Climate Change Response (Removal of Transitional Measure) Amendment Bill

I move, That the Climate Change Response (Removal of Transitional Measure) Amendment Bill be now read a second time. I think we covered quite a lot in that first reading as far as being quite clear about how the transition is happening and why we are kind of phasing it in goes.

We looked at a whole lot options, to be fair, on that. In some respect we looked at the price of fuel at the moment and the fact some of those costs might be passed on and we felt at that time that, actually, households were in a situation where they might take that bit of a lift. Would we look at 100 percent? But we then looked at businesses, and certainly read those submissions we got, and equally, I think, most importantly, we looked at farmers. The additional cost that potentially goes to our farmers from the emissions that Fonterra itself emits and then, of course, its increased costs with the amount of fuel and electricity it uses—we did not want to be putting an undue burden on farmers at a time when they could probably least afford it with prices at the moment.

So what we got from businesses the most was that what they wanted was certainty and the opportunity to do their outward projections, obviously, and take this into account. There were things like local government, where they had already looked at what their spend would be. This has an effect on them, particularly in their waste, and so, actually, they would not have the money to pay for the additional cost if we actually rushed it in too quickly when they had already done their accounts and things, as you can imagine. We needed to bring it in over time.

I think when it comes to climate change, for me, I reckon—well, for anyone who doubts it—I just do not think there can be any doubt at all. With all respect, you do just need to look at some of our Pacific neighbours and it is pretty stark. You can see what is happening there. Equally, I think this response through the emissions trading scheme (ETS) and us reducing can play a big part. It plays a part in respect of upping the price, obviously, for those businesses that are exposed to the ETS and, as a consequence, cost does affect behaviour. Our main reason for actually removing the one-for-two measure is that we believe it will actually affect businesses and how they are looking at their own emissions and the cost of them, and we want to be encouraging them to work towards that lower-emission economy. It makes a big difference to us.

The other aspect of it is that in putting in this cost and imposing it more back at business we wanted to do it in a way that did not affect jobs. I heard in the first reading people sort of talking about how we should have never brought it in. Well, actually, those were also people who were saying that jobs at that time were most important, and there was a real risk back in 2009 that if we were having imposed costs that were beyond what people could actually cope with, then they would be laying more staff off. That is certainly why it was introduced, but we are at a very different—if you just look at the Budget today. What a fantastic Budget. If you look at the forward economy and what is happening, if you can see the 3 percent growth coming our way, if you can see another 170,000 jobs coming in—

💬 Grant Robertson: What about the bill?

💬 Dr Megan Woods: The bill.

Well, that is exactly the point—the 170,000 jobs coming in mean businesses can actually afford now to pick up a bigger share of their costs of what they are doing, and I reckon that is equally important in why we are looking at this measure.

To say it is good for the Government’s books is pretty obvious. We are budgeting $356 million that is positive for the Government’s books over the next 4 years. But, as I say, that was based on $12 a unit, which is what it was when we set this in place a few months ago. Well, we are already at nearly $15 a unit today, and everyone you speak to says it will not go back.

The other point I am not sure has been made, and another reason for removing the one-for-two measure, is the fact that you have got 140 million New Zealand Units (NZUs) that are currently stockpiled. To be quite blunt with you, I want to see some of them spent, and this will mean some of those businesses that are stockpiling NZUs will actually spend them to pay for their share of the cost, and that sort of thing. As a consequence, that will have, I think, a positive effect on some of that behavioural change and put some challenges to us.

I just want to say that on climate change, as I sort of said, my opinion, if anyone is kind of doubting whether there are effects and if they are doubting that this will make a difference, is that it will. But, equally, I reckon this is about our identity. Our identity, actually, is set in our land. It is set in our mountains, in our beaches, and in who we are. It does not matter if you are Māori or non-Māori. Actually, that is, for me, what my identity as a New Zealander is quite encompassed of. So we need to look after this land. We can argue that our contributions globally are at, you know, 0.15 percent, but, actually, this is about our economy. It is about who we are as a country, and we have to be putting things in place further than what we already have. I really note the Minister of Transport and the difference he is making with electric vehicles and introducing other transport ways.

This ETS removal of the one-for-two measure is one step, and I do not say it is the answer, but it is an important step in really letting businesses and the public know that change is coming and that we want to see that continuing as it does. I commend this second reading to the House, and thank you very much.

It is so soon to be taking a second call on this bill. It is comforting to hear from the Minister for Climate Change Issues that the measure may be joined by another measure to address climate change. Although we are supporting this single measure, it simply is not going to be enough. The Minister told us that our identity is bound up in our natural landscapes, in our mountains, in our rivers. It is those mountains and those rivers and those glaciers that are being put under threat by the risk we are posing to our planet by climate change. Until the Government can join up its thinking on that, we are going to get nowhere. I would like to put it to the Minister that, actually, this Government’s action on climate change is slower than the glacial retreat in this country. Glaciers are retreating in this country, in our own country, at a faster rate—on islands here, at a much faster rate.

The Minister talked about the great difference that this piece of legislation is going to make. Well, the regulatory impact statement for this legislation tells us it is going to make a 0.7 percent reduction of net emissions in New Zealand in 2020 at each price. In terms of the efforts that New Zealand has to make to meet its post-Paris and its pre-Paris commitments around emissions reductions, this is a tiny drop in the bucket. This is simply not enough. If this is all the Government has got, we are in trouble. A 0.7 percent reduction in our emissions is simply tiny. This Government took to Paris and put on the table a 30 percent reduction on 2005 levels of emissions—an 11 percent reduction on 1990 levels. More action—

The ASSISTANT SPEAKER (Lindsay Tisch): Sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.

Sitting suspended from 6 p.m. to 7.30 p.m.

I am happy to take another short call on this piece of legislation. Before the dinner break we were talking about the very small contribution to our overall target that this piece of legislation will make in terms of the emissions trading scheme and the wider options in terms of the ways in which we can reach our pre-2020 targets and also our post-2020 targets. Remember, this Government has signed up to a 50 percent reduction in our emissions by 2050, and we are simply not on a pathway to meet that in any way, shape, or form.

So when members of the Government get up and they talk about their pragmatic, sensible, balanced view on climate change, they treat it like it is something that they can choose to do or not. Rather than just reading the pap notes that they have been given, they could have even flicked through the regulatory impact statement that sat alongside this bill, where paragraph 6 on page 43—you might want to flick through now and have a little look—tells you that “Current NZ ETS policy settings do not put the New Zealand economy and Government in a good position to meet climate change targets and international obligations in the future.” The stark reality is that we are not doing what we need to do in order to protect our planet or to protect our economy into the future. So when the Minister says that they are having to balance jobs, I say that by not acting on climate change this Government is putting our economy and the security of jobs at risk.

Last year 232 people lost their jobs in my electorate, in Wigram. They lost their jobs shelling mussels, and they lost their jobs because the water in Northland was too warm for the mussel spat to grow and that plant was shut down. The research and development needed to do the breeding under new conditions simply had not kicked in. The response of the Minister, Gerry Brownlee—in this case, that Minister—was “Ah, there’s plenty of work in Christchurch in the rebuild.” To go from shucking mussels to picking up a paint brush requires something in the middle, and that is the role of Government. It is called skills training, and it is about transition pathways, and we are not seeing this.

So when the Minister says that there are other measures coming to join this Climate Change Response (Removal of Transitional Measure) Amendment Bill, we would like to see some other measures that do put us on a good, clear pathway where we can protect our economy, where we can futureproof it, and where we can ensure that the security for workers in the 21st century is there and that their jobs are not going to move from under them. Avoiding any kind of shock in an economy requires careful planning, and this Government simply is not doing that.

The Government speakers, when they are talking about their pragmatic, sensible, and balanced view on climate change, might actually want to address what this bill does not do. They might want to address what the official advice says is the current state of our emissions reduction pathway. They may want to consider that there is going to be a 0.07 percent reduction in New Zealand’s net emissions through the piece of legislation that is being passed tonight. It is a tiny drop in the bucket, and much more needs to be done. Labour supports this bill, but it would like to see other measures join this measure. Thank you.

It is a pleasure to take a quick call in the second reading debate of the bill, which is designed to phase out in a very pragmatic, very balanced, very measured, sensible, and reasoned way the one-for-two transitional arrangements that were set up back in 2009 in the very depths of the global financial crisis. That was a policy that was set about quite deliberately—very carefully, with a lot of considered thought—to ensure that businesses and jobs were protected.

I know that it upsets Opposition members to talk about being pragmatic and being sensible and being balanced, but that is the nature of good governance and good government, and that is something that we have seen today expressed in Bill English’s eighth Budget. He has done it very, very well, in my view—pragmatic, balanced, and sending the right kinds of signals.

The phasing out of the one-for-two emissions trading scheme (ETS) structure is actually really important. What is more, it comes with the support of a very wide range of businesses. Last year there were some nationwide submissions, consultative meetings that took place around the countryside. They included iwi and a whole wide range of interested parties, and at those meetings 75 percent of submitters were in favour of phasing out the one-for-two.

💬 Paul Foster-Bell: How many?

Seventy-five percent of submitters were in favour of phasing it out. So the Government did have options in terms of how that transition might take place. It would have, perhaps, been possible to simply start from where we were in 2009 and literally go cold turkey, but we are not a Government that wants to do that. We are very keen to ensure that businesses and others have time to make the adjustments that are required, and that is what this bill is about. Gradual phasing-out of the one-for-two is a really significant step in meeting our target to reduce emissions. I know Opposition members do not like to hear that, but the simple reality is that that is so. Our target is to reduce emissions by 30 percent below 2005 levels by 2030.

Earlier this year we were very pleased to sign up to the historic Paris Agreement, and at the time parties from around Parliament thought that was a very good idea. That was because the Paris Agreement really does amount to what is the first global agreement on climate change. New Zealand was actually one of the very first countries outside Europe to set up an emissions trading scheme, and this bill is about reviewing it, about changing it—transitioning it to make it stronger, to make it more effective—and about strengthening our ETS. If we can, as a result of this legislation, make the ETS more robust and help reduce emissions even further, then that is a good thing, and it does assist us to get to where we want to be in 2030. But in this space we have got to be smarter than other countries. We have to be more nimble and more clever, and the reason for that is that already 80 percent of our electricity comes from renewables, for instance. So our emissions profile is quite different to that of most other countries in the world; 80 percent of electricity coming from renewables is very, very impressive. We would like to get it to 90 percent, and I am confident that we will get it to 90 percent. We are committed to getting it to 90 percent, but in Europe only about 12 percent is generated from renewables—only about 12 percent; only about 12 percent.

So our emissions profile is completely different from that of most other developed countries. Ours is made up of agriculture, for instance, at about 49 percent, as good as 50 percent; other energy at about 40 percent—non-transport at 23 percent, transport at 17 percent—industrial processes at 6 percent; and waste at 5 percent. So our make-up is a different sort of model and style to other countries. That is why we do have to be more nimble, more flexible, and more smart, actually, in how we meet that target for 2030.

This is a good and practical, pragmatic, reasonable, balanced bill. I know that Opposition parties do not like that. They are going to be heartily sick of us talking about these things, because we are a sensible, reasonable, pragmatic Government. I commend this bill to the House.

We will thank Scott Simpson for his version of Fox News that he just gave us there—reasonable and balanced. At this point in the proceedings I would like to spend a little bit of time reflecting on the select committee submissions that we had on this piece of legislation.

💬 Dr David Clark: I didn’t see those.

Oh, that is right—there were none, because the Government has decided to put this bill through under urgency tonight. The Government knows that it has widespread support across the House for this measure, so here would have been an opportunity. Do a first reading, by all means; you have announced it in the Budget. Good on you! Then send the bill to a select committee, so that New Zealanders can actually have a say about what is happening with one of the most significant issues facing the planet.

💬 Paul Foster-Bell: Already had a say—already had a say.

Paul Foster-Bell says that they have already had a say. It is not good enough, Mr Foster-Bell. It is a piece of legislation. It has got clauses in it. It has got things in it that might not be quite right. It would not surprise me if we were back in the House sometime in the next few months, correcting this piece of legislation, because there will be a mistake. That is what happens when we move in haste—we make mistakes. So that is what could well be happening.

Right now, I should be standing here, saying: “Well, I would like to thank Generation Zero for their excellent contribution to the select committee process. I would like to thank the business organisations right around the country that have come in and said: ‘This is a really interesting change. We can see why the Government is doing it, but we want to see more to help create sustainable jobs.’ ”. I could be talking about all of those select committee submissions right now, today, and I cannot because the Government has decided that it had better do something important on Budget day; it had better look busy.

It is very important to look busy on Budget day if you are the Government, even if your Budget does not actually do anything to make the economy more sustainable, to allow us to transition to a low-carbon economy, and to allow us to help find the path to sustainable jobs right around New Zealand. That would be a fantastic thing to be debating today, in the Budget, but it is absent. It is not in the Budget. The Budget does not deliver a pathway forward to adjust the transition away from fossil fuels to a low-carbon economy. We all know we have got to do it. I even think members on the other side know that they have got to do it but there is no plan in the Budget for this.

Is it not interesting that this bill is entitled the Climate Change Response (Removal of Transitional Measure) Amendment Bill? That really sums it up—just the one; just the one measure. It would be good to have seen something about measures perhaps, but no, just the one measure.

As I have said, everybody in this House, certainly in the first reading, supported this bill. I am sure that will continue to be the case as we go through. The one-for-two subsidy has had its day. It is quite clear that we need polluters to take more responsibility for what they do, for the emissions that they have, and this is one small step in that regard.

I do note that in the Budget documents this will net the Crown about $356 million—not an insignificant sum of money, you might say. Would it be good to see some of that money translated into some of the other initiatives that might actually promote a more sustainable New Zealand, that might actually allow us to meet our climate change goals and targets? That would be a good thing. Sadly lacking in that regard.

I see the Warm Up New Zealand funding is now $18 million over the next 2 years, in comparison to the $100 million over 4 years that came before. I heard Simon Bridges say that the Warm Up New Zealand subsidies are now more targeted. Well, that is an interesting idea because we are only about one-third of the way through retrofitting New Zealand homes for insulation, so I do not think we are quite up to the targeting stage. I think we probably have a bit more work to do in New Zealand to get our housing stock up to the state of being both healthy and energy efficient.

It would have been good to see some of the $356 million that the Government pockets today, as a result of this change that we are passing in this legislation, actually go on to being used to help create a more sustainable New Zealand, but again there is no plan for that whatsoever in this piece of legislation.

On this side of the House, and I think this actually goes for all of the Opposition parties, we have been calling on the Government for some time now to step up with a real plan on climate change—a plan that actually acknowledges what is happening in New Zealand today and what is happening in the world today. Members of the Government might care to take a trip down to my old home town where I grew up, down in south Dunedin, and check out what is now effectively a flood plain that has been created in south Dunedin.

Large insurance companies are going to stop insuring the residents of south Dunedin within the next 10 years, possibly even shorter. This is also going to be replicated in parts of Christchurch, as Mr O’Rourke knows, and in other parts of New Zealand as well. This is happening now. One single measure in a bill today is not enough. It is not even close to enough. It is a tiny, little, baby step.

Our responsibility is to meet the targets that we have said are not being met. New Zealand’s emissions per capita are the fifth-highest out of 40 developed nations in 2012, and we have got a 19 percent increase in emissions since 2008, since National came in. They are not doing the job, and they are selling out New Zealanders by not doing the job. Not only are those residents of south Dunedin—incidentally, it is important to know that the community of south Dunedin is low-income and elderly. The most vulnerable people in New Zealand are living in one of the most vulnerable areas in New Zealand. This is what is happening with climate change. This is what is happening with sea-level rise, and the Government just sits there and says: “Well, we will put up one measure. We will do one measure today. We will try to do just enough to be seen to be doing something.”

Just enough is not good enough. It is not good enough. We have got to be doing better than that. On this side of the House what we are seeking is a just transition to the change to a low-carbon economy, one where we support communities through the change. We are not seeing enough action from the Government to deal with those industries that are changing, and deal with those communities when things are changing. We have seen Huntly having a small extension. I think the Government should be in a community like Huntly right now, today, saying: “What are we doing to train and retrain people to give them new skills, and to give them opportunities to generate wealth themselves?”. Those polluting industries are gone now; we know that.

It is important for New Zealand as a country, in terms of our image in the world and how we sell our products in the world, that we lead the way on this. John Key has gone from being a fast follower, or whatever it was he said he wanted to be, to being a bewildered bystander. He has got no idea what to do when it comes to climate change. But he found this one. I am sure he found this measure because it earns him $356 million in a year where he needs to prop his surplus up a little bit. I am sure that is what he did here.

We welcome the fact that the Government has taken this tiny, little, baby step, but it needs to get into its big-kid clothes, get out there, and start taking proper steps towards a sustainable future for New Zealand, and one where we take climate change seriously.

The Labour Party would have liked today to see the Government with a clear pathway forward—not just a working group or a review or anything like that, but an independent climate commission that actually starts setting proper carbon-budgeting goals, that starts setting proper pathways forward for New Zealand, and that puts out there, in front of New Zealanders, every single day what it is that we need to do to make this transition.

This is not all doom and gloom. There are massive opportunities for New Zealand in transitioning to a low-carbon economy to build up our regions, to create wealth for small businesses, and to create wealth from innovation, but this Government comes to us with one small, simple, tiny measure. Well, under such urgent circumstances we commend and support this bill.

As a balanced, pragmatic, sensible, and reasonable MP, and one who represents Invercargill and parts of Southland, I am very pleased to take this call in support of the Climate Change Response (Removal of Transitional Measure) Amendment Bill. I say again that this is a balanced, pragmatic bill, which looks to phase out, in a staged way, the one-to-two subsidy. The bill phases out the subsidy in the emissions trading scheme that allows some businesses to pay one emission unit for every two tonnes of pollution they emit, and that is over a 3-year period.

If I come back to Southland and what Southlanders believe, we are a primary industry - driven economy and we are an export-driven economy. We have a lot of manufacturing in our region. Our region is one that is doing well: it is holding its own and it is one that is creating jobs for our people. In fact, we have one of the lowest unemployment rates in New Zealand.

My businesses in Southland are going to be very pleased about the staged process of redaction of the one-to-two scheme in this bill, in the way that it is set out. It is a measured bill. It is a measured process of reducing this measure, to make it sustainable for businesses to build that into their processes so that the money spent is not too onerous. As such, I again say that this is a balanced and pragmatic bill, and I commend this bill to the House.

James Shaw—I am hoping he has a different set of notes.

Mr Speaker—

The ASSISTANT SPEAKER (Hon Trevor Mallard): I hope the speaker has a different set of notes.

Balanced, pragmatic, reasonable, and robotic! Southland businesses, I am sure, will be delighted about this bill, because it does not do anything. One of the previous speakers, I think it was Mr Scott Simpson, said that this is a really significant step in our challenge of meeting our global emissions reduction target. It is a 0.7 percent—0.7 percent—reduction in emissions. Is it significant? Give me a break. This is against a business-as-usual scenario. I thank Grant Robertson for pointing out again that all of the other measures are staying in place—all of the other measures—which means that the business-as-usual scenario of a 96 percent increase in our emissions above 1990 levels by the year 2030 is on track. This measure, this single measure, will reduce emissions by 0.7 percent from a 96 percent increase, and that is against a target of reducing emissions by 11 percent. I mean, it is absurd to think that this bill does anything to get us anywhere close to our, actually, frankly pathetic target of reducing emissions by 11 percent. I mean, it is a pathetic measure against a pathetic target, and business as usual is going to carry on.

There are so many more things that we need to do if we actually want to do something about climate change, but clearly this Government is far more interested in looking as if it is doing something about climate change. It has pulled one of the most acceptable measures from the current emissions trading scheme (ETS) review in order to get it into the Budget, in order to be able to talk about it as if it was committed to doing something about climate change.

I think it has occurred to the Government that after seven other Budgets it has not actually mentioned climate change, and it is still a thing. It has been hiding away from it, pretending that it is not happening, business as usual is carrying on, and let us just hope that if we do not mention it, then, you know, no one will call peek-a-boo and say that it is actually happening. Well, I think that after seven Budgets, Government members have finally got to the point where it is like: “Oh, actually, no, we do need to mention it; we do need to do something. What is the weakest-tea approach that we can take that enables us to talk about it during a Budget?”. And they have pulled out the two-for-one subsidy.

It is great, because this is, of course, the party of business—that pragmatic, free-market party that likes to crow about how good it is for business—busy subsidising business under the cause of the emissions trading scheme, with subsidies that apply to certain sectors over other sectors and subsidies in the form of the two-for-one deal. So the two-for-one deal is about to die a very deserved death, even though by itself removing it is not going to fix New Zealand’s challenge of reaching our commitments on climate change, right? It is not going to get us there, but it does allow the Government to talk about how good it is, and how much it is doing to fix climate change.

The other thing that Grant Robertson said that I wanted to pick up on, of course, is that many, many, many years ago the Prime Minister said that we did not really want to be a leader on climate change; we wanted to be a fast follower. I think it would be great if we followed, actually. I think that following would be a massive improvement on where we are now, which is walking in the opposite direction from where the rest of the planet is going.

If you look at what France is doing right now, it is putting in place a NZ$50 minimum price per tonne on emissions, and we are maintaining a price cap, a maximum price, of $25. In other words, we can have a market in emissions, as long as the price does not get above $25, which is about the minimum level that most economists think it would need to be for people to start making decisions about how they allocate land use, what to invest in, whether to get into the green economy or stay in the existing polluting economy, and so on. In other words, everything else that the Government is doing is going to make sure that our emissions continue to rise inexorably over the course of the next 15 years.

The decision to keep the Huntly coal-fired power station open until 2022 means that there are millions of tonnes of carbon dioxide being poured into the atmosphere. It completely wipes out any gain that this bill will be making. The decision to continue to leave out agriculture and other subsidised polluting industries from the ETS means that you continue, as Westpac economists have said, to see a skew in the economy of investment towards those sectors that are being subsidised. That is what happens when you subsidise industries—investment flows subsequently. So we are incentivising people to move their money away from the high-value, clean-tech, green economy, and into polluting industries that we subsidise under the existing and remaining measures of the emissions trading scheme. So, as I said, it would be nice if we actually did follow. Following would be good. It would be even better if we started following fast, because the world is definitely moving in this direction.

One of the other previous speakers said that this was about strengthening our emissions trading scheme. It would be amazing if our emissions trading scheme developed a spine of any description, actually. It is a jellyfish. The purpose of an emissions trading scheme is to reduce emissions. Why would you introduce an emissions trading scheme if you did not want to reduce emissions? There is no point in having it. And yet, in the time that our emissions trading scheme has been in place, our emissions have gone up 19 percent. It is actually having the reverse effect that it is supposed to have because we continue to subsidise industries. We actually create an emissions trading scheme in which we pay people to pollute, and we are taking money away from those industries that are cleaner and greener. It is a busted mechanism, and it needs to be replaced forthwith.

One of the other speakers previously said that, you know, New Zealand has a unique emissions profile. Well, guess what? So does every country. Every country has a unique set of conditions that mean that its emissions profile is different from every single other country. Our emissions profile happens to be weighted towards agriculture. There are several other countries in the world that also have agriculture, and they also have to deal with the same problem that we do.

The United States is saying: “A majority of our energy comes from coal-fired power stations, so it’s incredibly hard for us, it’s so difficult for us, to get out of coal-fired energy and into cleaner forms of energy. You know, the United States is somehow unique.” It is an absurd statement to make. Every country has a unique profile. Every country needs to do what it can to reduce its emissions.

One of the other things that people say about New Zealand’s emissions profile is that we are so small that we cannot make a difference. I was very encouraged at the beginning of this reading to hear Paula Bennett, the Minister for Climate Change Issues, put the point, which people have argued in this country, that we should not really do anything because we are such a small country. I am pleased to see that the Minister acknowledges that that is an absurd assertion. Actually, over 40 percent of all global emissions come from countries that each, individually, emit less than 1 percent of global emissions. So to say that we are too small to make a difference is actually to let off all of those other countries in the world that, like us, emit less than 1 percent of global emissions, or about 1 percent of global emissions. That means that you would have 40 percent of total global emissions going nowhere—well, continuing to increase. So every single country needs to do its part, based on an allocation of what is the total global carbon budget and how we derive from there, on a per capita and development basis, what our responsibility is.

As Grant Robertson said before, we are the fifth-highest per capita emitter of greenhouse gas emissions in the world. That is a staggering statistic. What we would need to do to even get to close to our share is well north of our target of an 11 percent reduction by the year 2030, which is the Government’s target. This bill is just—I mean it barely scratches the surface in terms of getting us there.

Having said all of that, as I have said before, the Green Party will be supporting this bill. We will be introducing some amendments at the Committee stage in order to strengthen the bill, and, with any luck, increase the percentage by which this bill will help to reduce New Zealand’s greenhouse gas emissions and get us even just a tiny bit closer to the target that the Government has set for itself. I commend the bill to the House.

Here in this bill is one small step for “Kiwi-kind” but one massive trip-up for climate change targets as far as New Zealand is concerned. Here is one small step, in a complete absence of any genuine plan or strategy for New Zealand to achieve or even make any significant progress towards achieving its Paris commitments to climate change and the reduction of emissions. That is the truth of the matter there.

I recently attended a forum in Christchurch on climate change. Chatham House Rules applied, so I cannot quote anybody who was there, but I can say that there were business people there. I was encouraged by the positive attitude that they had to taking some real steps towards the reduction in emissions for climate change purposes in New Zealand. It was very good to see that, because they were enthusiastic and wanted to get things done. They had a pretty good understanding of what would be expected of them, and they actually saw it as an opportunity for many of them to get a competitive advantage over other businesses that were not taking the actions that would be required.

Other people present were from local government. They were calling out for central government leadership on these issues. In fact, local government was champing at the bit. They wanted to hear from central government what its plans were, so that local government could do its bit towards tackling climate change, through the reduction in carbon dioxide emissions in particular. All we get in response from the Government is not only no leadership but no genuine action at all, or vague commitments that actually amount to nothing much more than planning to plan for the future. All these months after the Paris commitments were given, that is as far as we have got, and now there is this minor, insignificant step forward.

I heard today from Government speakers about consultation and how wonderful it had been that 75 percent of those consulted would support this measure. But the truth is that there has actually been no consultation at all on the much more important question about what specific steps New Zealand will take to achieve its climate change commitments. There has been no talk about that, no consultation at all, and yet these people are waiting, ready and waiting, to be talked to, to make a contribution, to find out what is expected of them, and then to take those actions that are expected of them.

Business, agriculture, and local government are looking for Government leadership because they want to act. They need to know how they should act. Business people in particular need to know that there will be a level playing field that has to be achieved by a comprehensive raft of regulation. There is no other way of doing it. They want to see that in place, so that they can take the actions they want to take. They need the benefit of research, factual material, that can be put in front of them by the Government so that they can back up the actions they are taking and get confidence that they are doing the right thing.

But we are not seeing any of this from this Government. It is a complete void. There is a complete lack of consultation, a complete lack of communication, and, actually, a virtually complete lack of action, other than this pathetic little measure we are seeing in this bill. In fact, you could accurately call it nothing more than window dressing, because that is all it is. It is such a minute contribution that it will actually make little or no progress at all towards a reduction in carbon dioxide emissions in New Zealand.

I want to mention now some of the things I have read in Paula Bennett’s news release today. The first thing she says is: “The subsidy will be phased out over three years to give businesses time to plan and adjust, to support a more stable market.” She then says: “The current 50 per cent unit cost will increase to 67 per cent from 1 January, then 83 per cent from 1 January 2018, with all sectors in the ETS paying the full market price from 1 January 2019.” The third thing she says is: “The current price ceiling which caps units at $25 will remain.” And then, for some strange reason, she says: “This is a significant step in helping New Zealand meet its ambitious target of reducing emissions to 30 per cent below 2005 levels by 2030.”

We are expected to believe that these measures are a significant step when in fact they are going to take 3 years to implement. As I said, business people, including those in the agricultural sector and in local government, across the board, in New Zealand are desperate for much more significant measures than these. They are willing to play their part, but the Government is not telling them what to do. Instead, it is telling them that as far as the emissions trading scheme is concerned, it will take 3 years to get there. That is absolutely pathetic. The measure itself is pathetic enough, but to actually take 3 years to get there is even more pathetic.

Furthermore, the current price ceiling that caps units at $25 will remain. So what that means is that we are going to have to wait for a very long time before we get a genuine market for the price of units in New Zealand. Without that actually being allowed to happen—because it will take 3 years for this measure alone to be implemented, and, even then, there will be a price ceiling of $25—we are not actually going to see a genuine market in New Zealand emerge for a very long time. That time frame is totally unacceptable. It makes this measure, as I have said, nothing more than window dressing.

The people of New Zealand, especially the business people of New Zealand, the people in the agricultural sector of New Zealand, the people in local government, and the public generally all deserve much stronger leadership from that Minister and this Government than a pathetic measure like this that will take 3 years to implement, and in the absence of any genuine plan or strategy for the achievement of New Zealand’s climate change target, as committed to in Paris all those months ago. Frankly, if this is as good as this Government can deliver, then it really deserves to be voted out of office at the next election. Let us hope that happens.

That was a very tiring contribution from that member, Denis O’Rourke, who seems to have only two settings in any debate. Every bill that is put up before this House, according to that member, either is pathetic and window dressing or is the end of the world as we know it. It is just a great tragedy that he is not capable of taking a more sophisticated and nuanced approach to what I think is very balanced, reasonable, and pragmatic legislation that has been put up by this—

The ASSISTANT SPEAKER (Hon Trevor Mallard): The member will resume his seat. I think we have now reached the point of relevance and repetition. I have warned members before that reading out the same set of notes is not allowed in the House, and the member is, I think, the fourth person to do that.

I raise a point of order, Mr Speaker.

The ASSISTANT SPEAKER (Hon Trevor Mallard): You are not going to argue with me, Mr Foster-Bell, are you?

I am not going to argue with you, Mr Assistant Speaker, but I just wanted to point out, I suppose, that I was engaging in a response to points raised by the previous speaker.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Well, I was pointing out to the member—and I think he is aware—that he was repeating the words that had been used by three other people in this debate and, in fact, I think he was actually reading them as well, if he—[Interruption] Well, maybe he has got them memorised.

Thank you, Mr Assistant Speaker. I am not actually reading from my notes at all; I have them here for convenient reference.

But, in any case, this is a Government that is focused on protecting the environment—something that the previous Labour Government seemed to give very, very little interest to. We have an excellent Minister for Climate Change Issues. This measure will cost New Zealand households—low to moderate income households—around about $30 to $40 per year. If the member wants more sweeping measures that are not window dressing, in his words, what sort of cost is he wanting to impose on New Zealand households? Would $300 or $400 a year, or $3,000 or $4,000 a year—in Mr O’Rourke’s world—be sufficient to implement the sweeping and significant measures that he seems to want, as opposed to what I think are utterly timely and very appropriate measures from this Government, which has put considerable effort into retaining a position that is well-balanced?

I commend the bill to the House.

Reflecting on the comments made in the second reading, as opposed to the first reading, and starting with the remarks by the Minister for Climate Change Issues commencing the second reading, let me take the opportunity to pay tribute to the Minister. I think that her tenure in office is offering a whole new positive approach to climate policy in New Zealand, and I think that we can all be hopeful that we can build more of a national consensus, the kind with scope for respectful disagreement that exists in Europe. I am very hopeful that we can develop that as the months go by.

The Minister, from my recall, in commencing the second reading, made two fundamental points. I want to just comment and critique them. The first was—and it is there in the explanatory note—that the reason for the switch to the one-for-two measure back in 2009 was essentially in response to the global financial crisis (GFC) and a protective maternal concern for business in New Zealand, which we all share; then, again, it was essentially extenuated in 2011 because things had not quite recovered sufficiently. In response, I suggest that that was a missed opportunity on the part of the Government to seize the moment for a real, conscious, and cohesive national effort at a transformational pathway to a low-carbon economy. That was missed because the protective action of calibrating that surrender obligation, in a way that the business people made it clear they felt comfortable with, by definition meant that they were not going to change. You might have wished to have modified it a little bit, but you did need to keep it in store such that the business community would move along the transition that Grant Robertson and James Shaw and others have mentioned.

I do not hear the words much: “transformational pathway”; I do not hear the words “just transition” coming from National colleagues. I invite them, seriously, to start using those words so that we can start sharing in the framing of a future national climate policy. I would love to see a cross-party dialogue, informally, in advance of the implementation, no doubt, of the treaty examination of the Paris agreement, that allows for both a just and effective transition in the next few years.

Her second point was, as she put it, about identity. It was about identity of New Zealand and the way in which, as individuals, we Ministers and MPs and citizens identify with the land. Of course we all share that—no question about that. But I would toss it back and say that, in caring about our land, we are going to just have to recognise the magnitude and urgency of the climate crisis. If we go back to 1992 it was regarded as a major problem coming down the track, but not a crisis. Well, that was a quarter of a century ago when the framework convention established that. The principal Act of 2002 is already 14 years old. The Paris agreement reflects a qualitative change in the nature of the crisis. It is now upon us; it is a global crisis. New Zealand is not immune from it.

We have to identify—and I will be putting forward a Supplementary Order Paper that tries to link the traditional framework convention obligations that inspires, in the explanatory note, the removal of the one-for-two and links it to the 2002 principal Act, and links the 1992 framework convention to Paris, and basically modernises it. Let us do that on a cross-party basis as well.

To reiterate, my final point is that I still am not sure that our colleagues across the aisle here recognise the magnitude of the problem. The current pledges guarantee 2.7 to 3 degrees. That is teetering between dangerous and catastrophic climate change. If the best we can do tonight is take these pragmatic, principled baby steps to catastrophic climate change, then we can flag it away. But I do not think that is in the intent of the Minister or her Government or her colleagues, and so I put out the challenge to our National colleagues to work with Opposition members—Labour, Green, and New Zealand First—on a cross-party basis to develop a consensus in the future.

I want to share the sentiment that Dr Kennedy Graham has brought to this conversation. We know this measure is nothing but window dressing on behalf of the Government, and we would push them to go a little further. We are supporting the bill—

💬 Ian McKelvie: Stop reading your notes.

—because we think that—thank you for your advice. We support the bill because we support some baby steps towards a future where emissions reductions are a real part of it, and where we can shift our economy towards a low-carbon economy that has real opportunity for New Zealanders.

The regulatory impact statement, which, sadly, is about all we have got in terms of submissions because we have skipped the stages that we would normally have in the debate, tell us the direct cost is worth about 8 hours of GDP. That is pathetic as a signal. The opportunity on the other side of this is what is being lost. There is an opportunity. Grant Robertson raised the issue of re-educating those in Huntly to give them the opportunity of new skills development. That is what we would like to see on this side of the House.

We believe that there is a real upside to the climate change downside where, if New Zealand gets involved in developing new intellectual property and is on the upside of the technology, we can seize an opportunity and raise living standards for New Zealanders, instead of managing decline in a world that is facing catastrophic climate change.

Can I start where that last speaker, Dr David Clark, left off. I would like to congratulate all the parties in the House on getting behind this bill. At the end of the day we are aiming to move forward, to get a target of reducing emissions to 30 percent under the 2005 level by 2030. If there is going to be a Minister who will do that in this House, it is the Hon Paula Bennett, who is driving this agenda forward.

Picking up the themes around working in a globalised world, I think we need to think about that and the role that we play in a globalised world. New Zealand has a significant part to play. I think we take our obligations about reducing climate change very seriously. We know that the Government has done a lot of work. This is just one tool in that work, about uncoupling emissions to GDP growth. We know that since 1990 the GDP emission unit has reduced by 34 percent. So we have done some work—hey, nothing is perfect—but we are moving forward. I commend this bill to the House.

It used to be that this country of ours used to look forward to Budget day. Both business and the workforce would look forward to it in the hopes that Budget day would somehow give them hope to achieve some of their own individual goals. But today was not such a day. I think the last day that people sort of had hope on Budget day was when the words were uttered in this House of the promise made by Mr Key—

💬 Scott Simpson: A decade of deficits.

No—of a brighter future. The words were uttered about 8 years ago that New Zealanders would have a brighter future. We have fallen away from the track of that brighter future—so far away that it is just not laughable any more. I agree with some of my colleagues who have spoken that it is time for New Zealanders to start thinking about changing this Government; that things will only get better if there is a change of Government.

You know, it also used to be that on nights such as this, the Government would be producing legislation under urgency that would implement something significant in that particular Budget. But tonight we have got only two pieces of legislation. There is this one here, the Climate Change Response (Removal of Transitional Measure) Amendment Bill, and this one does not take effect until 2017. I do not know why we have not had the benefit of forwarding this piece of legislation to our select committee process—a select committee process that is admired worldwide.

Climate change is an international issue. It is a global crisis in which I do not believe that the information, the intelligence, or the knowledge that is required for us to find the right solution for us to move forward on this is found in this House, least of all in that bunch over there. And so I would have thought that this Government would take the opportunity to send this piece of legislation to a select committee after the first reading, and ensure that New Zealand, as widely as possible, had the opportunity to make submissions on it. But alas that is not the case. I do not know why we prolong this particular debate. It simply reduces—

💬 Paul Foster-Bell: Well, don’t then.

Well, we are going to try to drag this out for as long as we can to punish that group there for not taking seriously the issues that New Zealand wanted to hear them fix tonight. That is not what happened tonight.

I do want to come back and acknowledge the Minister for Climate Change Issues, because as baby a step as this is, it is an important step, and the Labour Party is supporting it. And, in fact, by acknowledging the mistake that they made in 2009, it also puts in a bad light Mr Key, the Hon Simon Bridges, and that other fulla who is no longer a member of Parliament, who went to the Paris meeting last year. They went to that meeting with all of our hopes and aspirations, and we were thinking that they were going to come back and make a real commitment—real commitment—to the Paris agreement. This is all we get—this baby step.

I want to challenge the Minister: this is your time. This is your time to take over the reins from Mr Key. This is your time to present a comprehensive plan about how we take seriously the issue of climate change. We are not immune from what is happening. She said earlier in her first reading speech that the Government introduced the temporary measure in 2009 because it did not want to see farmers hurt. Nobody wants to see farmers hurt. But she needs to take seriously that the issue here is about reducing significantly the fossil fuel emissions that we emit, and sending a signal to the rest of the world that we are serious.

The fact of the matter is this baby step suggests that she is going to do as little as possible, with regard to our commitments to the Paris agreement, because she knows that none of that matters until 2020. She knows that it is on a voluntary basis. She knows that as long as the Government kowtows to business and to the fossil fuel industry it will continue to receive the support that it has so far received, in being elected for the past 8 years. But it does not resolve the issue that if we want to be able to position New Zealand in a far better position and reclaim our brand of a clean, greener New Zealand, then we have got to come up with much more than simply this.

We have got to come up with a comprehensive plan—a plan that is going to reduce our fossil fuel emissions significantly, a plan that is going to encourage innovation and encourage investment in cleaner fuel, and a plan that is going to transition business into the kind of workforce that we need to ensure that we meet our international obligations. It is much more than just doing the right thing for the rest of the world. We have also got to do the right thing for our own country.

Twice now this House has been presented with reports by the Parliamentary Commissioner for the Environment. In those last two reports this House should take note of how seriously she points out that we are now under threat from coastal erosion, and that local governments around the coast of New Zealand are in fear of the kinds of costs that they are going to have to bear. This little action here actually increases that. It increases the threat that we have to face. It increases the threat that businesses have to face. It increases the threat that our workforce has to face. And so far, we just seem to be thinking that this is going to be all right. It is not all right. It is not all right.

The Minister might laugh when I say that it is her time. But I genuinely believe that. I genuinely believe that this is her time, provided that she is genuine about going further than what is presented tonight. We are here to pass this legislation under urgency—and I agree with Grant Robertson that it almost appears as if we are trying to fool the rest of the country by appearing to be busy, by appearing to do something, because the Budget was lacklustre and did not address any of the significant crises that this country of ours faces. So I would encourage the Minister: look, if you have taken this baby step, go further. Take a giant leap. Take a giant leap and do the right thing. Come up with a comprehensive plan, a plan where we encourage all of the great minds of this country to participate in formulating a plan that shows that we take seriously climate change, we take seriously the impact of coastal erosions on our own country, we take seriously also our obligation to stand in solidarity with the Pacific.

The Pacific countries have said time and time again in the international arena that they are the canary in the tunnel. They are forewarning us of what is coming. What is happening to them is going to happen to us, and so far we just seem to think that that is so far off. Islands are now underwater—as stated in the report that was released from Australia a couple of weeks back. Islands are underwater. More and more of those people living in the outer islands in the Pacific are moving into the main islands, putting pressure on already pressured resources. Similarly, we are going to have to decide what we do, what our role is, when those main islands come under threat. What do we do? Surely, this Government can begin to think long term and come up with a comprehensive plan that realises how important this issue is for us and for the rest of the world.

Kia ora, e Te Mana Whakawā, e mihi atu ana ki a koe. It is my pleasure to be the final speaker on this bill. I have two very important points to finish off on. The first thing is that the bill does reflect the Government’s commitment to a low-carbon economy. The other one is that this also is a piece of legislation that is very grounded and, if I dare say, very pragmatic, that shows the Government will not sacrifice our economy, it will not sacrifice our businesses, it will not sacrifice our people and economy on the altar of environmentalism. So, on that note, I would dearly commend this bill to the House. Kia ora.

Bill read a second time.

In Committee