Shirley Ken: Resource Management (Waitaki Catchment) Amendment Bill — Second Reading 
Shirley Ken: Resource Management (Waitaki Catchment) Amendment Bill — Second Reading 
[Volume:616;Page:12016] 
Hon KEN SHIRLEY (Deputy Leader—ACT) 
: 
 The ACT party opposes this legislation in its entirety and I will come to the reasons for that later in my speech. At the outset I would like to comment on some of the Local Government and Environment Committee’s considerations and on its processes. The Minister Marian Hobbs made a plea in her speech for this bill to be passed as soon as possible and said that that was essential. That is really what this legislation is all about. Her own words confirm what we have always suspected—that this is the Government’s new “National Development Act” to streamline the passage of its pet project— 
Hon David Cunliffe 
: Wash your mouth out with soap. 
Hon KEN SHIRLEY 
: That was Mr Cunliffe the commercial genius of the alliance! 
This legislation is appalling. It was rammed into the House shortly before we rose for the Christmas period. The expectation was that the select committee would report it back at very short notice. I was ashamed and embarrassed during the select committee process and I do not blame the chairperson Jeanette Fitzsimons who did a particularly good job in chairing the committee unlike Mr Cunliffe whose chairing of select committees is pathetic and hopeless. The chair was as considerate as she could be but the constraints put on her by this Government were very unreasonable. Submitters who had travelled long distances from remote valleys—I am thinking of our hearings in Kurow—were not even given the courtesy of being able to tell us what they wanted to tell us. They had very truncated time frames—5 minutes—to try to explain what their concerns were. That is a very unsatisfactory process. 
 However the real issue is the question of why special legislation outside the Resource Management Act is needed when the Act was set up specifically for that form of allocation. Environment Canterbury has been in existence for 14 years. It was set up with that specific function with a statutory requirement to produce regional plans for things like allocating water; yet in the 14 years of its existence Environment Canterbury has failed to produce a water allocation plan. We all know that for much of the time water is scarce in the Canterbury Plains including the Waitaki catchment yet that statutory body having existed for 14 years has never brought down a water allocation plan. 
There is no doubt in my mind that this Government panicked. It knows it has a looming energy crisis on its hands. It has a fixation with renewables. That is why it is not looking at other options like coal to the extent it should be even though we know we have 1000 years of electricity generation in our coal reserves at competitive prices. But having signed on to the fundamentally flawed Kyoto Protocol this Government does not want to look at the coal option to any large extent. It would rather rush through a proposal that involves taking 75 percent of the low flow of the Waitaki River at Kurow and placing it in a canal for a distance of some 65 kilometres dropping through six power stations and generating some 455 megawatts of power. We certainly need that power but it will meet only 2 to 3 years of our expanding electricity demand. Project Aqua will not be coming on stream until 2008. By then we will already have expanded our demand way above what the plant will deliver. 
If we were serious about our looming energy crisis we would be looking at alternatives such as coal. With the Kyoto Protocol if the Government were serious it would leave the incentives as market instruments as proposed with the carbon credit trading system. But what did the Government do? Instead of leaving the incentive to plant more forest it nationalised the carbon credits of forest sequestration and is handing them out to its pet projects. It has given them to Meridian for its Te Apiti wind farm. And what has Meridian done? It has on-sold them to the Dutch Government. So the Government gets back the money as a dividend payment from a State-owned enterprise a Government-owned company. 
I tell the House now that the same is intended for Project Aqua. The Government will dish out a whole lot of the carbon credits it stole off the forestry sector destroying the economic instrument of a carbon trading system. Project Aqua will flog them off in a world market and the Government will get that money back. That is what is behind the Government’s intention to rush through that project. It is rushing it through with special empowering legislation—and it is thoroughly bad legislation; there is no question about that 
The select committee was quite concerned about a number of aspects. One was the Minister’s own behaviour. At the meeting in Kurow we were handed the Minister for the Environment’s newsletter. In it we read that the Minister had called for nominations to the allocation board under this legislation—even though the legislation has not been passed—trying to pre-empt the committee’s right to change it. We decided there should not be ministerial appointments yet the Minister pre-empted that and was out there calling for nominations. That shows the arrogance of that Minister. 
However my real concern about the bill—and the reason I say that this bill is fundamentally flawed and why ACT opposes it in its entirety—is that it is based on more bureaucracy and more central regulation and control. When it comes to allocating a scarce resource particularly water that has never worked. The mechanisms in the bill are not best world practice. Water scarcity is not new. It is increasingly new for many New Zealanders but around the world water is a very precious resource and there have been many many years of hard experience. Central government big government and administration schemes such as Mr Cunliffe advocates have never worked. In fact Mr Cunliffe attended a function in Adelaide with me last year where we had a graphic example of how to allocate water in a situation where it was scarce. It was in the Murray River. 
Hon David Cunliffe 
: Where’s the report? 
Hon KEN SHIRLEY 
: Madam Speaker would you please ask Mr Cunliffe to stop interjecting from the cross benches. 
Madam DEPUTY SPEAKER 
: Would the member not interrupt across the cross benches. It is very disconcerting to the speaker. 
Hon KEN SHIRLEY 
: I raise a point of order Mr Speaker. He continued to do so during my point of order. 
Madam DEPUTY SPEAKER 
: The member will desist. 
Hon KEN SHIRLEY 
: It was quite clear in the Murray River case in Australia where with a known water crisis there has been a move to an allocation system based on clear tradable property rights and pricing mechanisms. The same applies in the UK now and in many other places around the world such as South Africa and various counties of California because it works. They get a better result. Rather this bill proposes to set up a politicised bureaucratic monstrous committee that will never get it right. Under that type of scheme one cannot get efficient water use because the allocation is decided by a bureaucrat through a politicised process—and it is “Use it or lose it.” 
If people had tradable water rights they would use the water efficiently in order to optimise its use and to make the best use of it. Irrigators told us that they could earn $50 billion for the country if they were given the water rather than it being used for electricity generation. How do we test that? There is only one way and that is through a pricing mechanism. Sure it can be complicated in that there are storage header tanks in the Pukaki Ohau and Tekapo lakes. Essentially they are just storage header tanks. But those provisions can be provided. For much of the year the price would be negligible because there is no scarcity. Often the river is in flood when there is any amount of water. For much of the year the irrigators are not interested in the water. The only times being talked about are those variable times that are very seasonal when there is a shortage and the only way to satisfactorily allocate a scarce resource is by introducing a property right that is tradable and has some value. This bill fails totally to do that. It is doomed to failure.