Young Jonathan; Rurawhe AdrianJONATHAN YOUNG (National—New Plymouth): Thank you Mr Assistant Speaker. I'm pleased to stand and speak this afternoon on the Prime Minister's statement. I would have to say—and I don't want to be overtly critical—that I was not inspired by the Prime Minister's statement. In fact there were a number of comments that I would challenge in terms of the workability and the outcome of them.Can I just say in regard to the comments of the previous speaker Louisa Wall that I think it's well and good to give people funds without any strings attached but in order to do that you've got to have a very strong economy that can afford to do that and I think that that is something that we need to address in this Parliament and in this country—and it is sustainability. Yes it's one thing to have sympathy but we must have sustainability. We must continue to encourage self-determination and we must continue to upskill and support people to become self-reliant. Otherwise you will not have a country that can afford to do that and hence some of the comments that have come through on our side regarding for example a capital gains tax which depletes the resource base of people to continue to build that self-determining sustaining self-reliant economy. So getting those balances at the right place is very very important. Otherwise what will happen is that this Government will bankrupt this country as has happened in the past and then the country will have to revert back to some very stringent measures. We all believe that there need to be safety nets for people of course but we must also ensure that we have a really strong robust economy that is growing every year to be able to afford to do that.I want to just come to some comments that the Prime Minister made in her statement on page 5—and yes it's relevant to my electorate and to the rohe the families and the friends that live in North Taranaki and around the coast where I am their MP. She said The fourth priority underpinning our economic theme is the transition to a clean green and carbon-neutral New Zealand." Well we understand there is bipartisan work to come to an agreed place and process on how this can happen and my colleague Todd Muller is leading that for the National Party. Then the Prime Minister went on to say "A key policy priority will be to support a just transition for workers in industries that need to reduce emissions. Initiatives will continue to be developed to support the creation of jobs in sectors that are carbon-free or carbon sinks such as forestry."As I said last night in my speech right now in North Taranaki there's a big jack-up rig that's been deployed. It's at the Pohokura platform and it's going to be working there for three months to enable a freer and more extensive flow of natural gas. Now while this Government is looking at transitioning away from fossil fuels the promises or the potential that has been put before us by the Government is that we will see the potential of hydrogen replacing natural gas particularly around the areas of heavy transport—which I do support—but also around process heat. There are some companies that use natural gas because it is intense and it's relatively inexpensive and companies like Fonterra do that.So in the last week there have been reports that have come out because obviously the Government is looking at the potential and the possibility of hydrogen replacing natural gas. Concept Consulting the Ministry of Business Innovation and Employment and many other organisations have collaborated to research and dig into this and what these researchers and analysts have found is that it is highly unlikely—highly unlikely—that hydrogen can displace electricity and natural gas for process heat especially in that high heat area of above 200 degrees or 300 degrees Celsius that's needed.Now the issue about this is that those companies that rely on natural gas don't have an alternative except to import gas and in order to do that and to establish the infrastructure and to put all of that in play it will take around about 10 years. It's quite expensive and extensive and there's a lot of consenting and a lot of issues around all of that. But the problem is that New Zealand's supply of gas—that supply of natural gas that we are around about 90 percent confident we can access—is available for six years or maybe a bit less. So there is looming an energy gap that this country is going to face. So while this Government wants to be kind and they want to help people without any strings attached they are using strings to tie up industries that will empower and enable our industrial and our agricultural sector to continue to prosper and it doesn't make sense. I think the elephant in the room that the Prime Minister talked about a year ago and said was smaller this year is a lack of connectivity between the production of energy and the consumption of it. If you went to liberal urbanites and asked them where natural gas comes from they'd point to a blimmin pipe in the wall. They might forget that it actually comes from 3000 metres down it's piped to them on the Māui or the Vector pipeline from Taranaki and it gets up there into Auckland.Without that gas flowing New Zealand is incredibly vulnerable. Back in 2011 when the Māui pipeline had a leak in it and it took 138 hours to repair that the New Zealand economy lost $200 million principally from the agricultural sector. So what the Ministry of Business Innovation and Employment (MBIE) did was they were highly concerned about that and they asked WorleyParsons to go and do a study to find what would happen if there were gas disruption in New Zealand. So they alongside of information from the New Zealand Institute of Economic Research produced a report that was delivered to MBIE in about 2013 and they calculated that without a supply of gas to the northern part of the North Island only the loss—the economic cost—would be in the vicinity of over $650 million per month.Now some people would say "Well we should not be reliant on gas. That proves that we are too dependent on a resource." But what I would say is that if you look at the cost of gas to industry whether that's Fonterra New Zealand Steel New Zealand Refining or Methanex which produces low-emission methanol that's going to be used more and more in ship transportation as a fuel—if you look at that and then you say "Well move away from gas to electricity." then just that shift is three times the cost. Fonterra said they can't afford that. If you were to shift from natural gas to hydrogen it's 10 times the cost.So if you tell industries that their energy cost is going to increase 10 times what they will say is "We can't do business in New Zealand so we will import our steel from Indonesia. It's about four to five times the emission load than what New Zealand steel costs us in terms of greenhouse gases." The fact is that over November and December there were shortages of gas because of infrastructure challenges. What happened is that we had to depend on imported coal. In the quarter ending 30 September New Zealand used 57000 tonnes of coal for electricity generation but in the quarter ending 31 December that had gone to around about 260000 tonnes. Because there was a lack of gas in New Zealand our emissions exploded and our costs of electricity tripled and what we're seeing is that there is no real opportunity to use hydrogen without seeing substantial increases in the costs of doing business in this country. This is why there is an elephant in the room.ASSISTANT SPEAKER (Adrian Rurawhe): I understand this is a split call—five minutes."