Scheme could create 17,000 jobs

Spending over $5 billion on large-scale Canterbury irrigation will create 17,000 new jobs and boost the region's economy by 8 per cent a year, a new report claims.

The first economic assessment of the Canterbury Water Management Strategy (CWMS) says building water storage in Tekapo, Lake Coleridge, Lees Valley and Hurunui will cost $5.2b and irrigate an extra 236,000 hectares.

On-farm gross domestic product (GDP) would be boosted by $400 million a year.

About $1.7b would be added to regional GDP annually, an 8 per cent increase.

An estimated 17,000 jobs would be created in the region, including 3000 farm jobs, the report said.

Environmentalists warn the report is "superficial" and does not account for environmental mitigation.

Irrigation supporters welcomed the report andsaid benefits such as recreational opportunities could not be quantified in dollar terms.

The report comes amid rising tension about the future of Canterbury's water.

Christchurch today hosts a rally in Victoria Square at 12.15pm organised by umbrella group Canterbury: Our Water to protest against the threat of water management being taken out of local hands.

A handful of councillors from Environment Canterbury (ECan) will take part, including Crs Jane Demeter, Eugenie Sage and Carole Evans.

ECan deputy chairwoman Jo Kane said she would also attend with a placard saying: "Regional councillors, endangered species".

Cabinet is expected today to discuss the future of ECan, after the Creech report recommended sacking the elected councillors, appointing commissioners and establishing a regional water authority.

The Government is expected to decide within weeks if it will adopt the report's recommendations.

The CWMS report's findings were described as "compelling" by Agriculture Minister David Carter.

The strategy was launched by the Canterbury Mayoral Forum in 2002.

"There's been a long investment in time [in the strategy] and it would be a shame to throw that out, " Carter said.

Irrigation New Zealand chairman Graeme Sutton, a member of the strategy's steering group committee, said he was encouraged by the report's findings.

However, the benefits of irrigation would probably not flow through until the second generation of farmers.

The Government should fund feasibility studies to find the best options for irrigating Canterbury, he said.

Carter said financial support for Canterbury's water-related infrastructure projects had not been discussed by Cabinet.

He watered down suggestions of long-term government help.

"Financiers are telling us that once we get rid of the regulatory hurdles, and there's more certainty in the process, these projects would stack up far better, " he said.

The authors of the economic report - Harris Consulting, Aqualinc Research, Agribusiness Group and Butcher Partners - warned the irrigation benefits to Canterbury were overstated because environmental mitigation was excluded.

The scenario's assumptions could be "readily changed", they said.

Without environmental mitigation nitrate leaching could increase by up to 40 per cent in some areas, they warned.

Canterbury Water Rights Trust chairman Murray Rogers said the report was a "superficial analysis".

"Without assuming the need to be environmentally sustainable it's likely the report significantly overstates the financial returns from irrigation development."

Malvern Hills Protection Society spokeswoman Rosalie Snoyink said she wanted a greater emphasis on the environmental cleanup before the economics of irrigation were debated.

Green Party co-leader Russel Norman said Canterbury's proposed irrigation projects were "think big" and large financial returns were not guaranteed.

Federated Farmers chairman Don Nicolson said $5.2b to build the schemes seemed "excessive", but a strategy which managed Canterbury's water more efficiently was a good idea.

Report co-author Simon Harris, of Harris Consulting, said the findings measured the potential upper limit of the financial returns from co- ordinated irrigation in Canterbury.

"The final outcome could look quite different."

- © Fairfax NZ News