Mackey Moana: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — Second Reading In Committee Third Reading 
Mackey Moana: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — Second Reading In Committee Third Reading 
[Volume:651;Page:813] 
MOANA MACKEY (Labour) 
: 
First of all I will just mention how disappointed I am in the member Jacqui Dean who sought to shut down this debate so quickly. This Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill has not been to a select committee. This is the only chance we are getting even to try to question the Government on why it is doing this and on parts of this bill. The Minister in the chair the Hon Gerry Brownlee seems particularly reticent to stand up and answer any of our questions. He has answered only the questions he has wanted to answer and then he has answered some questions we did not even ask. Well that is not particularly useful and I point out to the Minister once again that he is ramming this bill through under urgency. 
This bill should have gone to a select committee so that Mr McNicholl and other people who are adversely affected by the repeal of the mandatory biofuel obligation could have had the chance to have told us why. National members who believe that Mr McNicholl is lying and is just saying what he is saying for some competitive advantage would have had the opportunity to put those questions to him I say to Mr Brownlee and to challenge him at a select committee rather than to stand up in this Chamber where Mr McNicholl has no right of reply and no ability to defend himself and just call him a liar and a scaremonger. I do not think that that is good for the Parliament of New Zealand. I do not think that that is good enough for this Parliament. I think that if that is the way this National Government is to continue with 100 percent of bills so far being rammed through under urgency in this House with no select committee process then it will be a very long 3 years for the people of New Zealand. 
Jacqui Dean is probably worried about compulsion. She is the member who wanted to ban water so I find that concern slightly difficult to take from her. But I will support the amendment of the member David Parker. The relative tax treatment of different fuel types was something that the select committee did consider quite carefully. As the Minister will know in the explanatory note that accompanied the Biofuel Bill that came back from the Local Government and Environment Committee we recommended that a total review be made by 2010 in order to consider all fuel types. The review was to consider not just vehicles using biofuel and engine fuel but also electric vehicles—which we were told during the select committee process had to drive around with a sticker on them stating “diesel” I think because that was the category they fitted into most easily as current rules did not allow for them—and to consider LPG as well. Perhaps it is time to review the way in which we tax vehicles and to apply an environmental eye to that and not just to apply road-user charges and excise duty. 
When Gull Petroleum first wanted to blend ethanol into its fuel it wanted to know what the relative tax treatment of ethanol would be. Currently ethanol is brought into New Zealand for two reasons: as drinking alcohol or for use as a chemical. Ethanol as a chemical attracts no excise; ethanol as a drink obviously attracts alcohol excise duty. A decision was made at that time to allow the excise treatment of ethanol as a fuel to be treated as ethanol as a chemical which meant that it would attract no excise. The company was given a commitment that until 2012 that would be the case and that the decision would not be reviewed. We took that very seriously at the select committee. Gull Petroleum had made all this investment in its infrastructure and in bringing in blends and it had gone into a contract with Fonterra until 2012 to take ethanol from whey to blend into its fuels so we did not want to say to Gull Petroleum that we would take that away at that time through a select committee process that had been looking primarily at a mandatory biofuels obligation and not at the relative tax treatment. 
But the point was that we were putting in place a mandatory biofuels obligation that addressed a number of those issues; with that being taken away suddenly this becomes a far more pressing issue. That is why I urge the Minister in the chair Gerry Brownlee to support this amendment. It does what he has already said in this Chamber that he wants to do so I do not see any issue with that. But it provides some kind of incentive which he will be taking away with the repeal of this part of the existing legislation. 
Certainly a number of the bio-diesel producers who came before the select committee were concerned about the relative tax treatment. We know that the way in which we treat the excise on ethanol is an issue of great concern. We have seen the impact that the subsidies on ethanol in the United States have had on the world biofuel market. It has made it extraordinarily difficult and the “splash and dash” ethanol that we have seen produced out of the United States has distorted that market. It has made it a lot harder for our producers here to be able to compete. 
We believe that this is an issue that needs wider treatment than just being about ethanol and bio-diesel versus engine fuel; it needs to go beyond that. I would like the Minister in the chair to take a call on this part because it seems to me that we are entering a real no man’s land here and we are in real danger of ending up with absolutely nothing.