doubling exports by delivering strong frontline services, cutting red tape and reducing regulatory costs
• Minimising the administrative burden on farmers caused by duplication, red tape and regulatory blocks on things such as irrigation, water storage, flood protection schemes and stock exclusion rules
• Replacing the National Policy Statement for Freshwater Management 2020 (Three Waters) and delivering better resource management legislation for the primary sector
• Taking an independent review of agricultural biogenic methane science by providing clear advice on New Zealand’s domestic 2050 methane targets
• Committing $27 million for the removal of woody debris in Tairawhiti that will restore and help prevent further damage to vital infrastructure in local communities in the region
• Committing $36 million over four years to catchment groups that back farmers’ efforts to improve land management practices, and
• Driving innovation that will ensure farmers and growers remain global leaders in challenges, including reducing on-farm emissions.
The government considers its Budget will back the sector’s continued growth by providing support and professional resources to the frontline, and boosting research and innovation.
Should we be optimistic?
No one would expect the rural community to feel particularly inspired by this Budget and its overuse of words ‘innovation’ and ‘growth’ that do not necessarily translate to practical implementation.
The Budget is clearly focusing more on the bigger election promises such as infrastructure, education, and law and order. Although the Budget was more or less neutral on agriculture, the sector will nonetheless be pleased to see a focus on legislative repeal that was going to create a suffocating amount of red tape and make farming financially unviable (for some) in the near future.
It was a tight Budget that intends to put New Zealand’s books back into the black. The deficit is forecast to continue through to 2025 with a surplus expected to be reached in 2027–28. The government will continue to rely on revenue from the rural sector, but it seems unlikely that those at the farm gate will notice any positive economic changes for several years.
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