Norman Russel William: Debate on Prime Minister’s Statement 
Norman Russel William: Debate on Prime Minister’s Statement 
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Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 I rise on behalf of the Green Party this afternoon to make a few short comments on some of the economic challenges facing us at the moment and to give the Greens’ response. One of the most important economic challenges facing us at the moment is climate change. People often think of climate change as an environmental issue but if one happened to be living in Queensland at the moment one would recognise that climate change has fantastic and diabolical economic consequences. No one particular extreme weather event can be said to be caused by climate change but the frequency and severity of extreme weather events such as floods droughts and cyclones will be greater as a result of climate change. 
When we look at what has happened in Queensland over the last month or so we can see there has been a very large very expensive flood and a cyclone—a very very expensive cyclone. Both of those kinds of events will happen more often as climate change advances. It seems to me that currently the cost of those kinds of extreme weather events is borne by the individuals themselves—they have to pay to fix up their houses. If they pay insurance the cost might be borne by the insurance companies and hence collectively by everyone who pays premiums. Or as is happening at the moment in Australia the cost is borne by the taxpayers. Usually it is a combination of all of those factors. Currently the Australian Government is talking about striking what is effectively an extra tax to pay for the cost of the floods and the cyclone in Queensland. 
It seems to me that if we were to take a purely economic approach to climate change we would attempt to internalise those externalities. Currently if we cause climate change by emitting a lot of greenhouse gases we do not pay any of the costs. The Queensland coal industry which is one of the biggest polluters on the planet as Queensland is the biggest coal exporter there is does not have to pay any of the costs of the climate-induced damage it causes. That seems to me ridiculous. Why is it that those who are causing the pollution do not have to pay for any of the damage caused by the pollution? One of the most important things we can do is to— 
The Deputy Speaker raised the question that a Minister was not present in the Chamber. The bell was rung and the Deputy Speaker declared that a Minister was present. 
Dr RUSSEL NORMAN 
: It seems that not only is the Government’s programme in disarray but it is having trouble keeping Ministers in the House. The problem with the Government’s programme aside from it being unable to manage to keep a Minister in the House is that the Government has no way of knowing what to do about climate change. When we look at the Prime Minister’s statement we see maybe one sentence about the emissions trading scheme. We can hear Sandra Goudie yawning very loudly; she often interjects during these debates to make the most inane comments. When we are debating an issue like climate change which is a genuine threat to the New Zealand economy of course Sandra Goudie yawns because she does not even understand it. 
The Prime Minister had one sentence about the emissions trading scheme in his statement. In that sentence he talked about the way the Government is reducing the price signal through the emissions trading scheme. The Government has watered down the price signal. This means that taxpayers will pick up more of the cost of pollution as opposed to those who pollute. The cost has to be paid by someone. Someone has to pay the cost of this pollution; it is just a question of who. It can either be the taxpayers which is the Government’s proposal or as the Green Party would suggest the polluters should pay the cost of pollution. But those are the only options on the table because somebody has to pay the cost of the pollution. 
Moreover by introducing a charge for carbon we create price incentives to change the way our economy functions so that we move towards economic activities that produce fewer greenhouse emissions. That is the nature of price signals. One of the most important changes we need to make is to use markets which are very very powerful mechanisms to direct our economy in a more sustainable direction. That means we need a price on carbon emissions. That is absolutely fundamental to redirecting the New Zealand economy to make it much more sustainable. Unfortunately when the Government got in it reduced the price signal on carbon by around half. That means the taxpayer will pick up the bill and it means there is less of a price signal going through the New Zealand economy so we will make investments further down the track that are very high carbon-producing investments. That means we are not making the transition that we need to make. 
Another element of the climate change policy that was introduced by the Government is the “50 by 50” target that the Government supposedly recently introduced. If one were a layperson listening to the Minister for the Environment saying that the Government has adopted a target of reducing New Zealand’s emissions by 50 percent by 2050 one would think that meant a reduction in emissions. Sadly that is not the case. The Minister in talking about that was comparing gross emissions in 1990—that is about 60 million tonnes—with net emissions in 2050. Once again we hear Sandra Goudie yawning loudly; because she does not really understand this kind of stuff that is her approach to it. The problem is that the Government is comparing gross emissions in 1990 with net emissions in 2050. If one compares net emissions in 1990 with net emissions in 2050 one finds that the Government is talking about “reducing” net emissions from 29 million tonnes of carbon dioxide equivalent in 1990 to 30 million tonnes in 2050. If we look at the Government’s target of “50 by 50” we see that it turns out to actually be an increase in net emissions of 1 million tonnes of carbon dioxide equivalent per year by 2050. In fact the Government’s target the so-called “50 by 50” target is in practice in reality actually an increase in net greenhouse emissions. It may seem extraordinary that the Government should effectively mislead the people of New Zealand by not comparing like with like but that is what it has done. 
The other great challenge to the New Zealand economy as we go forward will be the end of cheap oil. One revelation in the last few days is that the latest WikiLeaks release has shown that the US embassy in Saudi Arabia has sent cables back to its capital in Washington that say the Saudi oil reserves are grossly overestimated. The Saudi Government is telling the rest of the world that the size of the Saudi oil reserves is actually much greater than it is in reality. This is what the US embassy has been telling Washington over the last few years. This means that world oil prices have now increased very significantly and now petrol at the bowser has gone up to $2 a litre. In fact that is just the beginning because demand for oil is increasing more and more but the ability to supply that oil is not increasing very much at all. 
For an economy like ours in which the transport sector is incredibly dependent on oil that makes us incredibly vulnerable. The Government’s response to our vulnerability to oil prices is to build more motorways. Of course that was largely the response of the previous Government as well. It is a particularly absurd response to a vulnerability to oil supply. It is hard to fathom why when all the evidence in the world is that oil prices can only increase quite significantly one would invest billions of borrowed dollars in a transport mode that is entirely dependent on oil. Why one would take that path is really hard to fathom but none the less that is exactly what we are doing instead of investing in buses trains cycling and walking which is exactly what we need. 
The other great economic challenge facing us at the moment is around fresh water. New Zealand is fantastically blessed with a lot of fresh water but we have a national crisis because so much of our fresh water is heavily polluted. Currently the Minister for the Environment has a draft national policy statement on freshwater management that would put in place rules for clean water. Rules for clean water are fundamental to protecting one of the key aspects of the New Zealand economy. 
Sandra Goudie 
: He doesn’t even know the difference between stormwater and— 
Dr RUSSEL NORMAN 
: One of the key aspects of our economy which the member for Coromandel has absolutely no idea about once again— 
Hon Darren Hughes 
: How do you know she’s not right? 
Dr RUSSEL NORMAN 
: The member for Coromandel has no idea about any of this. The New Zealand economy is dependent on clean water. It is part of our clean green image. It is fundamental to our economy. But we are ruining that by polluting our water. We need to put in place those clean water rules as soon as possible. 
In this very brief speech I have touched on climate change the end of cheap oil and water. These are just three critical elements of the New Zealand economy that this Government currently appears to have very little understanding of—as we have seen from the interjections—and it seems to have very little plan as to what to do about them.