Some farmers are "genuinely worried" about the uncertain outcome of the election and are keeping their wallets in their pockets, Federated Farmers says.
Federated Farmers head Katie Milne says many farmers are "genuinely worried" about the election result. Photo: RNZ / Alexander Robertson
Farmers have demonstrated against several Labour Party policies - including a proposal to introduce a charge for irrigation, and to include agricultural in the Emissions Trading Scheme.
Last week New Zealand First leader Winston Peters said he would not support National or Labour's policies to impose new taxes on farmers nor include agriculture in the emissions scheme.
The Green Party has said it would push hard to be involved with any negotiations between Labour and New Zealand First, and Mr Peters said his party would not be rushed into making any decision about forming the next government.
Federated Farmers president Katie Milne said there was now a feeling of unease in the rural sector.
"There are still some who are genuinely worried - well, quite a lot actually - and there are some who have already indicated that they've really battened down their hatches until they know a result.
"The basic spending is going on, but they're really tightening their belts in case it goes the other way and the indiscriminate taxes come in.
"There's definitely a feeling of trepidation there for some."
Ms Milne said there was no discretionary spending as people waited to see what would happen.
"If farmers put their cheque books away all the rural towns feel it. It may not be absolutely immediately, but after a few months they notice it."
She said farmers hoped that if there was a coalition between Labour, Greens and NZ First, then Mr Peters would keep his promise on water taxes.
"We would hope that Winston would be able to stick to his guns."
Farmers would welcome a chance to sit down with Labour leader Jacinda Ardern and talk about how to deal with water quality, Ms Milne said.
When asked if Federated Farmers supported any kind of water tax, such as a 'user pays' or 'polluter pays' type system, Ms Milne said it would depend on the details because it needed to be fair to farmers.
"At the moment the way people are working towards solutions - I don't see the point.
"Everyone is really trying hard, without regulation, to get there.
"Sometimes if you put regulation in you only get a bottom line ... whereas if you don't have it people often reach higher in a lot of cases and do more."