Jim Sutton Speech: International Society of Plant Propagators meeting Tauranga

Ladies and Gentlemen, thank you for the invitation to speak today.

During the past couple of years, the Labour-Progressive Government has been working on a strategy called the Growth and Innovation Framework.

In 2002, the Prime Minister launched the Growth in Innovation strategy, focussing on three sectors which had the potential to affect all aspects of our lives ? what the policy wonks call "horizontal technologies".

These were: information and communication technology, arts and creative industries, and biotechnology.

The Growth through Innovation framework documents a broad consensus that has emerged over the ensuing two years as to what needs to be done to accelerate New Zealand's growth through innovation.

To do that, the Government is committing to implementing policies with more emphasis on: • Enhancing our innovation framework, that is, our systems for supporting innovative enterprise; • Developing our skills and talents; • Increasing our global connectedness; and • Focusing interventions in those areas that can have maximum impact.

The Government chose to target its innovation initiatives initially in biotechnology, ICT and the creative industries. These are all areas which, if they attain their growth potential, can significantly enhance the performance of the broad scope of the New Zealand economy.

Obviously, these three sectors are not the only sectors we want to see innovation and growth in. For our country, and our economy, to achieve the way we want it to, innovation must happen across the board.

Ladies and Gentlemen: ICT, biotechnology, and the creative industries are not about to displace dairy, meat, and tourism as the main agents of our economy. But they are three sectors of enabling technologies that are going to drive change and add value in those sectors and many others to help New Zealand lift its overall performance.

Horticulture is an industry I would like to use as an example of creativity and innovation.

To quote the Orchardist magazine, New Zealand horticulture prides itself on being a global leader, a major contributor to our country's economy, and a major part of New Zealand life. It is an industry that provides significant employment from Northland to Southland, and builds New Zealand's profile in over 105 countries. It exports $2.2 billion a year, and supplies most of the requirements of the New Zealand market ? a total export and domestic value for fruit and vegetables of $3.3 billion.

And the sector continues to grow strongly. The Orchardist cite statistics showing the horticulture industry has doubled in size in the past 12 years with further growth projected.

For the orchardist to produce fruit and the grower vegetables, they are reliant on breeders and propagators.

Historically, horticulturalists in the widest sense have been innovative, developing and selecting plant species to better suit our needs.

For example, I am told the first carrots were purple, originating in Afghanistan about 5,000 years ago. Drawings on temple walls dated 4,000 years ago show a purple carrot. I'm told carrots weren't orange until the 16th century when patriotic Dutch farmers bred them to match the Dutch flag.

Here in New Zealand, we have a tradition of growing plant varieties from other nations ? such as the feijoa and the kiwifruit now known as Zespri Green and Zespri Gold ? and making them our own through plant selection and breeding. This is still happening, as shown by the emergence of the Jazz variety of apple.

However, current law has made that increasingly difficult.

There have been articles in the media pointing out that if the kiwifruit was not already in New Zealand, it would be very difficult, if not impossible, to import it now. Given its invasive nature, that's quite possible.

As Biosecurity Minister, another of my roles, I think it is unlikely that the family cat would get in now either, let alone the rainbow and brown trout, possum, rat, and rabbit. The Biosecurity Act and Hazardous Substances and New Organisms Act were not adopted without good reason, grounded in lessons learned from past mistakes.

But the Government is not ignoring the concerns of industry, that we may have thrown a few babies out with the bathwater.

The ability to bring new genetic material into New Zealand is crucial to the development and marketing of improved varieties and breeds of plants and animals. Such new material also provides a basis for research, development and innovation in the biotechnology sector.

It is equally important to ensure that biosecurity is maintained when bringing in new material, to protect what is already here: native, introduced and economically important flora and fauna.

In New Zealand, post-entry quarantine is the tool that we use to ensure that new genetic material is imported in a way that protects the agriculture and horticulture industries, and the environment, from any pests and diseases that may be inadvertently imported at the same time.

Currently, however, gaps in level 3 (that is, the high-security) plant PEQ services mean that New Zealanders cannot bring in a wide range of high-value plant genetic material. The main problem is that nobody in New Zealand currently has the resource to provide the full range of highly specialist diagnostic services required for plant PEQ.

This has been an important issue, of increasing economic significance, for New Zealand's agricultural and horticultural industries. This is about to change.

I am delighted to announced that next week's Budget will include measures to address it.

The government has agreed as part of its Growth and Innovation Framework package to resource MAF's National Plant Pest Reference Laboratory in Auckland to offer the critical PEQ diagnostic services that private businesses have been unable to provide. These new services will cover diagnostics for level 1, 2 and 3 plant PEQ.

This will free private operators from having to provide for their own level 3 PEQ diagnostic services.

Of course, as you know, this is only half of the answer. Quarantined material must be held in transitional facilities of sufficient standard. But private enterprise has proven well capable of providing transitional facilities for PEQ, and we expect private businesses to be responsible for providing and maintaining level 3 transitional facilities in the long term.

We are aware that New Zealand currently has very little glasshouse space approved to level 3 standards, and we know that it will take some time for businesses to construct more level 3 glasshouse facilities.

In the short term, the government will make a limited amount of level 3 glasshouse space available for importers to rent while private level 3 glasshouses are being constructed.

There is a wide range of industries and individuals wanting access to level 3 PEQ facilities and services. We appreciate that constructing and operating a level 3 glasshouse may not be economically feasible for smaller individual industries, and so the government will be encouraging industries to work together to provide and share level 3 transitional facilities.

The Government is currently engaged with the food and beverage sector in an initiative aimed at markedly increasing the sustainable growth of the sector. This will involve the sector and government working together to make the most of opportunities such as those presented by free trade agreements, and to overcome barriers to progress such as challenges to accessing new genetic material.

The Food and Beverage Sector Engagement has recognised from the beginning the importance of access to new genetic material. I am sure that you will make the most of the opportunities it presents for working together to revive and sustain level 3 PEQ services into the future.

MAF Policy and Biosecurity New Zealand are working together to implement these outcomes. Any questions about what this means for you, and how the new level 3 PEQ system might work, should be addressed to MAF Policy.

Another pressing issue is the review of the Plant Variety Rights Act which is being done in tandem with the Patents Act.

The key issue for the review was whether the current Act adequately protects the interests of New Zealand plant breeders ? and indeed the interests of overseas breeders who may be hesitant to release their own new varieties to New Zealand growers.

Underlying this question is whether New Zealand should ratify the 1991 revision of the UPOV Convention and amend the Act accordingly. UPOV 91 is the agreement that establishes the rights available to plant breeders internationally. New Zealand's current Act is based on the 1978 revision of the UPOV Convention. As you know, UPOV 91, in Article 14, gives plant breeders greater rights over their protected varieties, and extends this protection to varieties "essentially derived" from a protected variety.

In July 2003, Cabinet agreed that UPOV 91 not be ratified at this time, as ratification may constrain the government's ability to respond to the future outcome of the WAI 262 claim and any future amendment of the PVRA to take account of objectives of the government's bioprospecting strategy, once developed.

Cabinet did agree, however, that ratification be reconsidered after the WAI 262 claim has been resolved and work on a bioprospecting policy is completed, or within three years, which ever was sooner.

Notwithstanding the deferral of ratification, Cabinet agreed that the PVRA be amended to extend plant breeders' rights in line with those accorded under Article 14 of UPOV 91.

To balance the wider public interest and that of plant breeders, Cabinet agreed that the exemption on farm saved seed be retained, but that the PVRA be amended to provide for regulations to declare specified species to be excluded from the exemptions in the Act.

It is expected that a draft of the proposed Plant Variety Rights Amendment Bill will shortly be released for public comment. The Cabinet paper outlining policy decisions in this area can be found on the Economic Development Ministry's website.

Ladies and Gentlemen: Plants, as well as animals, are central to the New Zealand economy. The work of people such as yourselves is crucial, not just for our economic wellbeing, but our health and cultural integrity as well.

I wish you all the best for your conference, and success in the future. Thank you.

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