Govt announces new funding for sheep and beef genetics research – but is it “corporate welfare”?

The Taxpayer’s Union has challenged new government funding of the sheep and beef sector.

Science and Innovation Minister Steven Joyce yesterday announced a $15 million investment over five years into advances in genetics research that will improve the profitability of New Zealand’s sheep and beef sector.

A new partnership, Beef + Lamb New Zealand Genetics, will also bring together New Zealand’s existing sheep and beef genetics research by consolidating Sheep Improvement Ltd, the Beef + Lamb New Zealand Central Progeny Test, and Ovita.

Total funding for the new project from government and industry sources will be up to $8.8 million a year.

“Science and innovation are major drivers of economic growth and international competitiveness. The Government is committed to ensuring we invest in purpose-driven research that benefits New Zealand,” Mr Joyce says.

“Genetic improvement in the sheep industry has contributed greatly to farm profitability, and for every dollar captured on farm, another 50 cents is captured off-farm. In just 10 years Beef + Lamb New Zealand Genetics expect that farmers will receive $5.90 extra profit per lamb sold at that time.”

The funding, contributed by the Ministry of Business, Innovation and Employment, will allow further expansion into beef genetics and will allow both the beef and sheep industries to further improve genetic gain in the development of new traits to satisfy the increasing trend of farming in hill country environments.

“Investing in genetics will help improve meat quality, contribute directly to improving on-farm profitability, and ensure we’re meeting the needs of consumers,” Mr Joyce says.

“As a nation, we are already leading the world in pastoral animal and plant genetics. This partnership will help us maintain this critical position and to continue to build on it through further research and development in sheep and beef genetics.”

AgResearch will play a major role in the partnership, along with other research partners Abacus Bio, Lincoln University, Massey University, and the University of Otago.

But the Taxpayers Union regards regards the investment as corporate welfare.

“The only winners are the sheep and beef farmers who will ultimately profit,” says Jordan Williams, Executive Director of the Taxpayers’ Union. “Like most corporate welfare, it’s everyday taxpayers who will be left out of pocket.

“As Mr Joyce points out, New Zealand already leads the world in pastoral animal and plant genetics. Why is the Government pouring millions into an existing multi-billion dollar export industry? Expecting increases in farmers’ profits is not justification.”

Williams reckons the funding is for good headlines, not good economics, and asks: What other industries have their normal research and development costs borne by the taxpayer?

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