Smith Nick: Climate Change Response Amendment Bill — First Reading 
Smith Nick: Climate Change Response Amendment Bill — First Reading 
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Hon Dr NICK SMITH (National—Nelson) 
: 
 This bill illustrates the serious pickle the Labour Government has got New Zealand into with its premature ratification of the Kyoto Protocol. It is piecemeal law that will create some quite perverse incentives in terms of the proposed carbon-trading market. What is particularly bizarre about this bill is that if people go out and create productive forestry if they plant a new area of  
Pinus radiata 
 for commerce despite the fact that that will have equally a gain in terms of the protocol they will be able to register their credits only if it is unproductive forestry. It seems somewhat bizarre but when I really think about it not unusual from Labour—that it would want us to encourage unproductive activity but discourage productive activity. 
Russell Fairbrother 
: We don’t encourage unproductivity. 
Hon Dr NICK SMITH 
: I would like the member opposite to explain it to me. Why is it that if people go out and plant trees for non-commercial purposes they will be able to register it and get credits from this Government but if they do this to create wealth to earn income for this nation the Government says no? It is truly bizarre. It really does illustrate the muddled mind of the Government with respect to this whole issue of climate change. It is part of the folly of this Government’s desperate bid to be cleaner and greener than anybody else on the planet—without rational thought as to the implications for New Zealand for our economy and for our environment of going ahead of the pace. 
Just last week the Government announced a new carbon tax that will impose an extra $300 million or $400 million on New Zealand homeowners on New Zealand businesses and on New Zealand farms. It is interesting to note what the United Kingdom’s  
Guardian 
 newspaper said last week about the Government’s announcement. It said it was going to be an interesting experiment for New Zealand. Well an experiment is something with high risk. While the rest of the world will be watching New Zealand with great interest this Labour Government has no right to play games of experiments with the livelihoods of the key industries and the families of New Zealand. It should be an embarrassment that the Government is experimenting with the New Zealand economy. 
It is interesting that the Europeans the ones whom Pete Hodgson and the Government are so keen to trot out after in the 1990s abandoned any idea of a Europe-wide carbon tax. It is high risk it will have a negative impact on the New Zealand economy and it will be for negligible environmental gain. How many members of this House really believe that the 4c a litre carbon tax will result in any less petrol or diesel being used in New Zealand? 
Hon Ken Shirley 
: None at all. 
Hon Dr NICK SMITH 
: Ken Shirley quite properly says “None at all.” Labour members are silent because they know in their heart of hearts that it will make not a dot’s worth of difference. They know. They have twice already put up the petrol tax. When they put up the petrol tax in 2002 was there any reduction in the amount of petrol used? 
Lindsay Tisch 
: No. 
Hon Dr NICK SMITH 
: Not at all. Will there be any reduction since 1 April this year when Labour again put the petrol tax up? So why is it that Pete Hodgson and the Labour Party want to impose this extra carbon tax on New Zealand business and on New Zealand households when they know that it will not work? I say to Pete Hodgson that the carbon tax will be as successful as the “fart tax” and it will not be long before this Government is scurrying off into its hole and apologising for getting this one wrong as well. 
The real difficulty the Government has got itself into with the Kyoto Protocol is going so far ahead of our major trading partners. It is National’s view that New Zealand needs to move in parallel with our most important trading partners and it was a mistake in 2002 for this Government to ratify the Kyoto Protocol when neither Australia nor the United States was part of it. 
I point out to Darren Hughes who is trying to interject that New Zealand’s emissions amount to less than 0.5 percent internationally and per head of population our emissions are about half that of Australia’s and the United States’ emissions. So why are we going to impose costs and impose controls and impose red tape on New Zealanders when countries like China India Singapore Australia the United States and Canada do not have restrictions on them? 
The devil of this bill will actually be in the detail. Because in that continuum—from a national park forest that is fully protected all the way through to the production forest—where does this bill strike? The answer is that we do not know. We do not know because in fact it is the regulations that will flow from this law that will sort out who is in and who is out. But I can bet one thing: this Government has no intention of providing the credits for those forest planters since 1990 who are eligible for Kyoto credits. Why will it not do that? Is there some great ideological reason? Is there some reason why if it is indigenous forests the Government will provide the credits but not if it is plantation forests? Is there some rationale for the distinction that the Government is making in this bill to give out credits to some but not to others? 
It is very simple. The reason is that without the forest credits this Government’s policy is absolutely naked. Without confiscating those forest rights from those thousands of Kyoto forest owners unless the Government has those it is seriously in the pickle. I ask Government members opposite why should those who have this forest mechanism get credits but not plantation forest owners? Why do those who use the cleaner development mechanism—say a wind farm—get the credits but not those that plant pine forests? Why are those who meet the requirements of the joint implementation mechanism of the Kyoto Protocol able to get their credits and to trade with them but not the forest owner? Why is it that the forest owner who has planted  
Pinus radiata 
 in good faith is out but these guys are in? I say that it will provide some very crude and wrongful incentives for all the wrong sort of behaviour. 
This is all part of Helen Clark’s rushing in to get the cute photo opportunity without thinking through all the implications of New Zealand’s ratification of the Kyoto Protocol. It is National’s view that when we move to a point of this agreement being truly international—that is when we move to a tradable emissions permit system and this is a very big “but” we need to move with everyone. We cannot pick just some. We cannot say to those plantation forest owners: “We’re going to grab your credits and nationalise them.” and say to those who have an indigenous forest that has been newly created or even I understand an exotic forest: “Your forest is not to be harvested; it is to be put into canopy.” or that somehow they will be treated differently and that if they have a cleaner development mechanism they will be treated differently. 
National’s view is that we must treat all of those equally we must move to a comprehensive emissions trading permit system—or none at all. We say that it is either all or none. Picking only some will cause all sorts of distortions. The Government’s Kyoto policies are in a mess. This bill will not work. It will only create more problems. The correct thing for the Government to have done was to hold back wait until Kyoto becomes truly international and then move all players into a tradable emissions permit system.