Irrigation schemes in Otago could prove a profitable start-up investment for both local councils and foreign investors, Primary Industries Minister David Carter says.
Following revelations on Tuesday that the Otago Regional Council was considering investing in an irrigation scheme proposed by Tarras Water Ltd, Mr Carter said during a visit to North Otago irrigation schemes yesterday more councils could follow suit.
Mr Carter, who is also Minister of Local Government, said it was a case of a council being prepared to underwrite the scheme to get it off the ground, but the council would still be able to withdraw from the investment at a later stage.
"I think that's about a council sensibly saying 'how do we develop economic growth; how do we develop opportunities for employment within our region?' - and irrigation solves a lot of those problems.
"I think many councils are going to be in a similar position to where Government is. There will be some schemes large enough for the central government to say we will be there as a cornerstone investor but after a period of time, when they become 100% subscribed, then the Government can then remove itself from the scheme.
"I think in some of the smaller schemes, regional councils can undertake that same role."
The Government released a $35 million support fund for irrigation schemes in May, and the creation of the Irrigation Acceleration Fund had given those proposing irrigation schemes the confidence to "move forward", Mr Carter said.
Investing in irrigation until a scheme's catchment was totally irrigated could be done profitably by both the private and public sector, Mr Carter said. He believed irrigation schemes also had the "potential" to attract foreign investment.
"We recognise we have got to drive more productivity out of the New Zealand primary sector, and a fundamental way we can do that is by delivering more irrigation and more reliable irrigation."
