$7m NAIT bill looms

Up until now, the government has paid the bulk of the establishment costs of the scheme, with farmers chipping in indirectly by way of levies paid through DairyNZ and Beef+Lamb New Zealand.

However, from July 1, most of the cash to run NAIT will be collected directly from farmers by way of levy. The budget for NAIT is set at $8.6m for the year beginning July 1, 2012 with the government picking up just $1.6 m of that in the first year.

But over time, it is planned that the industry will pick up about 65% of the cost of NAIT and government the balance.

NAIT chief executive, Russell Burnard says once the scheme is properly established, it's anticipated that the annual cost for running the scheme will drop to about $7.8 m of which $5.5 m will come directly from the industry.

But before all this is set in concrete, NAIT is consulting with interested parties on this proposal. A consultation document has been prepared and parties have until December 23 to make submissions.

Burnard says the cost will work out at about $2.50 per animal over its lifetime, the cost of which will be split between the purchase of a NAIT tag and a levy at slaughter. The tag levy would be $1.10 and slaughter levy $1.35.

"The levy cannot take effect until the NAIT legislation is passed by the new parliament, but it does have bipartisan support. This consultation is being carried out in anticipation of this legislation being passed and the scheme becoming operative from July 1 next year," he says.

Burnard says the various interested parties will be informed about the proposal and it has been widely circulated in the media.

"It's on our web site. We are not planning to do a road show, as it's the wrong time of the year for that. But obviously if anyone wants us to go out and talk to them we are happy to do so," he says.

Following this consultation, NAIT will analyse the submissions early in the new year and get this advice to the Minister of Biosecurity.

Burnard says the industry funding of NAIT should not come as a surprise to farmers whose leaders have been kept informed throughout the process.

However, he admits the fact that farmers will have to pay, might have got lost in the drawn out discussions on when NAIT would or wouldn't happen.

"Certainly Feds will be aware of it at the political level. We've been informing them all the way through this process. We've engaged a broad sector working group to try and get the best levy structure that works.

"That includes the policy analysts at the levy funder level and includes the MIA and the Federation, but whether the rank and file members are aware of it, that's in the eye of the beholder," he says.