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Defining the Election Issue: National and Green climate policy

by Kennedy Graham

At its AGM last weekend, the Green Climate Protection Package was rolled out.

–    It contains the over-riding goal of net carbon-neutral economy by 2050, with a National Carbon Budget comprising a series of five-yearly budget components to get to that goal.

–    There will be an independent Climate Commission to advise the Government on both budget and policy.

–    The policy will be two inter-related policy mechanisms: an economic instrument and a suite of complementary measures.

–    As the economic instrument, the failed ETS will be phased out and a climate tax will apply to all emissions, except that with agriculture it will initially only apply to dairy. All revenue thus raised will be recycled back to households through income tax relief and to businesses and farms through corporate tax relief. The dairy farms will be able to use a green farm certification scheme to claw back some of their tax liability.

–    The complementary measures will include a set of specific incentives in green energy, green transport, green finance and green farms and forestry.

This marks the Green Party out as the only party contesting the election with a comprehensive and effective plan to protect the climate. Given this is the most challenging issue we have ever faced, it’s not a bad idea for the other parties to respond.

National cabinet minister Tim Groser responded this morning, on RNZ. It is not difficult to rebut the five substantive critiques he advanced. They were as follows:

  1. Our plan would do nothing to change consumer behaviour but would put ‘vulnerable parts of the economy’ at risk.

Wrong: the Green plan will commence the transformation to a decarbonised economy within a time-frame that averts dangerous climate change; while protecting consumers (through an income tax-free threshold) and businesses and farms (through a 1% company tax cut). Individual businesses and farms that still believe they face financial hardship would be free to apply for special consideration. Those applications would be handled with full public transparency.

  1. Climate change is a ‘very large international problem’ that needs a global solution. But ‘people of this extreme position’ overlook the fact that New Zealand is of tiny economic and political significance and it is only the large emitters in aggregate that are going to make the difference.

Misleading: each country, and especially each rich developed country, has a legal obligation under the UN convention to reduce emissions. That was signed by a Jim Bolger’s National Govt. in ‘92. John Key’s Govt. under Tim Groser’s ministerial proclamations, is welching on that obligation. Each country, large and small, is obliged to do its fair share. New Zealand currently is not. We did not adopt this craven attitude when we sent our troops to Gallipoli.

  1. New Zealand is only one of a small group of countries that place a price on carbon; some 97% of emissions remain outside the price mechanism.

Misleading: Under the UN convention, the rich developed countries are to take the lead ahead of the developing world, in reducing emissions, until there is a global agreement in place that includes obligations for all. That global agreement will not enter into force until 2020. Between 1992 and 2020, it is the rich countries that must reduce. The fact that most emissions are outside the European trading system does not change that.

  1. New Zealand has one of the most efficient dairy and pasture-based economies and we should be encouraging our farmers to do more, not less.

Misleading: it is precisely because we have one of the more efficient livestock economies that we must commence the move to low-carbon farming. NZ agriculture is capable of responding to a price signal that disincentivises carbon pollution and promotes productivity.

  1. New Zealand’s ETS is working ‘only very slowly’ because international carbon prices are so low; it requires the international community to get its act together on climate policy, first.

Ironically true: New Zealand could have ‘greened’ its ETS independent of the international system, but this Govt. chose not to. That is why we need now to phase out the ETS and introduce a fiscal package that will be effective in reducing emissions and fair between sectors.

06/05/2014 – 00:00


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