Friday, 16 February 2018 11:30

DIRA review on the cards

Written by 
Minister of Agriculture Damien O’Connor. Minister of Agriculture Damien O’Connor.

Provisions to manage Fonterra’s dominant position in New Zealand’s dairy markets will not expire at the end of May.

Parliament has passed a law change so that the efficiency and contestability provisions of the Dairy Industry Restructuring Act 2001 (DIRA) will be retained.

Minister of Agriculture Damien O’Connor says the Government will now undertake a comprehensive review of the DIRA and consult fully with the dairy sector.

O’Connor says the review will consider key issues facing the dairy industry, including, for example, environmental impact, land use, Fonterra’s obligation to collect milk, and how to achieve the best outcomes for farmers, consumers and the New Zealand economy.

Details on timing, delivery and definitive scope will be considered by Cabinet in the coming weeks.

“It was not in the interest of farmers, dairy processors, consumers, or the wider New Zealand economy to let these key DIRA provisions expire in the South Island and tinkering with the Act would not answer some of the bigger questions facing the industry.

“By rolling over the Act and committing ourselves to a wide-ranging review we are taking a considered and strategic approach to the changing needs of the dairy industry.’’

A report from the Commerce Commission, published in 2016, found that competition was not yet sufficient to warrant the removal of the DIRA provisions. This Government is satisfied that it is appropriate to retain the existing provisions while the review is conducted. 

“Officials are currently working on the terms of reference for the review, and I intend to share these with the New Zealand public and the dairy industry in the first half of this year,” says O’Connor.

The DIRA was passed in 2001 to manage Fonterra’s dominant position in dairy markets, until sufficient competition emerged. Its automatic expiry provisions were triggered in 2015, when other dairy processors collected more than 20% of milksolids in the South Island.

More like this

Delays ruled out on water reforms

Delaying the introduction of new water reforms was not an option according to the two cabinet Ministers directly involved – Environment Minister David Parker and Agriculture Minister Damien O’Connor.

Delays ruled out on water reforms

Delaying the introduction of new water reforms was not an option according to the two cabinet Ministers directly involved – Environment Minister David Parker and Agriculture Minister Damien O’Connor.

$700m for freshwater clean up

The Government has announced a $700 million fund to support the primary sector and other groups in meeting new clean water standards.

Featured

Report highlights good pay packets

A report confirming a sharp rise in pay for dairy sector workers will help attract more New Zealanders to farming jobs, says Federated Farmers dairy chair Chris Lewis.

Saving livestock and lives

With $1 million now behind them, Hawkes Bay Rural Advisory Group is working to get as many farmers and livestock through winter as possible.

 

» The RNG Weather Report

» Latest Print Issues Online

Milking It

Effluent power

Finnish dairy company Valio is on a mission to reduce milk’s carbon footprint to zero by 2035.

What’s in a name?

The man who coined the term ‘Gypsy Day’ is slightly miffed that a term he introduced to New Zealand’s farming…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter