Forests (Legal Harvest Assurance) Amendment Bill

I present a legislative statement on the Forests (Legal Harvest Assurance) Amendment Bill.

ASSISTANT SPEAKER (Hon Jenny Salesa): The legislative statement is published under the authority of the House and can be found on the parliamentary website.

I move, That the Forests (Legal Harvest Assurance) Amendment Bill be now read a first time. I nominate the Primary Production Committee to consider the bill.

Today, I stand to explain to the House why the introduction of the Forests (Legal Harvest Assurance) Amendment Bill is a priority for the Government and should be of importance to everyone with an interest in the integrity of our forest and timber industry.

The introduction of an insurance system for timber products is a tangible step New Zealand can take to support the international efforts to curb the trade in illegal timber products. At the same time, it provides importers and our domestic processors and exporters with a framework for demonstrating that due diligence has been completed on the legal harvest of timber products they are trading. This bill will be comprehensive and will cover exported and imported timber products, as well as our domestic supply. How New Zealand responds to the issue of illegally harvested timber has been debated since before I entered this House. A number of voluntary actions have been taken and I would like to recognise the efforts of importers and domestic producers in this respect. But we have reached a point where consumers and markets are expecting more in the way of formal assurances.

If we do not respond to these calls, consumer confidence could be impacted and log and timber product exporters could face increasing difficulties in maintaining market access in an increasingly competitive global environment. The sale of illegally harvested timber is a major problem in the world today. It is the harvesting of timber in contravention of the laws and regulations of the country of harvest, and there are many ways that this might happen. It is difficult to assess the extent of illegal logging; however, Interpol estimates the illegal timber industry is worth around US$152 billion a year. And the World Bank estimates that the global annual market value of losses from illegal cutting of forests at over US$10 billion. Approximately 10 percent to 30 percent of the global timber trade involves illegally harvested timber.

Illegal logging not only destroys forests and fragile ecosystems, it strips the economic livelihood of local communities and responsible companies. Timber that is logged without payment of duties and tax pushes down the market price of timber, which acts as an incentive for other loggers to follow the same practice. This further increases losses to communities and Governments and starts a vicious circle in the market.

When it comes to New Zealand, we are mainly an exporter of timber products; however, timber imports have increased by approximately 70 percent over the last decade to $2.35 billion of timber products imported in 2021. The rising volume of timber imports into New Zealand increases the risk that we become a destination for any illegally harvested timber products. This is because we do not have any mandatory timber assurance measures and we are largely dependent on the voluntary assurance measures that are in place through industry initiatives and environmental certification. This bill will create a due diligence system that will shut the door on illegally harvested timber products and will show the global community that New Zealand is committed to helping eradicate this problem. Our primary processors—importers and exporters—will need to check and validate the integrity of the information provided by the grower, or person they bought the timber from, to assess whether it has been illegally harvested. This due diligence system may be streamlined through using an approved template or by being a member of an existing forestry certification scheme such as the Forest Stewardship Council or the Programme for the Endorsement of Forest Certification. This is to alleviate the burden of the new regulatory system.

The second issue this bill will seek to address is how we maintain market access for our exporters who are trading timber into markets that are introducing timber legality requirements. Forestry is an important industry for New Zealand, it contributes around $6.7 billion to our annual gross income and employs approximately 35,000 people. Timber products are our fourth-largest export earner behind dairy, meat, and horticulture, and forestry export revenue is forecast to increase by 3 percent in 2022 and 2 percent in 2023.

More and more countries are introducing formal requirements to prove legal harvest. Several of our key forestry trading partners—including Australia, the United States, Indonesia, Republic of Korea, Japan, Vietnam, and China—have implemented or are developing their own legislation to prevent the import or export or trans-shipment of illegally harvested timber. We export nearly 85 percent of our timber products to these countries. Third-party environmental certification has, to date, been accepted by most of our trading partners as a means of demonstrating legality. However, private certification is not a viable financial option for the majority of our smaller growers, who represent approximately 30 percent of the estate and who are supplying up to 40 percent of the harvest during the 2020s, due to the age of their forests. With the building of international efforts to ensure that traded timber products are legally sourced, we also need to ensure that we have a legal harvest assurance in place. If we do not do this, we run the risk that we no longer can export to these markets.

This bill has several components. One is the due diligence system I mentioned earlier. But there are other key components, such as a definition of what is “legally harvested”, a registration system, and harvest and exporter statements. These will form a robust programme which will simultaneously strengthen the international reputation of our foreign sector and safeguard and enhance market access for our forestry exports. Guidance for our registered parties will be provided at each step of the process, and we are drawing on international experience to identify how this works in overseas jurisdictions. Forest owners will not need to be registered, but they will have an obligation to provide a statement confirming their right to access the timber.

By curbing the importation of illegally harvested timber products, it ensures that New Zealand’s forest growers are operating on a level playing field and that pricing reflects the cost of production. In developing the regulatory proposals, the Ministry for Primary Industries has worked with affected parties to ensure that the system is fit for purpose, cost-effective, and not overly burdensome for the individuals and companies operating in this space. In 2020, the Forests Act was amended to introduce a new registration system for forestry advisers and log traders, as log traders will need to also register for legal harvest, this bill aligns with the registration system currently being implemented for log traders.

The purpose of the 2020 amendment was to ensure forest owners received better advice and there was more transparency in the market. This bill complements the amendment Act by strengthening the resilience of the supply chain and the reputation of New Zealand forestry. I commend this bill to the House.

ASSISTANT SPEAKER (Ian McKelvie): The question is that the motion be agreed to.

Thank you, Mr Speaker, and it is a great privilege to stand and speak on the Forests (Legal Harvest Assurance) Amendment Bill. I thank the Minister for his pretty comprehensive summary of the purpose of the bill and what the Government is seeking to do. I can confirm that the National Party supports the bill. It’s a solid piece of legislation and does tidy up an area which, as the Minister has noted, has needed some focus. There’s been some good voluntary frameworks in place, particularly on the importer side, and this is the appropriate step forward.

I do have a few comments that I’d like to share with the House this evening. Firstly, in terms of the detail of the bill and how it is structured, I’d like to just build a little bit on what the Minister has said. The proposed bill does amend the Forests Act 1949, and it will be three new parts in that Act: Part 5 talking about legal harvest assurance, Part 6 around log trading, and Part 7 around cost recovery.

As you look through the proposed legislative changes that are listed in the bill, they all make sense, but there is an issue that jumps out to me, Minister, and I would hope that we explore this as we work through the select committee process. There has been a lift in imports of timber into this country, and, as the Minister says, a 70 percent increase now to $2.3 billion. That’s a higher number than I expect most people listening tonight would have expected. Most people, when we reflect on our forestry sector, see it through the lens of exporting to the rest of the world, as opposed to the quantum and value of the imported product. I also accept, and the National Party accepts, that we are part of a global trading environment, a multilateral global environment that has been seeking to put into practice greater assurances and compliance for all trading of wood products globally to ensure that illegal harvesting doesn’t occur. So we, of course, accept that, as part of that commitment, we are going to need to put obligations on our exporters to ensure that they meet the standards that are being taken up across the world.

Now, we have absolute confidence that our exporters do. We are known for our quality of exporting to the world, the quality of the wood both in terms of native and exotic products. So from our perspective, from an exporter perspective, it is overlaying a compliance framework that confirms what we already are doing. That is accepted, no doubt in some corners reluctantly, as the price of doing business in a global world, that people need the assurance and it needs to be buttressed, if you like, with a formal certification process. But when I look through the bill and the detail that is suggested, most of the focus is on ensuring that our exporters are very clear around what the obligations are for them to meet the certification and to formalise the compliance—little acknowledgment that they largely do this already.

It is quite an explicit framework of additional cost and effort that they will need to go to to ensure that they meet these expectations. It is relatively silent on the core issue that has brought this to the House, which is the challenge of ensuring that what you import into this country has actually come from an appropriately sourced harvest in a country that has met the standards that we apply to ourselves. That is the critical part of this bill.

Now, it is noted in here that it is part of the framework, but the detail that this bill outlines is heavily weighted to framing the compliance obligation on the exporters of wood products to the rest of the world. It is relatively silent on what the obligations are going to need to be for those importers and how they are going to assure themselves that what they are bringing into this country meets the standards that we are committing to in terms of our exporting around the world. I think that’s an area that needs further exploration in the select committee.

We all understand the importance of demonstrating that you are best practice in terms of a certification framework. That’s a given. A lot of our exporters understand that regarding a product, particularly in an agri-sector. Like I say, there will be some frustration that it is more compliance on a sector that feels particularly weighed down by additional compliance year in, year out from this Government, but if they helicopter up and look at the global trade context, I think it actually makes some sense.

But I return to that issue: when you look through this bill—and I will listen intently for those who are yet to speak—where is the fundamental change of ensuring that the importers have the confidence of their supply chain that they actually can look back through their customers to give the New Zealand public the assurance that, actually, it has been sourced sustainably and sourced appropriately? That has to be more than simply saying that the person that you bought it off in the particular country just confirms that it was sourced appropriately; it needs to match the obligations, the significant obligations, that we have put on our exporters in terms of their “harvest” definition, their confirmation that we have done everything according to this new framework. It needs to be just as explicit and just as demanding and just as transparent, or we are weighting this too much, frankly, against our exporters and not demanding enough of importers.

The other issue that I just want to quickly touch on is the exception with respect to indigenous timber. That is an exception of this framework because it is apparently already regulated under Part 3A of the Forests Act. I just want to test that, because why is it that indigenous exports and imports are exempt, but non-indigenous wood and timber isn’t? Why do we have the confidence that Part 3A provides the protections, the confidence of appropriately high-quality assurance in terms of the harvesting in a New Zealand context, but the exotics we do not? It is lacking in the exotic space that needs this new framework.

I’m not convinced from the Minister’s answer and speech here this evening that there is enough clarity as to why the exotic timber harvesting and products need this new framework but the indigenous timber and harvesting does not, and particularly in the context, again, of the import context, because when you reflect as a potential consumer of imported timber from around the world, often it is framed up in some of those places that you can buy exotic timber or indigenous timber that you’ve imported as very special qualities that have come from a particular space in the world. It was pleasing to hear that Indonesia has made a commitment to this sort of framework, but it is not just Indonesia from which we import timber that is promoted as special indigenous timber.

Again, we’ve got to ensure that we’ve got consistency, comparability between the exotic and indigenous timber trading, and that it is fair and efficient. But, overall, this is a step in the right direction. We support it with those caveats. I won’t be sitting on the Primary Production Committee—I’ve got too much on in the oceans and fisheries space—but I look forward to hearing how that committee progresses those issues. It is a committee that is known for its thorough investigation of bills such as this, and often in quite a bipartisan way. I hope they bring the best of their thinking and ensure that what we get back in the second reading is a further step forward again. Thank you.

Thank you, Mr Speaker. I’m really pleased to rise and take a call on the Forests (Legal Harvest Assurance) Amendment Bill as the chair of the select committee that will be looking after this piece of legislation. As the Minister outlined in his contribution, the economic and ecological losses from illegally harvested forests have massive impact right across the world. We heard that, for our economy, it’s worth $6.7 billion and we employ 35,000 people within the forestry sector, so it makes absolute sense that we would look to bring this piece of legislation in.

I just want to acknowledge the contribution that the previous speaker Todd Muller made, and I do look forward to the committee being able to further investigate and address some of the issues that he raised. He is right in the fact that the Primary Production Committee works in a pretty bipartisan way to get the best outcomes for legislation that comes before us.

We heard from the Minister that this piece of legislation is about protecting the integrity of our export forestry, and I think that’s really important for New Zealand. The purpose of the bill, though, is to ensure that timber that is grown in New Zealand and imported into New Zealand is legally harvested. The definition of “legally harvested” is going to be a key concept under this bill. It’s about ensuring that the person who harvests it has the right to harvest it, has the necessary legal authority to exercise that right, and does not contravene the harvest laws of the place or country of harvest when carrying out the harvest, and the member previously talked about the rules and obligations for harvest in other countries. So that’s a really interesting point that the member did make, and one that I’m sure that the select committee will look to delve into a bit further.

Again, I’m looking forward to having this bill before our select committee, looking forward to hearing submissions on it and shepherding it through the House. So I commend this bill to the House.

Thank you, Mr Speaker—good choice, sir, if unexpected for a few people. I have great pleasure in speaking to the Forests (Legal Harvest Assurance) Amendment Bill. As the MP for Kaipara ki Mahurangi, I should take an active interest in such matters: there are a large number of forests covering a considerable area of that, the most wonderful electorate in New Zealand—indeed, the world.

Obviously, at the first reading, we are interested in sort of general principles. We’re also interested in the basic mechanisms of how it works. The relevant select committee, obviously, will have a really close look—I don’t have the pleasure of being on that select committee, but colleagues here, no doubt, will have great pleasure and apply considerable diligence to that task, and I wish them well in it.

But, at a reasonably sort of high level, it does seem to me that a number of different themes are palpable, if I may. One is an environmental category, and I refer to my colleague and friend Todd Muller’s contribution, which emphasised that along with the commercial imperatives that are important not only for those in New Zealand who are engaged in the trade but also those overseas.

And, of course, it’s the trade, in that import-export sense, that is so important for the balance. Again, I refer to Mr Muller’s contribution and talk about the importance of those being aligned, such that we don’t have a mismatch that ends up with an unfairness from the perspective of those in this green and pleasant land to engage in the activity, but also in terms of a fair trading environment, a level playing field—if that’s not, you know, mixing my metaphors in terms of forests. Obviously, that’s really important so that we don’t end up with distortions such that we unwittingly incentivise practises that are less efficient, less environmentally friendly, and certainly those that are not legal.

So, in that sense, I would argue that there’s a third main rationale alongside the environmental and the commercial, which I might refer to as architectural. Not in the sense that the timber itself is used for building of physical dwellings and other buildings—of course it may be—but architectural in the sense of the rules-based order being held up by these principles that we’re discussing tonight.

The objectives of the bill, obviously, are very worthy, as expressed within the legislative statement. I’ve had the benefit of reading that, as well as hearing an oral presentation of, essentially, the same material by Minister Nash, and it seems that combating the global trade in illegally harvested timber is actually a very real issue, a live issue. Another friend and colleague of mine knows a lot about this, actually, Mr Speaker—and I can’t bring you into the debate, so I would just say that that member is not a million miles away from the Speaker’s Chair as we speak. I’m hoping that he will smile kindly upon my contribution.

💬 Nicola Grigg: For Rangitīkei.

That’s right. As my other colleague and friend Nicola Grigg points out, that person may also be the member for Rangitīkei.

The bill looks to strengthen the international reputation of our forestry sector, and it looks to reduce the risk of importing timber into New Zealand that’s not legally harvested. So it’s really a combination of those two things, I think, that enables us to say that we will reduce international trade in timber that is not legally harvested. The outgoing and incoming both, obviously, need to be kosher, and that’s to the benefit of, you know, everyone engaged in the trade and, obviously, ultimately, the consumers of the products, which is everyone who has something to do with timber, I suppose, ultimately. And here we are, surrounded by the stuff, and what beautiful carved timber it is too, in this House.

I was actually quite struck by reading in the legislative statement the extent to which we import timber, as well as the export. Again, Mr Muller referred to that. So the balance of trade calculation is interesting. As an export earner, some $6.3 billion worth in the year ending June of last year, and in the equivalent period, $2.35 billion going the other way. So we do win overall on that equation, but it’s not insignificant that we have timber from other nations coming in. And so, of course, we want to assure ourselves as to the legal provenance of that. Of course, New Zealand has a reputation already as a high-quality exporter of timber products. We do trade on our reputation, quite literally, in the sense that we want those international markets not only to consider us “100% Pure”, as the marketing campaign goes, in an environmental sense, but also in assuring the purity of our products, in the sense that it is legally pure, almost morally pure, if we’re talking about, again, the environmental aims that go alongside the commercial imperatives to protect the trade.

It’s interesting, the way that the bill seeks to achieve these things. It’s got a number of different mechanisms within it. One is that it actually requires certain compliance activities by those who are engaged in timber exporting, for example, and your administrative measures to help exporters furnish proof of legality. And that might sound like a burden on them—and, no doubt, to some extent it is—but the burden is designed, ultimately, to provide a benefit, which is to provide the assurance to the end-user or the purchaser or the export market of the bona fides of the timber. And so, to that extent, it’s actually for the benefit of the New Zealand market and, indeed, the New Zealand provider—the harvester of the timber, if you will—to comply with those.

We have mandatory registration, therefore, for those who are engaged to a certain level, and we’ve heard about specified thresholds. I don’t know what those thresholds are, whether they’re appropriate, but, no doubt, again, that’s the select committee’s work to determine whether those are set at an appropriate level. No doubt, submitters who are actively engaged and knowledgeable in the sector will have a clear view on that. No doubt, the select committee will hear and act as appropriate if amendments should be required.

Also interesting, a voluntary registration scheme for those engaging in activities on a smaller scale. Why would someone voluntarily register? Why would they go through that burdensome process? Well, I think, again, the answer is that, actually, it might ultimately be for their benefit. And so the purpose of the bill—which, as Mr Muller has explained, we do support—is, of course, to enhance that reputation for “New Zealand Inc.” as a whole, and, indeed, those involved actively in the industry. The way it’s achieved, a legal harvest statement and declaration—and, of course, if that’s to be relied upon, then those who are making the statements and engaged in the industry must have some sort of credibility and weight behind them, and so it is that there is a fit and proper person test. Lawyers have a fit and proper person test, and if a lawyer can be a fit and proper person, I suppose a forestry harvester certainly can be. I feel like I can say that—and my colleague and friend Harete Hipango seems to enjoy that. She’s a very fit and proper person herself, in every sense of that phrase, no doubt. And so there’s a due diligence system to maintain the standards and to minimise the risk that illegally harvested forests will be trafficked, so to speak—or that they’ll be illegally harvested in the first place, I suppose, more helpfully.

And a bit of a mix of private and public, where there’s a certification scheme within the due diligence system, actually, that appears to be in the manner of self-regulation, but which is recognised, none the less, in the certification. So I would say, and I think those on this side of the House would say, if there’s an opportunity for the State not to duplicate processes that are designed well, are followed in good faith, and have credibility in themselves, there’s no need for that to be replicated. So I do give some credit to the Government for acknowledging that a private certification scheme can be part of that architecture as a whole in protecting the industry.

There’s a principles-based cost recovery framework, we hear, and to members of the Regulations Review Committee—and I just pause in case there are any in the House, because, inevitably, there will be a roar of approval. There is none.

💬 Hon Members: Hooray!

There’s a roar of some kind. I don’t know that it’s—

💬 Hon Member: Timber.

The roar is timber, appropriately. That’s right. That’s right. [Interruption] Maybe Tāne Mahuta as the Reserve Bank Governor’s about to fall. I don’t know, that wouldn’t be within the context of the bill, so I wouldn’t suggest such a thing.

Anyway, so there’ll be a set of principles that are founding or underlying a cost recovery framework, so it’ll be important that the regulations setting those up take due regard to the way that the system needs to be able to carry itself, from a financial sustainability point of view—again, mirroring the environmental sustainability imperatives that underlie this work as well. There’ll be the ability for regulated parties to seek a review of the decision—again, that’s something that we will look at very seriously at that other select committee, and want to understand that there are fair processes involved for all those concerned.

I seem to have run out of time, to the great disappointment of all, except mine. So I shall leave it there, but say—

Order! The member’s time is up.

Kia ora, Madam Speaker; thank you. It is a pleasure to take a call on this bill, the Forests (Legal Harvest Assurance) Amendment Bill. I just want to take a moment to acknowledge the broader context within which this bill sits—that is, helping us to secure our future. Te Uru Rākau, the New Zealand Forest Service, is in the process of developing a forestry and wood-processing industry transformation plan. This bill will support the aims of this plan. It’s a fantastic process. Collaboration is always messy and time-consuming but they’re getting there, and there’s some really exciting stuff coming out as a result of the collaboration.

One of the aims that this bill will contribute to is that forestry will be able to contribute more to the New Zealand economy by ensuring access to markets—specifically the growing number of markets that are requiring us to demonstrate the legality of our timber products. As we’ve already heard tonight, this is a significant and growing industry—a 70 percent increase in the last decade alone—and so it’s really, really important that we protect and futureproof our export markets. Another aim of the industry transformation plan is that we unlock the sector’s potential to support our climate change goals. Our historic emissions reduction plan talks about how we can better prepare for a low-emissions future and protect our economic security, and forestry covers so many bases when it comes to meeting those obligations. We’ve heard about illegal harvesting globally, and the contribution it makes to deforestation, degradation of ecosystems, and the damaging economic and social impacts.

This is an important piece of legislation, and we really look forward to it coming to select committee. It’s great to hear the support from across the House, which means we’ll be able to put all of our energy into making this a great piece of legislation. I recommend this to the House.

Tēnā koe, Madam Speaker. Thank you. I’m pleased to take a call on the Forests (Legal Harvest Assurance) Amendment Bill. The Green Party is supporting this bill, which will amend the Forests Act 1949 to create a legal framework for ensuring that wood imported into, and exported from, Aotearoa is harvested legally. We’re supporting it because it is an improvement to the status quo, but it is a lost opportunity. The Green Party wants a much-stronger purpose, stricter liability provisions, and changes to the bill to widen its scope and to ensure that it is effective in outlawing illegal logging rather than providing a fig leaf to cover it.

This bill needs to be about much more than safeguarding market access for New Zealand logs and timber. It needs to prevent the curse of deforestation in temperate and tropical rainforests. It needs to be strengthened if it’s going to have any significant impact in outlawing illegal logging and ending the human rights abuses that logging has on customary forest owners and on indigenous peoples. And the Green Party will be looking for changes in the Primary Production Committee to ensure that the bill has a robust regime in terms of what constitutes legal and illegal harvest. And we want to see its scope expanded beyond timber products to include all forest products, including palm oil and palm kernel expeller (PKE), because, as the Minister noted, the scale of illegal logging is enormous and it’s having huge impacts not only on plants and wildlife and the integrity of the forest but on the indigenous communities that depend on those forests for their cultural and social identity and wellbeing, and it’s having huge impacts on the climate because deforestation and the change in land use to farming involves enormous loss of carbon. Illegal logging is violence against people, against nature, and against the climate.

And the Minister recognised the efforts of importers and timber producers, but the people we really have to thank and acknowledge for the fact that Parliament is even considering this legislation are courageous activists from Brazil to Indonesia and environmental organisations such as Greenpeace. It is their strength, their determination, and not that of Governments and Government agencies, which have exposed the seriousness, the extent, and the impacts of illegal logging and what this heinous trade in illegal timber is doing to nature, the climate, and the ability of the planet to support the amazing web of life which is found in unlogged tropical and temperate rainforests. And can I pay tribute and extend the condolences of the Green Party to the family, friends, and colleagues of the Guardian journalist Dom Phillips and Brazilian activist Bruno Pereira. They’ve been missing in the Amazonian rainforest since 5 June and are widely thought to have been murdered while they were looking at the impacts of cocaine trafficking and illegal poaching on the Amazonian rainforest and on the indigenous people who live there.

This Parliament has a duty to strengthen and expand the scope and effectiveness of the bill. So it certainly puts in place a framework and puts the onus on proving legality on importers, exporters, log traders, and primary processors, who will be required to establish due-diligence systems. It allows for the recognition of private certification systems, such as the one organised by the Forests Stewardship Council. It defines timber as “FMPI legally harvested” if the harvester has the right to harvest the wood, has the necessary legal authority to exercise that right, and doesn’t contravene the harvest laws of the place or country of harvest. But this definition is too weak because, in terms of the applicable legislation in the country of harvest, if you have loose legislation, official documents won’t often provide adequate proof that it’s being logged legally without threat, intimidation, violence, or abuse of the rights of indigenous people. There needs to be a look behind that country-of-origin documentation. There needs to be additional investment into site visits, third-party auditing, verifying species and the origin of timber through DNA and isotope testing.

And the Ministry for Primary Industries (MPI) needs to work with organisations, like Greenpeace, which have investigated supply chains and gone behind those official documents, because Greenpeace, in its studies on the Brazilian logging, has shown that huge indiscriminate and illegal logging is occurring there. Loggers are after trees like the ipe tree, which, when it’s processed into flooring and decking, can fetch up to US$2,500 a cubic metre. And all of the satellite imagery that Greenpeace and others have shown there is that logging is spreading right into the core of the Amazonian rainforest. And when the logging penetrates, illegal roads go in further, and more logging happens. So we’re seeing a huge destruction of biodiversity and an intensification of violence—people terrorised, intimidated, and murdered. And we’ve had decades of violence because the Brazilian Government has been able to get away with not doing the enforcement and prosecution that’s required. There’s a weak licensing process in Brazil for forest management plans, there are no field inspections, there are poor estimates of timber volumes in forests, and there are changes to the accounting in terms of sawmills and tree species not being properly identified.

So MPI needs to work with the environmental organisations that have got the data on this. And this bill needs to apply not just to timber products but to any forest products that are associated with illegal logging, because in a report that Greenpeace did last year—it was a very detailed report called Deceased estate: illegal palm oil wiping out Indonesia’s national forest—Greenpeace has described the illegal palm oil plantations and their expansion into the rainforests in Indonesia’s forest estate as, I quote, “the largest single cause of destruction of critical Indonesian rainforests over the last two decades.” And who benefits from that encroachment? Not the forest, not the customary indigenous owners, but industrial agriculture in Aotearoa New Zealand and the New Zealand dairy industry. One of four palm oil producers with more than 50,000 hectares in the Indonesian national forest estate is Wilmar International, and it’s a major importer of palm kernel expeller into New Zealand as a supplementary feed for the dairy industry. And, of course, Aotearoa is the world’s largest importer of PKE, so we are directly involved in the destruction of rainforests. This bill will do nothing—nothing—to stop that. It will do nothing to stop the forest destruction caused by the illegal expansion of palm oil plantations. So that’s where the bill needs to change, and if it changes there, then it would do something about protecting the 2,000 indigenous communities in the Indonesian rainforest. It would help protect the habitat of orang-utan, of elephants, and of the Sumatran tiger, and it would help reduce the climate pollution and the carbon loss from the land-use change involved in deforestation.

MPI also needs a major change in culture if the system is to be robust. We have seen what happened with the swamp kauri debacle in Aotearoa where it took the Northland Environmental Protection Society—taking MPI all the way to the Supreme Court—to establish that the export of sawn planks did not qualify as finished products or tabletops as the swamp kauri miners were claiming. And that was NGOs again. So there needs to be, behind this bill, a complete change in MPI’s culture so that the legislation, when it’s passed, is actually properly enforced, because we need to stop this illegal logging. The life of the forests depends on it. The lives and wellbeing of indigenous communities who depend on those forests also depend on it. The bill needs to be significantly strengthened. Kia ora.

Thank you, Madam Speaker. It’s a pleasure that the Minister has brought this piece of legislation, the Forests (Legal Harvest Assurance) Amendment Bill, to the House. I think it’s a good piece of legislation, quite candidly, and although I just want to touch on my Green colleague’s previous assertions about confusing palm oil and the palm kernel industry as a—I mean, palm kernel is a by-product of palm oil production and if she really believed in that, she wouldn’t eat anything with palm oil in it. It’s in one in five foods in New Zealand, so I can’t see the nonsensical argument there—but anyway.

None the less, let’s get to the bill. I think this bill creates a new regulatory framework for the illegal harvest assurance of illegal timber products. I can speak to this personally. I travelled to Brazil five times over a decade ago and it was a profound problem. I was in the cities of Rio, Sao Paulo, and a city called Belo Horizonte, and it’s a real problem over there. So, I think, as the member Todd Muller pointed out, the real crux of this legislation, which potentially really needs honing in on, and I think the Primary Production Committee will do that, is about the import of timber products.

Timber products produced here, as we’ve well canvassed, are worth $6.3 billion. I mean, it’s a wonderful industry in New Zealand, the fourth-largest exporter. I would maintain, hand on heart, it’s probably an integral part of New Zealand—I think everyone would agree with that—and it’s probably not permeated with a lot of illegal timber product. However, the import industry is where the concern really lies, and I think we contextualised the problem here. This is $152 billion—I think the Minister quoted before. These are figures out of Interpol, this global trade of illegal timber products. The Green member the Hon Eugenie Sage pointed out the effects to the indigenous people all around the world, and she’s absolutely right in that regard. As I say, again, I was in Brazil and this is a profound problem in that part of the world, and it’s damnably hard for us as importers to have a fair and honest understanding of the certification process and what it means when we are importing these products.

The illegal trade counts for about 30 percent of the global trade of timber products. It contributes 50 percent of the tropical deforestation. Now, that’s a monumental geographical area, and, suffice to say, it displaces all manner of indigenous people and natural wildlife. Damage to local forests and communities—and I think we’ve well canvassed this tonight—is significant for producer countries, diluting their legitimate timber market and by virtue exacerbating the problem of what is illegal and what is not. Habitat lost—that’s been well canvassed in the House, and I think we all agree this trade accentuates and threatens the ecosystem, endangering further ecological damage to various species, which are on the brink of potential extinction etc., in many parts of the world.

We need to be in line with our trading partners. We need a clearer certification process for New Zealand to have assurances in our export trade of timber, and, by virtue, equally, have a clear line of clarity when we are importing timber products, whether they are furniture or whether it’s framed timber etc., or decking, which seems to be routinely a concern. Better codes of practice in the retail sector—and I think if New Zealander retailers here and members of the New Zealand Imported Timber Trade Group are involved in this, it can only further add assurance. Consumer confidence—we trade on our reputation which has been well canvassed tonight. Clarity around not only our exports but, most importantly, as the member Mr Muller highlighted before, around imports. We absolutely need certainty.

This is a great piece of legislation. ACT will fully support it in this first reading. I look forward to further canvassing this in the select committee process with my colleagues on the other side of the House, and over this side, and, hopefully, we can iron out any kinks along the way and really make this a wonderful piece of legislation going forward. Thank you very much, Madam Speaker.

Thank you, Madam Speaker. We’ve heard tonight that the scale of illegal logging across the world is enormous. As a member of the Primary Production Committee, I’m looking forward to hearing more through the submissions process around the import of illegal logging materials into New Zealand and the scale of that and how we measure it.

I’d just like to acknowledge the Green Party member Eugenie Sage for the passion that she spoke with tonight. And listening to the significant issues that she has raised, I think it’s imperative for us as a select committee to listen to those issues that have been brought up. I recommend this bill to the House. Thank you, Madam Speaker.

Madam Speaker, I just popped a Fruit Burst in my mouth and Anna Lorck was very quick to finish. Excuse me—excuse me.

I rise just to take a very quick call—now that I’ve finished my Fruit Burst—on the Forests (Legal Harvest Assurance) Amendment Bill. As has been acknowledged before me, the National Party will be supporting this bill to select committee, and I sit on the Primary Production Committee so I, too, like my colleagues Anna Lorck and Mark Cameron, will be looking forward to hearing the submissions on this.

I was very surprised to read in the notes that for the past 20 years or so, this has been a largely unregulated sector of the forestry industry, and I think it speaks volumes for those who own and operate businesses in New Zealand that thus far these seem to have been self-moderating, to a degree. We do like the idea that within this bill, it will seek to address illegal forestry and illegal harvest practices by ensuring that wood harvested would have to be verified as legally harvested. And indeed, I think that’s one of the first more important steps, to define what is “legally harvested”, which is also a caveat in the bill. More importantly, I think, is to ensure that imported timber is not illegally sourced. Already a number of speakers have mentioned—I think the most obvious example to most people in the general public is the state of rainforests in the Amazon basin and the detrimental impact that has been had on (a) the forests, (b) the ecology, and (c), probably most importantly, the peoples that live in and live off those forests.

This bill will also help, I think, to reinforce the integrity of the New Zealand timber export industry, and that is an incredibly important mechanism to put in place, as we know. We’ve seen, I think—thrown into stark relief in the last couple of years—that this country really, really does rely on our export industries, particularly the primary industries. We know in a world of digital and data capability that traceability is easy, but also incredibly important. And this is the kind of traceability mechanism that will help to ensure the robustness of this system.

We do support legislation aimed particularly at preventing illegal harvesting, and most New Zealanders will think with some horror of the examples that we’ve seen over the years of the illegal harvest, particularly of swamp kauri, and the export of those largely untreated logs offshore to never return to New Zealand shores again.

Like my colleague Todd Muller made reference to, we do think that this bill is largely silent on the obligations on importers, and we do hold out some concern that more and more regulation layered on to the exporters will prove to be overly onerous and burdensome. And I know that those of us on our side of the House, when we do consider this bill at the select committee, will be at pains to ensure that that does not actually occur. As I mentioned earlier, we are acutely aware of the importance that the export industry plays to the New Zealand economy, and I think the last thing that any export industry needs is more and more paperwork that is actually going to prevent them getting product to market and, indeed, doing business. It is already a heavily regulated industry and it does, to be fair, have a difficult health and safety track record, and we just need to ensure that more paperwork isn’t actually going to prevent businesses being viable and being able to operate.

When I looked at various clauses within the bill, particularly Part 5—being responsible for the legal harvest assurance and establishing that regulatory system for legal harvest—I was particularly interested to read that it would require a person “who is responsible for harvesting regulated timber to (i) provide … legal harvest information about … timber … (ii) keep the legal harvest information up to date; and (iii) keep records of any legal harvest information they have provided”. Again, when we do come to consider this bill, I certainly will be asking the Ministry for Primary Industries, in particular, what kinds of programmes, what kinds of systems, what kinds of technologies are in existence or are already in place or are commercially available to this sector to be able to incorporate this new system of regulatory requirements. So we do look forward to considering this bill, and may I also join my colleagues in commending it to the House.

Thank you, Madam Speaker. It’s a pleasure to take a brief call in support of the Forests (Legal Harvest Assurance) Amendment Bill in the name of the Minister of Forestry, the Hon Stuart Nash. Can I thank him for bringing the bill to the House, because we all know that forestry is absolutely important to our primary sector and the success of that sector, but so too is the reputation around timber harvesting, here domestically but also the products that are imported into this country as well. So that sense of global confidence in the systems that we have here and those elsewhere around the world leads to that integrity within the forestry supply chain, which obviously is an advantage.

I know that members of the select committee—we’ve heard from many of them this evening—obviously are really looking forward to engaging with a number of submitters as part of this process, and I certainly wish them well for that. I commend this bill to the House.

Thank you, Madam Speaker. The previous speaker was right: in terms of this bill, global consumers really want those assurances about our high-quality primary products. I live in Rotorua. We’re on the doorstep of the Kaingaroa Forest. We need to have absolute certainty that our forest products that we have in New Zealand, but also things that we’re domestically importing from overseas, are harvested in the right way. The illegal harvesting of wood is a significant problem globally, as previous speakers have gone and said. They contribute to deforestation, the degradation of ecosystems, and damaging economic and social impacts. In New Zealand, we have to be committed to trade only in legally harvested timber, and this bill looks to do that today. So I commend this bill to the House.

Thank you very much, Madam Speaker. It’s an absolute pleasure to be rising on behalf of the National Party, as the member of Parliament for North Shore, to be talking on the Forests (Legal Harvest Assurance) Amendment Bill’s first reading.

When I was reflecting long and hard about what I would say this evening in regards to this bill, I thought back to my younger days, when the way in which I funded my university study was through pruning pine trees on a number of forestry plantations in the mighty Waikato. So I have some connection to this important topic. Those were long and challenging days, but I did my small part to contribute to what is a significant and very important sector, and I hope those trees are still growing as strong and hard as they were many years ago.

Anyway, in regards to this bill, National will be supporting this bill. That’s important because of the fact that in our current environment we have a regime which is primarily voluntary. We have, within a domestic sense, aspects and considerations but the reality is, as many speakers, including the MP for Selwyn, Nicola Grigg, in terms of her comment and contribution—quite comprehensive, obviously—said before, there are some gaps that exist in regards to the importation aspect around timber product. That element, in terms of risk, absolutely has impacts in regards to not only environmental consequences but also commercial consequences, and also the element of an unfair playing field as well, in regards to when those products come into this country. So anything that we can do, in regards to alignment, around making sure that we’ve got robustness in terms of the regulatory environment that deals with the outcome, which primarily is to ensure that forestry products that do come into this country are not from or sourced through illegal means, will bring significant benefit in terms of the overall system—I think, as I said, providing that even playing field to our domestic providers as well.

I was interested to hear also—it might have been Mark Cameron, actually, in terms of his contribution—the scale of the sector. I think he’s right: $6 billion or so in terms of the forestry sector, the fourth-largest sector, as I understand. Yeah, the thumb’s up from down that end, from Mark Cameron. He’s right. It’s a great sector. It employs a lot of hard-working Kiwis. And so the significance of the fact that the domestic portion is $6 billion, but that international element, in terms of what’s imported, is about a third of that, just over $2.75 billion and growing—and I think, in the region of what the bill says, it’s gone up 70 percent in the last decade. The importance of having a robustness in terms of our regulatory framework in play, to make sure that what’s flowing in is coming from appropriate sources, is really, really important. So that is probably one of the key elements around why National are supporting this bill.

The other aspect I wanted to talk about is that with the impacts of COVID, and it’s referred to in the bill there, that volatility within the international market space—and we’re seeing this across the board at the moment, but, in particular, the volatility in regards to the trade environment, supply chain, and costs in terms of supply chain as well—means that people are going to be looking for opportunities in terms of the importation of forestry products to be able to cut corners. And so in order to achieve that degree of margin and profitability, if there’s going to be an easier way to do things, then they’re going to be trying to find those opportunities. And so that opens us up more—so around the element around illegally harvested timber and the importance that we have, as I said, a regulatory environment that deals with mitigating the risk around that. And the contrast again is that New Zealand is seen as reasonably low risk in terms of our overall processes, our risk profile is the stuff that’s coming in, and, as I said, quite exponentially growing as well, in terms of the trajectory as well.

I think one of the benefits that we can look to see in terms of this overall legislation—I, sadly, don’t sit on the Primary Production Committee. I know there’s pretty big competition within our caucus to get on to that team. And we’ve got a number of very astute members that will be sitting there going through this bill, no doubt, in significant detail, and asking those good and proper questions as any select committee should. But the process around ensuring that we’ve got the balance right in terms of this legislation, and the fact that, actually, is it going to achieve the outcomes that we need it to achieve, in regards to mitigation of the risks around that illegally harvested timber and getting that balance between regulatory burden that that places on domestic providers—getting that balance between the two is going to be very important. I can imagine the select committee process that will follow this will go into that. And so I’m looking forward to having a little bit of a read through the select committee’s findings in regards to this bill, because I’m sure there’s going to be a lot more that will come out of that process.

I think the element that was mentioned before, just referring to what clause it was, but there was an element around establishing the due diligence in the systems and the processes. And people at home watching this, at this hour of the night, and I’m sure there’ll be a lot of people sitting back—

💬 Hon Michael Woodhouse: Oh, in their tens of thousands!

—particularly in the mighty Waikato, no doubt, the Hon Michael Woodhouse and maybe a few down in Dunedin, I’m sure!—they’ll be thinking “Well, crikey, what are the processes and systems that they’re going to put in play here?” and it’s going to be “Geez, this sounds complex.” I think that’s a reality, which is going to be: how are you going to get that balance in terms of that register, as it says, that due diligence process, trying to be able to record the source of where these timber products have come from, be able to see that audit and flow through from source to once they actually land in New Zealand. And I guess the substantiation process around actually being able to evidence and substantiate the documentation around timber products that are being imported into New Zealand actually is legitimate, because that’s a big issue.

I mean, some of these countries that these products are going to come from—not everyone’s operating under the same rules, right? And so the risk around, you know, that not being robust enough or getting that right balance is going to be an important aspect. It doesn’t matter if you’ve got a good law, if you haven’t got the processes and procedures and the systems in place in order to make sure that, actually, all those legal elements are actually implemented and we achieve the right outcomes, then we’re not going to get maximum value in regards to this legislation.

The other element I think it’ll be interesting to hear and see how the select committee deal with is around the scope of this legislation. So where do you draw the line in terms of requirements? And I think, again, my colleague Nicola Grigg talked about some of the domestic elements around timber production in the New Zealand context and where do you draw the line around the different types of trees. I won’t get into a full detailed conversation around that, but you can imagine there’s a wide range of different types of trees. The scope of that bill will need to consider around that aspect as well, and that will be important.

Just in my closing comments—I’ve got quite a lot more to say, but I’m running out of time, so that’s a shame. But anyway, I’m sure there’ll be other opportunities. The commencement of this bill was something that I was actually taking a look at, and it’s interesting—

💬 Nicola Grigg: Ha, ha!

I’m getting a lot of support here! But the point that it makes here is it says that the bill will come into force around the earlier of three years after Royal assent or the date—there is a three-year lead-in process in regards to this. And I guess that’s the challenge around, again, thinking about it, three years being a long time. The points made during the Green Party speech before around the impact—you know, this is illegal harvesting happening and is that period of time too long or too short? Probably more the former in regards to how practically we can get this legislation into play. I guess the challenge for the select committee process will be actually: where can we get that point at which we can get maximum value and outcomes from this legislation without having to wait three years in order to achieve it? But we’ll see what the select committee come up with in that regard.

I think that pretty much sums up what I wanted to cover in terms of this first reading. It’s obviously a broad overview in terms of this bill, but, as I said, National supports, in principle, the elements around this bill. We’re really looking forward to contributing and hearing the submissions as part of the select committee process which, no doubt, will be very solid and robust, and National supports this bill.

Mālō ‘aupito, Madam Speaker. As always, it’s a privilege and an honour to take a call in this Fale of change.

It’s been some time since I’ve been able to take a call in the Chamber. Some of that was due to illness, but some of that was also due to the weather events that have been happening throughout Aotearoa but also hitting the Ōtaki electorate quite bad—not just in terms of the flooding but also we had hurricanes, something that we have very rarely seen in the Ōtaki electorate. This is evidence that Papatūānuku and Ranginui are not happy. This is evidence that climate change issues are real. This bill supports the need to make sure that we get our actions in terms of climate change right by stopping illegal logging.

As has been said already by many throughout the House, this bill also ensures that timber that is being imported to Aotearoa, as well as the home-grown timber here in Aotearoa, is legally harvested. This we know will uphold the mana—or the reputation—of our forestry industry here in Aotearoa. For that reason, I commend this bill to the House.

Motion agreed to.

Bill read a first time.

The question is, That the Forests (Legal Harvest Assurance) Amendment Bill be considered by the Primary Production Committee.

Motion agreed to.

Bill referred to the Primary Production Committee.