Boscawen John: Reports — Briefing on Finance Company Failures—Consideration of Report of Commerce Committee Complaint Regarding SR 2008/319 Marine Safety Charges Amendment Regulations 2008—Consideration of Interim Report of Regulations Review Committee Review of the Emissions Trading Scheme and Related Matters—Consideration of Report of Emissions Trading Scheme Review Committee Report from the Controller and Auditor-General on Local Government: Results of the 2007-08 Audits—Consideration of Report of Local Government and Environment Committee Report from the Controller and Auditor-General on Inland Revenue Department: Managing Tax Debts—Consideration of Report of Finance and Expenditure Committee Reserve Bank of New Zealand’s Monetary Policy Statement September 2009—Consideration of Report of Finance and Expenditure Committee 
Text is incorporated into the Bound Volume 
Boscawen John: Reports — Briefing on Finance Company Failures—Consideration of Report of Commerce Committee Complaint Regarding SR 2008/319 Marine Safety Charges Amendment Regulations 2008—Consideration of Interim Report of Regulations Review Committee Review of the Emissions Trading Scheme and Related Matters—Consideration of Report of Emissions Trading Scheme Review Committee Report from the Controller and Auditor-General on Local Government: Results of the 2007-08 Audits—Consideration of Report of Local Government and Environment Committee Report from the Controller and Auditor-General on Inland Revenue Department: Managing Tax Debts—Consideration of Report of Finance and Expenditure Committee Reserve Bank of New Zealand’s Monetary Policy Statement September 2009—Consideration of Report of Finance and Expenditure Committee 
[Sitting date: 18 November 2009. Volume:659;Page:7823. Text is incorporated into the Bound Volume.] 
JOHN BOSCAWEN (ACT) 
: 
 Parliament is an interesting place. I came down to the House at 20 to 8 this evening to do 50 minutes in the House before taking leave of the House at 8.30 to walk across the road and appear on the  
Back Benches 
 television programme. 
Hon Simon Power 
: Name-dropper! 
JOHN BOSCAWEN 
: In demand I say to Mr Justice Minister. I have appeared on it three times in about 7 weeks. No sooner had I arrived in the House than I was told that it would not be rising early but would be going on to debate the report of the Commerce Committee on finance company failures. I sat down to start to prepare a speech on the inquiry into finance company failures. I am a new person in this House and I understood that the Government was going to move a motion that the House defer the debate on the finance company collapses until a later time. That motion was not moved and I missed my chance to speak—and there is much that I could have said. 
However I was then informed that if we did not debate the finance company failures we would debate the emissions trading scheme. That is also an issue of real concern to the ACT Party. I intend to use my remaining time to debate that issue and to respond to some of the comments that have just been made by Jeanette Fitzsimons. Unfortunately because of my other commitments I will not be able to stay in the House to hear the continuation of that debate and to those speakers who follow me I apologise. 
But let us come to the comments made by Jeanette Fitzsimons. She quite correctly said that the Government had reviewed the emissions trading scheme. She said that the review had been instigated by the ACT Party. Well why was that? There are several reasons. First of all the National Party campaigned on amending the emissions trading scheme which was passed into law late last year. The ACT Party—very much a minor party compared with National a smaller party in terms of the confidence and supply agreement—campaigned on scrapping the emissions trading scheme. One of the concessions that we negotiated in our confidence and supply agreement was for a full review of the emissions trading scheme. The Government agreed to a review and it established the Emissions Trading Scheme Review Committee which Jeanette Fitzsimons referred to. 
But why was it necessary to review the scheme? Let us look at the reasons. It was necessary because the emissions trading scheme was a massive tax on all consumers all businesses and all taxpayers in New Zealand. It was a massive tax and I will explain that. When the New Zealand Government signed the Kyoto Protocol it agreed to limit our emissions during the period 2008 to 2012 to the levels that prevailed in 1990. It is called the “first commitment period”. For that 5-year period between 2008 and 2012 it agreed that we New Zealanders would emit no more than our 1990 level of carbon dioxide or carbon dioxide equivalents. It further agreed that if we exceeded that level it would be prepared to pay some money to those who managed to limit their emissions. In actual fact in the calculation of that figure we were allowed to take into account what we call the extra absorption of carbon dioxide—the absorption of carbon dioxide by plants and forests. At this stage it looks as though New Zealand will have no net liability for the period up until 2012. 
The question then becomes what we will have to pay after 2012. Well we do not know because we have not signed a commitment to do so. It would seem that National is hell-bent on recklessly pushing ahead with its amendments to the scheme with the intention that its proposal should be made law before the Copenhagen conference next month. It has become very obvious in recent weeks that no agreement will be reached in Copenhagen—not next December not next year and probably not even before the Kyoto Protocol expires at the end of 2012. 
But let us say that we did reach agreement and we reached agreement to reduce our emissions to this theoretical mystical figure of a 50 percent reduction by 2050—a 50 percent reduction. Let us assume that we were to commit to that; there are many reasons why we should not and I will come back to those shortly but let us say that we do. It would mean that New Zealand would essentially have to pay for its excess emissions on a sliding scale. So we start in 2013 and in the following 37 to 38 years—by 2050—we would have to reduce our emissions by 50 percent. 
What did the Labour scheme state? The Labour scheme stated that Labour would give industry a short time to adapt but it would expect industry to then achieve massive reductions such that it would reduce its carbon emissions to zero by 2030—to zero. That means that once industry’s allowance was reduced to zero by 2030 it would have to pay for extra emissions above zero even though the Government would not have to pay that money offshore. If we agree to that target of a 50 percent reduction by 2050 we will still be allowed half of that carbon discharge. That means the reductions that companies industries and emitters are required to achieve are very excessive. They will be paying huge amounts for those emissions despite the fact that New Zealand is not liable for them. It has been calculated by Treasury that on the basis of Labour’s existing scheme those businesses will be paying in excess of $2 billion a year extra every year from 2030 onwards. 
National wishes to reduce that massive overtaxation. Labour has made much of the fact that Treasury acknowledged to the select committee last Wednesday that the cost of what is being given back is $105 billion. That is a massive figure. The reason it is being given back is that Labour’s scheme took it in the first place. What National is trying to achieve—I would imagine—with its legislation is to make the costs on higher-intensity emitters and medium-intensity emitters more akin to what the taxpayer has to pay. 
I would like to come back to that 50 percent target. Jeannette Fitzsimons said that New Zealand was the fourth-highest emitter in the world on a per capita basis. Shock horror! We are the fourth-highest emitter. One would think that is pretty bad. Jeanette Fitzsimons did not tell the House that half of those emissions result from agriculture. Half of those emissions result from growing food for the rest of the world. So they are not emissions that are generated by New Zealanders for New Zealanders’ use. It is not as though they are generated by New Zealanders driving around in Hummers and 5-litre cars or using coal-fired power stations that puff emissions and soot into the air. We have some very efficient industry; we have some very efficient agriculture. Our emissions profile is unique because half of our emissions are generated as we feed the world. And we feed the world very efficiently. If we close down our agriculture or we substantially reduce the output of our farmers that food will have to be grown somewhere else in the world and I suspect that the carbon emissions of those outputs or that production will be far greater than they would have been if the food had been grown in New Zealand. 
That has a big bearing on that 50 percent target. The reality is that if our farmers on the basis of current science were to do everything humanly possible—nitrogen fixation and schemes that are available right now—they could reduce their emissions by just 13 percent. To achieve that 50 percent target by 2050 means the other half of the economy has to reduce its emissions by 87 percent. That shows us what an unrealistic target it is for New Zealand to try to achieve a 50 percent reduction by 2050. 
It is all very well having targets of 2015 2020 2030 if our scientists can develop technology if they can breed grasses if they can genetically re-engineer sheep and cattle so that they do not burp and discharge methane. If they can do that well fair enough. But in my view our country would be very very foolish to sign up to a commitment that we know we cannot meet and to incur huge costs for all New Zealand taxpayers. Thank you. 
Motion agreed to.