Smith Nick: Climate Change (New Zealand Superannuation Fund) Bill — First Reading 
Text is incorporated into the Bound Volume 
Smith Nick: Climate Change (New Zealand Superannuation Fund) Bill — First Reading 
[Sitting date: 05 December 2012. Volume:686;Page:7208. Text is incorporated into the Bound Volume.] 
Hon Dr NICK SMITH (National—Nelson) 
: 
 This bill the Climate Change (New Zealand Superannuation Fund) Bill is one of those typical Green bills that sounds very worthy on the surface but the moment you stop and think about it you realise that it is actually pretty daft and silly. You see it is going to be a bill that is bad for investment policy but it is also bad climate change policy and I want to work through those issues. You see what this bill would do is say to the Guardians of New Zealand Superannuation that it has to invest its billions of dollars in a climate change - friendly way and the big question that it leaves wide open is what in the heck that actually means. 
Is it going to be proper for the New Zealand Superannuation Fund to invest in New Zealand’s all-important dairy industry? We all know that 48 percent of New Zealand’s emissions actually come from farm animals. We also know from a recent report that has come out in the United Kingdom that it is far more efficient to produce meat and dairy products in New Zealand than to do it overseas from a climate change point of view. So what real signal do we actually give to the New Zealand Superannuation Fund as to whether it should or whether it should not invest in major industries in New Zealand like the meat and dairy industry? And I ask whether the member in charge of this bill Dr Russel Norman is really saying that any climate change impact on any industry should prohibit the New Zealand Superannuation Fund from investing because every single human activity does have some impact. It could be eliminating investment in infrastructure and in the transport sector. It could eliminate investment in the fertiliser business. Even many industries that we think might be on the surface green might have some climate change impact. For instance it is very true that New Zealand’s all-important tourism industry actually depends on overseas travellers coming a great distance which does impact on climate change. So all it does is create a great deal of fuzziness and confusion about the Superannuation Fund. 
The second challenge I have got for the Greens is this: if you really believe that the Guardians of New Zealand Superannuation should have to take into account worthiness why do we not go into other areas? For instance I think most members of this House would say that it is good for business to invest in research and development. So why do we not put it to the guardians of the fund that it should invest only in companies that are meeting the Government’s targets of increasing research and development expenditure? Or for instance I think most of us here would accept that we need to improve the number of women who are directors of businesses and who hold senior roles. So why do we not put it to the Superannuation Fund that it invest only in businesses where there is a certain proportion of women directors and women involved in senior positions? What about in terms of workplace safety? Why do we not put extra requirements on the Superannuation Fund to say that it should invest only in funds that have got extraordinarily good records around workplace safety? 
That too would be worthy but all of those measures would be flawed for this very reason. The objective of the Superannuation Fund is for those guardians to do the very best with those investment funds to secure superannuation for future New Zealanders and the standards that the New Zealand Superannuation Fund should meet should be no different than the standard that applies to any private superannuation fund or any other investment. If the Government wants tougher workplace safety standards it should apply it not just to investments from the Superannuation Fund but to investments across the board. If the Government wants to pass some rules about increased research and development expenditure about more women participating as directors or about any of those other worthy goals there is no justification for saying that investments from the Superannuation Fund should have to meet some sort of different standard to any other investment and that is where the bill is flawed. 
But I also want to say around climate change policy that this Government is very proud of its record in the area of climate change policy because we are making real progress. The member is a Green and I respect those members’ view that the Government needs to put a greater weight on reducing emissions. If they want to run an argument that we should have a higher price for carbon there would be a trade-off. There would be a cost in jobs and in terms of the cost of living for New Zealand families of that measure but that would be a rational approach to reducing emissions. A higher carbon price would not just impact on the decisions that are made by the New Zealand Superannuation Fund but would of course apply across the board. That would be a rational perspective rather than the piecemeal and silly approach in this bill. 
I do want to put on record the many initiatives that this Government has taken around climate change because they are so often overlooked by members opposite. Let us look in terms of renewables. Everybody accepts that one of the areas where New Zealand has gone backwards has been that too much of our electricity has been produced by thermal electricity. In fact in the period from 1990 to 2008 we saw a consistent increase in the amount of electricity that was being produced in New Zealand thermally. 
Hon Trevor Mallard 
: Nothing wrong with renewable geothermal. 
Hon Dr NICK SMITH 
: There is a previous Minister of Energy Mr Mallard. In each and every year since we have been the Government the proportion of renewable power that New Zealand has produced has increased and that is a trend of which we are proud. 
In the course of this Government we have had 180000 homes insulated. Is that not a sensible climate change policy which this Government has adopted and advanced? 
Let us look at an area like trees. We all accept that trees have an impact on climate change—it is actually about 30 percent of the global impacts. During the course of the last term of the previous Government we saw New Zealand lose 40000 hectares of trees. Contrast that with the record of this Government. In our first 3 years in Government we have actually seen the forest estate grow by 30000 trees. 
Charles Chauvel 
: What’s going to happen now Nick that you’ve taken the credits away? 
Hon Dr NICK SMITH 
: Let us take the overall numbers—I say to Mr Charles Chauvel—and when it comes to climate change should the test not be what New Zealand’s net emissions are doing? Have we have met our Kyoto Protocol obligations? I am proud of the fact and we are only a few weeks out from the end that New Zealand has met its climate change obligations. Actually we have exceeded them by a significant mark and that is something of which this Government is proud. 
I would also note that in contrast to the years under Labour—remember that Labour campaigned on New Zealand being the first carbon-neutral country in the world? Look I acknowledge that the Green Party and the Labour Party are better on climate change rhetoric than anybody I know. They are really good on the promise; the problem is that they are hopeless on the delivery. They promised a carbon-neutral New Zealand and emissions went up by 26 percent. They went up every single year under the Clark Government. And do you know what the latest reports tabled in this Parliament last month show? They show that in the years 2009-10 the last 2 years that we have got figures for New Zealand’s net emissions have been coming down. How many congratulations messages have you heard the Green Party give this Government on being the first Government in more than a decade that has actually had New Zealand’s net emissions come down? 
Finally I want to conclude on the superb job in the international negotiations that the Minister for Climate Change Issues Tim Groser is doing not just in Doha but consistently. He has had more influence over international negotiations than any New Zealander in the last 20 years. I have been party to some of those and have seen Tim Groser do his work. Tim Groser’s basic message is right on the money and it is this: all of the growth in emissions over the next 20 to 50 years is in developing countries. That is where the big growth is. So for members opposite to be preoccupied on the 15 percent of emissions coming from developed countries is to completely miss the challenge. 
If we are to get on top of this problem of climate change the really big challenge is to get those fast-growing developing countries to move to new technologies. That is the message that Tim Groser is vigorously arguing in Doha. It is the only long-term answer to this challenging issue and that is why New Zealand says and says absolutely correctly that the successor agreement to Kyoto has got to be one that includes not just 15 percent of emissions but all those emissions including those from countries where emissions are growing so strongly—the likes of China the likes of India and the likes of Brazil—because we will not get on top of this problem unless those countries are part of the picture. 
This Government has a very credible record on climate change. This is a warm fuzzy bill that will do nothing. It will send only confused signals to the New Zealand Superannuation Fund and the House should reject this bill.