New Zealand Winemakers Fighting Increased Food Safety Fees

The Ministry of Primary Industries (MPI) proposed $12.8 million increase in fees in order to maintain food safety levels and protect biosecurity risks
January 23, 2015

Earlier this week the Ministry of Primary Industries (MPI) in New Zealand announced a proposed $12.8 million increase in fees in order to maintain food safety levels and protect New Zealand from biosecurity risks. 

Of the proposed fee increase, $2.9 million would be payable by the wine industry in a move that has been deemed 'manifestly unfair' by Steve Green, Chairman of the New Zealand Winegrowers Association.

First Fee Increase Since 2008

The Ministry of Primary Industries explains on their website that this will be the first increase in food safety fees since 2008.

“Biosecurity and food safety are critical to the operation and viability of New Zealand’s primary industries. Without these systems, New Zealand’s $38.3 billion primary sector exports would never get past importing countries’ borders and New Zealand’s primary industries would be exposed to a much greater risk of potentially devastating pests and diseases,” says Dan Bolger, MPI’s Deputy Director-General, Office of the Director-General. “Over and above that benefit to industry, the systems ensure the safety for consumers of New Zealand products, at home and abroad.”

The increase in fees has been attributed to increased imports and exports, inflation and a greater number of food businesses that need to be monitored.

Money raised would be used towards audit costs, inspection costs and costs associated with running the wine export scheme according to Mr Green.

End to Government Rebates on Wine Samples

Currently, New Zealand's wine industry is reimbursed for the cost of testing samples of wine destined for export. This can cost up to $160 per sample and wine companies now pay the laboratories directly before being reimbursed by the Government. The proposal by MPI explains why these rebates will stop.

“Rebates were originally offered when New Zealand’s wine industry was in its infancy. The wine industry is now a mature industry and the condition for rebating no longer applies. The practice of rebating the cost of testing will cease from 1 July 2015,” the proposal explains.

The proposal may have a point about the maturity of the market. Between 2005 and 2014 the wine industry in New Zealand grew by more than 13 percent per year, with exports growing from $435 million in 2005 to $1.33 billion in 2014.

This is deemed irrelevant by the New Zealand Winegrowers Association who state that they already pay more to the government than other primary industries as they have to pay excise duties on their exports, something other food producers do not have to do. That's a $200 million payment each year already made to Government. The $2.9 million proposed fee increase would be added on top of this.

To learn more and to get involved in the consultation on this proposal visit the Consultations page on the MPI website.