Tuesday, October 7, 2014

Are we having the wool levy being pulled over our eyes?

I have been reading the numerous article and letters, like most of us I suspect, on the pros and cons of another wool levy,  more pros as it would seem the wool levy group has a reasonable budget judging by the coverage in the farming magazines.

 I was certainly someone who was sitting on the fence on this. In theory it’s a great idea, we collectively contribute funding to a body that has our best interests at heart; such a body then makes intelligent prioritised and relevant decisions as to what is in our best interests.    In theory it’s fantastic!!!  Just like a cooperative for a meat company!

 The levy group make a number of blanket statements as to how the money will be used for Communication, Education and Innovation with a number of bullet points under each of these headings.    But again everything they say is generic statements for example one bullet point under the heading Communication: “provide industry leadership and a shared vision for the sector- industry direction, unity and alignment”.   It’s hard to disagree with such statement; the problem is how you achieve this goal, there is no detail as to how this maybe achieved.  We probably need such detail given we had a wool levy for many many years prior to 2009, which, despite it (which was considerably more in dollar terms than what is proposed now),  wool continued to decline to some very low levels in both price and demand, so how will the introduction of this wool levy be any different?

 Education:  again one bullet point under this heading: “provide funding for promoting awareness of wool to ensure that retailers, consumers and those that influence buying decisions have an understanding of wool and an incentive to use it”   Hard to disagree with such a goal, but realistically even if the whole $4.6 million proposed was used to achieve this one goal, would you make any traction?  Synthetic manufacturers of substitute products for wool (best example carpet), as I understand it, spend millions on promoting their product, including bigger margins and cash incentives for turnover of product, will 2.7 million (figure suggested) be anything but a drop in the bucket, unless its done comprehensively and properly is there any point in doing it all.  Not to mention the obvious; what indeed is the best way of educating these people when one considers you are competing against entities that have much deeper pockets than we ever will.  For example do you drive it from the consumer end or push it from the producer end, do you get celebrities or do you educate the young (possible in New Zealand perhaps, but in other countries with 2.7 million).  There are endless questions as to how you do this and whether you will achieve anything at all if you don’t have the budget to succeed.

 Another heading is “Innovation”: half a million for essentially research and development purposes.    Again great, but if you have a good idea, is there not numerous ways to get funding for this now.   There seem to be a number of government funding avenues now if the idea you want to research and develop is credible: why will another half million all of sudden make such a difference to wool innovation.  Perhaps it will but I have my doubts.

 It seems to be the norm in our industry that generic statements are made without providing the detail as to how you achieve these goals.  The Meat Industry Excellence Group, the Red Meat Sector report and now this wool levy.    To be credible and get people on your side you need detail as to how one intends to achieve such goals, particularly in light of the fact that all these issues are not new, in fact they continually come up on a regular basis with seemingly no solution.

 I have no doubt that those who are pushing for the reintroduction of the wool levy and well meaning in their intent, but if introduced its success depends on the people driving it.  I understand that entities like these take up a lot of time and often the people you want to be running it are simply too busy running their own operation to put their hand up and those who do have the time and make themselves available are not always the best people for the job.

 As you can tell from what I have written I am probably going to vote no, as firstly I think the amount of the levy is simply not enough to achieve anything: if you don’t have enough money to do something comprehensively and properly then realistically attempting to do something on half hearted basis is a waste of time (which I think the budget proposed is far from enough).  Secondly, like everything it’s only as good as the people running it, and I need more detail as to who this would be and how they intend to go about achieving these goals as in my experience history shows that when its not your money one is spending its easy to spend the money on the wrong things in the wrong way.



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