Up to $80 million is being earmarked for bridging finance for large-scale irrigation schemes in the next financial year, with the Government expecting its consider its first application within 12 months.
In 2011 the Government signalled it would spend up to $400m to provide finance for "regional-scale" irrigation schemes, in a bid to encourage investment from the private sector.
In its first meeting of 2013 today, the Cabinet directed that $80 million be set aside from 2013 from a company set up to encourage the investment.
"The development of well-designed storage and irrigation infrastructure has the potential to deliver significant economic growth for our primary industries and support new jobs, which will have a flow-on effect for all New Zealanders," Primary Industries Minister David Carter said.
"A number of groups are developing proposals for these larger, regional-level schemes, and the Government expects to consider at least one proposal in the next 12 months."
Carter said that because the type of investment in large irrigation schemes was new for private investors "it is appropriate for the Government to take a bridging investment role to ensure the right projects can get under way".
He said the Government would be a minority shareholder in any such scheme, and planned to make the investment only for a short time.