DairyNZ director’s in for a pay rise

The annual meeting this week in Invercargill is expected to approve the chairman’s annual fee increasing 3.5% to $76,500. Directors’ fees will rise 4% to $40,500. Directors also get $2000 for serving on a sub-committee and $4000 for chairing a sub-committee. These fees will remain the same.

According to voting papers, the board’s recommendation to increase director fees follows an independent survey of fees paid to directors in the ‘marketplace’.

DairyNZ’s annual report shows last year it paid $478,000 in director fees and $411,000 in the previous year.

In 2011-12 its revenues were $88 million – $61m in farmer levies from dairy companies and $27m in government funding and farm income. It spent $83m on programmes and operations.

As expected, Fonterra was the largest levy payer. The co-op’s 10,500 farmers paid $53m in 2012, up from $48m the previous year after record milk production.

Open Country Dairy paid $2.3m in farmer levy ($2.4m the previous year), Westland $1.9m ($1.6m), Synlait $1.3m ($890,000), NZ Dairies $390,000 ($500,000) and Tatua $478,000 ($434,000). Other dairy processors paid $424,000 ($27,000).

In his annual review chairman John Luxton says its board and staff have been focussing on five strategies: competitiveness, profit from productivity, people, achieving shared goals, and image and reputation. “It is a work in progress, but we are making progress,” says Luxton.

According to DairyNZ, nationally the level of significant non-compliance with dairy effluent fell below 10% for the first time. The first five companies became ‘accredited’ designers of farm dairy effluent systems under a programme funded by DairyNZ and the Primary Growth Partnership Fund. There is also a high level of compliance with the Animal Welfare Code, according to a survey in 2011.

Luxton says in April 2012, 92% of the New Zealand public agreed the success of the dairy industry is critical to the economy.

He says 62% of the public have favourable impressions of dairy farming; and 63% agree New Zealand dairy farmers are the most efficient milk producers in the world.

“DairyNZ has a key role to play in educating and ensuring that farmers are doing the right thing. We can and do tell the good stories of land stewardship but this all gets undone by bad practice and bad headlines. A good reputation is hard to win but easy to lose.”

The industry is also facing the challenge of growing milk production. Much of the industry’s growth is occurring in Southland and Canterbury. Milksolids production in the South Island has increased 7.7% annually since 2000.

With just 15% of the arable land in these regions in dairy farming, there is still much potential, Luxton says. “However, if we want to achieve that growth and potential, we will need to rise to the challenges we are facing and continue implementing our strategies to deal with them.

“DairyNZ, and the levy that supports its work and leverages significant further government and commercial investment in our industry, sits at the heart of that response. So do the partnerships we have with the many other organisations in our industry that are just as committed as we are to making a difference.”