Smith Nick: Climate Change Response (Emissions Trading) Amendment Bill Electricity (Renewable Preference) Amendment Bill — Third Readings 
Smith Nick: Climate Change Response (Emissions Trading) Amendment Bill Electricity (Renewable Preference) Amendment Bill — Third Readings 
[Volume:650;Page:18725] 
Hon Dr NICK SMITH (National—Nelson) 
: 
 It is with considerable disappointment that National comes to the third readings of this legislation which is about what I think is the most challenging issue facing not just New Zealand but the globe. The emissions trading legislation is not in a state for us to be putting it on the law book. It requires additional work if it is to be workable legislation that we do not end up amending over and over again in future years. 
This issue is such a big issue that I was optimistic that we might be able to build enough cross-party support to ensure that instead of the legislation being passed with a very slim majority in the dying days of a Government it would have broad community and parliamentary support. That is why I want to briefly recite the history of the debate on emissions trading. Back in 1999 the then National Cabinet made a decision in principle that the best way for New Zealand to respond to the challenge of climate change and to the Kyoto Protocol was to put work into the development of an emissions trading scheme. When Labour came to office in 2000 it abandoned that work and for 6 years it went down the road of a carbon tax. When the Government abandoned the carbon tax proposal I wrote to David Parker on behalf of my National colleagues to say that we were open to constructive dialogue on an emissions trading scheme for New Zealand. We did not even receive the courtesy of a response. 
Every action that this Government has taken over the last 2 years has led me to the view that Labour wants National to vote against this legislation. Let me give members a few examples. In respect of the release of the discussion papers National received them after the media did. When it came to the introduction of the original Climate Change (Emissions Trading and Renewable Preferences) Bill National had absolutely no advance notice of it; however we acted in good faith and voted for its first reading. During the select committee process there was absolutely no attempt by the Government to engage with National. In fact it tabled a thousand amendments to the bill the day before in effect the deliberation on them—the day before we had to vote on those amendments. Furthermore the Government announced a major change to the emissions trading scheme—the delay of the liquid fuels sector—in the middle of the select committee process without any consultation with the select committee at all. Then during the Committee stage the Government just last Tuesday tabled 785 amendments without any consultation and National members were forced to vote on them that day. I put that information to the House to show there has been absolutely no endeavour by the Government to build the sort of cross-party support that is needed for this sort of very major reform. 
National’s key concern about this legislation is that it is being rushed through the House. We have had hundreds and hundreds of amendments. The Minister in charge of the legislation David Parker may dismiss them as minor technical issues but they go to the core of the issue of whether this legislation will work. I can only conclude that Government members in their own minds are trying to gain credit for introducing the biggest most ambitious “all gases all sectors” emissions trading legislation in the world and are passing this legislation in the hope almost that they will not have to deal with its complexity. It is my view that this legislation in its current form represents a hospital pass for whichever party forms the next Government. 
National has six key areas of concern about this legislation. I want to work through them because they are substantive. 
The first is the issue of balance. It is National’s view that this legislation is driven by the Prime Minister’s objective of New Zealand being a world leader on climate change. The problem for Labour is that in its 9 years of Government our emissions have actually gone up faster than those of any other country. This Government has the 38th worst record when it comes to growth in emissions. Far from the 20 percent reduction in emissions by 2005 that it promised emissions have in fact gone up by 20 percent. The difficulty is that every step along the way—whether it has been the carbon tax the animal emissions levy or the negotiated greenhouse gases agreement; whether it has been any one of those measures—the Government has had poor process it has blustered ahead in a gung-ho way and the policies have fallen flat on their faces. The tragedy of this legislation is that the Government has learnt nothing from 9 years of failed climate change policy. National wants a policy that is balanced. If the Government is honest about wanting a world-leading climate change emissions trading scheme it should be honest with the public and say that it means having world-leading petrol prices and world-leading electricity prices. If National is given the chance to amend the legislation we will put in it a more balanced objective of a 50 percent reduction in New Zealand’s emissions by 2050. 
National’s second area of concern about this bill is that it is a massive cash cow for the Government. The Government’s officials have advised that the Government expects to make a profit of $23 billion over the timetable of this legislation. Climate change is not an excuse for Michael Cullen to get his fingers deeper into the pockets of New Zealand businesses and New Zealand families. 
The third area of concern is in respect of our maximising alignment of this scheme with that being developed in Australia. The European Union has an emissions trading scheme covering the 24 countries within it. There may be areas of difference between Australia and New Zealand but it is National’s long-term view that if we are to deal with climate change then surely New Zealand with all our commonality with Australia should be able to more closely align our emissions trading scheme with that of Australia. 
We also have concerns that this legislation will export both jobs and emissions. National is interested only in climate change measures that will make a difference. We are not interested in the provisions of this legislation that will encourage the relocation of some of our heavy energy-intensive industries overseas. It is also our view that this legislation needs to be changed in respect of the way it deals with small and medium enterprises which are discriminated against. We oppose the rigid timetable for the phasing out of industry support and we want a more flexible regime in which the phasing out moves in line with what occurs in international negotiations. 
I also have to express concern about the detailed provisions for forestry. This Government’s dealing with forestry in this legislation has contributed to the greatest level of deforestation since records began in 1951. National members are not satisfied that we have got right the provision of incentives to plant trees which is one of the least-cost ways that New Zealand can rise to this challenge. We have concerns about the issue of flexible land use. We put amendments in the Committee to provide for the offset rule to apply in respect of forestry and we are disappointed that the Government has not seen the merit of that approach which would not have posed any difficulty in terms of actual emissions but would have resulted in a lesser cost to the economy and more efficient use of New Zealand land. 
I also express concerns about the fishing sector which is discriminated against in this legislation. 
In summary National says that New Zealand needs a well-balanced and carefully designed emissions trading scheme but we should not underestimate how important and how difficult that challenge is. The gung-ho approach that we have seen from the Minister and the Government will cost New Zealand dearly and will not address environmental issues. National members will address them. National will amend this important legislation so that we get a price for carbon on 1 January 2010 but the legislation in its current form does not deserve National’s support.