Bal­lot of­fer tar­gets young farm­ers

Marlborough Express - - BUSINESS - GERARD HUTCHING

Na­tional will di­rect Land­corp to of­fer farms to young farm­ers be­cause ‘‘there is no clear pub­lic good com­ing from Crown own­er­ship and lit­tle fi­nan­cial re­turn to tax­pay­ers’’.

Pri­mary In­dus­tries Min­is­ter Nathan Guy said the young farm­ers would have to ‘‘work the land’’ for five to 10 years, af­ter which they could lease the farms be­fore buy­ing them.

It was en­vis­aged about 100 young farm­ing fam­i­lies would ben­e­fit from the pro­gramme.

‘‘Not all of Land­corp’s around 140 farms will be sold,’’ Guy said.

‘‘Many are sub­ject to Treaty [of Wai­tangi] claims and oth­ers have a right of first re­fusal for iwi – and th­ese rights will of course be re­spected.

‘‘Some of Land­corp’s larger farms will be di­vided into smaller units more ap­pro­pri­ate for first-time own­ers.’’

Fed­er­ated Farm­ers president Katie Milne said it was an ‘‘ex­cit­ing prospect’’ for young farm­ers.

It was a slightly ‘‘back to the fu­ture’’ pol­icy be­cause in the days of the De­part­ment of Lands and Sur­vey farm­ers went into a bal­lot each year for farms.

‘‘I know of a few farm­ers who won the bal­lot and were able to buy a farm. I re­mem­ber when my fa­ther and mother used to en­ter the bal­lot every year, al­though they never won any­thing.’’

Milne would not com­ment on Guy’s view about the fi­nan­cial per­for­mance of the state-owned cor­po­ra­tion, ex­cept to say it was ex­posed to the va­garies of the mar­ket like all farm­ers.

‘‘But we have chal­lenged Land­corp over tak­ing on sharemilk­ers be­cause that’s a way for young peo­ple to get eq­uity and buy a farm. They de­cided to em­ploy man­agers in­stead.’’

Labour’s pri­mary in­dus­tries spokesman, Damien O’Con­nor, said it was not his party’s pol­icy.

‘‘We ex­pect caveats on the sales so that farms can’t be on-sold to for­eign buy­ers. Labour be­lieves Land­corp has the size and ex­per­tise to lead in­no­va­tion across the agri-busi­ness sec­tor and we don’t want to un­der­mine that.’’

While 100 farm­ers would ben­e­fit, ‘‘thou­sands’’ of oth­ers needed as­sis­tance to buy their own farms, O’Con­nor said.

Green Party en­vi­ron­ment and pri­mary in­dus­tries spokes­woman Eu­ge­nie Sage said the sales risked land fall­ing into over­seas own­er­ship.

‘‘Land­corp can lead the shift to en­vi­ron­men­tally sus­tain­able farm­ing. Its farms are a pub­lic as­set we should be keep­ing, not sell­ing them for over­seas buy­ers to pur­chase some­time in the fu­ture,’’ Sage said.

Guy said there would be no time lim­its on when the farms could be sold by the new own­ers, al­though be­cause they had in­vested years in de­vel­op­ing them dur­ing the leas­ing process, they would be less in­clined to sell them.

Land­corp is New Zealand’s largest farmer, run­ning about 140 farms the length and breadth of the coun­try.

It has 700 staff, with an av­er­age of six per farm. Guy en­vis­aged some of those staff might be in­ter­ested in ap­ply­ing to buy, and oth­ers might want to work for the new own­ers.

Last week it an­nounced an af­ter-tax profit of $51.9 mil­lion com­pared with the year be­fore of $11.5m, but did not of­fer a div­i­dend to the Govern­ment.

Guy said the young farm­ers would have the op­por­tu­nity to buy the farms ‘‘at mar­ket rates’’ when they had built up enough cap­i­tal af­ter leas­ing them.

The farms would be awarded on a lease-to-buy ar­range­ment, with leases awarded by a panel and bal­lot, and pri­ori­tised to­wards young farm­ers who had ex­pe­ri­ence at run­ning a farm­ing op­er­a­tion.

The lessee would be re­quired to work the farm for at least five years be­fore be­ing able to buy it, or longer if they needed more time to build up cap­i­tal.

New Zealand Young Farm­ers chief ex­ec­u­tive Terry Copeland said the an­nounce­ment was great news.

‘‘The mech­a­nism to lease first and build up some ex­per­tise and some pro­file be­fore buy­ing in is a very smart move.’’

Na­tional says it will di­rect New Zealand’s largest farmer, Land­corp, to lease and sell Crown-owned farms to up-and-com­ing farm­ers.

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