A key part of the Government’s Essential Freshwater 2020 package was the proposal to improve farm practices by requiring all farmers have a farm plan with a freshwater module (known as Freshwater Farm Plans or FW-FPs). The idea was that FW-FPs would help farmers understand the unique environmental issues on their properties and respond accordingly.

The farm plan concept was implemented by introducing a new Part 9A into the Resource Management Act 1991. However, that Part of the RMA required regulations to bring it into force but it has been sitting dormant since June 2020.

Nearly 3 years on, the Resource Management (Freshwater Farm Plans) Regulations 2023 (Regulations) have been published. The Regulations detail the requirements for farmers and regional councils in preparing, certifying and auditing FW-FPs. The following provides a high-level summary of the requirements for FW-FPs, along with our initial impressions of the likely effectiveness of the tool.

When are FW-FPs required?

A farm must have a certified FW-FP if it involves:

• pastoral or arable land use of 20 or more hectares or horticultural land use of 5 or more hectares; or
• a combination of any two or more of these land uses amounting to 20 or more hectares of the farm

The requirement for FW-FPs will be rolled out across New Zealand in stages. From 1 August 2023, the Regulations will apply to parts of the Waikato and Southland regions, with the Regulations being applied to the remaining parts of those regions in stages throughout 2024 and 2025. It has not been specified whether or when other regions will be added.

Farm operators are responsible for ensuring FW-FPs are prepared, certified, complied with, and audited. Failure to comply with the FW-FP Regulations or the actions in a FW-FP is an infringement offence with a fine of $1,500.

Basic content requirements of FW-FPs

FW-FPs must identify the risks of adverse effects of farming activities on freshwater and freshwater ecosystems by:

• identifying, mapping, and describing each land unit of the farm
• identifying and assessing the inherent vulnerabilities and risks from farming activities in each land unit

The farm operator must then identify existing and new actions to avoid, remedy, or mitigate the risk of adverse effects of regulated farming activities; and set a time frame within which each action must be implemented.

Regs 8-16 of the Regulations provide detail on what must be considered and included in a FW-FP, as well as exceptions for certain on-farm elements (forestry, processing facilities or packhouses, residential or commercial premises or visitor accommodation).

FW-FPs may contain actions that go beyond the bare requirements in a regional plan (either because that activity is not regulated in a regional plan or because the farm plan requirement is more stringent than the regional plan's requirement). However, if a regional plan provision restricts an activity more than a requirement of a FW-FP, the regional plan provision must be complied with. Compliance with the FW-FP Regulations does not of itself authorise a person to undertake an activity.

Certification

Once prepared, farming operators must engage an approved certifier to certify the FW-FP and assess it against the requirements of the Regulations and the RMA. The certifier is essentially the regulator tasked with ensuring that FW-FPs are compliant and effective.

Farmers have 18 months from the date the Regulations apply to their area to have a certified FW-FP and must recertify it every 5 years.

Audit

Within 12 months of a FW-FP being certified (or recertified), it must be audited by an approved auditor. Again, the farm operator is responsible for engaging the auditor.

Costs

In 2020, it was estimated that the costs of preparing, certifying and auditing FW-FPs would be in the order of $3,500 per farm. The regulatory impact assessment for the Regulations now estimates the average cost as $6,000, based on a range of $2,500 - $15,000. The cost of implementing actions identified in FW-FPs are additional (and may be significant).

Our comments

The new Regulations place substantial new obligations on farm operators to prepare, certify, comply with, and audit FW-FPs. With many regions around the country also having separate farm plan requirements in their regional plans, the preparation, certification, and auditing of farm plans appears set to become a significant industry.

While the Regulations appear to have been drafted to provide flexibility for farmers in assessing risks of adverse effects on freshwater and identifying actions in response, that flexibility may be a double-edged sword. The Regulations lack clarity about the extent to which adverse effects must be avoided, remedied or mitigated - is the expectation that FW-FPs must ensure that no adverse effect is left unmitigated?

The success of the Regulations appears to depend on both farm operators and certifiers having a clear understanding of the risks to be targeted and the actions that can avoid, remedy and mitigate those risks. The Waikato and Southland Regions are in the unenviable position of testing the FW-FP roll-out. It seems inevitable that those regions will come across kinks that need to be ironed out before the FW-FP process is implemented nation-wide.

The Regulations have been accompanied by a flurry of guidance material published by the Ministry for the Environment. While this material may be helpful for those tasked with preparing and certifying FW-FPs, there is a growing line of caselaw that confirms that such guidance cannot be relied on in interpreting regulations.