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Monday, 28 May 2018 16:17

$886m bill: Govt to meet 68% of total cost, farmers 32%

Written by 
Prime Minister Jacinda Ardern and Agriculture and Biosecurity Minister Damien O’Connor. Prime Minister Jacinda Ardern and Agriculture and Biosecurity Minister Damien O’Connor.

The Government has just announced that it will attempt to eradicate Mycoplasma bovis from NZ herds.

Eradication will involve:

- Culling all cattle on all infected properties along with cattle on most restricted properties 

- All infected farms found in future will also be depopulated

- Following depopulation, farms are disinfected and will lie fallow for 60 days after which they can be restocked

- Intensive active surveillance, including testing and tracing, will continue to detect infected herds

- There will be some flexibility for farmers in the timing of culling to offset production losses

- An improved compensation claim process. MPI says a substantial part of a farmer’s claim for culled cows should now take 4-10 days, with a fully verified claim taking 2-3 weeks.

The full cost of phased eradication over 10 years is projected at $886 million. Of this, $16 million is loss of production and is borne by farmers and $870 million is the cost of the response (including compensation to farmers). 

The Government expects to do most of the eradication work in 1-2 years.

Government will meet 68% of this cost and DairyNZ and Beef+Lamb New Zealand will meet 32%.

The alternative option was for long-term management. This was projected at $1.2 billion. Of this, $698 million is the loss of production borne by farmers and $520 million of response costs.

“To not act at all is estimated to cost the industry $1.3 billion in lost production over 10 years, with ongoing productivity losses across our farming sector,” the Govt says.

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