Parker David: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — Second Reading In Committee Third Reading 
Parker David: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — Second Reading In Committee Third Reading 
[Volume:651;Page:812] 
Hon DAVID PARKER (Labour) 
: 
 I have proposed an amendment to this part of the bill to give the tax break or the subsidy that National has said it wants to give to the bio-diesel industry in order to give it competitive neutrality with ethanol so as to bring forward bio-diesel but that National has not included in the bill. National finds it easy to draft a clause that completely ruins the biofuels industry in New Zealand a fledgling industry at the cost of scores of jobs. We know of one factory alone that will as a consequence of this legislation lose current jobs and jobs that are about to be created. It will lose at least 46 full-time jobs plus no doubt some part-timers and millions of dollars of capital investment. That is I emphasise but one biofuel producer and maybe just maybe a tax break on bio-diesel would be enough to save that company. I somehow doubt whether it will be enough to do that because the fundamental problem is that the oil companies do not want the bother of selling biofuels. They have their existing product streams that they buy. They import product from offshore and they do not want the hassle of having to blend in 0.5 percent of biofuels in the first year. It is easier for them not to do that so without compulsion they probably will not do it. 
But there is a chance that the oil companies might do so if the subsidy for bio-diesel—which National campaigned on and said was its policy—was put into place now. That might save those jobs. That might save the family fortune of Mr McNicholl. It might not do so but it might and National would at least be honouring its pre-election commitment that it would give a tax break equivalent to the tax break that ethanol gets. Ethanol gets a tax break of 42.524c per litre. That is the excise duty on petrol. Road-user charges are paid for diesel and it is not as easy to give a break on that but we can give the equivalent of the excise duty as a tax break to bio-diesel sellers—and National has been proposing that. 
That is what my amendment does in its proposed new clause 16. It takes only three lines to meet that promise. It states that the sellers of fuel will get a credit against the levies they have to pay under the Energy (Fuels Levies and References) Act “equivalent to 42.524 cents per litre of biodiesel sold by the levy payer.” It is very simple; why has National not done it? I am proposing an amendment that might protect the jobs I spoke about. It is less ideal than the mandatory sales obligation which is simpler gives some certainty to the producer and has a better environmental outcome as a consequence of that but as a second-line alternative that amendment is pretty good. 
I ask the Minister in the chair the Hon Gerry Brownlee whether the National-led Government will vote in favour of that amendment. It does only what he said the Government would do which is to give an effective tax incentive to bio-diesel equivalent to 42.524c per litre of bio-diesel that is sold. It does that by way of having a credit against the levies that would otherwise be paid by the sellers of ordinary fuel. It is very simple to understand. It might protect the jobs that I spoke about or it might not but it is more likely to do so than the current regime that is being pushed through under urgency by this National-led Government without any select committee process. I urge the Minister to consider that. 
The alternative is that the National Government will do to the biofuels market what it has already done to forestry. It has cost that industry over $300 million and probably $400 million of inward direct investment. It has killed scores of jobs in the forestry industry through the suspension of the emissions trading scheme and the uncertainty around it. This Government has killed jobs in the service sector. We had some of the largest companies in the world that trade in carbon rights coming to New Zealand to set up business. They were to open their New Zealand offices in the week that the National Government said it would suspend the emissions trading scheme. Those businesses cancelled that with the cost of jobs. The “Great White Trader” John Key—we are told that he was a trader to the world and has wonderful commercial skills—has killed the carbon market.