Introduction
Good morning ladies and gentlemen. Thank you, Jim Edwards, for the introduction.

I would also like to thank President, Frans Laas, for this invitation to speak here today and the organising committee of the Waikato Branch of the National Beekeepers' Association, who are hosting this conference here in Rotorua.

Last month I was delighted to help the bee industry in launching New Zealand's first ever Bee Week.

You did a great job to raise the profile of an essential but sometimes overlooked component of our agricultural and horticultural sectors.

As a former student of agriculture, and a farmer, I was aware of the importance of bees as pollinators. What surprised me and many of those attending the Bee Week launch was the range of other products derived from honey bees.

The industry has moved a long way from shipping out honey in 44-gallon drums, and paying beekeepers solely on colour.

When any industry group gathers, there is a strong temptation to focus on the difficulties the industry encounters. I believe it is a mistake to focus only on the negatives.

On a positive note, demand for pollination hives is growing every year, from an increasing range of crops.

This is providing a source of income for beekeepers far removed from ‘traditional' pollination users like kiwifruit and apples.

Our honey continues to fetch premium prices on world markets, due to outstanding quality, presentation and marketing.

Manuka honey has become an international sensation, envied by beekeepers around the world. It has also provided an example to other New Zealand industries considering research to understand the properties of their unique products.

Manuka honey
This brings me to an issue that I understand is causing division in the industry. I am referring here to the branding of manuka honey, and the different ways that its antibacterial properties can be measured.

Only last week this debate was back in the limelight with news Cornish beekeepers have started producing manuka honey (albeit in tiny amounts, 3kg in a year) and selling it for more than $150 a pot.

This just shows the huge potential for New Zealand - if we can sort out the debate.

The industry currently appears divided, with each group firmly convinced that they are in the right.

It isn't my job to judge the competing claims that are made. However, as Minister of Agriculture, and with a lifetime spent in the primary sector, I strongly urge you not to fall victim to the in-fighting that has handicapped other industries.

One sector that you might like to reflect on is the wine industry. This industry has been delivering astonishing growth, year after year, for almost two decades.

Like you, they are marketing a premium product for consumers who are very sensitive to flavour and image.

There are now over 500 wineries in New Zealand, all competing fiercely for shelf space and the consumer dollar.

Despite this competition, you rarely hear one winemaker publicly attacking another's products.

The wine industry knows that in this wired-up world, customers anywhere in the world can stumble across press releases and newspaper articles written for a local industry audience.

Attacks on a rival brand will cause collateral damage to the good name of New Zealand wine.

This is an issue the industry needs to sort out, and no outside party can do it for you. However, bodies like Standards New Zealand, the Food Safety Authority and Food Standards Australia New Zealand may be in a position to help the industry come up with a solution.

That is the end of my sermon on the dangers of infighting but I hope you give this matter some thought; now, on to American foulbrood.

American foulbrood (AFB)
As you all know, American foulbrood has been managed by the beekeeping industry, under a national pest management strategy, for the past ten years.

What you may not realise is that American foulbrood first came under regulatory control in 1905. The government was responsible for early foulbrood control.

The past ten years have seen industry in control. There have been plusses and minuses. On the positive side, AFB has been kept at very low levels by international standards. Encouragingly, spore levels in packed honey appear to have fallen substantially over the past ten years.

Less positively, the strategy has failed to meet its targets for disease reduction, by a large margin.

Early this year, the Ministry of Agriculture and Forestry gathered submissions on the strategy. My officials have asked me to thank those who made submissions - many of the 26 submissions went into great detail on some of the key issues.

By a large margin, submissions supported continuation of the strategy in some shape or form. There was less agreement over what changes were needed to make the strategy more effective.

In the next few weeks, the Ministry of Agriculture and Forestry will release a summary of these submissions, and make some recommendations based on them. Given the diversity of views in the submissions, I can be confident everyone will find something to disagree with!

MAF will be seeking feedback on its recommendations. So I would urge those of you with a keen interest in the strategy to comment once again on the direction the strategy should take.

Once MAF has that feedback, the Director-General will make a recommendation to me about the future of the strategy.

If I am satisfied that the revised strategy will provide effective control of American foulbrood, and meets the requirements of the Biosecurity Act, I will recommend to Cabinet that the strategy is re-imposed.

This will set the legal machinery in motion, and should result in the new strategy taking effect towards the end of the year.

Possibility of honey imports
I am aware that the bee industry has been opposing the import of Australian honey for several years. I should therefore make my own position clear.

Any decision on any import must be based on science. We demand this of other nations as we battle for entry of New Zealand products. We must therefore be extremely even-handed and open in the way we deal with imports, but at the same time be very mindful of security risks.

I was chairman of the Select Committee that reviewed the conditions for importing honey. Our recommendation resulted in the establishment of an independent panel to review MAF's decisions on these matters to ensure it was not both judge and jury. I am confident this process provides the right level of balance in assessing new import health standards.

The independent review panel on honey imports was originally scheduled to report back in May. I understand it has sought an extension to this time, and its review is now due any day. I have no more idea than you as to what it will say.

Current Economic Situation
Before I conclude I would like to talk about one more topical issue.

We all know the world economy is in recession.

Fortunately, people will keep eating, and our primary production sector is the engine that will pull New Zealand through this rough patch.

Many of you will be carefully going through the books in your own businesses, looking for places to trim costs.

As you saw in the Budget, the government has done precisely the same thing.

Primary Growth partnership
On Budget Day I made an announcement which will benefit you as essential contributors to the primary sector. That is, the Primary Growth Partnership.

For 20 years we, as a nation, haven't invested enough in primary sector research and development. Many of the recent productivity increases we have achieved on-farm are as a result of research done almost 30 years ago.

The former Agriculture Minister, Jim Anderton should be acknowledged for his vision for pastoral and food sector R&D with his promotion of the Fast Forward Fund.

National assessed Fast Forward and decided we could do better. Fast Forward was funded through a nebulous capital fund that was to be drawn down over a period of 15 years. The Primary Growth Partnership is funded through an ongoing, annual government appropriation that will be matched by industry.

PGP is a bigger commitment than Fast Forward. It incorporates a transparent and accountable funding structure that is focused on results.

So how it will work?

Budget 2009 provides $190 million of Government funding over four years for PGP. It will start at $30 million this year; go to $40 million next year; $50 million the year after that; rising to $70 million per year ongoing from 2012/13.

Funding will be increased as industry shows capacity and the need to spend even more.

With a matching commitment, dollar-for-dollar, by industry, up to $140 million will be invested annually.

It is an enduring commitment from central Government.

Funding will start this year at $30 million. We have started with a smaller amount because we believe projects will need time to be developed and assessed.

There will be five sections of funding with each proportioned a dedicated amount. This year it will be $2 million. The sections are divided up into:

1. pastoral (including wool) and arable production;
2. horticulture;
3. seafood (including aquaculture);
4. forestry and wood products; and
5. food processing (including nutriceuticals).

In addition to the five sections, $5 million will be proportioned for Greenhouse Gas research and development. I'll talk more on that shortly.

The remaining $15 million in year one will form a contestable fund open to any sector to bid for. If the dedicated $2 million for any of the sectors is not used, it will transfer to the contestable fund. Those industries that propose bigger and more ambitious projects can apply for more from the contestable fund.

In my mind the $2 million works like a teaser - every sector has a fair chance.

Government does not see PGP as 'business as usual'. It is an ambitious project and has an ambitious scope.

PGP has been closely developed with industry. It is unashamedly industry-led and simple in its structure. PGP will focus on results, and bureaucracy will be minimised.

The priorities and strategic direction of PGP will be led by those industries that choose to be involved. As I said at Bee Week there is opportunity for the bee industry to collaborate with other sectors.

My advice to you is to unite with other industry bodies and state your case for well-reasoned research projects to assist your industry.

Conclusion
In summary I am confident that the dynamic nature of our primary sector will ensure that breakthroughs are substantial and will underpin our future economic growth.

The next few years promise to be exciting times for primary sector research.

Budget 2009 will be a turning point for New Zealand. Ten years of economic growth and expansive appetites for debt and Government spending have ended.

Budget 2009 outlines the challenges to rebalance the economy from debt and consumption to investment and exports. Primary production will lead that rebalance.

Thank you again for inviting me to address your conference. I wish you all the best for your discussions.