Biofuel Bill

Part 1 includes clauses 3 to 17. The debate on Part 1 includes debate on schedules 1 and 1A.

The great disappointment with this Biofuel Bill is that this Clark-Peters Government is ignoring all of the international evidence in respect of concern about biofuels. We are asked to believe that the OECD is wrong, that the United Nations is wrong, that the World Health Organization is wrong, that the British House of Commons is wrong, that New Zealand’s own Parliamentary Commissioner for the Environment is wrong, and that the only one who has it right is David Parker. Well, the Government is mistaken. Rushing through under urgency this flawed bill, which will impose significant extra costs on New Zealand consumers at a time when they can least afford it, and for very little environmental gain, is flawed, bad public policy.

The first key question I have for the Government is this: why impose a compulsion, a nanny State “you must do”, before putting in place a sustainability standard? Why on earth compel every person who buys liquid fuels to include in his or her purchase a component of biofuel, when the Government has not sorted out its biofuels sustainability standard? I think I know exactly why. It is because, after 9 years of this Government, our greenhouse gas emissions have gone up in every single one of those years. New Zealand has one of the worst records in the world in terms of increased greenhouse gas emissions, and in a desperate last-minute bid, a few weeks before the election, the Government wants to try to get some climate change policy on the record in a hurry.

💬 Hon Pete Hodgson: Oh, Nick.

That is it, I say to Pete Hodgson. That is it.

💬 Hon Member: Where’s the rest of it?

Well, the thing on which I would challenge Mr Pete Hodgson—the guy who went around New Zealand saying we should ratify the Kyoto Protocol, because we would make a billion dollars—[Interruption] I say to Mr Hodgson that I have spoken to the officials, and he misled Parliament; he knew that New Zealand did not have a surplus, and he fibbed and he told porkies—

💬 Hon Pete Hodgson: I raise a point of order, Mr Chairperson. Dr Nick Smith has just advised Parliament that he knows that I misled Parliament.

That is right.

💬 Hon Pete Hodgson: And he has just said that is right. Not only is that remark out of order but it is flat wrong, and I invite him to withdraw and apologise for it. It is entirely out of order.

The CHAIRPERSON (Hon Clem Simich): The member has requested that the member withdraw and apologise, and I would ask him to do that, please.

I withdraw and apologise. It is a matter of record that for 12 months before Minister Pete Hodgson came clean about the mess this Government had made around Kyoto policy, Ministry for the Environment officials advised him that the numbers that he was telling the public were untrue—were false. I would be happy to table the emails and the facts to back up my assertion about that scandal involving Pete Hodgson.

Coming back to the Biofuel Bill—

💬 Hon Pete Hodgson: Go right ahead. You’re just making it up.

Well, did the member claim that New Zealand stood to make a billion dollars from Kyoto?

💬 Hon Members: Yes.

Yes, he did. He got it awfully wrong, and officials advised him at least 12 months before he came clean that he was continuing to express a view that we had a surplus when we did not. That is the sort of snaky behaviour, I say to Pete Hodgson, that we have come to expect from this Government. Whether it is Owen Glenn and his donations to this Government, or whether it is Kyoto, the dishonesty that this Clark-Peters Government now displays is a tragedy for New Zealand, and is one of the reasons there will be a change of Government in a few weeks’ time.

The Government says we should not worry about the big global debate around sustainability, because the Government has put some principles in Part 1. But what is the use of principles if they do not result in regulation? The real flaw in this bill is this: why should we compel people to use biofuels before the sustainability standard comes into place? Can any member of the Government or any of the parties that are supporting this bill answer that very basic question? Why compel the use of biofuels before one has a sustainability standard?

💬 Moana Mackey: Because they told us in their submissions that they wanted to know what would be in those sustainability standards, so that they could plan ahead.

The Minister in the chair, the Hon David Parker, is silent, but we have the chair of the Local Government and Environment Committee commenting. The officials have said that it will take till 2011 to get a sustainability standard. That is what they advised us in their papers to the committee. So I ask the chairperson of the committee and the Minister why on earth they would want to compel people to use biofuels before then. This is nanny State saying we must do something without it being really sure that there will be an environmental benefit.

What is really ridiculous about this provision is that there will be a substantive cost—the select committee heard it is about $130 million—in that the fuel companies will have to put in place the infrastructure to be able to deal with the different types of biofuels. Whether it is bio-diesel, which has particular technical issues around it being cold, so there is a need to avoid blockages, or whether it is ethanol, in terms of it being water absorbent, an investment of about $130 million in infrastructure will be required. But before one invested in that infrastructure, would not one want to know which biofuels are OK and which ones are not? The madness, the absolute madness, is that the Government is going to require the introduction of biofuels before the standard is in place. That is unforgivable; it is mad public policy.

A further issue is this. Why is the Government providing a huge skewing of the scrum towards ethanol over bio-diesel? The Government says that, yes, it acknowledges there is a problem. There is no logic to it providing a 42c a litre advantage to the importing of ethanol from Brazil compared with bio-diesel made in New Zealand out of tallow—no good reason at all. The Government accepts that, but it says it will put off sorting out that issue until 2012. What nonsense! Why would one introduce a compulsory biofuels requirement today, when one acknowledges that the tax rules significantly advantage ethanol over bio-diesel for no good environmental reason, and then say: “Oh, we can’t sort that out now; we’ll put it off until 2012.”? I tell the Minister that that is not good enough. He should sort out the tax issues and the sustainability issues now, before introducing the compulsory requirement.

I will be asking the Committee to support a very simple, straightforward amendment to put the sustainability standard before the compulsory requirement. I want any member of the Committee to please advise why Parliament would not want to do that. Why would we not want to put the standard before the compulsion? The silence is deafening; the silence is absolutely deafening. I tell members that there is only one reason for not doing that, and it is political—straight politics. It is because this Clark-Peters Government continually puts its own political interests ahead of what is right for New Zealand. It is desperate to pass any sort of climate change legislation, even flawed legislation, before the election, rather than do what is right for New Zealand. I invite the Committee to support that amendment to ensure that we sort out the sustainability standard and the tax issues before we introduce compulsion.

The last point I would make is this. Every party in this Parliament agrees that a carbon price and an emissions trading system is the sensible way to respond across the economy to climate change. The problem with the Minister is that, in terms of getting an emissions trading scheme, he immediately says we need some extra regulation. If biofuels cannot stack up economically, why are we going to compel their use? That is the million-dollar question. In respect of the illogical ban that this Government wants to put on thermal generation, and in respect of the Biofuels Bill, the Government is being a busybody. It cannot help reverting to a nanny State attitude. It wants to tell people how to live their lives, rather than just give a price signal.

Where members on this side of the Chamber differ significantly from the Government on environmental issues is this: we say that we should provide a price incentive, and not have a nanny State. We should provide an incentive and provide the right sorts of price signals, and let people get on and live their own lives, rather than having the nanny State dictates that we get in Part 1 of this bill. This Clark-Peters Government believes that it knows best, and National says otherwise.

I just want to take a short call to respond to the previous speech. I sometimes wonder whether Dr Nick Smith and I were sitting in the same select committee when listening to the submissions, because what he is relaying to the Committee is certainly not what we were told during those submissions. And if he had listened, then the submitters would have answered a lot of questions for him.

💬 Hon Dr Nick Smith: What did the Parliamentary Commissioner for the Environment say?

Well, I tell Dr Smith that the Parliamentary Commissioner for the Environment submitted on the original bill, not the bill as reported back to the House after the Local Government and Environment Committee had done its work. In fact, all the international organisations that Dr Smith quoted were the reason why the select committee worked so many extra hours through all the adjournments, and I acknowledge the hard work that Dr Smith himself put into coming along to the select committee and working on the bill. We did it because we listened to those international organisations, and because we listened to the reports out there. We recognised, as a committee, that the bill needed to change from the original format that came to us, which was the format that the Parliamentary Commissioner for the Environment spoke on when she came to our select committee and gave that report. Dr Smith knows that just as well as everyone else.

I want to say of Dr Smith’s amendment, which he brought up, that it is a very handy way of never having to do anything. If we simply do not ever develop standards, and if we do not have a time line in the bill as we have now, where the Minister has to come back with the methodology, then we never have to do anything—that is true. I tell Dr Smith that if we never come up with standards, then his amendment says we never have to have a biofuel obligation—yes?

💬 Hon Dr Nick Smith: That’s right.

Dr Smith says “That’s right.” Well, we say that that is not good enough.

We were told by submitters that they wanted to know the kind of biofuels that the select committee and this House believe should be exempt. That is why we put in those three sustainability standards that we developed in conjunction with the Greens—to make it clear. Oil companies do not go into 3-week contracts when they are looking at biofuels; they want to know up front what this Parliament might smack on them part-way through their obligation. And we have told them. So they know that some biofuels out there are absolutely never going to be allowed, regardless of what the Minister comes back with after he has done the methodologies and the things the bill requires him to do.

We have been up front about it. We know that that is what biofuel producers want, because they need some certainty. We will never have a domestic biofuel industry in this country if we cannot provide some form of certainty, like a biofuel obligation, so that producers know they will have some kind of industry to provide to here. That is why we are doing it. I do not know how many times Dr Smith needs to be told, but if he had listened at the select committee, then I would not have to be telling him again and again.

I have been listening to this debate and it is just amazing listening to the reasons why the smaller parties are supporting this legislation. This Government is foisting a Mad Hatter’s experiment on this country, and if we listen to the debates by, first of all, the Greens, by New Zealand First, and by Peter Dunne, we hear them all saying: “Yep, we know there are some problems. Yep, we know some issues need to be debated. But, nevertheless, let us be first, let us give it a go, and let us lead the world on this whole issue.”

One of the things that absolutely astonished me was what Peter Brown said. He went through three reasons, three things that he was concerned about and that really worried New Zealand First, with the last reason being an issue about food security and the impact it might have on other countries. But he said in the end that those members can accept it because it will happen anyway, so it does not matter. That is exactly what he said, and the Hansard will prove it. He said it does not matter, because it will happen like that anyway, so let us not worry about it. Well, we need to be worried about those very things.

Peter Dunne said exactly the same thing. He said there are real worries about this whole bill and we should be concerned about it, but if we do not get started, we will never get going. Well, it is all very well to say we should get on the bike, but I say that if it is going downhill at a great rate of knots and one cannot control it, then one does not want to get on it. That is what Peter Dunne is saying.

I listened to Jeanette Fitzsimons. She said that although we know there are a whole lot of issues around the world that we need to be concerned about and that all sorts of reports are telling us this is a real problem, we need not worry because we will put this sort of ring around New Zealand. She said we will make sure that it is New Zealand - generated and that the rest of the world does not matter, because we will do our own little bit. Well, if we are to try to contain ourselves, then we will be going back to the good old days when we had all the borders shut, people could not come and trade, and we were not allowed to do things overseas. If we wanted to buy a pound of butter or margarine, we had to go to the doctor to get a prescription! Are we going back to those days? Obviously, that is what the Government wants, and those parties are supporting the Clark-Peters Government in making the sorts of policies that take us backwards at a great rate of knots. I have to say that is just crazy.

Mr Chairman, you are indicating that I should come back to the bill, but I am pointing out that this is a crazy, silly bill. All of Part 1 is just dopey, and New Zealand will end up being worse off.

The Minister of Finance has come down to the Chamber to listen to my speech, and I can understand why he would do that. He is worried about the financial impact this bill will have on the country. He should be concerned. He knows that at this time, when New Zealanders are struggling, when New Zealanders have their backs to the wall, and when lots of people are struggling to put food in the mouths of their children, his Government wants to put more costs on to those families. This whole bill will add more on to their fuel costs and it will add more on to their living costs. He might laugh about it, but that is the impact it will have.

Not one person who came before the Local Government and Environment Committee said: “Please do this because it will be advantageous financially to New Zealanders.” Not one! Everyone said that, yes, there will be a cost. Even the Minister’s own officials said that, and I ask the Minister of Finance to have a look at this paper. The officials said there is an issue around the cost. Surely to goodness, should we not be listening to the officials and listening to the submitters?

The only people who seem to think that it does not matter is the Labour Government and New Zealand First. The Greens do not seem to worry about these costs. Peter Dunne does not seem to be worried about them. Surely to goodness, somewhere along the line, we have to take into account what the public think about more costs being put on to them by this House. Is that not an issue we should be worried about? Maybe the Minister of Finance does not care. Maybe it does not matter.

💬 Moana Mackey: What if it works out cheaper?

Cheaper than what?

💬 Hon Dr Nick Smith: Why make it compulsory?

That is a good question. If it could be cheaper, as the chairperson of the select committee says, then surely to goodness it will just happen, will it not?

Given that Mr John Carter, for the first time in about 5 years, deigned to speak in the Chamber in some detail about a bill, although it was not clear that he knew which bill he was talking about—I can help him in that case; it is the Biofuel Bill—let me just respond to a couple of points he makes. The first point, very clearly, following upon the rational guidance from Dr Nick Smith, is that Mr Carter has joined the brigade of those who believe that one can save the planet at no cost, and that it is possible to actually deal with global warming with nobody changing his or her behaviour, with no relative cost changes at all, and with nobody doing anything differently; all anybody needs to do is—what? It was not clear.

We heard from Dr Nick Smith that every party supports the emissions trading scheme. That is not true, actually. The ACT party does not. The ACT party now supports having a carbon charge, but, of course, when the Government proposed a carbon charge, the ACT party opposed a carbon charge. The Business Roundtable is being followed faithfully by the ACT party in that respect. But ACT supports the emissions trading scheme, as long as there is no cost to anybody and nothing has to change.

So what is the cost in this bill? Well, the best estimate we have been told is 0.2c to 0.4c per litre. Petrol prices go up and down 3c or 4c a litre a day, at the present time. They went down US$10 a barrel overnight. Dr Norman was almost in tears this morning, thinking about the price of oil coming down. That is not supposed to happen. It went down by US$10 a barrel! That is equivalent to something like 6c a litre at the pump in New Zealand. So this bill will make a tiny difference on costs, but unless there is a requirement to start moving, we will never build the infrastructure for alternative fuels, because that is where the cost occurs.

The larger the usage of alternative fuels, then the lower the cost per litre to use those alternative fuels, because the infrastructure is being better used in that respect. And, yes, there are some problems with some alternative fuels, but this bill lays out the method by which we address those matters to ensure—

💬 Hon Dr Nick Smith: After it’s compulsory.

Oh, after a period of months or so we will lay out those rules! So what Dr Smith says is that, for the sake of 9 months, we should do nothing. I wish his parents had said the same thing at a certain key moment in the past. We would all have been saved this kind of irrationality on matters of this sort.

I say: “Get with the programme, National!”. There is a real need to address the issues before us. When National members promote themselves as young and vigorous and a brighter future, but on everything they are timid, unable to move, and afraid of change, then this is not the brighter future that National is pointing to.

Let me just respond to the comments of the Minister of Finance. The issue about costs is that they will be an impost on those who are involved in the transportation industry. So it will be a cost on them; and if it is a cost on them, then surely to goodness it will be a cost on the mums and dads out there. Even the transportation of a budget loaf of bread will result in an impost, a cost, to the mums and dads. So that is where the issue of costs arises, I say to the Minister, who has gone now.

The CHAIRPERSON (Hon Clem Simich): Order!

The whole thing about coming up with a standard is that if we develop a standard, everybody in New Zealand knows the standard and that is what they have to do to make their business work. But there is nothing of the sort in the bill. There is no standard whatsoever.

💬 Moana Mackey: Read the bill.

So there is a standard? So the standards have been sorted out in somebody’s feeble mind—for the future. John Harrison of Harrison Motors, the transport company up in the mid-north, has to think: “That’s right. The standards are there in the feeble mind of the Government, but it’s not going to tell us.” So how can they run a business; how can people possibly operate on an idea of standards? What are the standards?

💬 Moana Mackey: Read the bill.

So there are standards? The standards have been sorted out? That is what list member No. 43 is saying—no, sorry, that is not the member’s number. That is Louisa Wall’s number.

💬 Allan Peachey: What’s the number then, 48?

Well, if she is not No. 48, she should not be there anyway. I want to set out that the bill creates an obligation for fuel companies to blend diesel and petrol with 0.5 percent biofuel on 1 October, with the requirement increasing by 0.5 percent each year to 2.5 percent in 2012. We couple that with the bill’s stated intention that requires a person subject to the biofuel sales obligation to file an annual return. What have we heard over the last 2 or 3 years from businesses? We have heard that the impact of red tape is huge on that 90 percent making up small to medium sized enterprises in this country. It is a huge impost and has a huge impact on their day-to-day business. Because they have just been told that the fuel companies will have to file a return every year—it is another piece of paper they have to fill out—then that is an impost. It has an impact not only on the transport companies and on the fuel companies, but also on mums and dads. At the end of the day, when they toddle off to Woolworths, to Countdown, or to Foodtown, that is where they get it. Who pays for it? The mums and dads do. So on the one hand we get a tax cut from the great Labour Government, but it gets taken away with all these other little add-ons. In the end, they do not see anything.

💬 Hon Pete Hodgson: Have a talk to Maurice. He will tell you about it.

Leave it until tomorrow? Well, we could leave it until tomorrow. We might leave it until tomorrow. If the Minister wants to leave it until tomorrow, if that is his philosophy, then it is no wonder he is no longer the Minister of Health.

Let me say this. It would have been all right for the House to accept no standards if the Government had been here for only 6 months. We could have forgiven the fact that there was only a small amount of time in which to figure out what the standards were to be and to put them in place, after the compulsion bit. But let us not forget, the Government has been in office for 9 years.

💬 Eric Roy: How long?

For 9 long years. What has the Government been doing for the last 8 years? Has there been anything on standards? No. Has there been anything on listening to other nations and organisations from around the world? No. The Government has gone ahead and thought it knew everything; and all it has done, and all it will do on the passage of this bill, is put an impost on mums and dads. That is where it will happen. Mums and dads will pay for the Government’s weird ideas about saving the planet, because that is all it is. It is the weird ideas from the Labour Government and the nanny State, supported by the Greens over there. For goodness’ sake! Talk about putting the cart before the horse! My goodness me! The next thing we will know is that we will be riding around in a horse and cart. Mind you, there is nothing wrong with that, I suppose, if we are on holiday down in the South Island somewhere. But if we have to get to work from west Auckland out to South Auckland, and there is no highway because the Government could not afford to look forward on the transportation—[Interruption] Absolutely, Mr Chairman.

I want to finish by coining the phrase that Moana Mackey used in this House not so long ago—get with the programme. Absolutely! We have to say “Get with the programme.” What is that programme? The programme is to get rid of this Government.

I feel sorry for my colleagues on the other side of the Chamber. Half of them will not be back here after the election, and they might need some biofuels. Where they are going, they will need our help. In all seriousness, this is nothing more than a cost on mum and dad. Mums and dads, in these times, cannot afford another tax, another impost, on their meagre wages.

One particular part of Mr Henare’s contribution does need to be repeated. It is his complaint that the compliance cost of an annual return on biofuel blends is a compliance cost on small business. There are approximately five oil companies in New Zealand. Those companies have a combined turnover that is measured in billions of dollars—[Interruption] An annual return for companies that have a turnover of many hundreds of millions of dollars is not an onerous compliance cost. If that is the sort of hurdle that can never be overcome by a National Government, as we move towards sustainability measures, it is no wonder National members never do anything to advance sustainability issues.

The reality is that oil companies will not introduce biofuels without there being a mandatory obligation for them to do so, except for the occasional exception, like Gull Petroleum. Probably even that company is introducing them only because it knew that a biofuels obligation was coming. When they do introduce biofuels because of this obligation, they will be helping New Zealand to take a small step towards sustainability—not a large step. But that small step towards sustainability has to be taken before the subsequent larger steps can be taken.

We have to update our infrastructure. In terms of the cost of that, the advice from the officials to the select committee—on which the National Party was represented, and its members did not accuse the officials of misrepresenting the facts—was clear that the infrastructural cost will be between 0.2c and 0.4c per litre of fuel, if that cost is recovered over 4 years. It will probably be recovered over a longer period, because, as sure as anything, it will last more than 4 years. The cost is minimal. In terms of the fuel itself, it is not yet clear what the impact on price will be. Some of the tallow producers say that, at current oil prices—at prices under US$100 a barrel—bio-diesel from tallow could be cost competitive with, or, indeed, slightly cheaper than, petrol.

There is nothing wrong with this bill. The sustainability standards are world leading. That is not good enough for the National Party, but, of course, it is not willing to lead on anything.

I am here to speak briefly on the bill. I am one of the few people in the House who has been very actively campaigning against palm oil - based biofuels over a long time. Of course, palm oil is one of the really problematic biofuels. It has resulted in massive deforestation in South-east Asia; 20 percent of all greenhouse gas emissions are now as a result of tropical forest deforestation, which is being driven in part by the palm oil industry.

It should also be noted that New Zealand has a connection to the palm oil industry. One of the by-products of the palm oil industry, palm kernel, is now imported into New Zealand in vast quantities. Last year alone, 400,000 tonnes of palm kernel were imported into New Zealand, largely to feed dairy cattle. One of the secondary drivers of the destruction of rainforest is the palm kernel industry, and the palm oil companies are on the public record as saying that palm kernel is now one of the significant factors in their profit stream. Biofuels are a major issue, and they are linked to the palm oil industry.

The Greens would not be supporting this bill had we not negotiated clauses around sustainability. Listening to the National Party members talking about sustainability reminds me of the saying that “A little bit of knowledge is a dangerous thing.” Clearly, if we are going to make some progress on these issues, we need to encourage, particularly, the domestic production of biofuels. I do not know how many members have been to look at some of the projects happening around Taupō, and elsewhere, around biofuels and woody biomass. Woody biomass offers a real opportunity in a country like ours to develop second-generation biofuels. I would have thought we would be supporting it, because it seems to me that it is real progress.

It is also worth saying, in terms of the amendment that has been put by Nick Smith, that the member has not discussed it with the member in charge of the bill from the Green Party’s side, Jeanette Fitzsimons. If National were serious about that amendment, I am sure it would have discussed it with us earlier. We will not be supporting the amendment, because it has not been discussed with us. If it had been, we obviously would have considered it and looked at it.

I shall respond to the discussion around regulation and leaving it up to the price to determine. It is certainly true that, in the transition we need to make towards sustainability, price and price signals are an essential part. But by themselves they will not be sufficient. We also need to use regulatory mechanisms, and regulatory mechanisms need to work alongside price mechanisms. It is also true that we need to reach out to the community and win people over to the idea of our moving towards sustainability. We have, if you like, three levers that we can use in this transition: one is price signals, one is regulation, and one is what we might call consciousness raising, or winning the community over to our ideas. Green members believe that we need to use all three levers.

Finally, in response to the increase in price that is involved—the very small increase—I say that the long-term trend of oil prices, in spite of what the Minister of Finance was saying earlier, is up. Anyone who has read the International Energy Agency’s reports on this matter will be aware that even that agency is now saying that the long-term trend of oil prices is up, and that we need to look at alternatives. Biofuels may be a small part of that, but they are certainly not a part that we should rule out.

I stand and agree entirely with my colleagues from the National Party and with what they have been saying about the Biofuel Bill. This bill as introduced requires petrol and diesel suppliers to also supply biofuels with an initial level of 0.53 percent in 2008, increasing—as we have heard—to an upper level of 2.5 percent by 2012. Here we have more dopey legislation being introduced in this urgency motion. Why, after 9 long years of a Labour Government, is this bill suddenly being rushed through in the death throes of this Government? The reason is that it wants to leave its mark on the world and show that it cares. Well, if it really cared it would look not just at the costs, which it is having difficulty quantifying anyway—or describing accurately—but also at the hidden costs this bill will bring, to not just New Zealand but elsewhere.

The environmental benefits of biofuels are arguable at best. Before we embark here in New Zealand on a campaign of changing our fuel source, let us look at what is happening abroad. I contend that other countries are now exhibiting very serious lessons that we should be paying some attention to. In the United States, the leading source of biofuels is corn, or maize. Nobel Prize - winning atmospheric chemist Paul Crutzen, a man not known for his climate change scepticism, found in 2007 that biofuels made from corn and rapeseed—something that Jeanette Fitzsimons stood in this House and propounded the benefits of—contribute more to global warming than fossil fuels. Biofuels made from corn and rapeseed contribute more to global warming than fossil fuels; there is a lesson there.

While we are on the topic of emissions, we should note that biofuels emit a significantly higher level of nitrous oxide into the air. Before Mr Anderton gets too excited, I should point out that nitrous oxides are the principal cause of smog—something that people in Christchurch are well aware of, or at least they should be. So I ask the Labour members of this House from Christchurch to explain to their constituents why they are supporting this bill.

While we are talking about overseas examples, I ask: what about Brazil? It is the second largest producer of biofuels in the world. How has it achieved this honour? Through having a large-scale slash and burn of the country’s native rainforest. As if the rainforest was not diminishing at a rapid enough rate as it is, Brazil has now embarked on an unprecedented campaign of cutting down rainforest to plant sugar cane for biofuel production. That is something I thought the Greens and possibly some of the more conservation-minded members of the Labour Party might have thought was important.

The loss of Brazil’s rainforest, though, is potentially not the worst impact of biofuels. The worst impacts may well be seen in Africa. In May 2008 Olivier de Schutter, the United Nations food adviser, stated: “The ambitious goals for biofuel production set by the United States and the European Union are irresponsible … I am calling for a freeze on all investment in this sector.” Why did he call for that? The reasons are twofold. Firstly, food that was once used for its intended purpose is now being turned into biofuels. The very poor in the world are now starving, because they can no longer afford what was very cheap food that made them sustainable—it actually kept them alive. Again, the Greens and Labour once upon a time actually believed in helping out the poor of the world.

Secondly, land once used for intensive food production is now being converted to biofuel production. The cause is the latest fascination of the West, and the victims are those in poverty—those in poverty in Asia and Africa. Sadly, those who are in poverty in New Zealand will now have more costs imposed upon them. Pushing food prices up will hurt most those who are least able to afford it, and all so that Helen Clark, Michael Cullen, and the Labour Cabinet can feel that they are doing something positive for the environment when they drive around in their new BMW ministerial fleet. Legislation that diverts food supply into fuel for those least able to afford it is dopey legislation, and the ACT party will be opposing it.

I want to make a contribution. I am fascinated, intrigued, and a little disturbed by the Biofuel Bill. I think, for a start, it is wrongly named, but we are not having the title debate. I am inclined to think that it is the “Placebo Climate Change Bill’.

The Minister of Energy said this measure would be a small step. Well, it is not even a step; it is barely a shuffle. You see, if we look at what New Zealand is attributed to be contributing to the world’s discharge of carbon gases, we see that we contribute 0.2 percent nationwide. Fifty percent of that is from agriculture. I do not know what the figure for transport is by—

💬 Peter Brown: About half of that.

Well, no. I say to Mr Brown that it is less than half of that, because there is coal consumption in a whole lot of furnaces, coal is used in electricity generation, and quite a bit is used in thermal energy. So transport contributes a long way less than one-half of 0.2 percent.

💬 Peter Brown: No, no—half.

Let us not get into that. It is minuscule. Yet we are here in the dead of night arguing about 0.5 percent of an element of fuel. It is not even a small step. It is so small that it is not even a perceptible shuffle.

I am a bit alarmed, because I actually believe that the consumption of fossil fuels is a serious issue. I do not believe that, from here on in, we can combust and release 6 billion tonnes of greenhouse gases into the atmosphere every year without it having an impact. My point is this: the energy and the effort that we are putting into this debate will have zero impact. If there is an issue out there, our focus should be on doing some serious work on looking at alternatives in the whole transport arena—hydrogen-powered vehicles and that sort of thing. That is where the focus must be—to find an alternative.

The Minister may well argue that this measure should be a focus. My argument would be that it is more of a placebo. It actually will not make one whit of difference. Well, it will make a difference, because the world has embraced biofuels, and that has created some huge distortions in other areas. Dr Norman referred to this issue. When biofuels are picked up in the wrong way, there is quite often destruction of ecosystems that actually make a contribution to reducing greenhouse gas emissions. For example, in tropical areas, palm oil and sugar cane are replacing rainforests. In a lot of places in the world, particularly in Europe and the United States, crops that have high fertiliser and water requirements are being grown to produce biofuels, and they have a negative impact.

What does that mean in terms of the world? Well, let us look at the world supply of food on a consumption basis. For at least the last two decades, the time frame between harvesting food and consumption has been between 100 and 120 days. If we grow and harvest lettuces, they are not going to last 120 days, but for baked beans, ice cream, frozen mutton, or milk powder, that is what the time frame has been—between 100 and 120 days. We are seeing food shortages in countries that have never had food shortages before. One of the drivers of those food shortages is the shift of arable land to biofuels. I am told—and I am gullible, so I believe it—that the current time frame, in terms of the food chain, between harvest and consumption is around 50 days. At times it has been down to as low as 47 days. That is simply because we are misusing arable potential to create biofuels that will not make one whit of difference in terms of dealing with the issue of fossil fuel - generated carbon gases.

I say that, yes, we have a responsibility, but as for dealing with a bill such as this in urgency, well, that is why I call it the “Placebo Climate Change Bill”. There are a whole range of other issues. We talk about sustainability—

I will start by responding to John Carter’s comments in regard to my earlier contribution. I outlined the concerns New Zealand First had with this kind of legislation at the time of the first reading, and I outlined the solutions that had been put to us by various experts in the field of biofuels. We are quite happy with that. The growing of crops in Africa to sell to the global market is a concern, but it is not a concern that New Zealand can address. If we can, I would like to know how. If they are growing crops in Africa to produce ethanol to sell in America, that is a concern, but I am not sure how New Zealand can stop that. I would like to stop it, but I do not know how we could.

I do have a legitimate concern and I invite the Minister of Energy to respond to it. I understand that ethanol absorbs water. I see the Minister’s attention is taken elsewhere, but I trust he is listening with his other ear. Ethanol absorbs water. The aviation industry, and particularly the leisure boat and maritime industries, use fuels that, I think, would be more effective if they did not contain ethanol, because water can get in the fuel tanks of airplanes, and it can certainly get into the fuel tank of the outboard motor of a leisure boat. It concerns me that, if we are putting ethanol into these products, and an airplane or a leisure boat fills its tanks with it, there is a high risk that something will go astray—there will be water in the tank, the ethanol will absorb it, and the engine will stop. That is not too good an experience when one is a pilot in the sky, and it is not particularly pleasant when one is in or outside the harbour in a small boat powered by an outboard motor. I invite the Minister to address my concern and tell us how this bill will prevent that problem from occurring. It is a genuine concern. I am an ex-mariner and my son is a pilot, so I would like to know exactly how this bill will address that concern.

Before I respond to Mr Brown’s query, in respect of Eric Roy’s contribution I contrast that with the position he took in the first reading, as recorded in Hansard, when he said he believed that biofuels are a part of our response to the whole issue of climate change—which seems a little inconsistent with the position Mr Roy has articulated now.

In terms of Peter Brown’s question, the member is correct that ethanol does mix with water, so we can get water in ethanol in a way that we cannot with petrol because petrol would float on top of the water. There are issues that ethanol also cannot be used in some transport applications, for reasons of safety—for example, we do not want it in aircraft, because of the propensity of water with ethanol to freeze. How is that avoided? These biofuel blends will not be taken down the lines that are used to deliver jet fuel and the like from the refinery to the major airports, so there will not be cross-contamination there. How will it be handled at service stations for people who are filling up, for example, their outboard motor for a pleasure craft? It is likely that one pump will have a biofuel blend and one will not, and there will be some labelling to ensure that people know which choice they are making.

There are biofuels that are suitable for use in the fishing industry. Indeed, I read an article recently about a vessel that has been specially built to run on bio-diesel. It was a fishing vessel that was launched recently in the Lyttelton region, so there are some biofuel solutions there, too.

I appreciate the opportunity to make a contribution to the debate on Part 1 of the Biofuel Bill. The people of New Zealand heard it here first, when the Minister who is the Deputy Prime Minister and Minister of Finance in the disintegrating Clark-Peters coalition came down to this Chamber and told us that this bill will cost New Zealanders money. I do not know why the Minister of Finance did not go the next step and admit that the way in which this bill is structured amounts to nothing more than stealing food from the mouths of the poor. That is what that crowd opposite and its coalition partners to my left are engaged in.

I listened with a good degree of interest to the contribution made by the list member Moana Mackey. This Government, with contributions such as that member’s, is ignoring some of the best international evidence on this subject. Does anybody in this Chamber, in this debate on Part 1 of the Biofuel Bill, find compelling the suggestion that Moana Mackey, list MP, who is not capable of holding a seat herself, has greater wisdom than the chief scientist of the United Kingdom? For that matter, do the members of the Green Party have any greater wisdom than the secretaries general of the United Nations, the Royal Society, or the World Bank? And surely nobody in this House will suggest there is greater wisdom in the New Zealand First Party—in particular in the New Zealand First member who spoke a few moments ago—than, for example, the G8 conference of legislators, the House of Commons Environmental Audit Committee report, or the OECD Round Table on Sustainable Development.

It will not be lost on the people of New Zealand, as we debate Part 1, that that Government over there, the disintegrating Clark-Peters coalition, is putting forward legislation for this country, and trying to rush it through under urgency, in the dying days of this tired Parliament. I ask the Minister in the chair, the Hon David Parker, what the hurry is. I invite the Minister to explain what the hurry is. Does anybody in New Zealand seriously think that this bill is good for the country? I invite the Minister to get up, be up front, and explain to this House—and, through this House, to the citizens of New Zealand—why this is so urgent. What are the compelling political forces that are driving the Clark-Peters coalition to bring this legislation—Part 1 of the Biofuel Bill—before this House, under urgency, in its dying days? The Minister must answer that question.

The Minister must also answer the question as to why there is a mandatory sales obligation. Why is a mandatory sales obligation coming into effect before the regulations to define sustainable biofuels? Why is that? Is this just another example of a nanny State, a disintegrating Government, and a Parliament in the last days of its life telling New Zealanders what is better for them?

I move, That the question be now put.