Smith Lockwood: Estimates Debate —  
Smith Lockwood: Estimates Debate —  
[Volume:610;Page:7167] 
Dr the Hon LOCKWOOD SMITH (NZ National—Rodney) 
: 
 Now that the Minister the Hon Dr Michael Cullen is back in the chair I would like to question him about the quality of the advice he has received from Treasury in respect of certain revenue policy matters. It is common knowledge in this Committee that when the Government introduced its increased tax on alcohol which took the tax from $21 to $38 per litre on beverages with an alcohol content of between 14 and 23 percent it was aiming at the alcopop market. 
Hon Dr Michael Cullen 
: No. 
Dr the Hon LOCKWOOD SMITH 
: If members check  
Hansard 
 they will see that Jim Anderton said when he introduced the legislation that it was aimed at combating youth drinking. Quite clearly the policy has failed totally because it did not hit the drinks that young people drink—unless Dr Cullen thinks that young people drink sherry. That tax increase hit sherry drinkers instead of young people. 
When I was formerly the deputy Minister of Finance the Treasury advised on increased taxes. I want to know from the Minister in the chair whether Treasury advised the Government on that increased tax and on its effectiveness in dealing with youth drinking issues. If Treasury advised the Government on that did its advice point out that the tax the Government proposed to bring in would not even hit the drinks that young people drink? If Treasury did not point that out what is the Minister’s assessment of the quality of its advice—or was it the case that Treasury did point that out and the Minister took no notice? 
We are debating important issues this afternoon—the $50 million - odd that this Parliament appropriates for Treasury to advise the Government. That tax was clearly a cock-up. Whichever way we look at it no one on the Government side of the Chamber can claim that the Government planned to hit the old folks with a sherry tax. That was clearly a stuff-up. As we appropriate $56 million to the Treasury we as a Parliament have a right to know what the advice of Treasury was on that matter. 
My second issue in respect of Treasury advice is that I want to know what Treasury has advised with regard to the “flatulence tax”. I want to know whether Treasury has advised the Government on the time that methane exists in the atmosphere. I want to know whether Treasury has looked at what the Government has proposed to impose on our primary agriculture industry in terms of revenue gathering and whether it has advised the Government that it has the remotest opportunity at all to change the level of methane in the atmosphere through playing around with ruminants’ eructation levels. If the Government is to go ahead with that tax without Treasury advice it is worth us knowing that because we will then know we are spending this money on Treasury for no purpose. If Treasury has advised the Government on that tax then I want to know the quality of its advice. 
Has Treasury looked at the level of methane in the atmosphere? I know that it used to do that kind of work. It would advise the Government on all those sorts of things and would not just rely on other departments. Has Treasury looked at the length of time that methane lasts in the atmosphere? Is it a few hours in daylight hours? If a ruminant animal belches out some methane this afternoon will it still exist in the atmosphere tomorrow morning? The answer is that probably no it will not. Yet millions of dollars will be taken from farmers in this country putting them at a competitive disadvantage when the methane that they are supposed to damage our environment with does not hang around. 
What is more has Treasury advised the Government on the background level of methane in the atmosphere? Has Treasury advised the Government on our ability to change that level one iota? By that I mean change it perceptibly at all—not just change it by 1 2 or 3 percent. If the Government is to go ahead and tax New Zealand’s farmers millions of dollars that Australian or American farmers do not have to pay this Labour Government is just imposing more anti-competitive policy on New Zealand. What is the quality of the advice that the Government is receiving? Is it that the Government has gone headlong into the Kyoto Protocol and is now so caught up in it that it does not know what it is doing and what damage it is doing to this economy? Is it just that the Government has to be seen to be doing something because it is determined to implement the Kyoto Protocol come hell or high water? 
Someone has told the Government that ruminants eructate methane into the atmosphere and that methane is a terrible greenhouse gas. The fact that it does not stay in the atmosphere for very long has not occurred to the Government. I want to know what advice the Government has received on methane emissions and what the quality of that advice was.