The 2015 Sheep & Beef Levy Referendum

Background & update

Why we need to hold a referendum

• B+LNZ operates under the Commodity Levies Act 1990 (CLA)• The CLA enables a commodity levy order to be created• A levy order lasts six years – current orders expire April 2016• There are two separate levy orders (beef and sheepmeat), creating two

separate levies• Sheep, beef and dairy farmers vote to create a new levy order (or

cease operations)• A registered farmer’s (a farmer who has put themselves on the B+LNZ

electoral roll) vote is assessed in two ways:– One farmer, one vote – Weighted stock units (250 sheep, 50 Beef Cattle, 100 Dairy Cattle)

• Both ‘tests’ must be passed (>50% support from those who vote) for a new levy order to be created

• A successful Ref15 vote will means B+LNZ can continue to operate for a further six year cycle from 2016-2022

Vote outcomes

Yes = new levy order for the period 2016-22

No = B+LNZ ceases

When is the 2015 referendum?

The 2015 Sheep & Beef levy referendum will be held over a six week period in August and early September.

Referendum window 6 weeks spanning August – early Sept Vote period 4 weeks

Launch 3 August at Farmer Council

conference

Why then?

• Time required to enact a new levy order before April 2016 (2016-22) – legal and parliamentary process

• Need to conclude Market Development negotiations and communicate outcome to farmers as part of the Ref15 ‘offer’

• Recognise on-farm activity around the country

Referendum Working Group

• James Parsons • Anne Munro• Kirsten Bryant• Martin Coup• Scott Champion• Richard Wakelin• Cros Spooner• Jan Keir Smith• Kelvin Whall (Project Manager)• Sam Halstead (contracted PR)

Ref15 Framed from a farmer point of view

Farmer focus

From farmer feedback we have identified the following principles for Ref15:• Keep messages and materials brief and simple• Have a short referendum period • Have several ways for farmers to engage with

Ref15 (not just a roadshow, i.e. face-to-face meetings)

• Utilise Farmer Council and regional networks• Create a regional focus/’value proposition’• Engage others in the sector

Principles for Ref15

• Referendum Working Group active since Sept 2014

• Budget in place to support Ref15• PR & communications support in place• Timeline confirmed• Communications plan in place• Indicative levy levels 2016-22 for consultation• Farmer Council National Executive briefed and

engaged • Key messages in draft form• Ref15 offer being built

Activity to date

What next? – before the launch

• Farmer Council conversations – key sounding board

• Stakeholder organisations engaged• Key messages confirmed – with regional

customisation• Materials development – simple and concise• Enrolment campaigns – electoral roll• Consistent Ref15 messages through ‘business as

usual’• Prepare regional delivery and roadshow• Deliver the day-to-day B+LNZ operations really

well!

What happens in the active referendum period?

• Materials distributed to farmers – roadshow schedule and online info

• Active media – raise awareness, call to action• Online channel for depth and detail• Regional roadshow

• Delivered concurrently within a 7-10 day period• Involving regional Directors, staff and local

Farmer Council• Key event in each region plus a mix of others

• Voting by post and online• Telephone calls within voting period to remind farmers

to vote

What is happening right now?

• Market Development negotiations

• Meeting key stakeholders

• Levy rate testing

• Farmer Councils and FC Exec – teleconfs

• Developing regional messages and planning regional delivery

• Dairy engagement strategy

• Look & feel for Ref15

• Farmer online consultation tool development and testing

The 2015

Sheepmeat & Beef levy referendum

DRAFT OFFER FOR CONSULTATION

Achievements

The draft offer 2016-22

Current strategic priorities

Plus• A new market development initiative co-funded by processors• Increased focus on environment• Increased focus on Health & Safety

Proposed levy investment

Sheep levy• 60c/hd no change for first 2 years of new levy order.

• Increasing to 65c in 2017/18

• Increasing to 68c in 2019/20

 Beef• $4.40/hd no change for first 2 years of new levy order.

• Increasing to $4.80 in 2017/18

• Increasing to $5.10 in 2019/20

Increased levy investment mooted to commence in 2017/18 based on a successful negotiations on a new market development with processors. Failure to reach agreement will see a review of offer. Likely no increase to levy.

What do I pay now?

Current levy rates collected at slaughter (to expire in April 2016);

• Currently the average (all classes) Sheep & Beef farm invests $1,518 per year in levies. This is made up of;

–Lamb $960 (approx. 3.3c/kg)–Sheep $199 (approx. 2.4c/kg)–Beef $361 (approx. 1.6c/kg)

• Currently the average dairy farm invests $343 per year in beef levy from cull animals. This represents approx. 2.3c/kg

 

Current investment

What might I pay 2016-22

• No change in either sheep or beef levy to begin the new levy order in 2016

• An 8c per head increase in sheep levy is proposed during the period to 2022, with

full implementation in 2019/20.

• A 70c per head increase in beef levy is proposed during the period to 2022 with full

implementation in 2017/18.

• The average Sheep & Beef farm (all classes) would invest (at full implementation in

2017/18) $1,730 per year in levies – an increase of +$212, this made up of;

– Lamb $1,087 (approx. 3.8 c/kg, up 0.5c/kg)

– Sheep $225 (approx. 2.7c/kg, up 0.3c/kg)

– Beef $418 (approx. 1.8c/kg, up 0.2c/kg

• The average dairy farm (at full implementation in (2017/18) would invest $398 per

year in beef levy from cull animals – an increase of +$55, representing approx.

2.7c/kg (up 0.4c/kg). Note: for comparison - the average dairy farm pays $5,500

per year in milksolids levy to DairyNZ.

Possible new levy order