A report released Wednesday raised serious concerns about the tool's transparency and accuracy. File photo: Lynn Grieveson

The Parliamentary Commissioner for the Environment spoke to Eloise Gibson about the way forward for Overseer, following his detailed report into serious issues with a tool many councils are using to try to curb water pollution.

The climate is right for the Government to “pick up Overseer and run with it”, says an environmental watchdog.

While the Government part-owns and has heavily funded the water quality tool, it has never put in enough money or explicitly said that councils should use it – although they have been doing so anyway, says the Parliamentary Commissioner for the Environment, Simon Upton.

Now Upton says that Overseer’s owners recognise that change is needed, and the model could be spruced up using a mix of increased taxpayer funding and regional council research money, with ongoing revenue coming from farmers’ subscription fees. 

He spoke to Newsroom about possible ways forward after releasing a report yesterday raising serious concerns about the tool’s transparency and accuracy. 

Despite its shortcomings, six regional councils are using Overseer to regulate nitrogen leaching from farms: Bay of Plenty, Canterbury, Hawke’s Bay, Horizons, Otago and Waikato. Another three councils require farms to use Overseer to provide environmental reports.

The tool was originally designed to help farmers make money by maximising the milk or meat they gain from using artificial fertilisers. But as a corollary the tool estimates how much fertiliser is wasted from paddocks by leaching below the bottom of the grass-roots. That feature allowed Overseer to morph into a regulatory tool that several regional councils use to manage nitrogen pollution reaching waterways. Upton found that councils in some of our most troubled catchments were using it because it was the only alternative they had to cruder measures like capping cow numbers.

The computer model is owned by Overseer Ltd, a company comprised of two fertiliser companies, Ballance and Ravensdown and the Ministry for Primary Industries, with intellectual property input from the Crown-owned science company, AgResearch. Out of fear of losing its IP to a competitor, the company keeps its source code secret, making it difficult for outside scientists to tell whether the model is accurate and robust.

Upton says all parties involved in its use – including Overseer Ltd – are aware of the need for the system to change, making it a good time for government to take charge of the tool if it wants to. “We did not encounter anyone in defensive mode. Overseer Ltd was helpful. There is a real understanding that we need to act. (So) it’s a good climate for the government to pick this up and run with it.”

The recommendations fall at a good time of year to request funding, ahead of the next Budget. “If water quality is truly a priority, (with Overseer) you are investing in something known and you know where the gaps are” says Upton.

“I’m not saying Overseer is a dog, this is a tool that’s had three decades of investment, some of it impressive and some frankly less so.”

Upton identified several major short-comings with Overseer.

But he told Newsroom that scrapping it and starting from scratch would require doing-over much of the work that had already gone into designing the tool.

“I’m not saying Overseer is a dog, this is a tool that’s had three decades of investment, some of it impressive and some frankly less so,” he says.

“The pattern of investment has been stop/go, some trials here and there, with the government funding the bulk of it. But even though taxpayers were funding it [the government] was never saying ‘We want this to be used.’”

One of his main recommendations is for the Government to make clear to councils whether they should be using it – and how. 

The other is: “It’s time for Overseer to be opened up”, by making it open-source.

While Upton couldn’t name a cost, he said turning the tool from a product with heavy taxpayer investment but no official status into an officially sanctioned regulatory tool will require investing more than the $1.25m a year the government has been contributing but less than “tens of millions”.

His report raised the prospect that the Government may want to buy the share of Overseer Ltd that is owned by the country’s two major fertiliser companies to avoid any perceived conflict of interest, however, that decision will fall to the Government and the fertiliser companies.

As for the costs of making the tool more reliable, Upton told Newsroom the up-front research should be jointly funded by councils and central government, with farmers contributing to ongoing costs through subscription fees. 

Despite its increasing use by councils, the inner-workings of Overseer have never been made public, but enough is known to make clear that it needs more calibrating. 

Upton says the often-cited statistic that the model is accurate to within about 25-30 percent of real nitrogen leaching is based on a single study of one part of the model, carried out in 2001. “We are now in 2018, and there has never been an analysis of the model as a whole.”

He has urgently recommended that the Ministry for Primary Industries orders a full peer review of the whole model.

The model uses various inputs to make its estimates – for example, it will model how much nitrogen is lost as cattle urine by looking at how much a typical animal needs to eat, how much nitrogen is in their food, and how much gets converted to milk or meat, to work out how much nitrogen gets lost beyond the grass’ root zone into groundwater.

While a variation of 25-30 percent between “real” losses and modelled numbers might sound like a lot, Upton says the bigger problem is that the variation isn’t consistent around the country – it only applies in certain soil types, within certain amounts of rainfall, and if farmers and their consultants enter the correct amounts of fertiliser and cattle feed.

Regional councils can cope with a level of variation when they manage water quality, he says; they can set targets that manage nitrogen outflows within a range. But that range needs to be certain, says Upton; and, right now, it isn’t. “You need to know that [the model] is reliably producing results with the same level of uncertainty, because then you can build that into your policy – that’s more important than the level of uncertainty.”

One of the biggest investments needed to pin down that range is mapping soil types in the roughly 30 percent of New Zealand’s productive land that doesn’t have good information at present, says Upton. Ideally that would start by filling the gaps in areas with the worst water quality issues.

Most trials so far that were carried out to calibrate Overseer were done in Waikato and Southland but there were “powerful” variables of soil and rain and climate that affected the results other parts of the country, says Upton. Already, Bay of Plenty’s regional council is funding research in its area to tune up the model so it can use it to help lessen pollution in Lake Rotorua. Other councils should also contribute to the research needed in their areas, says Upton. He believes taxpayers should joint-fund this regional research, as well as pay for a peer-review of the whole tool, which he estimates would take a year or two. That’s because the science of water quality is an issue of public interest, he says.

Farmers – the sources of nitrogen leaching – would do their bit for Overseer by paying subscription fees to use the model, which would cover other costs, he suggested.

The upshot of the improvements should be that farmers and councils can rely on the tool, he says. And that may lessen any incentive for farmers to try to game the system, he says. Upton’s report cited anecdotal reports from farm consultants and others who had seen farmers deliberately manipulating the tool to reduce any need to change their practices. He recommended up-skilling a lot more outside auditors. But improving the model would also help, he said.

“If you think you’re being put in the hands of a wild west regulatory system you’ll take evasive action. If you are confident everyone’s being treated fairly, there’s less incentive to do that. I think a lot of rural New Zealand knows it needs to clean up but they also need to know it’s going to work,” says Upton. 

“If you want confidence to use the tool you really have to open the thing up.”

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