Smith StuartSTUART SMITH (National—Kaikōura): Thank you Mr Speaker and I would like to thank Minister James Shaw for his fulsome answers that he gave during the committee stage. It is helpful when we have the cooperation of a Minister who doesn't sit there like a laughing clown and does nothing. He actually answers the questions in a full manner and I think all due respect to you for that Minister. However it is a great shame that we have arrived here tonight in what is a departure from what the tradition has been in this Parliament around climate change legislation in that we now are departing from having a cross-Parliament agreement on such matters. The Minister talked about the market needing confidence in the process. Well the Parliament needs confidence in the process and unfortunately the failure to support my amendment to have the Minister have to consult with the leaders of the non-governing parties does not ensure confidence of this House in that process. It's essential that we do have that and it's probably more important actually than the market having confidence in the process because we are the people that actually have to answer to our constituents for this. As my colleague the Hon Scott Simpson said earlier in the evening in the debate Governments are temporary. How temporary they are is the only thing we're uncertain of although we're pretty certain there's less than a couple of years to—Hon Scott Simpson: This one's very temporary. STUART SMITH: It's very temporary—precisely. So to have this important legislation endure through those temporary Governments it's essential we have the confidence of the House. Unfortunately we cannot support this through third reading. I think it's outrageous. That very simple amendment would have given confidence not only to the National Party—the ACT members have also spoken in favour of it. This is not a big ask. It makes no imposition to the bill and it really comes down I think to the advice that you've had Minister. I think it's quite poor and I think that it really has trampled on that long-held principle that we across the House support such legislation. So it's very disappointing. The Minister asked about electricity markets and the emissions trading scheme (ETS) auction. He drew a parallel between them and asked why should the leaders of non-governing parties have a say on the ETS auction price and he said they were the same. Well there's a very clear difference: the electricity market rules set the amount of profit that buyers in that market can make. This confidential reserve price sets the limit below which prices cannot go and it raises revenue directly for the Government. They're quite different. Perhaps the officials hadn't thought of that and if they haven't shame on them. I realise you've got a lot on your plate Minister but that is actually a pretty simple concept. You talked a lot about the ETS. That is a marvellous mechanism and I think that's what we all support here. We want it to operate properly and there was your example that you gave about not wasting opportunities to lower emissions and utilising the best signal to do that. But we've seen all around the world crazy policies that cost a lot and I think the best example is the barrow bikes in Germany. Barrow bikes are a pushbike-type thing with a barrow on the front of it. People can cart their supplies from the shops on their bike and the German cities thought it was a great idea to subsidise these barrow bikes. They abated a total of 7 tonnes at a cost of €20000 a tonne. That is an example of a well-meaning policy attempting to lower emissions and in fact all it does is cost a lot of money. I think what the problem we have here now is we're getting mixed signals here with this ETS. We're now going into a confidential reserve price. We need to know that this auction is going to work properly. We need to know that we can have confidence in that reserve price and without our leader and the leaders of other non-governing parties knowing that we don't have the confidence that we would otherwise have and I think that's really important when we've got such a complex issue as the ETS. As I mentioned earlier I spoke to a group on the weekend who are very engaged in this issue. They are not newbies to it and they had a pretty low understanding of how the ETS works. I think we have to be certain and clear in our messages. Everybody doesn't need to know the intricate details of how the ETS works. They need to have a bit of an idea but they also need to know that there is no smoke and mirrors going on in behind the scenes when these auctions are occurring. I accept that there 120 million units surplus out there and we will have to work through those. The chance of an auction failing: although we disagree on terms here having an auction failing to clear and those units rolling over to the next auction—of course if it's the last auction of the year those units then disappear. They don't go on to the next one in the following year so there are actual consequences if auctions fail to clear and I think that didn't really get addressed during the debate tonight. I think that's certainly a big concern for us all. You mentioned also Minister the EU's ETS and how good it was. Well I think that's actually a Clayton's ETS quite frankly. It doesn't include transport and it doesn't include agriculture and nor should it. Nor does ours and it shouldn't either until such time as our trading partners do. I think we too often take the EU as a shining example when we're the market leaders in this not the followers and I think we should be proud of our ETS. It is quite well constructed particularly now it's capped. We can manage our emissions down and I think that this auction is of course an important part of that. I accept that you want to get this up and running ahead of time so that the market is familiar with how the auction system works. Any bugs that are there can be ironed out with the day-to-day running and we just hope that there are no bugs in the legislation. This has been a robust process and while it's not a very thick bill and it's only a few pages there certainly is a lot of room here for mistakes—mistakes that could have serious consequences. We've done our best through the select committee process. Everyone across that select committee did their best and there was a lot of cooperation across the Environment Committee. We worked very hard and collaboratively together. I wish the public could see more of what goes on in select committee and the collaborative way we work. Even if we don't support the legislation we want to make sure that it's the best that it can be. We did support this to the point where we couldn't support it because it's not one simple step but an important one that we on this side of the House have confidence in the methodology. As I mentioned section 20 of the Intelligence and Security Act is a principle that could be utilised here where the Leader of the Opposition is actually consulted on security matters. This is I would argue not as sensitive as those principles those things that are being consulted with the Leader of the Opposition perhaps not on a daily basis but certainly on an as-need-to basis and I think we should be doing the same thing with this auction bill. We did talk about the price of emissions being the best way to lower emissions and I talked about that earlier but my colleagues will all have more to say on this as we go through. My colleague Erica Stanford's amendment also would have brought quite a bit more rigour to the bill and it should have gone in. Simon Court's Supplementary Order Paper 15 also I thought was quite necessary. We thought about it in the select committee and we debated it. It should have been there and the reasons for it not being there were not convincing for the select committee but it got through anyway. I congratulate the member who's a new member in the House for putting such a good Supplementary Order Paper together. So unfortunately we cannot support this bill in the form it's in. Thank you.