Road User Charges Amendment Bill

I am pleased to stand and speak to Part 1 of the Road User Charges Amendment Bill. Essentially, Part 1 is about electric motor vehicles. There is an amendment to the preliminary provision, which states: “light electric motor vehicle means a motor vehicle whose motive power is wholly or partly derived from an external source of electricity and whose gross laden weight is 3.5 tonnes or less.” This bill will exempt light electric motor vehicles from paying road-user charges for 4 years, as a first step towards encouraging their uptake. At present, light electric vehicles are classed as diesel vehicles for the purposes of road-user charges.

The Government sees private vehicles continuing to be the most significant mode of transportation in New Zealand, and other statistics confirm this. Eighty-four percent of people go to work by car, truck, or motorbike, and 70 percent of all freight in New Zealand is carried by road. The environmental impacts of the widespread use of private vehicles need to be taken into account. Therefore, the Government feels it is important that we encourage the use of alternative fuel technologies in order to help meet our environmental obligations over time. The Government feels that this measure will encourage the uptake of electric vehicles, hence the bill that members are speaking to today. This technology will make a significant contribution to improving the efficiency of our vehicle fleet.

There are very few electric vehicles currently in the fleet, and the forgone revenue costs will not be significant. This bill is about the Government supporting a new fuel technology, and encouraging change to this new technology. Importantly, electric cars can also decrease our reliance on imported fossil fuels and improve our energy security. Combining highly efficient electric motors with our competitive advantage in renewable electricity generation will reduce the greenhouse gases produced by the transport sector, as well as the harmful emissions affecting air quality. There is no doubt that electric motor vehicle technology can make a significant contribution and improve the efficiency of our motor vehicle fleet, as well as addressing the environmental impacts of fossil fuels. Increasing the proportion of light electric motor vehicles in the fleet decreases reliance on these fossil fuels and improves our energy security. We think these are important positives. Combining highly efficient electric motors with New Zealand’s competitive advantage will reduce these greenhouse gases, and we feel this is definitely something that we want. We want to improve the air quality for New Zealanders.

Light electric vehicles are much cheaper to operate per kilometre than conventional motor vehicles, which is another added positive. Until there are economies of scale that will reduce the battery costs, early electric motor vehicles will be quite expensive. For example, the price of a conventional motor vehicle is approximately $20,000, but an electric motor vehicle, at the current time, can cost anywhere between $40,000 to $80,000, which is quite prohibitive. We see it as very important to encourage the use of electric motors, and this bill will go a way to helping to improve that uptake.

Although New Zealand does not have a light electric motor vehicle manufacturer at the current time, the Government feels there is an important role to play in improving the uptake, and this bill will go towards fulfilling that. Part of this role is also to remove the barriers that could prevent or delay the uptake of the market for light electric motor vehicles in New Zealand. One barrier has been the use of road-user charges, and this bill will obviously amend that provision. At the moment, when considering the upfront costs of early electric motor vehicle technology, road-user charges are probably only a minor consideration. We need to look at other ways to improve electric motor vehicle uptake, but this bill is a first step in the right direction. The National Party promised, in the lead-up to the 2008 general election, that light electric motor vehicles would be exempt from paying road-user charges, and now we have fulfilled that pre-election promise. In summary, we see that this bill, which will exempt light electric vehicles from paying road-user charges, will have many, many benefits. Certainly they will help the environmental impacts, they will help our reliance on fossil fuels, they will also support our energy sector, and, importantly, this is an option that, hopefully, will see New Zealanders—

Thank you, Mr Chairman, for the chance to participate in the Committee stage of the Road User Charges Amendment Bill. We are considering Part 1, which exempts light electric motor vehicles from paying road-user charges. I know that the Minister of Transport, Steven Joyce, has a Supplementary Order Paper that relates to this part, and I am sure he will give the Committee the courtesy of explaining how that works shortly.

I know that other members of the Opposition have questions they want to ask the Minister. I see that he is poised and ready and almost signalling to me that I should yield and let him take the opportunity to speak right now. I beg the indulgence of the Minister to complete my speech, and then I will ask him a few questions.

Obviously, the Opposition supports Part 1, to try to get an emerging market within our vehicle fleet for light electric motor vehicles. We support it for many of the reasons that the member who spoke previously has outlined. It was very pleasing to hear in Dr Blue’s speech a direct, overt reference to fossil fuel emissions. One of the things that has been missing a lot from the language of the Minister when he discusses transport policy is a commitment to battling climate change. So I want to encourage the Government—

💬 Hon Tau Henare: Why can’t you be happy?

I am congratulating the Government! I am congratulating the Government on picking up the sustainability agenda and on seeing that this can so easily fit into the topic of combating climate change. That, I think, is a very important thing that light electric vehicles can do. So in that sense the Minister has agreed for this effective subsidy to be placed on, or to be awarded to, light electric motor vehicles as a way of changing the modes of transport within the sector. That in itself is an interesting point.

💬 Paul Quinn: How is that a subsidy?

I said that it is an effective subsidy, because those people do not have to pay road-user charges. So an interventionist approach is being taken by the Government in order for this policy to occur.

The reason why I think that is a good thing for the Minister to do is that he has been very clear that he does not believe that other sectors of the transport industry should receive subsidies by way of coastal shipping and other alternatives to roading. I hope that what we are seeing here, from this initiative he has taken, is that he is open to the idea that the Government has a role to play in developing a multimodal approach to transport. Up until now it appears that he has seen just roads as the answer. I have not heard him make reference to subsidies for roads, which no doubt exist.

I would be interested to know from the Minister to what extent he is concerned that if the uptake for electric vehicles in this period is stronger than he has anticipated, there will be an effect on the National Land Transport Fund.

💬 Hon Steven Joyce: It would have to be a very big uptake.

The Minister should be more optimistic, perhaps, than he is being so far to date. Obviously, the number of cars we are talking about is very, very small. He has set a very timid goal of only 300 cars. I would be interested to know his thinking behind that and whether he considered other options that would, maybe, run into the thousands.

The explanatory note of the bill refers to a point when 1 percent of the vehicle fleet is electric as an option for exemption from road-user charges in terms of electric motor vehicles. I wonder why the Minister did not go down that path and choose that as a target in order to send a very strong signal not only to consumers but also to potential manufacturers and importers that the Government is seriously trying to promote light electric vehicles. I wonder to what extent the Minister feels that the target is just a little too timid.

In the explanatory note of the bill there is also reference to concern about creating a precedent. I would be interested to know from the Minister to what extent he feels this initiative is creating a precedent, and whether he feels that by going down this particular path other examples will be brought to him, particularly things that might have an environmental benefit whereby people might be looking for a road-user charge exemption. So I would be interested to know what process or what criteria he will be using to, in effect, suspend contributions to the National Land Transport Fund by some motorists. I think that would be quite useful information for him to give us.

I return to the point about climate change. We would like to know the amount of carbon dioxide emissions that he believes will be reduced as a consequence of Part 1, and we would like to know what target he would like to see set for that area. We know that people are very keen to make their contribution. One of the ways that households can do that most easily is through the transport sector, where there are fossil fuel emissions. The ability for people to make decisions to reduce their footprint in that respect is important, and for that to occur he has a role to play as the Minister of Transport.

Considering that the Road User Charges Amendment Bill is only three pages long, I was going to keep my speech pretty short until I heard that speech. But now I will say to Darren Hughes, the member who just resumed his seat, that this bill is in no way timid.

💬 Paul Quinn: What a disappointing contribution.

It was disappointing. This bill is in no way timid. First of all, this Government has recognised the issue of electric motive power. It is not since the days of Tesla that somebody has got out there on the front foot. It may not be the best thing since sliced bread, but we have to start somewhere.

I will read from the explanatory note. It states: “This Bill amends the Road User Charges Act 1977 to enable regulations to be made exempting light electric motor vehicles from road user charges (RUC). An exemption from RUC will encourage the uptake of light electric motor vehicles, which are expected to improve the efficiency of the motor vehicle fleet, decrease reliance on imported fossil fuels, improve energy security, and reduce vehicular emissions affecting air quality and greenhouse gas levels.” I ask what better way there is to make a statement that light electric motor vehicles will be exempt from paying R-U-Cs. And I call them R-U-Cs, because the only people who are looking for a subsidy on a “RUC” would most probably be the All Blacks.

💬 Michael Woodhouse: Wouldn’t know what a ruck was.

The All Blacks would not know what a ruck was.

The great thing about this bill is that it is a statement to the community, not only the punter out there but also those who make the cars. Basically, the statement is that people will not be penalised in any way for new technology. The technology is out there. I recently finished watching a documentary called Who Killed the Electric Car? and—

💬 Hon Darren Hughes: That’s good. I’ve seen that.

Yeah, it was an absolutely fantastic documentary. The thing is that if we do not get out there and front-foot this issue, then it will pass us by, and nobody in New Zealand will drive around in electric vehicles.

I have to disagree with the member Darren Hughes as to whether this measure is a subsidy. This is not a subsidy. It is an incentive to the producers and also to the punter who may wish to purchase an electric vehicle. In the long run, over the life of an electric vehicle, people will have their money back. At the same time we are making sure that we do not harm the environment as much as we have done over the last 100 years. This may be a very, very small step in the right direction, but I think it is a very, very important step forward for our vehicle fleet in New Zealand.

The word must go out to the producers—General Motors, Ford Motor Co., Mazda, Toyota, or whoever—that the go today is to preserve the fossil fuels. The go today is that more and more people around the world are looking for that next step, that next technology. Maybe one day they will come up with a V8 electric car, who knows? It could be for the West Aucklanders. It is extremely important—

💬 Michael Woodhouse: One with tape-recorded noise.

One with tape-recorded noise. They can just plug a hole in the old lake pipe, they will be right.

It is a very, very important step that we get buy in from the whole Committee, and I think that we have 100 percent buy in from the whole Committee. As I say, this measure is not a subsidy and it is in no way timid, which is what Darren Hughes said. This is all about incentivising the industry and the punter.

I am very pleased to take a call in relation to the Road User Charges Amendment Bill. Personal mobility in motor vehicles has been one of the great liberators of the mechanised age—it really has—and it has created huge productivity benefits. It has given people the ability to get around and, of course, most people find a motor vehicle a hugely wonderful tool. The challenge is that if the potential—and I stress “potential”—upcoming limitations on fossil fuels and climate change issues come into play, then we will have to look for other forms of motive power, and the electric car is one of those motive powers, and also biofuel and bio-diesels. We must encourage all of those forms of motive power, and we are doing so in the case of electric vehicles with this Road User Charges Amendment Bill.

I had my first ride in an electric car the other day. Unlike Mr Hughes opposite, it was very quiet and it was a very smooth run. But there were a couple of limitations. There was no car radio because there were not quite enough watts to drive the car radio as well as the car; and it was so quiet that I was able to hear my companion speak at great length quite easily all the way through the journey. The car drove very well. The biggest risk with electric cars is that they are very hard to hear because they are so quiet.

The point is that the technology is still very new, and this legislation is really about encouraging the technology to develop. It is not a massive cost; I think if it was a massive cost the Government would be concerned about the potential drain on the road-user charges in the National Land Transport Fund. At this stage it is not a massive cost; it is about encouraging electric vehicle manufacturers who are already looking favourably on New Zealand because of our high levels of renewable electricity and renewable energy use. They like the thought of their vehicles being introduced into this market as one of the earliest markets. They like the thought of New Zealanders being early adopters of electric vehicles and then showing the rest of the world how to do it. So they are encouraged by these sorts of signals from Government that this is something that we should do.

I would like to make brief mention of the Supplementary Order Paper, which is of great length and involves moving the word “issued”. We had the word “issued” at one point in a sentence and we have issued it across to another point in the sentence. I thank my colleague Amy Adams who very cleverly and sensibly made that change to make sure the meaning was clearer. Writing good law is always a good idea and I congratulate my colleague on making that amendment, which strengthens immeasurably this particular legislation.

As well as sending a strong message to the motor vehicle manufacturers, we must acknowledge that there is still a lot of work to do in the electric motor vehicle area. The reality is that New Zealand will not be doing that level of manufacturing and work, but there are some encouraging things. One of the challenges for the uptake of electric vehicles is the sheer cost of the vehicle compared to the operating cost—the sheer upfront costs. That is a difficulty; an electric vehicle is approximately double the cost of another light vehicle of a similar motive power level. That is a real challenge and it is one the manufacturers are working on at the moment. I have heard some very interesting ways in which they are looking to approach it. A big part of the cost of an electric vehicle is the batteries, and those batteries could potentially be leased or sold to owners on a lease-back arrangement to get the operating cost of a car up, and the purchase cost of a car down, making it look a little bit more like an internal combustion vehicle in terms of the economics that people are used to. That is one of the things the industry is looking at and I think it is certainly looking at partnerships within New Zealand, including with some of the State-owned enterprises, to see whether it can have these cars introduced as early as it possibly can.

Finally, I would like to mention the importance of road-user charges. We have a system in New Zealand where road-user charge revenue is hypothecated. It is used in the National Land Transport Fund, and this Government has made a special effort to ensure that as much of it as possible is returned to the road users who pay it. It is, therefore, the way that primarily we pay for our roading system and we must not have significant precedents. I have made it clear in the explanatory note of the bill that this is not to be seen as a precedent; this is purely a one-off to encourage electric motor vehicles.

I welcome the chance to follow the Minister of Transport, Steven Joyce, because I wish to clarify a couple of points he made in his speech. Before New Zealanders who listened to that speech rush off to buy hearing aids, because the Minister pointed out the danger of electric cars and the fact that they are silent, I tell them that we have to be realistic. There are going to be only 300 electric cars, as estimated by the Minister himself. It is important that New Zealanders do not get alarmed at the possibility of those quiet cars zooming around everywhere.

The Road User Charges Amendment Bill is hardly huge legislation, and one of the questions I ask of the Committee is how come it is going through today. I have a suspicion it is because John Key is somewhere else in the world, because if this bill is in any way related to climate change then I have to repeat the words of the Prime Minister, who said: “This is a complete and utter hoax, if I may say so. The impact of the Kyoto Protocol, even if one believes in global warming—and I am somewhat suspicious of it—is that we will see billions and billions of dollars poured into fixing … a problem.” We can be sure this legislation does not involve billions of dollars if, indeed, the Prime Minister has come around to the thinking of the Minister of Transport.

The Minister has been careful to point out in the explanatory note of the bill that this does not set a precedent. That is a bit sad. One would hope that by passing legislation that is focused on climate change, the general objectives are to encourage the uptake of electric vehicles, even if there will be only 300, and we in the Opposition applaud that initiative. But it is hardly even the gem of a good idea. It is more like the atom of a good idea, because it will not have that much impact. None the less, as long as we are moving forward in the right direction, and if this legislation was to set a precedent, then we could be assured that the Chamber was using its time properly.

Even though the Minister says that this legislation does not set a precedent, I think we have to ask a few questions around precedents or, indeed, the objective. Does this mean that the National Government accepts that climate change is a reality? Is this the first spark, the first glimmer of hope, that we will see legislation going through Chamber that will bring New Zealand into the new world and, hopefully, put us in a position where we can say we are “100% Pure New Zealand”? That is what we are through our tourism marketing, but the reality is that, as we know, we are not quite there in terms of carbon initiatives. Electric vehicles will move us down that path, so I applaud the legislation for what it does, but surely we could accept the small precedent that might be stated in the bill—but, no, it is not—that we are moving towards a path of low-emission vehicles across the country. If that was to be the case, then the question why we did not remove the road-user charges for small diesel vehicles to encourage the uptake of them, rather than the petrol-powered vehicles that are still the predominant vehicles on our roads, must arise.

If we are trying to set a precedent, as we should be doing with any legislation, and we are encouraging the uptake of low-emission vehicles, why does this legislation not include light diesel vehicles? There are 299 electric vehicles—not 300 because the Minister for the Environment, Nick Smith, who no doubt has stated his self-interest, has one of them—somewhere in the country that will be affected and will benefit from this legislation, and I would say that will have a very, very small impact on the climate. We need to do something substantive.

💬 Hon Tau Henare: It’s huge!

Mr Henare needs to change his V8 for an electric vehicle. I am sure that at some stage, just as the Prime Minister has accepted that climate change is a reality, that member may trade in his V8.

I am very pleased to take a call on the Road User Charges Amendment Bill, and in particular on Part 1. Before I do, I wonder whether I could address the accusations made by the former member for Ōtaki in the second reading of this bill, about my flights of sycophancy as they related to the Minister. I want to reassure the Committee, and the Minister, that any compliments I give him are purely merit-based and have absolutely nothing to do with my own personal ambitions in that regard.

I come back to the select committee’s consideration of this bill. We had some members visit the Transport and Industrial Relations Committee in the deliberation. The Committee may be aware that the group included the Hon Mr Barker. He put officials through something of an examination, I think we would say, around the definitions of a light electric vehicle, including why the vehicle had to be plugged into an external power source in order to qualify for the rebate. I think that that was very fair, but the reasons for it were given. I am a bit surprised, actually, that our friends on the other side of the Chamber have not raised a Supplementary Order Paper in this regard. It may have been as a consequence of the honourable member’s cameo appearance in the committee that perhaps they were not able to produce a Supplementary Order Paper of a similarly reasoned nature.

But we have other external electrical sources, like solar power, and we also have hybrid vehicles. Of course, I was quite interested to know why hybrid vehicles were not included in the exemption from road-user charges in order to encourage the uptake, and I was told that there are no diesel hybrids on the market at the moment. So that made perfect sense to me. But I will touch on the point Mr O’Connor made in the second reading debate about diesel, which he has addressed again today. In my interjections on him during the second reading debate, we were probably at cross purposes. I thought he was talking about diesel hybrids, but he—and he has stated it again in his call in the Committee stage—was talking about light diesel vehicles, and why they are not being exempted, as well. Well that, again, could have been discussed by way of a Supplementary Order Paper. But the advice I have—and I am very happy to be corrected on this by any other member, the Minister, or the officials—is that diesel-emitting vehicles do not actually emit much less carbon than petrol vehicles do. I checked that with the good people at the Parliamentary Library. In fact, if we excluded them, we would need to exclude any light vehicle, including petrol vehicles, which is probably not a place we want to go. Obviously, this legislation is about encouraging the uptake of new technologies, and the exemption of light electric vehicles is certainly going to do that.

I also challenge Mr O’Connor on his quite spurious comments around National’s commitment to climate change, and remind him—as he should know—that National was first to propose a carbon tax or a form of emissions trading scheme, as far back as 1998. Sadly, the electorate did not quite see things the way we did, and we were not able to implement that for some time. But I think it is very important to acknowledge that this Government has a very strong commitment to deal with climate change, and there will be plenty of other examples of that as we go on.

I will also touch on Mr Hughes’ comment about the potential for shifting the burden from those exempted from paying road-user charges when they buy light electric vehicles if there is a high number of these vehicles sold. The goal is 300. Would it not be great if we had that sort of problem? But it is also worth bearing in mind that the exemption is time-bound, so we will come to 2013 and it will be reviewed. The Greens are rather concerned about the fact that the measure is contained in regulations rather than in primary legislation. I will be interested in their views on that. I notice there is not a Supplementary Order Paper on that, which surprises me. I think there were some valid concerns around that. But, again, it comes down to materiality. If we are worried about the burden being shifted to low-income earners who have low-technology cars, but believe only as few as 30 electric vehicles will be purchased, we cannot quite argue both sides of the same coin. But I will be interested in what the Greens have to say about that burden, and whether it should be in primary legislation.

I think, overall, that this is a really sound initiative, and one that I think in the future will probably see a much greater number of people taking up electric vehicles than has been the case.

I rise to make quite a specific point, and to request the Minister to respond to that point, if he would. I am not a member of the Transport and Industrial Relations Committee so I had not been closely following the progress of this bill until a matter was raised with me by an organisation in my constituency in Palmerston North. It is called Zero Emissions Vehicles. The Minister in the chair, the Hon Steven Joyce, nods his head. I do not know whether he has been in contact with this organisation, but it is developing something that is quite a visionary idea that may be some time in the making—that is, a heavy electric vehicle. The company is working on the components to create a chassis and base, on which, I suppose, there could be a truck or bus—a heavy vehicle—completely run on electricity. The company has developed the battery, and it is a long way down the road of developing the drive mechanism that could make this work.

The company has raised a question with me about the 3.5 tonne limit for the road-user charge exemption, whether any consideration was given to the possibility of a heavy electric vehicle, or whether the concept of a heavy electric vehicle was even considered. Quite reasonably, I think, the company has raised the point that an exemption would assist it in having a selling point for such a vehicle if it were able to be developed—that councils might be interested in an electric tram or bus set-up within cities, and that transport companies might be interested in the truck option, as well. So having the exemption to the road-user charges would be advantageous in the uptake of such vehicles. The company has also made another very good point, which is that given such a vehicle does not exist currently, increasing the exemption beyond 3.5 tonnes would not cost the Government anything, because there is no such vehicle. The Government would not be exempting anybody at the moment; hopefully, further down the track that might happen.

I acknowledge that I am raising this issue quite late in the piece; there is not a Supplementary Order Paper around it. Perhaps if there had been a little more consultation at the select committee, these guys could have had the option to come along and make their submission, but on their behalf I raise that with the Minister. I get the feeling from his body language that he gets the points, and I will be very interested to see what response he has to that.

It gives me great pleasure to rise and support this Road User Charges Amendment Bill in its Committee stage. When we look at the part we are debating at this stage, we see that it predominantly focuses on the use of electric vehicles and the incentives this Government is making for those vehicles.

This is a new technology, and something that may not yet be available, in the sense that we will not see a whole fleet of electric cars taking over tomorrow the fleet of cars already on the road. But it is a starting point that is going forward for the future. When we look at what is happening around the world, we see there is an attempt to do that throughout the world. People are looking for cleaner, greener forms of car technology. The New Zealand Herald today has an article about a US programme that is basically encouraging people to trade in gas guzzlers for cleaner, more environmentally friendly cars. They are not quite of the electric technology, because that is the next level. I guess that electric technology will be the next level from the one of more fuel-efficient cars, which the US is going through at the moment. But the article shows that the world is moving that way, and New Zealand needs to be in that space. This bill is putting New Zealand in that space, so that we are ahead of the game when it comes to environmental concerns, and so that we are making the best initiatives possible to encourage the best results for our transport sector. I think it is a great initiative for this Government to do that, because it is showing not only that we are up with the play internationally but that we are taking a leading role in what we are doing with electric vehicles in this case.

The Road User Charges Amendment Bill is a perfect opportunity for us to show that desire and willingness to take a lead in regard to electric vehicles. The road-user charges that would have been on these light electric vehicles will now be exempt. We want to encourage this technology to go forward and to take advantage of what we see as one of the solutions for transport in the future. When we look at the current road-user charges for an electric vehicle weighing 3.5 tonnes or less, it is about $36 per 1,000 kilometres. So that is about $400 a year, based on travelling an average of 12,000 kilometres a year. We are keen to give that initiative to the purchasers of those vehicles so that they can make that choice.

An electric vehicle will be more expensive than a contemporary vehicle at this point in time, because it is new technology that is advancing. Over time we will see the price come very much down. The amount of $400 may not seem like a lot in comparison to the cost of an electric vehicle compared with the cost of a conventional vehicle, but over time, as that technology grows, the price gap will narrow and there will not be such a big gap between them.

💬 Sue Moroney: Oh, you’re going to slap the road-user charges on then!

Labour members are yelling out things about electric vehicles. Obviously they do not care about our environment. They do not have any concern for what is in the best interests of New Zealand. I imagine that they prefer to drive around in big diesel cars rather than taking some initiatives that are in the best interests of this country. They do not see the value in being a leader in environmental concerns. They do not see the value in taking an approach that takes greenhouse gas emissions into account. This Government is taking a constructive approach to ensure that this valued technology can be taken up by as many car owners in New Zealand as possible.

It is a small but important start in recognising that technology. A lot of the time it is about giving recognition to new technology so that people understand the importance of it and that the Government values that kind of technology, which is why we have given that exemption. The exemption will come into effect later this year and it will apply until 2013. During the select committee consideration the Green Party had concerns about the time frame for the exemption. It wanted it to be a shorter time frame, believe it or not.

It is a pleasure to take a call in the Committee stage of the Road User Charges Amendment Bill and to address Part 1. I do not think there is anything in Part 1 that members on this side of the Chamber would find much disagreement with.

💬 Hon Tau Henare: OK, sit down then.

If Tau Henare would be patient, I do have some things to say about it.

💬 Grant Robertson: He isn’t a patient person.

That is true, but I did happen to listen to his contribution so I ask that he please listen to mine. I am sorry to go over this point again—

💬 Michael Woodhouse: Well then, don’t.

I am sorry to do it; I am not bitter about this, but I am extremely disappointed in the process. My colleague Iain Lees-Galloway was talking about the things we could have considered had the Transport and Industrial Relations Committee had the opportunity to do so. I for one was looking forward to hearing more about the science and the future of electric-powered vehicles. I will admit that I do not know a lot about this topic. I wanted to know more and I wanted to learn more. We could have learnt more about what other countries are doing. We have heard some of that in this debate. We could have had a look at those things and suggested to the Government that some of them could be considered, if not in this bill, then perhaps in the future. That would have been a forward-thinking, innovative report from the select committee. Never mind, as I said, I am not bitter, but I do feel disappointed that there are lost opportunities.

I am glad that David Bennett referred to the report in the New Zealand Herald about what is happening in the United States. Sure, the report is about the buyers of hybrid vehicles, but I just want to ask the Minister whether he has considered some of the reports that came out of this article today. The United States has a programme that offers rebates to hybrid vehicle buyers. The objective is to increase the percentage of fuel-efficient vehicles in the national fleet, thereby producing environmental benefits. But any increase in hybrid vehicles has come largely at the expense of small fuel-efficient conventional cars, rather than people getting rid of their gas-guzzling sport utility vehicles, which is what the United States was trying to target. Apparently, American car buyers are choosing hybrids over similarly priced small and medium sized conventional cars, and these are not far behind hybrids in terms of fuel efficiency and emissions. So the reduction in carbon emissions is, therefore, minimal. Two-thirds of the Americans who bought hybrids were going to buy them anyway. So, for the majority, the rebates are not changing behaviour.

I am interested to hear from the Minister as to what research has been done and what information he had prior to considering the measure in this bill. People are saying that, yes, it is a small start, but it is aimed at encouraging people to take up the use of electric vehicles. I think we need to be on top of these issues. As I said, it is a small start, but now that we are offering road-user charges relief to the buyers of electric vehicles we need to start to think about the issues a lot more. We do have a great opportunity. Other members have talked about some of the things that other countries have been doing. When we say that it is a timid measure I go back to what I said about the opportunity that was missed at the select committee to consider what Denmark and the UK are doing; to have a look at other countries and at what works and what does not work. The reason we say this measure is timid is that it will mean only 300 cars after 5 years.

Labour members have also raised in this debate their concern about how we help people in old gas-guzzling cars who cannot afford to buy electric cars. How do we help those people to move forward into this new technology? Otherwise, what we are saying is that people can have a subsidy if they can afford a brand new electric car, but if they are poor and they are stuck with a family car that is 10 years old and does not fit that model, they are stuck with it and they will have to pay more. We do not think that is fair and we do think that, again, the select committee could have considered that issue; it could have thought about it and perhaps come up with some other ideas.

The other thing is that the Minister has referred to how quiet these vehicles are. I think there is a perverse issue or an unintended consequence from the introduction of electric vehicles, and it is the risk that their quietness poses for transport safety. The other day I met with a group of people from the Royal New Zealand Foundation of the Blind. They are genuinely concerned about this because when they are out walking on the footpaths, they rely on being able to hear cars coming before they cross the road.

It is a pleasure to take a call on the Road User Charges Amendment Bill. When we stop and think about the context of this bill, we find that it is introducing an incentive to stimulate the development of electric vehicles. From listening to the speeches in this debate, we can see that members are drilling down into a wide-ranging area. While we consider Part 1, “Amendment to preliminary provision”, I draw the attention of members to the fact that it is only a bit over 100 years since we have had motor vehicles, which is quite amazing when we consider what Mercedes-Benz produced back in the late 1800s compared with what the motor vehicle is like today. When we compare the Wright brothers in America and the aircraft they flew with what air travel is all about today, then from that point of view what we are endeavouring to do today becomes significant.

It is a pleasure for me to be involved in the Committee stage of this bill, even though I was not involved in the select committee process. I commend the thoroughness with which the Transport and Industrial Relations Committee considered this bill and returned it to the House for its second reading.

Most of us would have been aware of the slot car, which was electrically run. We all had a lot of fun with that. I also draw to the attention of members opposite that in Marlborough, one thing the elderly use a lot is the mobility scooter. When we start talking about the advances that are occurring and about how the battery is becoming far more effective in today’s use, we have to use only part of our minds to imagine what will be occurring in the future. I think this bill creates an incentive. It is going some way to ensuring that we have alternatives to the motor vehicles of today that use fossil fuels. The old adage “Big things come from small beginnings” is appropriate. The member opposite talked about the atom, and we can see what atomic energy and atomic medicine can do today for the human race. We are inspired by this legislation going forward; it offers a whole wide vision of opportunity going forward.

Another point that needs to be underscored in this Committee stage of Part 1, the “Amendment of the preliminary provision”, is that the bill was an election promise from National. It is good to carry that out. We on this side of the Chamber recognise the importance of being able to portray to the nation the confidence to go forward and to build on the policies of the Government, and this legislation fulfils an election promise. When we consider that the average cost for a motor vehicle under the road-user charges is $36.07 per thousand kilometres, which equates, under a 12,000 kilometre year, to something in the region of $432 annually, we know that that is an incentive to pass this legislation.

I thank the member on the Government side for explaining to us why hybrid cars were not involved, and that they had, effectively, to be plugged into an exterior power source and recharged. Some clarification was certainly greatly appreciated there. We cannot undervalue the opportunities around technology, and this bill encourages that. It is interesting to note that given the dramatic recession of today, and the adjustments within economies and such like, we see such magnificent organisations, like Chevrolet, having to totally readjust themselves. It is important that New Zealand keeps pace with what other nations are doing.

It is a pleasure to finally rise and speak on the Road User Charges Amendment Bill, albeit in the Committee stage of Part 1. It is interesting because it gives us the definition of a light electric motor vehicle. I have some questions to ask the Minister of Transport about this definition, because it specifically says: “light electric motor vehicle means a motor vehicle whose motive”—Colin King was probably quite right to talk before about motivation—“power is wholly or partly derived from an external source of electricity and whose gross laden weight is 3.5 tonnes or less”. My question is what vehicles does this exclude? Which vehicles over 3.5 tonnes does the Government not wish to see involved in this particular legislation? Certainly, I imagine that it means the Government, as we know, is not committed to electric trains, because they will be more than 3.5 tonnes. There obviously is a big question mark. The Minister is not sure, but I think they will weigh more than 3.5 tonnes. There is a big question mark over this Government’s commitment to electric trains, or, in fact, trains at all, but I will come back to that point.

We are talking about the definition of what is in and what is out. The definition excludes particular vehicles, and I would like some clarity from the Minister about those vehicles that the Government is moving to exclude by limiting the weight to 3.5 tonnes or less. I imagine that it will exclude the juggernauts that the Government seems to want to fast track and let loose on our roads, the same juggernauts that many local government authorities up and down the country are submitting on and opposing because they know that our roads are not equipped, built, or designed to carry those sorts of weights. I imagine that the juggernauts will be excluded from the 3.5 tonnes or less definition, and that those juggernauts will be discharging this dreadful diesel that David Bennett keeps mentioning when he talks about this bill, and which apparently the National Government is using as an excuse to go around opposing the proposal for a passenger train from Hamilton to Auckland. Apparently the Government is opposing it on the grounds that it will use diesel. I ask the Minister what on earth the juggernaut trucks will be using. Perhaps they will use diesel. I wonder, if the Government is prepared to fast track this proposal for juggernaut trucks to actually start using that dirty diesel that David Bennett is so concerned about, why the National Government is so vehemently opposed to the rail passenger transport proposal for Hamilton. It is clearly not about the use of diesel, so I want to know what the real reason is.

I turn back to the bill. When I look at what this definition means, I think about it from a local perspective. I understand that the Transport and Industrial Relations Committee went through a very truncated process and I am concerned about that. I have yet to hear any justification from the Government benches as to why this very important legislation was given only 1 hour’s deliberation by the select committee. I am still waiting to hear the justification for that. If the Government had allowed the select committee to delve into this bill more deeply then perhaps it would have thought about what 300 electric vehicles on our roads in the next 5 years might mean. Is this a big move forward or a small move forward? Generally, when we look at things from the Waikato’s perspective, roughly 10 percent of any initiative can be accounted for in the Waikato. That means that for the entire Waikato region, under this interpretation of the definition of a light electric vehicle, we are talking about an exemption that might apply for 30 cars.

💬 David Bennett: Excellent!

David Bennett is extremely excited that in 5 years’ time 30 families in the Waikato might benefit from this. I ask that member to reflect on what type of family those are likely to be.

It is with absolute delight that I stand to make a few comments about the Road User Charges Amendment Bill.

💬 Simon Bridges: We’re delighted to hear from you.

I thank the member very much. As the honourable Minister observed, the motor vehicle is the liberator of New Zealanders. We are in the process of building an extremely fine cycleway that will allow people to go the length and breadth of the country to places of interest and extreme scenic beauty, and it will be a huge boost to tourism in our country. We have public transport in small areas of urban concentration, but it is the car that is the liberator. It is the great liberator, “el libertador”, and anyone who has been to South America would have seen the Simón Bolívar of transport on the avenidas. The motor vehicle reigns supreme to this day.

The exemption from road-user charges, as the honourable member on the other side mentioned, is for light electric motor vehicles that weigh up to 3.5 tonnes. Some surprise was expressed as to why that should be, but I submit that we are in the relatively early days of a resurgence in interest in the development of electric-powered vehicles. We are at a stage where the seed has been planted, the research is starting, and who knows what the future will bring.

So I congratulate the Minister and the Transport and Industrial Relations Committee on shaping the bill to take us forward rather than backwards.

Rather than the dead hand of prescription and decree favoured by the previous administration, this Government is encouraging desired behaviour. In this case, with this small but perfectly formed bill, the Road User Charges Amendment Bill, the desired behaviour is an increase in the use of electric vehicles. We want to make that a little bit easier, and reduce the carbon footprint of the individual. Reducing our carbon emissions is crucial. We always hear about the cost, and this measure certainly addresses the cost, but also we have to consider the drivers of a growth business—growth in sales and growth in margins. New Zealand wants to be a growth business. Our future depends, as one of the members on the opposite side of the House pointed out, upon the perception of our 100 percent clean, green image, of our purity, and of the pristine nature of our environment. This small bill goes a small way to encouraging and rewarding those committed individuals who wish to reduce their personal carbon footprint but need a motor vehicle by dint of where they live, poor access to public transport, or having too far to travel by bike or by walking. This bill allows them to have the opportunity to buy and use an ecologically friendly motor vehicle.

The Government is, at the same time—as we are wont to do—keeping its election promises. One of our election promises was to reduce road-user charges for electric vehicles. As luck would have it, I have recently had the pleasure of riding in an electric vehicle. Where was it? It was in Christchurch. When was it? It was only a few days ago on my way to that celebration known as the National Party conference.

💬 Paul Quinn: When was that?

Last week.

💬 Paul Quinn: Very successful.

Yes, it was very successful. Last week when I came out of the airport, there was a green Toyota Prius. A local company had taken advantage of the opportunity, and was providing a green alternative for the traveller. This vehicle was extremely impressive. As a number of members have pointed out, the first thing one noted was the quietness. It was a very quiet vehicle. The other thing one noted was that when one came to a stop, there were no emissions—the electric motor had stopped, and the internal combustion engine was not in operation. So this bill is a very clean, green initiative, and I think it is appropriate that this Government, which believes in encouraging the desired behaviour, should have put this amendment in the bill.

As many of us have read, and those members on the select committee would have cogitated at length—

I rise to take a short call in response to a couple of questions raised by earlier speakers. The first question was raised by Mr Lees-Galloway about his constituents in Palmerston North. I am aware of the company he referred to, Zero Emissions Vehicles, and the work it is doing. It is encouraging and I hope the company succeeds with its project. Certainly, we would look at potentially extending that sort of incentive approach once the vehicle becomes ready for use.

In reference to Ms Moroney’s comments, it is appropriate to point out that road-user charges are not paid by trains. Trains do not pay road-user charges and they do not pull up at the weigh stations and get weighed. Her comments were a little bit irrelevant, if I may say so. In terms of passenger transport—I am a big enthusiast for its potential ability to reduce congestion in our major centres, and I think that is the point—it has to have a priority for reducing congestion in our major centres that have the most congestion. Of course, all funding involves choices between one project and another. I think the difficulty that the Waikato to Auckland train will find with the Transport Agency is simply that it will not reduce congestion on the Hamilton to Auckland road. I cannot see that happening. The route is already served by commercial, private bus services that pay their way. Huge numbers of private vehicles travel up there and, again, they fully pay their way. So that, I think, is the difficulty with the project, but we will see whether Hamilton City wants to make a contribution to KiwiRail. If it does, I am sure KiwiRail will be very keen to see that happen, but, again, it has to be done on a basis that makes some sort of sense when compared with other potential ways to invest in the transport sector. So those are the points I make in response to earlier speakers.

Tēnā koe, Mr Chair. I rise to speak to the Road User Charges Amendment Bill. It is interesting to follow Mr Cam Calder, who was talking about promises. Many of us on this side of the Chamber immediately thought of the sorts of promises that this Government has not kept. One promise that immediately comes to mind is the promise to have tax cuts. Tax cuts for ordinary New Zealanders were, of course, cancelled, while tax cuts for the rich were a priority and were put through the House at a time when there was a real need for Government funding for a range of very important initiatives.

Let me get back to the Road User Charges Amendment Bill. I rise to speak on Part 1, which is about the exemption for light electric motor vehicles from the requirement to pay road-user charges. As my colleagues have mentioned, we are supportive of this provision. But I will comment on some of the points made in the explanatory note of the bill. Although it is true that greater use of electric motor vehicle technology would make a significant contribution to improving the efficiency of the motor vehicle fleet, decrease reliance on fossil fuels, and improve energy security—and it would be used, of course, with our comparative advantage in renewable electricity generation—those factors have been somewhat overstated in relation to this particular bill and the current take-up of electric cars.

There has been a rather grand description of the contribution that will be made by this exemption. I would note that this is in the context of a lot of inaction by the current Government in terms of the environment. Certainly, the previous Labour Government did a lot towards preparing for the introduction of electric vehicles, and, certainly, it is fair to recognise that both the previous Government and this Government are hampered somewhat by the cost of electric vehicles and the fact that New Zealand is not a priority market for manufacturers to roll out electric vehicles. That means, as others have mentioned, that the exemption for light electric motor vehicles is best left for a shortish period of time, because we do not want to see what is effectively a subsidy for those who can afford to purchase these cars when people on lower incomes cannot afford to buy such a car.

I think it is important that we talk about climate change when we talk about electric vehicles. A number of speakers across the Chamber have already done so, and I think it is a very important point to make. Michael Woodhouse’s contribution was to acknowledge the Government’s strong commitment to climate change. That is so true! In fact, we can see that the Government is very committed to climate change and its terrible consequences by its complete inaction in leadership in this area at the moment. The Government is taking New Zealand from the situation of being a world leader to being an embarrassing laggard. Even worse—because I do not think that was actually what Michael Woodhouse meant—was David Bennett’s contribution. He started to say that Labour does not care about the environment. Frankly, that is an unbelievable statement.

When we compare the record of the previous Labour Government with this Government’s record, we see that this Government is moving in the wrong direction on climate change. Since November last year, what have we seen? We have seen the emissions trading scheme being put on hold at a significant cost to investment in planting in forestry.

💬 Paul Quinn: Part 1, Carol; Part 1.

I am speaking on Part 1: the environment and electric vehicles. A number of people have mentioned this thing.

The Government has also repealed the moratorium on the future construction of baseload thermal electricity generation plants. It has rescinded the phase out of energy-inefficient incandescent light bulbs. It has failed to promulgate allocation plans as required by law. We have seen all sorts of things. The home insulation package that Labour put forward was a fully targeted package, but it has been replaced with one that is untargeted. It will probably be picked up by those on higher incomes rather than by those who most need it.

The Government has used every possible excuse for having a delay in setting up a carbon pollution reduction target. It says that was for all sorts of reasons—forestry data and so on—while most other countries have gone on and actually done something.

I was a member of the Transport and Industrial Relations Committee, which considered the Road User Charges Amendment Bill and reported it back to the House. It has taken me a long time to get a call, but I am now grateful for the opportunity to make a contribution to the debate on Part 1. This part is one of two distinct amendments that the Government is making to the Road User Charges Act 1977.

I will take a moment to reflect on some of the things that have been said by Opposition members, particularly by Opposition members who were members of the select committee. The committee’s consideration of the bill was careful, thoughtful, and timely, yet members of the Opposition who sat on the committee now come into the House and somehow want to squeal that they did not have an opportunity to discuss matters there that they now want to discuss in the Committee. It is quite legitimate for members opposite to raise some of the things they have raised in this debate, but it is not legitimate, when they sat in the select committee, to now complain that somehow it was the Government’s fault that they did not get around to raising matters in the committee that, in retrospect, they wanted to raise.

The purpose of Part 1 is to enable regulations to be made that exempt light electric cars from road-user charges. The intention is that the provision will take effect in October and run on a trial basis until 2013. It is envisaged that 300 vehicles will be affected. That number of 300 is logical, sensible, and reasonable, and for the former member for Ōtaki to use the word “timid” is totally out of line. How dare any member of what was the previous Government for 9 years describe anything this Government is doing as timid? I humbly suggest to the young member that maybe he should get hold of a thesaurus—such as Roget’s Thesaurus—and spend a little of his time in this House on widening his vocabulary and learning a few words that may give a fairer, more exact description of what he is trying to say. We should not ever let any member on the opposite side of the House describe the actions of this Government as being timid.

💬 Hon Darren Hughes: Hopeless chairman.

Mr Bennett’s chairing of the select committee was outstanding. The fact that Labour members did not take the opportunity, given fairly to them by the chairperson, to raise issues in the committee that they now want to raise in this debate is not down to anything but their own lack of competence.

In this bill two things come together. The first thing is the reality that private vehicles continue to be the most significant mode of transport for most New Zealanders. When one accepts that reality—and it is a reality; there is no point in arguing about it—one sees that it makes sense for the Government to encourage the development of alternative fuel technologies. That is the intention of this amendment to the Act. It is to encourage alternative fuel technologies in the development of road transport. Secondly, of course, New Zealand has a major competitive advantage from its renewable electricity generation. It therefore makes very, very good sense that we use that competitive advantage in our motor vehicle transportation.

Part 1 agreed to.

Part 2 Amendments to Part 1 of principal Act