Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill

on behalf of the Minister of Climate Change: I present a legislative statement on the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill.

ASSISTANT SPEAKER (Teanau Tuiono): That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon ANDREW BAYLY: I move, That the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill be now read a third time.

The bill amends the Climate Change Response Act 2002 to remove significant agricultural activities from the New Zealand emissions trading scheme (ETS), which is a crucial step in our plan to introduce a fit for purpose agricultural emissions pricing system by 2030 without sending jobs and production overseas. The bill signals the repeal and replacement of policy related to the pricing of agricultural emissions. It will repeal the existing requirement of the agriculture sector to join the New Zealand ETS to pave the way for us to replace it with a fair and sustainable pricing system outside of the NZ ETS by 2030 that will not send production or jobs offshore.

The status quo is not fit for purpose. The current legislation requires agricultural processors to pay for fertiliser and livestock emissions from 1 January 2025—not that far away—and for farm-level reporting to commence in 2026, following, by payment for those emissions, in 2027. This would result in additional administrative implementation and compliance costs to our domestic agricultural sector. It would have a negative impact on both farm production and farm revenue, with disproportionate adverse impacts on small farmers.

Processor-level pricing in the New Zealand ETS is likely to be passed down to farmers regardless of the emission-efficiency rates. Farm-level pricing in the New Zealand ETS significantly increases the number of participants in the scheme. We estimate that this could be around 100,000 animal farmers, which is likely to disrupt the operation of the scheme. We need a pricing system that will support our farmers to reduce their emissions. The food and fibre sector is the backbone of New Zealand’s economy. The sector is our top export earner, contributing to 10.5 percent of GDP, 13 percent of employment, and close to 82 percent of all goods exported. Food and fibre export revenue is expected to reach $54.6 billion this year and will hit a record $66.6 billion in 2028.

We know that our farmers are world leaders in producing carbon-efficient products. We also know that climate change policies that reduce our agricultural production will not benefit global emissions if this gap is filled by other countries that are less emissions-efficient than our New Zealand farmers. We know we need to reduce agricultural emissions, and we have committed to meeting our net-zero target for 2050. Globally, we are seeing trends and consumer expectations change, and for those customers that want low-emissions products, it’s imperative we deliver.

We need to work with the agriculture sector, and not against it, in reducing our agricultural emissions. That is why we will have a dual focus on ensuring that New Zealand’s agricultural sector is able to meet our climate change goals and is also supported to continue to be among the world’s leaders in producing carbon-efficient agricultural products. We will do this by making sure that the settings are right, working closely with the sector, and find solutions to reduce agricultural emissions, and backing and trusting our farmers to be world leaders in producing carbon-efficient agricultural products.

The coalition Government has a climate strategy. In July this year, the coalition Government launched its climate strategy, a comprehensive and ambitious plan aimed at reducing impacts of climate change and preparing for its future impacts. The climate strategy is built on five core pillars, the fourth pillar being: having world-leading climate innovation that boosts the economy. The fourth pillar means that this coalition Government is taking the tools and technology approach to this issue.

The coalition Government is placing real priority on developing tools and technologies that work for New Zealand pasture-based systems. You will see more on this in the emissions reduction plan two. Technology will play a big part in ensuring that our farmers continue to be most carbon-efficient producers of high-quality food and fibre, and we believe it is critical that mitigations are available ahead of pricing. We do not want to drive production offshore or to undermine productivity. This is why the Government, in partnership with industry, has committed $400 million over the next four years to accelerate the commercialisation of tools and technology to reduce on-farm emissions and to get these tools into farmers’ hands faster.

Our plan also includes establishing fit for purpose regulatory pathways for mitigation technologies and developing measurement of on-farm emissions for use by 2025. Development of standardised farm-level methodology will be key to understanding differences at the farm level. It will provide a consistent foundation to inform farmers’ decisions to invest in emissions-reducing technologies and approaches, and will support consistency and confidence in emissions reporting.

These initiatives will play a big part in ensuring that our farmers continue to be the most carbon-efficient producers of high-quality food and fibre. Delaying the start of the pricing system also provides time for the independent review of the biogenic methane science in New Zealand’s 2050 target. This Government is committed to supporting the farmers to sustainably reduce agricultural emissions, and we will ensure that the agricultural sector’s contribution to the 2050 targets is fair and appropriate compared to other parts of the economy.

There has been some reference in this House that this bill will impact on our ability to understand New Zealand’s agricultural greenhouse gas emissions. This is not the case. The removal of process and reporting obligations—which aren’t sophisticated enough to discern between more or less efficient farmers—will not affect the ability of the Government to report agricultural emissions. New Zealand’s official estimates of agricultural emissions don’t use this data, and instead use input data from several sources—chiefly Statistics New Zealand, but also DairyNZ, Livestock Improvement Corporation, and Beef + Lamb New Zealand.

The processor-reporting obligations that the bill removes, which are over 10 years old, are entirely separate from our inventory reporting. New Zealand will remain on track to meet our emissions targets. While we develop a new, fair, sustainable pricing system and support the development of on-farm emission mitigation options, we will ensure New Zealand remains on track to meet its emission reduction targets.

The second emissions reduction plan, which outlines how New Zealand will meet emission budget two and puts us on track to 2050, accounts for taking agriculture out of the New Zealand ETS. This plan will be published by the end of this year, and future emission reduction plans will outline the policies and strategies New Zealand will take to meet future emission budgets.

In summary, this bill is the first step to ensuring a stable and profitable future for our agricultural sector, which plays a significant economic role for this country. I look forward to working collaboratively with the sector, with iwi Māori, and with New Zealanders on a fair and sustainable pricing system for agricultural emissions for the future. Accordingly, I commend this bill to the House.

The question is that the motion be agreed to.

Thank you, Mr Speaker. It’s a pleasure to take a call on this proposed bill in the third reading. There is something that I absolutely agree on with the previous speaker, the Hon Andrew Bayly, and that is that our farmers here are the most carbon emissions - efficient in the world. That is something, though, that is—or could be—all at risk. The Minister that just resumed his seat talked about the climate strategy that this Government has put in place, and I just wonder how that climate strategy is going, given that New Zealand has just fallen seven places in the Climate Change Performance Index released overnight—seven places; not one, not two, but seven places based on the climate inaction—

Mike Butterick: He Waka Eke Noa.

Hon JO LUXTON: —of this Government. The member opposite brings up He Waka Eke Noa, and, you know, we completely understand. We get it. He Waka Eke Noa didn’t work, it’s been thrown out, and that’s just the way it is when you have a change of Government. We understand that. Our concern with the change to this bill is that when it was suggested to the Minister that perhaps we could move the date from 1 January, as was in the current legislation, out a few years while another solution was found—I think it has been detrimental that the Government didn’t consider that as an option. Whilst we understand that there was the need by this Government to remove it as part of its coalition agreement and things that it’s campaigned on, the concern is there is nothing else there, nothing ready to go, nothing that gives our farmers the certainty of what they need to be doing.

We acknowledge the amount of money that’s been put into research and development to look at vaccines and all the other great things that are under way and being developed and researched, but that is all going to take time. It is going to take time to scale up and make commercially available and viable to our farmers here in New Zealand. People overseas don’t need our products—they can get products from anywhere else, and whether that’s done more carbon efficiently or not, they don’t need our products. We need overseas countries to want our products, and they want our products because they see us and our farmers as some of the most environmentally efficient producers in the world, and we don’t want to risk that. The risk I see in this bill, without having a plan, is that it puts it all at risk and we might end up being—rather than leaders worldwide, others can overtake us pretty quickly if they are adopting and addressing technology a lot quicker than we are.

My view on this piece of legislation is the concern around this, and the reason why Labour doesn’t support this is because there is no backup plan, there is no other alternative. We’re just crossing our fingers and hoping that something becomes available that can be scaled up and affordable to our farmers before 2030, when the Government has indicated and said that it will look to price agricultural emissions fairly. How do our farmers get there? Where is the certainty for them? What is it going to cost? I understand that, as I said before, He Waka Eke Noa got thrown out, but they threw out the baby with the bathwater. There should have been some parts that could have been kept and built on and worked on, rather than putting a new group in place, waiting on more technology, crossing our fingers, and hoping that it will be ready in time. All the while, our farmers are just sitting in limbo and waiting and hoping for the best. This bill does not provide certainty for farmers going forward, and that is why we cannot support it.

Saying you believe in climate change and then doing all the things that make climate change worse has exactly the same effect as denying climate change exists in the first place. This Government has systematically, over the course of its term, cancelled just about every single climate initiative that there is. When met with the greatest existential challenge that this planet faces—climate change—what do they do? They tell our biggest polluting sector, agriculture, and particularly the dairy industry, “You’re off the hook.”—you are off the hook.

We have not only fallen behind in terms of the Climate Change Performance Index, we as a nation are rapidly racing towards the bottom under this Luxon Government. They’ve brought back the oil and gas industry, they’re going to fast track the coal industry, and they’re telling the dairy industry, “You’re exempt from your emissions pricing.” Everybody else in society has to pay for their emissions. Every other sector has to pay. Oh, not the most polluting sector.

Hon Simeon Brown: You just want to kill the economy.

STEVE ABEL: Actually, to the member opposite: Mr Brown, we want to save the economy from the existential damage caused by the extreme weather events, of which farmers are on the front line. Farmers are on the front line of the extreme effects of climate change.

One of the biggest consequences of climate change globally is that it will impact the ability of the world to produce food because it will cause increased droughts, increased floods, increased wildfires, and those events are an existential threat to the ability of Homo sapiens to produce food to feed people. That is a very real threat to agriculture. It is a global challenge and it requires us all as a global community to be willing to tackle and take on the hard challenges. Here in Aotearoa New Zealand, the hard challenge is agriculture, because it’s our biggest emitting sector. We’ve got a great renewable energy system. We’ve got a great opportunity to electrify our energy system, electrify our transport, but, instead of doing that, this Government is doing everything that makes the problem worse.

Let me just outline what the actual Climate Change Performance Index said about New Zealand: “New Zealand has dropped seven places to 41st in the global Climate Change Performance Index, which ranks countries based on their emissions”. Listen to what they said about this Luxon Government: “A new Government was elected in October 2023 and the [Climate Change Performance Index] country experts note that it has taken significant backwards steps in climate policy.” Backwards on track is what this Luxon Government is. “It is unclear how New Zealand will meet its international climate obligations in 2050 emissions reductions target”, the index reported. One of the consequences of us not meeting that emissions reduction target is the potential that we will have to pay a bill between $3 billion and $23 billion to offset the pollution that we’ve increased, our failure to actually cut our greenhouse gas emissions.

This decision to remove agriculture from the emissions trading scheme is part of a longstanding failure of successive Governments to seize the nettle on our most polluting sector. It abandons one of the few current mechanisms for addressing agricultural emissions, the emissions trading scheme. Pricing climate pollution has been signalled for almost 20 years. Cancelling this action shows a disappointing failure of courage. It tells the industry, “It doesn’t matter what you do.”, but worse than that, in terms of a failure of basic principles, of fairness, of responsibility, of polluter-pays, by failing to treat agriculture like every other sector that pays a price on its emissions.

It also moves the incentive from farm-based emissions. I think that’s a good thing. We had a very interesting submission from the Parliamentary Commissioner for the Environment that pointed out that, in terms of dealing with water pollution in our agricultural sector, we need to take a catchment-based approach. Well, it is also right that we should take a processor-based approach to dealing with the emissions from the agricultural sector. If there is any price to be put, it should be better put at the processor level. It seems much too difficult, in many ways, to put a farm-level pricing system, but this gets rid of all of it—this gets rid of all of it.

Perhaps even worse than that—well, not worse than that; it’s bad. It’s very bad. It also gets rid of the reporting mechanisms. It basically says, “We’re not going to keep a track of what is even going on, emissions-wise, in the agricultural sector.” That is a major problem, because how are you to monitor who is doing well in terms of the methods of working out how to reduce emissions and who is doing badly if you don’t even keep a track of the reporting and the data? It is an explicit effort to just say, “We’re quitting on this challenge of climate change.” That’s what this Government is doing. It’s saying, “We’re out. We’re not going to do the things that need to be done.” Saying that you believe in it and then doing all the things that make it worse is the same as denying climate change is a problem. I would say that is climate denial, in its fundamental actions.

My former colleague from Greenpeace Amanda Larsson responded to this Climate Change Performance Index and said, “New Zealand is quiet-quitting in the fight to stop the climate crisis by saying they’re committed to climate action while simultaneously rolling back virtually every single initiative that would actually reduce emissions.” It is no secret that this Government’s approach to environmental policy is to let the polluters write the rules, and that’s why New Zealand has dropped in the rankings and that’s why this Government has chosen to take agriculture out of the emissions trading scheme.

One of the most important things that any Government does is it actually represents the interests of all people. It represents the interests of the entire population in protecting the commons from the harm that can be caused by those who would exploit it for profit. Where they would exploit it in a manner that harms that commons, it is the fundamental duty of the regulator and the legislator to protect that commons.

The biggest challenge we face in the climate change struggle globally is that those companies that are least interested in reducing emissions also happen to be the wealthiest and most powerful companies in the world—the likes of the oil industry, for example. Here in Aotearoa New Zealand, the courage to stand up to the big, vested interests, who are always going to have mighty lobbying power, is the courage that politicians must have. That is our duty as representatives of the people, as representatives of the greater good, to not be so readily lobbied by the vested interests who would have us do nothing about their pollution.

Of course polluters don’t want us to regulate or legislate against their polluting activities. That is a threat to their bottom line, but that is exactly why we are put in this House: to actually say, “Hang on a minute.” In the interests of the people, in the interests of the commons, in the interests of the future that we bestow to our children and grandchildren, we must be willing to stand up to those vested interests and say, “You need to do your part too.”

This is a collective challenge and that is what this Government is utterly failing to do. It is utterly failing to show the courage to say, “We will meet this challenge and we will stand alongside the agricultural sector and we will stand alongside the farmers who are innovating the ways to reduce emissions.” The likes of the farmer who presented to us from the Waikato, a dairy farmer who has reduced his emissions on a 300-cow dairy farm by 25 percent by cutting fertiliser and lowering stocking rates and doing various things. He is farm-gate profitable and he is cutting his emissions. There are people all over this country, farmers who are doing inspiring things, working out how to do production on the land and land-use change that is profitable, that looks after the land and looks after the water and looks after the climate.

The message of this Government and of this legislation is, “You don’t have to worry about any of that now. You get no credit; you get no acknowledgment for your efforts to meet this existential climate change challenge. We are just going to let you do whatever the heck you like. We don’t care how polluting you are. There will be no price on that pollution.” What message is that to send to that community of farmers who are doing the right thing? It is a terrible message to send. It is an embarrassing day for New Zealand. It is an embarrassing day that we have been recognised across the world for our failure to take part in this climate change challenge. It is an embarrassing day that we are having the third reading of this piece of legislation which says that our most polluting sector is no longer responsible for its emissions.

Thank you, Mr Speaker. Embarrassing? Try and reconcile that if you’re a rural New Zealander—the most efficient farmers in the world, and here we are pontificating on the left about how we’ve got to do more. Scientific debate, I would argue, has been lost by my mates on the left. Two parts of a million, Steve Abel and I have discussed, is the percentage of methane in the atmosphere. Carbon dioxide—carbon dioxide, Steve Abel. Carbon dioxide—428 parts per million, used to be 390; it’s gone up by 50 parts in 50 years. Admittedly, you are correct, sir, but, equally, it’s been higher in our history, 10 times higher, and here we all are, we’re surviving, and things are going along tickety-boo. The left loves the catastrophisation—end of days, everyone’s burning. I heard it yesterday in the House. Arena Williams: we’re all boiling, literally boiling, she said. God, this is the theatricality that we don’t need. Let’s have a conversation about common sense. We are the most efficient farmers in the world—second to none; I’m not going to apologise for that. Embarrassing? Hardly. It is a celebration.

I just make a couple of notable points. Notwithstanding we all acknowledge the nature of being a New Zealander and we are a part of the export global market reality, we’re also a significant domestic consumer. The number one issue that we hear all across New Zealand is that things are too dear, from a domestic point of view, categorically. In five years, for the members on the left, the socialists that just want to evangelise about climate all the time, food prices—let’s go through food prices for the everyday Kiwi mum and dad trying to make ends meet, notwithstanding we are also an exporter. What goes on inside New Zealand? Milk has gone up 20 percent—20 percent—in five years. Try and reconcile that when you’re a mum and dad trying to make ends meet—20 percent. Red meat has gone up 18 percent. It’s not all inflation, it’s not all competition with the foreign market; it has a lot to do with regulatory burden. I argue, if we get the methodology wrong, your side of the House has to say to your constituency, “You’re going to pay 25 or 30—

Hon Julie Anne Genter: Extreme weather events affect food prices. Climate change affects food prices.

MARK CAMERON: —for your red meat.” That’s what you’re not willing to do, because you’re not being honest—because we are all, Julie Anne Genter, literally burning.

ASSISTANT SPEAKER (Teanau Tuiono): Can I ask members not to have a conversation with each other across the Chamber.

MARK CAMERON: Stop the hyperbole. Thank you, Mr Speaker. I would argue that we have to have a common-sense conversation where we celebrate rural New Zealand. Let’s go and believe in the people that have innovated their way through our history. Every time we start running short of the bling, the cash, the notes, the green, the folding—whatever you want to call it—where do the left come out? They celebrate rural New Zealand, after they’ve spent an inordinate amount of time beating them up.

I go back to: what are the problems we’re seeking to fix? Keeping the farmers out of the emissions trading scheme was logical. By putting them in it, we were going to find 100,000 extra participants. What on earth was that going to cost? Causality, again—what did it mean for rural New Zealand? It harmed us. I hear it all the time, evangelical sermons that “We’re back here, we care about rural people, we care about the marginal communities.”, which are often in provincial New Zealand. Guys, like Mike Butterick and I, go home—that’s our part of the world. We get it mate, don’t we? They are suffering because of a varying degree of regulatory overburden. Let’s go back to cost-benefit analysis, causality—cause and effect.

I would just ask my mates on the left side of the House: are you willing to get it wrong? I am not, this side of the House is not, and I would say for my constituency, as a tie-off and final remark: stop the wokery. Start protecting everyday mums and dads—

Glen Bennett: You’re the Government; talk about what you’re doing.

MARK CAMERON: —that are already paying too much, Glen Bennett, for their food, and we can hopefully—hopefully—assure an economic future where rural New Zealand is champion of its own future and everyone else’s.

I was gearing up for this Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill. It is my pleasure to lend New Zealand First’s support to this bill.

This is, essentially, despite the pontification previously, a very narrow bill. It simply seeks to take away the obligation of agriculture entering the emissions trading scheme at the start of next year—the sword of Damocles no more hanging over agriculture and rural New Zealand. This was never a good idea. In fact, the previous Government knew it was never a good idea. It was something that they were prepared to park for a while because, ultimately, it wasn’t fit for purpose. The emissions trading scheme is in carbon dioxide equivalents; we are dealing mainly with methane here, which is a short-lived gas. So it was never fit for purpose; it was never a metric—

Steve Abel: Super heating gas.

Hon MARK PATTERSON: Ah, now I’m going to come to that, Steve Abel, in a second; I will address the issue.

New Zealand has embarked upon a world-leading strategy that has since been replicated around the world. We’ve led, as we often do, by having a split gas approach that recognises that methane is a short-lived gas: it dissipates after about a decade. It is part of a natural cycle. It is not fossil fuels that have been dug up and added into the atmosphere; it is recycled carbon—essentially, into methane, back into carbon, back being sequestered through photosynthesis. It’s akin to a bathtub—that’s how it’s best explained, I think—where you’re running water into a bath but the plug’s out and the water’s going out at about the same rate as it’s going in. The methane in New Zealand is, essentially, in a steady state. That is how this Government looks at that—and how the previous Government looked at that, actually. That’s why we went to a short-lived gas, because it’s a fundamentally different proposition—

Steve Abel: 85 times more potent over 20 years.

Hon MARK PATTERSON: —than what a carbon dioxide—and that is why we have reviewed the science on this to see what the warming impact is. That does not add to global warming or climate change—that is the metric. You will see very shortly, when that report is released, where we have landed on that, and that will guide our policy decisions going forward.

The status quo, without repealing this, would have been a disaster for agriculture in rural New Zealand. It was just a blunt tax with high compliance that would have not achieved anything. It would have put extra cost on an industry, particularly the red meat sector and the sheep and beef sector, which is already struggling with low profitability and has been for some time. The average sheep and beef farm, in Beef + Lamb New Zealand statistics, last year made about $60,000; that’s before interest tax and drawings. This is not an industry that’s in good shape. Putting a blunt tax on them would have been catastrophic and would have further—further—driven them into the arms of the carbon farmers and pine trees. The impact of that on rural New Zealand is significant.

We have to take this holistic approach. The sheep and beef sector, in particular, has been the conscience of a nation. The rest of the country is prepared to park up its trips in aeroplanes and SUVs to pick up the kids from school by planting trees out in the country, where they’re out of mind, out of sight. We say “Enough” to that, and we’ve got more to say about that soon. This would have turbocharged that trend by just making sheep and beef farming even less economically appealing.

We do take our emissions responsibility seriously, our international obligations seriously. We are not climate change denialists, Steve Abel, but this is actually one of the easiest of our tasks, I believe, as someone that has looked at this seriously and is over all the issues, the serious issues, that we do face in agriculture. I’m looking forward, actually, to the apology that comes from the other side of the House when the figures are released shortly that show agriculture is already meeting its targets. That’s the issue: the Opposition, the people over that side of the House, believe you only have to put a tax on it; unless you’ve got a tax on it, you can’t reduce your emissions. Well, we have reduced our emissions in agriculture, and when those figures come out, I expect some apologies from the other side of the House.

As I said before, we are reviewing the science, but the tragedy of meeting those targets, to date, is we’ve actually culled our way there. We’ve culled our way with a fairly dramatic drop in sheep numbers, a fairly dramatic drop in dairy cow numbers. That is not good for New Zealand. That is not good for our terms of trade. It’s not good for our rural communities and our economy in general. We are going to be much smarter about this. We are going to give farmers the tools. We are investing record amounts into R & D on this very issue, predominantly through AgriZeroNZ. You will see in the coalition agreement a commitment to rolling out low-methane genetics, and I’ve got a bit to do with that and that’s very exciting—particularly in the dairy industry. When I say it’s the easiest of our tasks, the dairy industry is just going to push these down the pipeline. LIC and Ambry virtually produce all the genetics. They are breeding low-methane genetics, so they will be just pushed down the supply chain. The dairy industry is responding.

Of course, the commercial drivers—Fonterra have a target of reducing their scope 3 career emissions by 30 percent by 2030. That is far in excess of what even the Government is suggesting. Things are happening. You don’t necessarily have to put this blunt tax for things to happen. The markets are responding; they are requesting these measures. That’s why we’re investing in a lot of these, like the low-methane genetics, like the vaccines, like the boluses, like the red seaweed.

Farming systems also—I was talking to a sheep and beef farmer the other day at the Christchurch show and he was telling me how frustrated he was that he wasn’t getting rewarded. He can finish his beef cattle at 16 months, but there’s no reward for it. He’s now gone back to a less intensive system that is finishing at 26 months. Now, that’s another 12 months that that animal is producing methane. This tax would have treated both those animals exactly the same—he would have paid exactly the same tax on a per kilo basis, so there was no incentive. The efficiency in his farming system from finishing one year earlier was much more profitable and much more efficient and would have made him more money. It’s actually just farming systems—raising lambing percentages, increasing growth rates; just straight efficiency. Actually, when I say it’s one of the easiest of the challenges, it’s the stuff that farmers try and do all the time. Increasing their efficiency by default is actually dropping greenhouse gas emissions.

At the end of the day, this is something that was long promised by all three parties in the coalition agreement. We have delivered yet another pledge to our farming constituency particularly, who felt particularly aggrieved with the one-size-fits-all and the complexity and compliance that was being foisted on them by the previous administration. We’re busy unwinding this. This is yet another commitment that has been kept. It is a sensible measure. This was never a good idea. This was never the bright tool, and we have put it to bed today. Thank you, Mr Speaker.

The next call is a split call, and if one of the parties doesn’t take that split call, that can become available at the end of the last scheduled call.

Thank you, Mr Speaker. I rise to oppose the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill—what a mouthful! The previous speaker, the Hon Mark Patterson, rightfully pointed out that this is, in his view, a minor change. The issue is that, in the broader context of the coalition Government’s climate policy, this is yet another slash-and-burn cut to climate policy that they’ve implemented.

The first speaker, the honourable Minister Andrew Bayly—and congratulations on your promotion to anti - cyber-bullying, sir, by the way—said that we were on target, but that’s not actually true. The Government’s own figures from the second emissions reduction plan, the draft consultation document, shows that we’re off track to meet the 2050 target. We were on track in the first emissions reduction plan, and now we’re off track—and we’re off track because of all the things that they’ve done.

They’ve de-hypothecated the Climate Emergency Response Fund, they’ve cut funding for community energy, they’ve cut funding for regional energy transition accelerators, they’ve repealed free and subsidised public transport, they’ve repealed the Clean Car Discount, and now they’re reviewing the methane science target and trying to put in a new consensus over the previous one. They’ve stripped farmers of the ability to actually reduce their agricultural emissions by funding them for agricultural emissions research and also for sequestration payments, which the previous bill, He Waka Eke Noa, would have done—the previous regime which they’ve abolished.

Everything that this Government has said that they’ve done to help climate change were things that were already going to happen anyway—it’s a complete red herring—already done by the previous Government. In the fringe benefit tax debate yesterday, one of the members opposite was bragging about the opening of new wind farms over in, I think, Hawke’s Bay. The issue is that that was approved by the previous Government, most of the work was done by the previous Government; they’ve only just cut the ribbon and taken credit for something that they didn’t even do. Ridiculous.

Now, what does this bill actually do? It’s another thing that’s in line with their programme of cuts. It removes backstop pricing for agricultural emissions, which were a last resort anyway. Members opposite are saying, “Oh, it was too soon to do it next year.”—then push out the date—but instead they’ve scrapped it. It removes the ability to independently monitor progress for agricultural emissions pricing, and it removes measurement requirements under regulations—regulations, by the way, that were passed under the Key Government; the Key Government that actually at least made a show of caring about climate change and climate issues, which this Government isn’t even pretending to do. They’re just putting on this rhetoric but they’re not actually putting any substance behind it. At least the Key Government worked with the Green Party in a cooperation agreement to build cycle trails all over the country. But this lot? This isn’t your fathers’ or your grandfathers’ National Party; these are people who have got into bed with people who fundamentally don’t believe in the science of climate change, who would seek to water down targets through bogus reviews rather than actually dealing with the reality behind us today.

One of the previous speakers on the Government benches suggested, “Oh, things were tickety-boo.” Well, tell that to the millions of people that are being displaced by climate-related disasters. Tell that to the people around the world who are being impacted by the impacts of climate change. Tell that to the people who have been displaced and affected by Cyclone Gabrielle and the events in Otago this year—741 grants from the civil defence payment; it’s not a small number.

In the committee of the whole House, we had substantial engagement with the Minister. I thank the Minister for his engagement on this issue. One of the things that became clear is also systematic of the wider Government policies around climate change. It is the lack of evidence. I asked the Minister repeatedly, during several stages of the debate, for the cost-benefit analysis for the other options other than the status quo option that was modelled. The Minister didn’t even aim to answer that question. Does the evidence not exist or does the evidence exist and they’re hiding it? Thank you.

Thank you, Mr Speaker. As a farmer and a rural MP from heartland Wairarapa, it gives me great pleasure to rise in support of the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill. Unlike the Opposition—wolf dressed in lamb’s clothing—we are delivering on our commitment to keep ag out of the emissions trading scheme (ETS). We understand that agriculture is the backbone of the economy. We back our words, just like we back our farmers. We’re going to make sensible changes to give our farmers the ability to do what they do best, and that is farm.

I have three figures for those on the other side that they may want to think about over the recess: 80-plus percent of export income from the food and fibre sector; that’s how we pay our bills to provide those services that New Zealanders expect and deserve. The number of businesses in the food and fibre sector in all of New Zealand is 70,000—they’re in your towns and your cities—and 360,000 is the number of people that work in it. I’d take this opportunity to thank all of them for what they do.

Another newsflash for the Opposition: Kiwi farmers are the world’s most efficient producers of product per unit when we take into account carbon emissions. It makes no sense to shut them down, to send production overseas. That’s called emissions leakage. That shift of production overseas, to less-efficient producers, means an increase in global emissions. On that basis, all in this House should be backing our farmers, celebrating their hard work and productivity, not wanting to price them out of existence and shutting them down, because that shift of production, emissions leakage, makes no sense—not to our economy, not to our farming communities, and not to overall global emissions.

Inclusion in the ETS wouldn’t have been effective; it would shut down those farms. They don’t have the tools to lower emissions. Many would have no choice but to significantly cull herds. Think of the $50 billion - plus of export income, those 70,000 businesses and the 360,000 people that work in them, and the devastating impact of that on them. Instead, we’ll take a technology-based approach to give our farmers the tools that they need and deserve. We respect and back our farmers. Madam, Speaker, it gives me great pleasure to commend this bill to the House.

Tēnā koe e te Māngai o te Whare. Heoi anō kei te tū mā te Pāti Reipa ki te whakahē i tēnei pire i tēnei ahiahi. [I stand on behalf of the Labour Party to oppose this bill this afternoon.]

First of all, I just want to clarify: did the member for Wairarapa just call me a wolf in lamb’s clothing? I’ve been called worse.

Heoi anō, also picking up on what the member for Wairarapa said, talking about farmers being the backbone of Aotearoa, we don’t dispute that. Here on this side of the House, we absolutely know the amazing contribution farmers make to Aotearoa—

David MacLeod: Support them, then.

CUSHLA TANGAERE-MANUEL: Support what? I’m being told from the other side of the House to support it. Support what? Support what, David MacLeod from Tīkapa? Heoi anō, and that’s the issue. Even farmers who don’t want to be included in the emissions trading scheme are not sure what in fact is being proposed here.

Now, furthermore, talking about the backbone, we can talk about industry until, pardon the pun, the cows come home, but at the end of the day what is actually the backbone of Aotearoa is, first of all, our whenua. I’m not putting them in order, because I’ll get to another priority shortly, but let’s start with whenua. Try telling the people of Ikaroa-Rāwhiti that everything is tickety-boo—tickety-boo when they’re watching erosion to the scale where they’re not building anymore. Farmers have lost so much land through climate change.

Steve Abel: That’s right.

CUSHLA TANGAERE-MANUEL: Thank you. We’ve just got to stop being climate deniers. Like I say, though—I repeat—it doesn’t matter what the opposite says, actually, because what is this being replaced with? I have to support my colleague to the left in asking: what does this bill do?

Another priority here is wai Māori—water. In the Primary Production Committee today, we heard about how the next big—well, it’s not new—issue is water: protecting our waterways, particularly in te ao Māori, where we identify with our water. You know, we’ve given personhood to bodies of water. Heoi anō, that brings up the issue of nitrates, and we know, while it cannot be specifically attributed to this bill today, just yet, that 100 out of 245 rural schools who were recently tested had nitrate levels above 1 milligram per litre. What I am saying is that we are forewarned, whānau. We are having too much of our tūtae, etc., leeching into our waterways, and now we are risking the health of not only our tamariki but Aotearoa whānui.

The final point I want to make is to talk about some of our Māori and iwi farm interests, who see the absolute big picture of agriculture in Aotearoa, including the value of whenua and wai, and our international reputation. Heoi anō, international reputation aside, and the value of our “clean, green” reputation, keeping it closer to home, kei te hārapa haere tēnei Kāwanatanga—this Government is just galloping away—with this legislation. What’s the hurry, and why was the consultation period so short? This has absolutely been raised by iwi and—

Dr Hamish Campbell: First reading.

CUSHLA TANGAERE-MANUEL: Actually, I’m going to give the member opposite a chance to yell that out again. What was that?

Dr Hamish Campbell: Skipped the first reading.

CUSHLA TANGAERE-MANUEL: So what? First reading, he says. Clearly, no understanding of the intricacies that some Māori farms, Māori landholdings, and ahu whenua trusts have to go to.

It’s very much my privilege to bring those perspectives today—that, actually, all industry aside, without a healthy environment, we are nothing. Also, the consultation process: we have to have stronger consideration for the—I’m glad the member for Taranaki is giving me the thumbs up. Tēnā koe e te whanaunga nō Tīkapa. Kei te whakaae koe i āku kōrero i tēnei ahiahi. [Thank you, my relation from Tīkapa. You agree with my comments this afternoon.] Heoi anō ra, I do not commend this bill to the House. Tēnā koe.

Thank you, Madam Speaker. This bill amends the Climate Change Response Act to remove agriculture, animal products, and fertiliser companies from entering the Emissions Trading Scheme (ETS) in 2025. This bill aligns with National’s election manifesto commitment to keep agriculture out of the ETS, and to implement a fair and sustainable pricing system for on-farm agricultural emissions by 2030, a system that reduces emissions without sending production overseas.

Hon Jo Luxton: Speak from the heart, Suze.

SUZE REDMAYNE: I’ve said it before, and I’ll say it again: agriculture is the backbone of the New Zealand economy, and it has been for 100 years. The export receipts we earn from our food and fibre industries were $56.4 billion last year. Agriculture pays the bills. You know this, Jo. You know it—80 percent of all of our exports, 10.5 percent of GDP, 12.8 percent of jobs across this country. Madam Speaker, just like you, I am a proud farmer.

DEPUTY SPEAKER: Don’t bring the Speaker into the debate. Thank you.

SUZE REDMAYNE: Sorry. Oh, I was trying to give you a shout-out. Well, none of them are. In the mighty Rangitīkei, that’s what we do. Let’s not forget, New Zealand farmers are amongst the most carbon-efficient in the world. This Government is committed to meeting our climate change obligations without shutting down New Zealand farms. This Government is committed to supporting farmers and the agriculture sector to reduce emissions in a way that doesn’t put farmers out of business, that doesn’t decimate our rural communities or shift production overseas, because it’s critical our domestic efforts to cut emissions don’t harm the ag sector.

I think I might have said it earlier: agriculture is the backbone of our economy. It’s pivotal to boosting our GDP, to raising the standard of living, and to providing the first-class education, health, and public services that we all expect and deserve. It’s why as a Government we’re focused on doubling our export receipts in the next 10 years. This bill is about backing our farmers to succeed. It’s good for farming, it’s good for agribusiness, it’s good for New Zealand, and it’s good for all New Zealanders. That is why I commend this bill to the House.

I’m so glad the previous MP, Suze Redmayne, is so passionate about farmers and the agriculture sector. It was a very well read speech, obviously from the heart, and I know she knows the sector well. I don’t know if this House is aware, but I come from a long line of proud farmers from the Waikato. No. 7 Road was the place that I spent a lot of time in my early years, and, actually, we lived with our grandparents after Dad had left to do other mahi—not left the family; left for a visit and to do other stuff. Sorry, Dad! Anyway, focus—focus on this.

I think this side of the House—I’ll speak on behalf of the Labour Party: we could consider supporting this legislation if it actually did anything. I think this is the challenge. I was really interested in reading the bill that was on the Table here, and the policy statement talks about this aligning with the Government’s action plan. This is action 12 of their action plan from the April to June quarter. Now, an action plan normally is about doing things, and I just feel like this action plan is around, “We won’t do anything; we’ll just stop doing it and see what happens.”

I hope that all of us can agree that things have to change. We can’t do what we’ve always done. We can’t live in the 20th century any more because—well, to be fair, today you see that New Zealand has gone backwards in terms of our standing around the Climate Change Performance Index. We’ve gone back seven places; we now sit 44 out of 63 countries that are measured. That’s why we need to seriously consider what we are doing to ensure that we don’t kick this can down the road. And, to me, I feel like, yet again, it’s this Government kicking the can down the road, saying, “We don’t know what we’re going to do. We’ll just wait and see and, hopefully, maybe technology, maybe the market, maybe something will figure it out.”

When you look at things like our ferries, you look at things like Resource Management Act reforms that are just thrown out, when you look at things like the water reforms, look at things like trying to get fair pay for workers, look at things—

DEPUTY SPEAKER: Back to the bill.

GLEN BENNETT: It’s very relevant, Madam Speaker.

DEPUTY SPEAKER: It’s relevant, but it can’t go on for too long.

GLEN BENNETT: One more?

DEPUTY SPEAKER: One more.

GLEN BENNETT: We heard at question time today about the Retirement Villages Act that was, again, kicked down the road. The reason I say that was—to come back to the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill—it feels like this Government just does nothing. It just repeals stuff and then doesn’t think it through.

As I’ve listened carefully to the debate today, which feels more like an episode of the Muppet Show, it feels to me like this Government is just spending their time talking about this side of the House. I often think the reason you talk about other people is because you’ve got nothing to talk about yourselves. You don’t know what you’re actually doing.

We can’t support this legislation. We think, and know, that we need to take responsibility. We need to find solutions. We need to invest in our future, which takes making hard decisions today for our future, because kicking this down the road does nothing to support and to fix our climate crisis.

Look, I will bring us back to the bill because, unlike that speaker who just spoke, Glen Bennett, on this side of the House, we have real farmers—real farmers—from the Rangitīkei, real farmers from the Wairarapa. I grew up in the King Country.

Glen Bennett: Point of Order, Madam Speaker.

CATHERINE WEDD: We’ve got farmers from Northland who are real gumboot-wearing farmers—

DEPUTY SPEAKER: I’ve got a point of order from Glen Bennett.

Glen Bennett: I take personal offence to the fact that that member is accusing this side of the House—or particularly, I assume, myself—of not being real farmers.

DEPUTY SPEAKER: No, no, she didn’t say that; she said this side of the House has real farmers. She had no comment on your side of the House as yet. Thank you.

CATHERINE WEDD: Thank you, Madam Speaker. I was referring to this side of the House, which has farmers, real farmers, who know how hard farmers work in New Zealand and know how farmers are very committed to reducing our emissions.

This is what this bill is about. It is a momentous day for our rural sector in New Zealand, where we are taking agriculture out of the emissions trading scheme (ETS). It’s what we campaigned on, and now we are delivering for New Zealanders, because it is senseless to send production to less-efficient countries. We need to back our farmers. We need to be aspirational again and pump confidence back into our rural sector.

We do have the most carbon-efficient farmers in the world, as we have heard on many occasions here tonight. It is what drives our economy, as we’ve heard; it’s the backbone of our economy. Speaking for the hard-working Tukituki electorate, where Tukituki is a rural electorate, everything thrives off our primary industries, off our meat sector. There, in Tukituki, we do produce the best, most premium meat in the world, and a lot of our businesses rely on our primary industry, on our farmers, our Ravensdown, our meatworks. Our farmers are doing a wonderful, wonderful job out there, but they’re doing it tough at the moment. As we heard from one of our wonderful Ministers of Agriculture, stock numbers are going down at the moment. We are naturally reducing those emissions, and on this side of the House, we do have a plan.

I’d just like to acknowledge, actually—I was just out opening the second-largest wind farm in New Zealand yesterday with our wonderful energy Minister here, because we have a commitment to electrify New Zealand and double the renewable energy in New Zealand by 2050, using our sun, our water, and our wind. I must say it was very, very windy up there yesterday. What was really interesting is that, when speaking to the landowners, they said it had taken 20 years to get the switch on on this wind farm—20 years. That is just absolutely senseless. That’s why the Fast-track Approvals Bill is going to be so good for this country, and it’s going to make sure that we reach our climate change targets and we reduce our emissions, because remember that it’s not just the agriculture emissions; it’s also our transport emissions. If we are going to electrify New Zealand and move towards electrical vehicles, we need the renewable energy to do so. That was a really momentous moment.

Coming back to this bill, taking agriculture out of the ETS is going to ensure that we are working together with our farmers, working together with our rural sector, which is what the previous Government did not do. They vilified our farmers, they went to war with our farmers, and we are saying no. We back provincial New Zealand. We back our hard-working farmers, who are the backbone of this economy, and that is why I commend this bill to the House.

Thank you very much, Madam Speaker, and thank you for the earlier guidance. I’ve been reflecting on that, and I think it’s true to say that this side of the House has honest MPs. Thank you for that guidance; I look forward to applying it further in future. The debate has not been a debate. Aside from Mark Patterson—whose I actually think was a considered contribution—who addressed the details of this legislation and explained why, in his view, this was necessary, all we’ve actually heard from the Government side is platitudes.

Now, if you put that to one side and look at it in isolation, I actually don’t think anyone in this House would disagree, certainly not from the Labour Party. Because—

Tim Costley: No, I disagree.

Hon KIERAN McANULTY: You disagree?

Tim Costley: I disagree.

Hon KIERAN McANULTY: You disagree with the fact that farmers are the backbone of the country, and you disagree that they are vital to our communities and that we rely on them in areas like where I live—that’s very interesting to know, Tim Costley, MP for the Ōtaki electorate. Very interesting to know, indeed.

The thing is, if you actually look at the contributions from particularly the National Party MPs, they’ve used this debate as an opportunity to praise farmers but haven’t actually touched on the actual issue at hand. The honest response is that I don’t want to see agriculture in the emissions trading scheme (ETS) either, but is completely removing them out of it right now, when the Government hasn’t got a plan in place to address it, the right response? Well, my honest answer to that would have to be no. If this was delaying this—

Tim Costley: Point of order. Madam Speaker, thank you. I just wonder if, in the spirit of the honesty of that side of the House that’s being reinforced, perhaps the member could be given the chance to correct for the Hansard what he said earlier about my reflection, which was that, as I think he probably heard, I didn’t agree with his assessment of the debate, but I certainly would agree with farmers being the backbone of our economy.

DEPUTY SPEAKER: Well, the member made an interjection which was, I guess, read by the member making a speech, and I don’t believe that the comment was misinterpreted at the time. I’d invite the Hon Kieran McAnulty to carry on.

Hon KIERAN McANULTY: Thank you very much, Madam Speaker. Now, if this bill was proposing that the deadline, so to speak, was to be pushed out, say, three years, as an example, I think there’s a very good chance that there’d be a lot more support in this House than what there is tonight. This is because, actually, there’s a long history of that being the approach.

If we think back to when the ETS was first brought in, there was a time by which agriculture could consider alternative options. That was pushed back. Then, of course, we all know that, through the He Waka Eke Noa process, an alternative to the ETS was trying to be found, because at the heart of that—admittedly, it’s now been sacked by this Government—was a recognition that if there is to be an alternative approach for agriculture, we as a Parliament should support it. That’s certainly the view of the Labour Party. This is because, essentially, our reputation and our contribution to the world determines the price that we can get for our products overseas. That’s what we tried to do with He Waka Eke Noa.

I recognise the potential downfalls with that—there’s the accuracy of the technology on recognising sequestration on farms, etc. That was a sticking point. But there was an opportunity there to get that right. I’m not sure that the overseas consumers that we as a country rely on, and our primary producers rely on, will be convinced by a promise that one day there might be technology. If this was pushed back, for example, for three years, it might demonstrate that, yep, we’re still taking this seriously but we’re just giving the sector a little bit longer. It’s not actually just the sector; it’s the Government. The investment in technology—there’s been some claims tonight it’s nowhere near as much as would have been if He Waka Eke Noa was in place. But that’s not really the point of this.

The point is that, if you look at the free-trade agreements this country has recently signed, in particular the European Union—hugely, hugely beneficial to this country; however, only if we live up to our obligations on climate change. Now, they take that incredibly seriously, the European Union. They have set this as a priority for them. We know in many ways that, where the EU is heading, other countries will follow, and free-trade agreements will be updated and be reflected in that respect. What is concerning is that today of all days, where we’re debating this, New Zealand has dropped seven points in the climate index. That should be a worry for all of us, because our reputation determines the prices that our primary sector gets.

I would put towards the debate that if this, the date on which agriculture enters the ETS, was simply to be pushed out instead of scrapped altogether, we might be able to make those claims to those consumers, and I’m concerned we can’t now. Now, that, ultimately, could have an impact on the price that farms get. That will impact regions like where I live. That will be a major worry. There’s two sides to this debate, and so often it’s a lazy, politically driven debate, where fingers are pointed and labels are thrown and names are thrown that aren’t accurate. This is too important for this country to simply have a debate that says, “We love farmers; they hate farmers.”, “They hate farmers; we love farmers.” It’s too important for that, because it’s not honest and it’s also not accurate.

Hon Simeon Brown: Well, it’s what you did for six years.

Hon KIERAN McANULTY: I don’t know why Simeon Brown’s chirping up. This is a man who has been on fewer farms than Erica Stanford has called Jan Tinetti names. He has come from the heart of Auckland. He might be a member of the National Party, and I recognise that they have farmers, but Simeon Brown is not one of those. Remember that time he stood on the side of the road with a shovel and pretended he would dig a hole? His shovel wasn’t even dirty and his boots weren’t even dirty. Look, I will take contributions from the likes of Mike Butterick, who I respect, and the other farmers in that, but I will not stand here and be chirped at by a bloke who’s never even visited a farm.

This bill is actually a missed opportunity for the large opportunities that are around, and I think that’s a shame. It’s on that basis that we don’t support this—not because of all the ridiculous and untrue statements that the other side have said; just because I think we’re not looking at the bigger picture.

Thank you very much, Madam Speaker. At this, the third reading, I’m conscious I stand between the New Zealand rural community and the certainty that they need once this legislation is passed into force, so I’m going to avoid being derailed too far. I would just note, for the area that is known as Kaipara ki Mahurangi, good rural farming stock up that north part of Auckland—just as my colleague and friend represents the old Franklin district, equivalent but on the side to the Rodney District, as my other colleague and friend Simon Court points out.

Nevertheless, more importantly, and supporting the comments made from those who are genuinely of a rural background, on this side of the House, this is important for “New Zealand Inc.” It’s important for the world as well, for all the reasons that have been canvassed. We allow our farmers to have some breathing space, to take stock, almost literally, as my colleague and friend Catherine Wedd pointed out in her speech about this momentous day that we’re about to have. Certainly, from a Land Information point of view, with the Crown pastoral estates being an important element to that, we know that there are many people doing great things out there on the land, including that which is actually owned by the Crown. We need to partner with these people, we need to give them the breathing space, and we need to enable and encourage the work that they’re already doing.

When the other side of the House asks what it is that must be done, actually, more importantly, the question must be: how can we, as a Government, support the work that is already being done? How can the Government form a partnership, not necessarily in the form of a rinky-dink scheme like He Waka Eke Noa, but actually genuinely to partner, to understand what’s going on, to support that, to invest, to enable the investment, including the technology? This is an important day for this country, our rural folk, and, therefore, all of New Zealand. We are so dependent on them—the backbone of our country. I have great pleasure in commending this bill to the House.

Bill read a third time.