Meat and Wool NZ was blindsided this week by a full page ad in a rural publication urging them to ditch plans by the organisation to increase levies.

The anonymous ad published in Farmers Weekly asks farmers to vote against a proposal outlining future funding and spending by Meat and Wool in favour of a new plan that focuses only research and development and costs less.

Meat and Wool chairman Mike Petersen said while the final proposal has been completed, it is going through the final stages and won’t be presented publicly until a press conference in Wellington on Wednesday, July 22.

The organisation funds a range of activities including spending on innovation, information analysis, market access, market development and skills and education. The total bill for all of this is around $80 million each year and about half of that is funded by farmer levies.

Revenue from levies has dropped this year, down $4 million to $28 million. In addition, another form of income, returns from reserves held by the former New Zealand Meat Board, have also dropped.

Revenue from other sources including industry input from meat companies for market development and the government for research and development contributions make up the rest.

Mr Petersen said the board had been working with returns of about 9% from the $90 million meat board reserves, but looking forward over the next five years, he said all advice indicated a drop to around 4%.

Meanwhile, kill numbers have been dropping, particularly with sheep, which led to the drop in levy revenue.

“And we expect that to continue over the next few years,” he said.

Mr Petersen revealed that the proposal released next week, which should be in farmers’ hands by August 3, suggests “small step increases” to levies over the next five years and a reduction in expenditure.

The proposal is based on more than 60 farmer meetings and 900 written submissions.

Farmers currently pay 40c for each sheep slaughtered; 5.25 cents a kilo for shorn wool and for wool on sheep at slaughter and $3.60 per head for slaughtered cattle.

The anonymous ad suggests rates of 15c for sheep, $1 for cattle and 2c per kilo of wool. It’s billed in that ad as a “low-cost proposal… presented by concerned New Zealand farmers.” This would be used to support research and development for on-farm benefits only, the ad proclaimed.

Mr Petersen said the numbers presented would raise about $6 million.

“This would mean that sheep and beef farmers would be the lowest investors in research out of any export sector in New Zealand,” he said.

“No farmer will agree with everything in the final proposal, but we are confident that we have accommodated the views of the majority to ensure there is the continuity of investment that farmers have told us they support”.

Mr Petersen believe Southland farmer Murray Turner was leading the group that contributed to the full page ad.

Mr Turner was not available to take NBR calls, but he told Radio New Zealand yesterday that farmers should not be paying for marketing and meat promotion activities that are the companies’ responsibility.

There are about 14,000 commercial sheep and beef farmers in New Zealand.

Farmers will have until the end of August to vote on the proposal.