New government requirement will add cost, but for what benefit?

These plans will be required for all farms (including vineyards) above 5 hectares; they will need to be certified in the first instance and then audited annually to ensure compliance with government requirements. The objective is to make sure the primary sector plays its part to improve freshwater quality in New Zealand's lakes, streams and rivers.

New Zealand Winegrowers (NZW) is supportive of the Government's goal to improve freshwater quality. Over the past two years we have worked closely with government agencies to develop a cost-effective way that the grape and wine industry can contribute to this goal. This has been a very frustrating exercise as we have not been able to persuade the Government to take a risk-based approach to the issue. What do we mean by that? Simply, design a regulatory system where the regulatory impact is proportionate to the risk any activity presents to freshwater quality, and gain momentum by using existing industry programmes like Sustainable Winegrowing New Zealand (SWNZ) to make progress faster while minimising transaction costs for all concerned. We thought that was a logical and sensible approach.

To that end, we recently wrote to the Ministry for the Environment (MfE) and Ministry for Primary Industries outlining our concerns. Extracts from that letter follow. Note that IAPs referenced in the letter are Industry Assurance Programmes such as SWNZ:

The evidence that viticultures has a low impact on water quality is compelling. It includes research recently undertaken by the Agribusiness Group.

MfE's own report, 'Our Freshwater 2023', released on April 12 confirms that water quality is generally better in the Wairau and Awatere River catchments (areas in Marlborough with viticulture as the predominant land use) than in many other catchments in the region, and better than other regions, where other primary sector land uses are more prevalent. Specifically, the report identifies that fertiliser use is a key cause of degradation in freshwater ecosystems, and notes that urea use in Marlborough has decline significantly between 2002 and 2019 as viticulture has become increasingly prevalent in the region. Our Freshwater 2023 corroborates our recent discussions with the Marlborough District Council who have highlighted that viticulture is not a key land use in any of Marlborough's high risk catchments.

In 2021 there were 1,342 vineyards over 5 hectares in New Zealand. During consultation in 2022 MfE staff identified that the likely ost of developing a freshwater farm plan would be between $3,00 and $15,000 per property. This means that the cost for the wine industry to implement the regulations will be between $4.03 million and $20.13 million. In our view this cost is disproportionate to the risk to water posed by the wine industry. Further, given the wine industry's low impact on water quality, this cost will result in negligible environmental gain.

We note the Government's commitment to uphold the environmental integrity of the Freshwater Farm Plan System. To achieve this, we consider it is important to enable IAPs to constructively support the system, and to minimise the substantial compliance costs on low-risk sectors such as the wine industry. We would welcome the opportunity to work with you to develop a solution that is fit for purpose. This could include:

• As a priority, reviewing Part 9A of the Resource Management Act and subsequent review of freshwater farm plan regulations that are currently being finalised;
• Lifting the threshold for exemption from the requirement to have a plan (for low-risk activities) from 5 to 20 hectares.
• Developing and delivering IAP equivalence arrangements in key regions (such as Marlborough) where the Freshwate Farm Plan Regulations have not been switched on; and
• Ensuring there are adequate transitional arrangements in place for members and regional councils in areas where regulations are switched on and equivaluence arrangements with relevant IAPs have not been finalised.

We strongly support the goals of the freshwater regulations, and we want to assist in their implementation in a way that will generate meaningful environmental benefits.

We remain concerned that if changes are not made to the Regulations, the duplicative environmental reporting and management framework that it creates will undermine the ongoing operation of SWNZ, a programme that has added significant value to our sector by helping to establish and maintain our reputation as a world leader in sustainable production for more than 25 years.

NZW's position is that as viticulture is a low-risk activity, the regulatory impositions need to be proportionate and must also acknowledge that industry programmes like SWNZ are crucial in driving positive outcomes. The alternative is an outcome with high cost, but little environmental benefit.

We are continuing to work with various Government agencies to try to get the very best outcome for our members on this matter. The truly disappointing thing in all this is, that if the current plans remain unchanged, then despite the millions of dollars in extra costs imposed on growers and wineries, the environment will be little to no better off! That sounds like a really bad outcome after years of work of all concerned.