Boscawen John: Budget Debate 
Boscawen John: Budget Debate 
[Volume:664;Page:11660] 
JOHN BOSCAWEN (ACT) 
: 
 There is much to commend in this Budget. One only needs to look at the reductions in marginal tax rates which will drive incentives for New Zealanders to work save and get ahead. However I will talk about the figures buried deep in this Budget that no one wants to talk about. I will talk about the $907 million—almost $1 billion—appropriated in this Budget for the emissions trading scheme. That figure ignores the $378 million that this Government will take in from selling permits. In essence $1.2 billion is being allocated to foresters in the current year. In less than a month this Government will usher in the most comprehensive emissions trading scheme in the world. We will expose our farmers and our exporters to costs that none of our major trading partners incur. We will lead the world on climate change we will lead the world with our emissions trading scheme and we will do it despite the fact that John Key promised at the last election that he would not be a leader on climate change but a fast follower. 
This Government for all its good work is prepared to put at risk people’s jobs and their livelihoods and it is prepared to do that at a time when our recovery is still very fragile. From 1 July in less than a month all New Zealanders will pay more for their electricity their heating their petrol and their food—everything that we consume. There will be massive windfall profits to electricity generators. Despite the fact that some 70 percent of the electricity that we consume is generated from renewable sources over 80 percent of the time New Zealanders will pay a price for electricity based on the more expensive coal or gas option. We are doing that at a time when our gross emissions of carbon dioxide per capita are actually less than they were in 1990. As individual New Zealanders our gross emissions are less per capita. That says nothing about the carbon sequestered by forests; of course if we allow for that the reduction in our emissions on a per capita basis is even greater. 
This is the most comprehensive emissions trading scheme that a country can have. How do I know that? Well Dr Nick Smith the Minister for Climate Change Issues said so to this very House. On 24 September just last year at the first reading of the bill modifying the previous Labour Government’s emissions trading scheme he said: “The emissions trading scheme will be the first of any country outside Europe and on 1 July 2010 will be the most comprehensive by including transport industrial and energy emissions.” So by his very acknowledgment the Minister for Climate Change Issues is acknowledging that New Zealand’s emissions trading scheme is the most comprehensive—and so much has happened since National made those amendments 6 months ago. It might suit Dr Smith and his party colleagues to play down that fact but that is the reality. 
It was not enough to say that on 24 September; Dr Smith repeated those remarks on 24 November 2 months later. Once again he asserted that the emissions trading scheme that this Parliament passed into law was the most comprehensive in the world. We will impose costs on our farmers and our exporters and they are the very backbone of our economy. Where is that money going? That is the question most New Zealanders want to know the answer to. As I travel up and down the country holding public meetings on this subject I am asked time and time again where the money is going. Where is it going? The answer is that $1.1 billion worth of emissions credits is to be allocated in the current year. Of that $1.1 billion $400 million is allocated for compensation to pre-1990 foresters. That is for losses that we cannot even calculate right now. We do not even know what losses if any those people have suffered because we have no post-Kyoto agreement; we have no international agreement beyond 2012 and with the failure of the Copenhagen talks I suspect the chance of having one has dropped substantially in the last 6 months. Even if we were to have one there is a real chance that there would be a change in the rules. So we are about to pay $400 million and we are about to tax all New Zealanders and charge all New Zealanders more for their electricity their petrol and their food so we can pay $400 million in compensation to pre-1990 foresters—and we cannot even be sure they have suffered a loss. 
Let us look at what has happened since this legislation was passed 6 months ago. Copenhagen as I have said failed to produce a post-Kyoto agreement. Climategate has challenged the very credibility of the scientists on the UN’s Intergovernmental Panel on Climate Change and the very hypothesis of climate change. We have had record cold winters in Europe and the United States which have resulted in a substantial reduction in public support for that type of scheme. France has abandoned its proposed carbon tax on transport and just last month Australia announced it was withdrawing its emissions trading scheme until at least 2013. 
So what will this National Government do? It will blunder on ahead blinkers on eyes focused ignoring totally what has happened in the world and ignoring totally that the Minister for Climate Change Issues got up in this Parliament not once but twice in the last 6 months and said that it is the most comprehensive emissions trading scheme in the world. The National Government is pushing on and ignoring the fact that it promised it would not be a leader. 
New Zealanders will pay more for their electricity—Treasury forecasts 5 percent more—and we have already seen it with Mercury Energy’s price rise just last month. Mercury Energy talked about increasing prices to reflect costs in emissions for the industry as a whole. That is Morse code—a signal—for windfall profits. The Government will make very substantial windfall profits from this emissions trading scheme and it does not even have the courtesy or the decency to acknowledge to the people of this country that it will make those windfall profits. The Minister for Climate Change Issues knows it because 2 years ago he wrote the National Party minority report on Labour’s scheme and he quoted the fact that the windfall profits to the Government in terms of its ownership of Mighty River Power and Meridian Energy would be over a billion dollars. 
Dr Smith has said up and down the country and on television that 29 of the 38 Kyoto developed countries have an emissions trading scheme. That is very generous of him. By his own admission those 29 countries are all in Europe and 80 percent of those European exports are to countries within Europe. Only 20 percent of European exports actually leave Europe—only 20 percent. How does that compare with ourselves? Eighty-five percent of our exports go to countries other than Europe. Our four major trading partners Australia China the United States and Japan do not have emissions trading schemes and only one other country that we trade with in the top 10 has a scheme and that is part of the European emissions trading scheme. 
Charles Chauvel 
: But Europe together is our second-largest trading partner. 
JOHN BOSCAWEN 
: I say to Mr Chauvel that that is right. Mr Chauvel is reminding me that we export 15 percent of our product to Europe and 85 percent to countries that do not have an emissions trading scheme and that is four times as much as Europe. Europe exports 20 percent of its products to countries that do not put these costs on their own economy. What are we doing? We are exporting 80 percent. It is an own goal and we are going to tax people up and down the country. 
One of my more successful meetings was held in Gore. At 11 o’clock on Monday morning in Gore 52 people attended to discuss the emissions trading scheme. The meeting was held half a mile from the Deputy Prime Minister’s electorate office. What did those people complain to me about? They complained about the fact that the area is situated around coalfields and the cost of the coal that they use to heat their homes in winter is going up by 30 percent. That is not a mistake. It is 30 percent. The cost of electricity might be going up by 5 percent but the cost of coal is rising by 30 percent. Where is the money going? It is going in subsidies to the Japanese owners of forests in Southland; that is where it is going. This Government is prepared to put taxes penalties and costs on to its exporters and to make it difficult for our exporters to expand at a time when we need them to be expanding and it is putting jobs at risk. Why? It is so we can pay in the current financial year $1.2 billion of subsidies to foresters both pre-1990 and post-1990. 
This is a disgrace an absolute disgrace and members of this Government know it. I urge members of the public to contact Ministers and to contact their members of Parliament because it is not too late. It is not too late for this Government to acknowledge that it made a commitment to the people of New Zealand not to lead on climate change not to lead with a world-class emissions trading scheme and not to bring in the most comprehensive emissions trading scheme that Dr Smith so proudly talked about in this Parliament fewer than 6 months ago. Thank you.