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

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

DEPUTY SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website.

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

Agriculture is the backbone of New Zealand’s economy and a contributor to the world economy. It will play an important role in achieving the Government’s goal of doubling the value of exports over the next decade. In the year 31 March 2024, the food and fibre sector accounted for 80.9 percent of New Zealand’s merchandise exports. Over the last 10 years, food and fibre exports have grown by an average of 3.6 percent per year, whereas other elements of export growth have only grown by 1.6 percent. One in seven New Zealanders work in the food and fibre sector, and that figure increases to one in four in some of our regional economies.

Our relationships with our trading partners are linked to the economy and the prosperity of this country, and that’s why this bill exists. The agricultural sector is critical to meeting our economic, trade, and climate goals. However, to do so effectively, that sector must adopt, and adapt to, the evolving global expectations. New Zealand remains committed to its international climate obligations, which, I wish to emphasise, this bill is consistent with.

While we have committed to repealing legislation that imposes emissions trading scheme (ETS) obligations on agricultural activities, we have also committed to replacing it with a fair and sustainable pricing system outside of the ETS by 2030 to ensure that we do not send production or jobs overseas.

The Climate Change Response Act currently requires agricultural processors to pay for fertiliser and livestock emissions from 1 January 2025. Under the current legislation, animal farmers would begin reporting on their on-farm emissions from 1 January 2026 and paying for those emissions from 1 January 2027.

Economic modelling commissioned by officials suggests that requiring agricultural processors to pay for their emissions under the emissions trading scheme would have a negative impact on both farm production and revenue. If agricultural processors are required to pay for on-farm emissions, this could lead to a trickle-down of costs directly to farmers, regardless of their emissions efficiency rates. The requirements for farmers to report and pay for their emissions would likely require up to 100,000 animal farmers to be registered and begin reporting and paying for those emissions under the emissions trading scheme. This would have disproportionate adverse impacts on small farmers and would significantly increase the number of participants in that scheme, which could disrupt the operations of the scheme.

In summary, the current system would result in additional administrative implementation and compliance costs to our domestic agricultural sector. I want to be really clear here: this Government will not shut down our productive sectors and shift production overseas, and this bill presents an opportunity for a new pathway forward. It will pave the way for us to develop a fair and sustainable pricing system for agriculture that reduces emissions without sending production offshore to farmers who are less emissions efficient than here in New Zealand. Not only that, but this bill will support our farmers and our rural communities.

In July, the Government launched its climate change strategy, a plan aimed at reducing the impacts of climate change and preparing for its future impacts. The climate change strategy has five key pillars: infrastructure that is resilient, communities that are well prepared, credible markets, clean and efficient and abundant energy, world-leading climate innovation that boosts our economy, and nature-based solutions that address climate change. I would like to emphasise the importance of the fourth pillar—having world-leading climate innovation that boosts the economy.

This Government has prioritised developing tools and technologies that work for New Zealand’s pasture-based systems. Examples of key policies and initiatives to achieve this were included in the second emissions reduction plan (ERP2) discussion document and include accelerating the development of mitigation tools and technologies to reduce on-farm emissions, with the Government also partnering with the private sector with $400 million of investment, fit-for-purpose regulatory pathways for mitigation technologies, an independent review of the biogenic methane science target, and standardised methodologies for developing measurement of on-farm emissions by 2025. It is clear that this Government is taking the right approach to reduce agricultural emissions by working with the sector and not against them, as we will continue to grow our efforts and grow our economy to double exports and to meet our climate goals.

Despite the urgency to amend the Climate Change Response Act by 1 January 2025, we have had a rigorous four-month select committee process that scrutinised this bill. I want to acknowledge my ministerial colleague the Hon Todd McClay, Minister of Agriculture, who I have worked very closely with on this bill, alongside officials from both of our joint agencies.

I would also like to thank members across the House who are part of the Primary Production Committee. Thank you for your work in considering this bill and thank you for the contributions that you have made as part of that. It is important to hear and consider the feedback from the sector, organisations, and the wider public. I would like to acknowledge the Opposition’s feedback provided in the select committee report on the bill, which included the importance and the impact of climate change, fairness, and equity concerns with other sectors of the economy—and while not perfect, the New Zealand ETS is the only current tool for pricing emissions. Despite these concerns, I want to reiterate the Government’s commitment to establishing a fair and sustainable pricing system for agriculture outside of the New Zealand ETS by 2030.

This system will ensure domestic production and jobs remain in New Zealand rather than being sent overseas. Members of the select committee listened to the views on this bill, receiving submissions from groups, organisations, and individuals across New Zealand. The committee received 581 submissions and 26 oral submissions during this consultation process. Of these total submissions, approximately two-thirds were supportive of this bill, with the remainder one-third being against the bill.

Agriculture must play its part, and it will. As outlined in the second emissions reduction plan, to get the desired impact, the tools to reduce emissions must come before pricing, not the other way around. These tools must be in the hands of our producers so they can utilise them to adapt and to remain profitable.

After careful consideration of the submissions and the advice from officials, the Primary Production Committee recommended by majority that this bill be passed without amendment. Submissions did not identify any unintended consequences, administrative errors, or inconsistencies with the Government’s policy intent that requires amendment. This bill as drafted gives effect to the Government’s objectives to remove agriculture from the New Zealand ETS and has been factored into the Government’s wider emissions reduction strategy, including consideration of the second emissions reduction plan.

As I have previously announced, this bill supports the Government’s broader plan to keep agriculture out of the New Zealand emissions trading scheme. This bill will enable us to pave a new way forward, working alongside the sector, iwi Māori, and the public to fairly and sustainably manage agricultural emissions. Mitigation technology and this Government’s focus on getting the tools into the hands of the farmers will play a key part in this. Accordingly, I commend this bill to the House, and I look forward to the next stage of debating this bill in the committee of the whole House.

The question is that the motion be agreed to.

Thank you, Madam Speaker. Just quiet, for a moment. [Drops a can] That’s the sound of the can being kicked down the road. Madam Deputy Speaker, it is good to have someone who knows something about this in the Chair.

In 1992, a National Government committed to a Kyoto Protocol, an international movement to reduce emissions. A National Government, in 2015, reiterated its commitment to emissions reduction, at Paris. Through that period, the National Government did nothing to implement any progress in the area where 50 percent of our emissions come from: agriculture. We tried, in 2000, in a Labour Government. We came in and we talked about a carbon tax. That was rejected by farmers—called a “fart tax”—and so we moved on to create an emissions trading scheme (ETS) as the next best option. It was accepted.

The National Government of the day—actually, it was the Opposition of the day—said, “We’re going to get rid of this.” When they got in, in 2009, they kept it in place because it was the only tool that we had to meet our international obligations, to provide some market signals for our economy and participants in our economy to reduce our emissions over time, because if we don’t, we’re going to be writing out cheques for billions of dollars under the Kyoto and the Paris accords.

We then said to farming sectors, when we came in in 2017, “We’ve got to do something here. We need a backstop, because, ultimately, the ETS is all we have, and if we can’t come up with an alternative, then agriculture must come in.”—even though the concession for agriculture was 95 percent discount; so, effectively, facing a 5 percent impost on the methane and other emissions from the agricultural system.

I know how important the primary sectors are to our economy. In fact, if you looked at the growth in our period of Government from 2017 to 2023, it was spectacular even through COVID, and we’re proud of that, but we still faced this dilemma of how we address agricultural emissions. So we said to agricultural leaders, “Look, we don’t want to put you into the ETS. If you can come up with a better scheme, then we’ll run with that.” We gave them the best part of four years. I was a little cynical; the Prime Minister was very ambitious. Lots of other people were a bit cynical as well, because agricultural leaders have failed to make the hard decisions many, many times.

Hon Mark Patterson: They did, and you turned them down.

Hon DAMIEN O’CONNOR: Because they have a legal obligation to represent their sectors—the dry stock sector that the Minister’s representing has a different way of farming from the dairy sector. That clash between who is emitting and who has the greatest opportunity to reduce was something that those leaders couldn’t resolve. They came back to the Government with most of the proposals, but some of the hard ones weren’t resolved. We went back to them and said, “Look, we’re going to have to go back and work through some of these hard issues.” We did not want to put them into the ETS, but it’s a necessary backstop. We failed with He Waka Eke Noa—the Government’s got rid of it. Now they’re going to take away the ETS. The question is: what are they going to do next?

I’ve just come from a Rural Leaders presentation, where Nuffield scholars—these are the brightest, most ambitious young rural leaders in this country—go out around the world. One of the presentations that came back was pretty blunt: “The systems that we have used to get us to where we are will not be the ones that have to take us to where we need to be.” That’s challenging, and I could see the unease among rural leaders in that room, but if we don’t do it, we will fail, because we don’t have the scale of South America or the US or other places. Some will say, “Oh, we’ll have GE technology available.” Well, we might or might not, and we need to see where the real, proven benefits of that genetic engineering come to play for a country that relies on the production of food for its existence—and that’s us.

There’s a member on the other side there who sat on the board of Fonterra, our biggest and most important company. Their customer of over 100 years, Nestlé, has said to them—and actually invested in a zero-carbon dairy farm in the North Island; working through that. I applaud both Nestlé and Fonterra for investing in it. In fact, Nestlé is investing 1.2 billion Swiss francs in initiatives to reduce emissions from agriculture systems, because they have said that they will aim to source 50 percent of their ingredients through regenerative agriculture methods by 2030. They have an ambitious goal. They are our biggest single customer of our biggest single company.

How are we going to do it? The Minister said, “Oh, we’re not going to make farmers do anything until we’ve got the tools.” Well, we actually do have the ability to reduce our emissions now: better pasture species, better genetic selection—without GE—

Grant McCallum: GE? He’s going to support it?

Hon DAMIEN O’CONNOR: Well, while that member goes on, can I say that changing farming systems will reduce emissions. We’ve seen huge progress made in the dry stock sector. The dairy sector has to make some progress.

Hon Member: We are.

Hon DAMIEN O’CONNOR: If they don’t, Nestlé will buy from other customers; from other suppliers. The ex-Fonterra member says, “Oh, no, they’ll always come and buy from us.” We produce about 2.5 percent of total dairy production across the globe. The US is ramping up its exports, South America is becoming more efficient, and Ireland is certainly ramping up too. We are going to face some severe competition into the future, and the question is: where will we be positioned? Well, Nestlé will say, “If you don’t meet these emissions reductions goals, we’re not going to buy from you.” There are many other customers, because the corporate obligations of those customers is to reduce emissions through all their supply chain. Fonterra have been out around the country talking about scope 3 emissions—that is, all the emissions from a farming system in our country will be accounted for.

The members on that side have been complaining about the impost on farmers of having to record more and do more. That is the world in which we operate now—that is the reality. If you weren’t at the Nuffield presentation just half an hour ago, you’ve missed a few clear messages from ambitious rural leaders who’ve been out around the world and are coming back. One of them was that we need to embrace GE carefully, to look at the opportunities into the future. I accept that. Those succession issues—that is, how we’re going to transfer farms to the next generation. But the idiots on that side of the House are going to open the door, are going to—

Hon Members: Oh, here we go!

Hon DAMIEN O’CONNOR: Well, because—[Interruption]

DEPUTY SPEAKER: That’s enough. That’s noisy.

Hon DAMIEN O’CONNOR: Can I just say: because opening the door to foreign investment in farmland will destroy opportunities for future generations of New Zealand farmers, and that’s what is being considered on that side of the House, supported by Federated Farmers. [Interruption] No, no, it is.

Can I come back to this: be careful what you ask for. There may be farmers and farming leaders who think that removing agriculture from the ETS without any alternative plan to incentivise and assist farmers to make the transition will leave us up a cul-de-sac. I fear that, as we see around the globe the climatic events—be it in Spain, be it fires—where the consumers and the voters are demanding more action from Governments, we’ll be caught in the crossfire between consumers who demand action to reduce emissions and us desperately needing to sell what are low-emissions products—I absolutely accept that.

As Neal Wallace, who travelled around the country—paid for by the agricultural sector. He came back and wrote 30 articles—and read them carefully, because he has said, “The speed in which the world is changing makes it more crucial than ever that New Zealand farmers have an eye on international market trends.” Those market trends that—

Grant McCallum: We do.

Hon DAMIEN O’CONNOR: No, that member doesn’t. Can I say: the market trends are for decarbonisation. They’re also around biodiversity, and the recent moves by the Government to remove obligations to acknowledge, to identify, and then promote biodiversity on farm—those incentives have been taken away. There’ll be some short-term celebration. The Minister talks the talk, but when this bill goes through, the absence of a clear alternative to give market signals to farmers to reduce their emissions, to get money to help them make that transition, will mean that our country, our economy, is at huge risk from this piece of legislation.

Thank you very much, Madam Speaker. Saying that one believes in climate change and then doing all the things that make climate change worse has the same effect as denying that climate change exists in the first place. That is what this Government is doing with bill after bill after bill. They are behaving like a Government that does not believe in climate change. The words are hollow; the words are as hollow and gaseous as the superheating gas methane.

That superheating gas methane is one of the most potent greenhouse gases produced by human activities, along with nitrous oxide. Nitrous oxide from fertiliser and manure is about 300 times more potent as a greenhouse gas than carbon dioxide, and methane is about 27 times more potent over a 100-year period. These gases are vital in us solving the global existential challenge of climate change. That is why we seek to address them on a planetary scale.

We seek to accept the existential threat of climate change, which is a threat not just to us as a nation, not just to us as a producer, a food producer—because let’s remember, farmers are on the front line of the effects of climate change: the extreme weather events, the droughts, the floods, the forest fires. These are things that hit people in the rural sector, in the productive sector, as much as anybody, as much as they hit people in the Pacific Islands. They hit people who are producing food, not just here in New Zealand but all over the world. This is a planetary existential threat, and it is seen as the biggest single threat to the ability of human beings to feed themselves over the coming century. This is a classic example of a Government that is in denial of the need to address that fundamental planetary problem of climate change. This legislation does exactly that.

When we hear that the Government is a backer of farmers, that they’re not going to leave farmers high and dry, in fact, what this legislation does is it does a big “stuff you” to all of the farmers who are doing all of the things to reduce their emissions. We know there are many of them in this country doing inspiring and innovative work to reduce their own carbon dioxide emissions and their own methane emissions and their nitrous oxide emissions. It’s one thing to say that we’re not even going to account for all those efforts; this legislation actually is literally not going to look any more to see where the emissions are coming from.

Since 2011, New Zealand has kept a track of the main sources of greenhouse gas emissions. This legislation takes away the requirement for processes to monitor and report the agricultural emissions under the emissions trading scheme. We’re not even going to look and see how things are going. The dairy farmer who presented to us from the Waikato, a guy farming 300 cows, who has eliminated synthetic nitrogen fertiliser from his production system and has cut his emissions by 25 percent, has done that unacknowledged. This legislation is saying to all those farmers who are doing that—who are making those breakthroughs—“We don’t care. You’re not going to get any benefit for that. You’re not going to get any acknowledgement for it. We’re not even going to keep a track of the emissions cuts that you are achieving.” This Government is saying we do not care about those farmers making those breakthroughs.

In terms of fairness, we live in a country where every other sector pays for its emissions under the emissions trading scheme. This is an agreement that was an across-Government agreement between the two legacy parties, between Labour and National, that the means by which we would deal with climate change was through the emissions trading scheme. Now, how is it that it functions if half of our total emissions are not even accounted for in the emissions trading scheme. How is it going to function? This is, essentially, another example of failing to seize the nettle on the greatest challenge that not only the world faces but that New Zealand faces in our agricultural production—yet again, kicking the can, as my colleague alongside me, the Hon Damien O’Connor, said. That is what it is. It’s saying we are not going to deal with this challenge.

Let’s be clear that in terms of the tools that are available to farmers, there are many tools available to farmers now. Most of them are to do with breeding and feeding and land use. Most of them are to do with how we do production systems.

Grant McCallum: And we’re doing it.

STEVE ABEL: And why don’t you keep a track of the achievements you’re making? This legislation explicitly takes away the accounting of where the emissions cuts are coming from. They are not making any distinction between that farmer who is producing a kilo of milk solids with far fewer emissions and the farmer who’s producing it with a lot of emissions. If you don’t account for it, if you don’t look, if you don’t count, you cannot measure the benefit. You cannot amplify the successes of those farmers who are making farm-gate profits through fewer emissions, who are decoupling the value of their production from the catastrophic impacts of climate change, for the good of the whole planet.

What about the fact that half of our emissions come from agriculture, but a full half of those come from only one sector: the dairy sector?

Hon Member: Oh, here we go.

STEVE ABEL: Yeah, let’s be honest about this. I’m going to put viticulture and horticulture and fruit and vegetables and even all of sheep and beef into one pile here—let’s call it the green pen—and I’m going to put dairy in this pile here, and this has as much emissions as every other form of agricultural production in this country—

Grant McCallum: And it pays a lot of bills.

STEVE ABEL: Are you saying that all the other forms of agricultural production don’t pay bills? Of course they do—of course they do. Why would we not incentivise those forms of agricultural production that put nutrition into human bodies without doing such catastrophic damage to the climate.

Miles Anderson: Subsidies—talking about subsidies, Steve.

STEVE ABEL: Without subsidies? Yeah. I mean, who’s subsidised in this country? The dairy industry is subsidised by the fact it doesn’t pay for its emissions. That’s exactly who is subsidised. It’s the failure of this sector to be willing to accept its responsibility. It’s saying we don’t want to be responsible and the biggest, most powerful lobbyist in this country is Fonterra. It is the dairy industry, and these guys are doing their bidding. This Government is doing the bidding of the big bully in the room, and that is Fonterra.

If the Government was actually willing to deal with the problem, they would rightly say—as people previously of other, more enlightened National Governments have rightly acknowledged—that we need to keep a track of what the emissions are doing, and we need to do something about it for the good of everybody, and there are solutions. There are ways to produce in a way that does not damage the climate, does not pollute our rivers, does not turn our water carcinogenic through contamination from nitrate. These are all things that can be achieved through a willingness to acknowledge the harm that is caused and those means of production that cause that harm.

It is a sad day in the trajectory of the challenge that we all do face in climate change, because if we’re not willing to take on the toughness of that challenge, we are choosing to put the pressure on to future generations to deal with it. If that price is not going to be paid in this generation, then the farmers of the future are going to have to pay that price, and they’re going to have to pay that price at a much greater level to catch up.

Not only is this Government kicking the cause and the consequences of climate change on all future generations, it’s putting the burden of the impact of dealing with greenhouse gas emissions from agriculture on to future farmers. That is what it’s doing. Or else, I should say, if it’s not doing that, it is choosing to decouple Aotearoa New Zealand from the global challenge. It’s saying that we’re no longer part of that global challenge; we’re not going to do our bit because we’re not going to be prepared to stand up to the biggest-emitting sector.

One of the burdens of us deciding to not do that is that, if we remain part of this Paris Agreement and these agreements to deal with climate change, we face a future bill of between $3 billion and $23 billion to buy overseas carbon credits to account for our failure to reduce our emissions in the way that we’ve committed to. Who’s going to pay that $23 billion come 2030? All of us: the public, the taxpayer; or is it going to be the dairy industry that pays it? Who’s going to pay the bills? Who’s going to pay for the clean-ups of the catastrophic weather events that are going to hit us with increasing frequency? It is going to be our children and our grandchildren, and that is a shame on this Government.

Thank you, Madam Speaker. This will be colourful, as you can well imagine, as I share a few thoughts on the second reading of the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill. Gracious me, I’m fascinated by some of the language that I’ve just heard shared from the Hon Damien O’Connor. “Idiots” I think was the language on this side of the House—an inference to my rural friends. Absolutely comedic from the said member. I do wonder, just very quickly, incidentally, kind sir, why you’re now sitting in Opposition. There you go: an abandonment of rural New Zealand.

This was a great piece of work my committee, the Primary Production Committee, did. We heard a lot of submissions, 581 submissions; 26 were heard orally—gracious me. And 65 percent, give or take a bit, were in support of this bill; about 30 percent opposed; and, depending on who you asked on the day, about 5 percent disagreed. We have heard all manner of hyperbole in this House, and we’ve just heard it now—the end of days, the catastrophisation, climate change—it’s all over; rural New Zealand’s going to be the first to bear the brunt of it. I want to frame it, if I can—

Hon Damien O’Connor: Go to Hawke’s Bay.

MARK CAMERON: —for that member and others—if I can frame a few questions for the sake of their virtue in this House. What percentage are we talking about here? Carbon dioxide is 0.04 percent. Gracious me, Mr O’Connor. Methane is two parts per million, and we’re having this hyperbolic runaway conversation, end of days—two parts per million. That, Steve, is a nonsense.

Steve Abel: Do you know how much cyanide gas—

MARK CAMERON: Well, we can debate that after the fact. We’re not talking about cyanide; we’re talking about methane. So here we go. By virtue, that side of the House is willing to impoverish a nation; this side of the House—i.e., the Government—is absolutely not. That’s why we’re committed to keeping rural New Zealand out of the emissions trading scheme. That’s why we’re having a genuine review of methane—its warming effects—creating a genuine split-gas approach. They are totally different—their warming effects are totally different—and we know full well that methane decays back to carbon dioxide in 10 or 12 years and is, by virtue, plant food.

We’ve got to have an honest conversation about what the role is of all the gases that are atmospherically warming. Stop the conflation, stop the hyperbole, and actually protect the sector in which, we maintain on this side of the House, we’re going to see a doubling of export revenue inside of the next 10 years. That’s what we’re here for, right? We represent that part of rural New Zealand—certainly my committee does—where we reconcile the costs of lawmaking. Do the costs and the benefits; what does that look like? Do the costs outweigh the benefits? Perhaps, if they do, we shouldn’t do it. That’s the kind of rationale, I think, that was employed by my committee.

This legislation affords some common sense, and it goes back to the kind of submission that we heard, or submissions that we heard; 65 percent of people were in favour of having a logical conversation. Adults in the room, stop the conflation; stop this nonsense—the theatricality I talk routinely about. Submissions from DairyNZ, Beef + Lamb, Federated Farmers, individual submissions, all spoke to the 100,000 extra participants that would be involved should farmers and rural people have been otherwise caught by an emissions trading scheme. That is an inordinately difficult problem and extremely expensive.

I maintain a couple of logical things: we have to have a conversation about what mitigation tools look like in our future. That is a journey we are on as a country, and I am absolutely happy to maintain a couple of, what I call, core factoids or truisms. We are the most emissions-friendly farmers in the world. Why are we willing to even risk impoverishing ourselves as a nation, our people, with all the difficulties that we have in this world, hospitals that we want to build, roads that we want to create, kids in school, and teachers?

Grant McCallum: Where’s the income coming from?

MARK CAMERON: Where does all that money come from? We can’t just magic this stuff up because the left says, “We’re going to tax the bejesus out of the farmers and it will all come right.”

I think this is the kind of conversation that we need to have as adults in the room. We are an emitter—yes, admittedly. What does that look like? What does our role as a little country in the bottom of the South Pacific look like in terms of reducing emissions? I pose the question because I have heard members on that side of the House say, “Reduce livestock numbers.” Well, I ask them: how many cows, how many sheep, how many goats, how many animal ruminants would we have to get reduced by number to keep our emissions profile additional warming below 1.5 degrees? You don’t know—you don’t know.

Steve Abel: Not many.

MARK CAMERON: This is the problem, right? That side of the House doesn’t know, and yet they’re the first people to say, “You, the rural sector, we want to see a reduction in animal numbers. We think that’s the way forward.” I think that is a nonsense. We’re the most efficient farmers in the world, and by virtue—

Steve Abel: That’s not even true.

MARK CAMERON: —the 40 million people we feed, the 5 million here and the 35 million—that member can debate that issue tomorrow. I maintain we’re really good at this, and there are other parts of the world that are not. If we’re not making it, someone else is.

I’ll tie off with one other remark: we are fortunate enough, as the Primary Production Committee, to have long-term insights briefings from the likes of Ray Smith and others—clever people. They have actually said, frequently, several times—people like Ray Smith and others—that in the next 30 years the greatest economic growth and rural growth as an industry—dairy, beef, sheep, you name it—will be in the Sahel belt of Africa and South-east Asia. These people are poverty stricken. They are going to be a lower-middle class that is emerging. What do they want? They want energy and they want high-quality protein. This country—and I won’t apologise for that—makes the best high-quality protein in the world. That side of the House would see that diminished. This side of the House absolutely will not, and we will support rural New Zealand.

This bill is a good piece of legislation that affords that kind of logic, and I support the commentary that is about to come, because I think this is good legislation, and we support rural people.

I rise to add New Zealand First’s support for this Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill—by gee, that is a mouthful. It is another coalition commitment being honoured by this side of the House. Bringing this piece of legislation through to this next stage and supporting it through, we have taken the sword of Damocles off the rural sector.

Why have we done that? As Mark Cameron has just so well articulated, it’s not because we don’t care about these things. It’s not because we’re buying into the hyperbole that we’ve heard, and some of the dire predictions. We have done it because the emissions trading scheme (ETS) is a wholly inappropriate vehicle for which to deal with this challenge of reducing biogenic methane.

The metrics around this would have involved converting the biogenic methane into a carbon dioxide equivalent, and farmers would have had to pay essentially a tax on that, when, as Mark Cameron alluded, this is a short-lived gas. It has different characteristics to carbon dioxide. Most of us came here in an aeroplane emitting carbon dioxide that will be in the atmosphere for hundreds of years. We are talking about a biological system where methane converts into carbon dioxide and is sequestered back round into the soil.

We, as a coalition, are having a re-look at where those metrics sit. We’ve got a team of international experts so that we can get that target exactly right. We’re looking at no additional warming as our yardstick. It makes absolutely no sense to put such a handbrake on our most important industries, the primary sector, those 82 percent of our exports for which our standard of living is so wholly dependent.

There would have been unintended consequences of this. We knew this at the time; Minister O’Connor knew this at the time. That’s why I didn’t put agriculture straight into the ETS: because we knew it was totally unsuitable for the challenge that we had with biogenic methane. It would have ended up being a dead-weight tax—that’s all it would have been on farmers.

The unintended consequences would have been that, actually, you would have tried to farm a little bit harder just to make a little bit more revenue to cover the cost of a tax because it wasn’t actually going to—Steve Abel is a little bit mistaken in thinking that farmers on an individual basis would have been incentivised to reduce their emissions. They actually wouldn’t have been. That would have been a great averaging system, and they would have just paid a tax based on essentially production. To offset that, they would have probably just tried to farm harder to make a little bit more revenue to pay for it.

If you look at our sheep and beef sector in particular at the moment, the Beef + Lamb New Zealand financial service forecast predicting last year a $65,000 profit before interest, tax, and drawings—a cash loss, in other words, for almost all farmers. These farms are not in a position to carry a dead-weight tax for no actual gains. We on this side of the House see much more merit in the carrot rather than the stick.

There has been some talk, and I note Fonterra has been brought up on the other side of the House. They have a target of a 30 percent reduction in emissions by 2030. We’ve got Nestlé over here—the former Minister O’Connor alluded to that earlier; they’ve got market pressure.

I went to one of the most positive meetings that I’ve been to in recent times—actually, since I’ve been back in this House—the low-methane genetics and Beef + Lamb New Zealand and AgResearch and AgriZero and some leading livestock farmers. We absolutely know how to do this; we just need to get the market incentives right.

I’m pleased to announce that you will be able to buy cool wool rugs by Christmas. Bremworth were there; they saw the advantage in this. They saw the marketing angle in getting behind those very farmers that Steve Abel was talking about that are demonstrating a real willingness to lower their emissions. They’re going to take their wool, put it into rugs, and put it out into the marketplace. That is the sort of initiative that will take farmers with them, not just getting a one-size-fits-all stick to beat them with. The farmers of this country are sick and tired of being portrayed as climate villains.

The red meat sector—and I know Mr Abel will have seen these figures too, because they’re not public, but they have already exceeded the targets for 2030, but they’re not doing it for any other reason but they’ve been driven out of business. We’re having an incredible drop in livestock numbers—6.5 million less used than just a few years ago. This is a very, very worrying trend.

Whilst I wasn’t at the Nuffield New Zealand Awards Function tonight, I’ll tell you where I was. I was at Unity Books down in Wellington there at the launch of the Woolsheds book, an amazing pictorial book with stories of 15 iconic New Zealand woolsheds. In her speech, the publisher got up and said that the great tragedy of this is that many of those sheds are no longer being used or have very reduced numbers going through them than what they did. Our very heritage, our very history is being taken from us. We are driving these farmers into the arms of forestry, and this is what we’ve got to be so mindful of on this side. We have got to have a balanced approach, and putting a tax on that sector particularly would be absolutely devastating, would accelerate that trend. It would have massive impacts on our rural community.

This is not climate denial; this is looking out for our rural communities and taking a balanced approach, reflecting the reality of what’s happening out there in the real world. We are looking to technology. We are looking for nature-based solutions. We are reviewing the science so that the targets genuinely reflect what we have to reduce, but we cannot do that by just continuing to reduce stocking rates. We must do it by farming smart and innovating and the things that have made agriculture the backbone of this economy for the last 150-odd years—or certainly since the ship sailed out of Dunedin in 1882, was it?

I’d thank the Minister of Climate Change for bringing this forward. As I say, this is a coalition agreement that we are honouring. Congratulations to the Primary Production Committee for hearing some 581 submissions—a large and significant task. As has been said, 65 percent of them—two-thirds of New Zealanders that submitted on this bill—saw what we were trying to do. It’s not about denying climate change; it’s not about agriculture not doing its bit. It’s about stripping away a tool that was wholly inappropriate for the job that it was being asked to do. This is a sensible approach, it’s a balanced approach, and it will be a successful approach. I commend this bill to the House.

The next call is a split call.

Tēnā koe e te Pīka. I stand to speak to this bill on behalf of Te Pāti Māori, and our view is that this Government must have some magical insight into Planet B that we’re not aware of. It’s not about being climate deniers; in fact, it’s about being tangata whenua deniers. If I was to summarise parts of the Māori perspective of the submission—and I can only share what it is that Māori submitted; you may not like it, but they have every right to put across their views—it’s that it excludes Te Tiriti.

Māori have not been adequately involved in the design and implementation of this bill. In fact, He Waka Eke Noa had at least included some input from Māori—Māori farmers who wanted to transition to sustainable farming were not supported to do so. I was going to say that again because they are the original rural people of this nation. I’m going to say it again for those who may have trouble understanding: Māori farmers who want to transition into sustainable farming were not supported to do so. The absence of emissions trading scheme could widen further economic disparities between Māori and non-Māori farmers. But this isn’t about Māori farmers and this isn’t about looking after good farmers. This is actually making it really easy for the lazy farmers, and that’s what this Government has been guilty of for a very long time.

Let’s talk about—again, this isn’t my view—my voters’, your voters’, our voters’ views. Let’s talk about the community we allegedly serve. The first thing is we’ve got Ngā Tai, who mentioned—again—“We are faced with the exclusion of Te Tiriti.” We’ve got Climate Justice Taranaki, who have stated in their submission: “Good farmers are already doing the right things, like reducing emissions and working with nature rather than against it. The Government framework should be supporting and encouraging good farmers.” Fridays For Future Whanganui have touched on the issue of intergenerational equity and a livable planet. “We can’t keep allowing”—listen to this, please, Minister Jones—“We can’t keep allowing the greed to dictate the future of our mokopuna.” I don’t know if this Government have any mokopuna, but we—Te Pāti Māori—are extremely focused on mokopuna decisions.

We go back to some of the other kōrero—[Interruption] Oh, you’re awake? I was worried that you may not have been awake. I mean, let’s talk about the fact that we have a whole agricultural sector that need to—and, actually, the good ones want to—be held to account. They want to be supported to reduce greenhouse gas emissions. What we’ve got here is that, again, we’ve been asked to support another bill that allows the desecration of te ao taiao. No surprise there, whānau—no surprise there. This is who we’re talking to. Once again, we have a Government that accelerates climate change. Even though you don’t want it, and even though you’ve come out with some amazing transformational recommendations and ideas, what we have here is, again, a bill that lets our biggest polluters—our biggest bad polluters—off the hook; our worst farmers off the hook. They do not give credit to the great farmers, and let’s make sure that a lot of that includes you and me.

What we have, in fact, is we have to support a bill that has had zero Māori input—surprise, surprise, surprise. The answer here, whānau, is kāo. Kāore—kāo means no: no way in this—again, we’ll just make it really clear for the understanding of this Government who actually sits here and tries to tell us they’re focused on the future of our nation. They’re actually focused on the future of lazy farmers, lazy polluters, and nothing transformational coming out of this Government. But hey, who’s surprised? Kia ora rā.

I call Fernando Hernandez.

Franciso Hernandez.

DEPUTY SPEAKER: Francisco, sorry—Francisco Hernandez. My apologies.

FRANCISCO HERNANDEZ: That’s all good—at least you didn’t call me Scott Willis!

DEPUTY SPEAKER: Ha, ha! No, I could never get you two mixed up.

FRANCISCO HERNANDEZ: Thank you, Madam Speaker. I rise here to take a call on the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill.

This is another piece of legislation where the Government’s rhetoric fundamentally doesn’t match up to the reality of their actions. This is a Government that talks about how they’re for law and order, but—surprise, surprise—there’s less front-line police in October than there were this time last year. This is a Government that talks about how they care about child poverty, but—surprise, surprise—they’re proposing weakening the targets. If you don’t count it, it doesn’t count, apparently. This is another example of how they’re saying they care about rural New Zealand, but have they looked at rural New Zealand lately with all the job losses that are happening in all the pulp and processing plants and all the meat processing plants? If this is what the Government thinks is care, I’m frightened to see what it looks like when they don’t care about something.

This bill is another example of them actually, rather than standing up for rural New Zealand, taking tools away from rural New Zealand, because the proposal of the previous Government was to actually not put agriculture in the emissions trading scheme (ETS); like everyone is saying, it was to work with the rural sector to come up with on-farm emissions pricing and a system that actually recognised the great work that farmers were doing through sequestration payments. Instead, they’ve torn that all up. They’ve said no.

My colleague Steve Abel has talked about already how farmers are at the front line of climate change, and, look, I’ve seen this. I’ve seen this when I visited Northland—great region. They talked about how in the events of Cyclone Gabrielle last year, the whole kūmara crop around the country was, basically, wiped out by the events of that. Farmers are at the front line of the climate crisis, and this Government thinks that by delaying action and by denying the actual reality of what’s happening; by relying on, you know, these fake scientific reviews, hoping to water down the metrics, they’re actually doing something about the issue, but that’s not the case at all—that’s not the case at all.

We know that climate delay is disastrous. We know the great work that He Waka Eke Noa was doing, which was actually going to fund—it was going to fund—farmers to come up with the latest emissions reduction practice. It was going to fund all that, because the proposal was to actually ring-fence all the funding that was going to be raised from the levy and redirect it back to the sector. There’s the rhetoric that “Oh, it’s just being taken by some Wellington bureaucrats to pay for free public transport.”, or whatever, but it was all going to farmers. That’s just not what the reality is.

There’s also another piece of rhetoric that’s—you know, they’ve said, “Oh, it’s going to be financially ruinous.” Well, if you actually looked at the proposal: the proposal in the ETS was to create a backstop whereby it was going to come in at a 95 percent discount—95 percent discount at a processor level. What does that actually look like? Well, I worked it out. I looked at the current ETS spot prices and it’s something like $63, and 5 percent of that is $3.15. Now, $3.15 for a ton of emissions—a ton of emissions—is not going to be, I’m sorry, financially ruinous. It’s a very small amount to contribute to research and development within the sector itself.

Another aspect of this is there’s been a lot of rhetoric about the EU, whether there’s going to be a split gas approach, and how other countries are going to do their bit and how we have the most emissions-efficient farmers. That might be true at the moment, but we should never be content to rest on our laurels. We should never be content to actually allow people to get complacent. We want the New Zealand farming sector to remain the best in the country, and the only way we’re going to do that is by funding research, by funding updated practices, and by funding good practice.

We’ve already seen protests happening in the European Union, in France, when they signed the free-trade agreement with New Zealand. Part of that protest was that the farmers over there don’t feel like New Zealand is going to pull its weight, and actions like this are going to absolutely—absolutely—threaten our market reputation. The Minister of Climate Change himself talked about the issue of the premium and how there’s strong market pressures to actually take action. Reputation—New Zealand’s reputation—is absolutely on the line, which is why we strongly oppose the bill and we hope that you’ll all oppose it too. Thank you.

Thank you, Madam Speaker. Pastoral farming in New Zealand is in crisis at the moment. We have had a significant drop—as my colleague Mark Patterson mentioned—in sheep numbers over the last few years. Our breeding ewe numbers in New Zealand are now at 15.6 million, down from the highs in the 1980s in the 70 million-odd sheep altogether there was. The answer to that, the Opposition thinks, is to tax the emissions on livestock. All that is going to do is drive more farmers out of business and add to the afforestation of New Zealand.

The intention to introduce emissions taxes is hardly fair when there is no clear way to measure emissions on farm. We’re getting there. They’re working towards it, but currently there is no fair way to measure emissions. Essentially—

Hon Damien O’Connor: Well, how are Fonterra going to do it?

MILES ANDERSON: Exactly. That’s why they’re not doing it yet, Damien.

Hon Damien O’Connor: How does Fonterra do it?

MILES ANDERSON: They’re not taxing them, Damien. The members opposite are very happy to tax farmers on a guess—and that’s what it is, it’s a guess. The members opposite are happy to tax our pastoral sector when, as I said, all that tax will do is accelerate the transition into pine trees.

James Meager: How much methane from a blueberry?

MILES ANDERSON: Ha, ha! There are no tools available as yet to help farmers in the mitigation. There are tools being developed, there are breeding tools, there are vaccines in the future, but nothing on farm available now. It takes generations of breeding to get livestock that are useful for breeding purposes.

We are investing in solutions. What we need to do and what this Government is doing is reevaluating some of the science. We’re looking at the sequestration and how that needs to be properly evaluated. It would annoy members of the Green Party to note that the Canterbury Plains now have several centimetres more of topsoil due to irrigation and dairy farming than they had previously, but none of that carbon in that topsoil is able to be counted. The methodology is not scientifically sound at the moment and is far from standing up to scientific peer review.

I’m very, very happy to see that the Primary Production Committee has majority voted to return the bill to the House unchanged, because I think this is going to make a big difference to the pastoral sector. There are scientific investments happening right now that will help alleviate any concerns around the emissions. What I would like to point out is that we consistently get told that 50 percent of our emissions are from farming, but that’s a gross target based on what is now considered to be poor science. It has been considered to be at least overvalued by four times, possibly more. That’s what this Government needs to do and is doing—re-evaluating all that science—because we are basing a lot of our decisions on science that is old. With that, I commend this bill to the House.

Tēnā koe e te Māngai o te Whare. Heoi anō e te Māngai ko taku mihi tuatahi ki ō tātou mate huhua o te wā. Otirā kua haere tini koutou ki tua o te ārai, nā reira, haere haere haere atu rā koutou. Tēnei te tangi aroha ki ngā whānau e noho pani ana i tēnei wā. Heoi anō huri noa ki a tātou i tēnei pō, tihei mauri ora. Ngā mihi o te pō ki a tātou.

[Thank you, Madam Speaker. Also, Madam Speaker, my first acknowledgment is to our loved ones who have recently passed. You have all gone beyond the veil, and so farewell, farewell, farewell to you all. My heart goes out to the families who have been left bereaved recently. Therefore, everyone present here this evening, good health and wellbeing to you all.]

I rise to speak on behalf of the Labour Party tonight. First of all, I’d like to acknowledge the Hon Simon Watts’ mihi to the Primary Production Committee—great committee, I must say—but also acknowledge that while he correctly stated that this bill was passed by majority, it was not unanimous. That said, it sounds like you are correct, opposite, in saying that 65 percent of submitters did support this bill. However, I’ve spoken to several of those submitters who say while they supported it, they don’t know exactly what’s coming. And that’s the issue here: what’s the plan? It’s OK to get rid of something—you know, ladies, when we get rid of a pair of shoes, we got a plan for a new pair. What’s the plan here? [Interruption] Is that right? No objection from that side of the House. Miles knows—Miles knows.

Effectively, we all want the same thing. The opposite campaigned on the fact that Labour don’t care about farmers—that’s simply not true. We just care about all farmers. We care about farmers across the spectrum. Debbie mentions some of the implications for Māori farmers, and I’ll get to talking about some specifics about that later, but across the floor, I heard the word “gains”. What are we talking about when we say, “gains”? Profit. There’s nothing wrong with profit. I’ve said it once, I’ll say it all the time—there’s absolutely nothing wrong with making profit—but when we say gains, we’re saying we want gains for the farmers, for the whenua, and for foreign trade, and we can do that all sustainably.

We know farmers are efficient, but I just want to pick up on some of the implications for farmers on whenua Māori, whose book we could take a leaf out of, I reckon, because some of us don’t have the luxury of thinking about our own farm in this generation. Some of us have the obligation of maintaining whenua for generations to come and in honour of generations before.

Grant McCallum: Heard of family farm?

CUSHLA TANGAERE-MANUEL: I live on one—I live on a family farm.

Grant McCallum: Exactly. So do I—so do I.

CUSHLA TANGAERE-MANUEL: That’s why I’m making the distinction.

Grant McCallum: So do I.

CUSHLA TANGAERE-MANUEL: That’s why I’m making the distinction.

James Meager: My neighbour’s a sheep.

CUSHLA TANGAERE-MANUEL: This is not a farm-off. I just told you—this is not a farm-off. This is about big picture and not considering things in isolation. We’re considering one tiny aspect, as you know, because you own a family farm. It’s not just about emissions. What about the whenua? We’ve got to think about the fact that there’s the potential under this bill for people to overstock—you know, the temptation. We’re trusting people. As we see in the Primary Production Committee, and we know in our personal lives, there are several—the majority of farmers have the best intention. However, when you talk about gains in the sense of profit, the temptation to overstock will be something some—probably a minority, but you can’t rule it out—will not be able to resist. Then we get the risk of something that’s already a huge issue: erosion.

Then we get the risk of biological matter—for the whānau watching at home, that’s mimi and tūtae—getting into our waterways. Far out, where normally you criticise the Greens for being the ideological ones, now you’re sitting there saying you can guarantee 100 percent of farmers are going to do the right thing.

DEPUTY SPEAKER: Let’s not overuse the word “you”.

CUSHLA TANGAERE-MANUEL: Oh, sorry—members opposite, usually the Greens, are getting accused of being ideological, living in some “Pollyanna” Greens utopia. Yet members opposite seem to be implying that they can guarantee that all farmers will do the right thing to reduce emissions.

Now, talking about how we can do this sustainably, and the Hon Damien O’Connor has already outlaid the benefits to our trade relationships of doing this right. So I want to give a personal shout-out to a farm called—you will have heard of it—Whangarā B5 the East Coast, managing the whenua sustainably; managing the wai sustainably; and taking the trade, taking Aotearoa, to the world. When they put their beef on the market, you know what the world said? “Da, da, da, da, da, I’m loving it!” because they supplied McDonald’s. Yet, while doing that, they are maintaining that whenua for generations to come. So, of course, we want farmers to do well individually, ahuwhenua, all of them, but we must maintain our taiao—it’s the only one we’ve got, whānau. Farms come and go; economies rise and fall; Papatūānuku, Tangaroa, and our wai are only here once. We’ve got to think about our generations to come.

Heoi anō, Madam Speaker, I’m just going to see if I’ve missed any of my notes—no, I think I’ve covered it all. Just to reiterate that, on this side of the House, we are here for farmers, for whenua, and for foreign trade. Tēnā koe, Madam Speaker.

Look, I rise with great pleasure to support this bill to take agriculture out of the emissions trading scheme (ETS), because on this side of the House, we recognise that farmers are the backbone of our economy. We are putting aspiration back into our primary sector again. To hear that side of the House refer to our farmers as “lazy”—I have never met a lazy farmer. Those farmers are up at the crack of dawn. They work hard all day, working to raise money, to get the wheels moving in this economy. Our famers are definitely not lazy.

That’s the thing, because that Government villainised our famers; they went to war with our farmers. Well, it’s about time that we put some confidence back into our rural sector, our primary industries, and we put some aspiration back again, and that is what this bill is about. It’s about practical sense. The purpose of this bill is to keep agriculture out of the ETS. Our dairy farmers here in New Zealand are among the most carbon-efficient in the world. They are some of the best farmers in the world. I’d actually vouch personally for—you know, a lot of my family are dairy farmers. They are hard-working dairy farmers. We’ve got some dairy farmers here on this side of the House. We know the realities of what it takes, producing some of the best, highest-value product in the world; our largest exporter.

To the point of the previous member, Cushla Tangaere-Manuel, they may actually need a bit of a lesson in what drives the productivity in this country. Our food and where it’s produced, our dairy, our butter, our milk, our red meat—it’s all produced by our hard-working farmers in New Zealand. We don’t want to give away our competitive advantage as a small nation at the bottom of the world, and keeping agriculture out of the ETS will ensure a profitable and sustainable future for our farmers and our country.

As I’ve already said, Kiwi farmers are the most efficient in the world. Farmers need the tools to reduce emissions before pricing agricultural emissions, and I think we’ve already spoken about that tonight and looked at our vision, looking at science and innovation and biotech, things that are going to power up our agriculture sector again, but we must not punish and vilify our famers. That is why this is a very good bill that makes practical sense, and that is why I commend it to the House.

Thank you, Madam Speaker. Look, this is a bill that takes us backwards—there’s no two ways about it. The member who just resumed his seat went on about—I don’t know if it was vilifying or villainising farmers. None of us are here to do that. Ultimately, that lesson was unnecessary because all of us know that our agricultural is vital to New Zealand. I don’t think anyone is arguing that point. We know that about 70 percent of goods exported—

Miles Anderson: 80 percent.

Hon PRIYANCA RADHAKRISHNAN: —are through agriculture—70 or 80 percent; whatever. The point I’m making is it’s pretty high. We all know that. We know that there have been financial insecurity and stresses and there’s pressure that farmers have been going through. None of us is here to vilify farmers, but the point remains that, currently, about half of New Zealand’s emissions come from agriculture. That is undeniable, as is the importance of agriculture.

What we are talking about on this side of the House is bringing some balance to this debate. We know that, primarily, emissions comes from biogenic methane and nitrous oxide. We know that this bill will take us backwards when it comes to our climate change commitments. We know that it jeopardises the trade commitments that we have made. All of those are facts.

The other point that we are making on this side of the House, and that colleagues have made eloquently, is the fact that He Waka Eke Noa was scrapped with no plan to replace it. That is the crux of the issue here.

Members opposite can stand up and wax lyrical about the importance of the agricultural sector. We on this side agree with that, but we also say, “What about our commitments to the environment and our trade agreements?” What about those very practical things as well? Where is the plan? Show us the plan. But there isn’t one, is there? I mean, I acknowledge the $400 million that the Minister of Climate Change has mentioned in terms of a commitment to technology and the tools being developed, but the point is that they’re being developed. If a commitment is made on the other side of the House to actually price emissions from agriculture by 2030, we’re running out of time. Where is the plan—once again. For that reason, I don’t commend this bill to the House.

Well, it’s becoming really clear in this House that there is a clear division when it comes to supporting and understanding our rural sector, because the people on that side of the House have no understanding and no feel and no trust in the people that earn the money for this country. This side of the House gets it. We understand the importance of our rural sector to New Zealand and to its economy, and that is the real frustration.

Probably some of the most divisive arguments and debates that we have in this House are around the rural sector, and I’ve heard comment about the He Waka Eke Noa proposal. Well, the reason it died was because the former Minister opposite killed it. They had their chance. That was put on the table, and all they had to do was accept it. No, it wasn’t good enough—

Hon Damien O’Connor: It didn’t answer all the questions.

GRANT McCALLUM: —they threw it back in their face, and that was lost. You’ve had your chance, you failed, and now it’s up to us to fix the problem. That’s what we’re doing—we’re here to fix the problems that you couldn’t. Right, and now the other conversation we had—

DEPUTY SPEAKER: Don’t overuse the word “you”, please. Thank you.

GRANT McCALLUM: Thank you, and it’s the members opposite—thank you. The other point I would like to make is that they talk about, “Well, what are we doing to reduce emissions?” Speaking as a Fonterra farmer, we’re very focused on reducing our scope 3 emissions. We are measuring those emissions and we have been incentivised to do so, and it’s called the cooperative difference payment. That is what we are doing, and we don’t need attacks to come from you lot—from that lot on the other side—to achieve it.

I say to you—I say to the people on the other side—that you’ve got to understand the farming sector. Understand the importance and understand the investment that we’re making in our communities in our rural sector, who do the science and the research to actually find these solutions, because otherwise the only thing that’s going to happen is our country will get poorer and the globe will heat up more, because you’ll find that that’s where the emissions will come from. It’s from more emissions from less efficiently produced food from the other side of the world. I commend this bill to the House.

Thank you, Madam Speaker. It is amazing how patronising these Government members can be and how lazy they are in their speeches when they just say that anybody who dares to disagree with anything they say is vilifying farmers—what a load of rubbish! Total rubbish!

Now, I wanted to start this speech with three things that I thought the House could agree on, but I’m not so sure after listening to the member for Waitaki’s speech. Because the first thing I was intending on saying in a friendly and amicable way was we should all be able to agree that agricultural emissions are about half of our country’s emissions. Getting a shake of the head from the member from Waitaki—that’s very interesting.

Then, of course, I think we can all agree that agriculture is a critical and very important part of our economy, which, of course, is why the member sitting next to me, the Hon Damien O’Connor, worked so hard on those trade deals with the EU and the UK. Then the third thing is that the emissions trading scheme (ETS) is really what this Government is focusing on in terms of emissions reduction. They rely, and say in all of their policy documents, that that is what they want to do—ETS. None of these complementary policies—they’re all gone; $3 billion in the last Budget gone. “Going to rely on the ETS.”—but not, it appears, for half of our emissions. There is some inconsistency there.

I do note that the point of agricultural emissions being in the ETS was as a backstop. There was a lot of time taken—and we heard about that in some detail from the Hon Damien O’Connor—to try and work out a way to fairly price agricultural emissions. But there was a backstop. With this bill, that backstop has gone. Despite this, we have heard from the Minister that we need to adapt to evolving international obligations. We need a fair pricing system, he said, but we also need tools. What are those tools, and do we not already have some of them, and is this just an excuse for head in the sand?

I think, from what I hear from the members opposite, that future technology is one of those tools. Of course, on this side, we agree about the importance of research, which is why we funded much of it when we were in Government, but that research should not be treated as a magic bullet. There may be new technologies that come along and they may reduce the methane produced by our cattle in particular and our dairy herd, but it may not. We know that there are different farm management techniques that can be used now and must be.

Instead, the policy commitments we have from this Government are a combination of more pine trees; the ETS, but not for agriculture; and removing, as I said, all those complementary policies. I have a challenge to this Government, and that is to give farmers some certainty that doesn’t merely rely on pine trees and magical new technologies that we don’t yet have. We can make progress now and this needs to happen. Instead, all I see when I’m in this House and all I hear is an assault on biodiversity, a love for more pollution in our rivers, and no incentives for any sort of decarbonisation of any single gas.

Hon Shane Jones: Wind it up!

Hon RACHEL BROOKING: Oh! I was just asked to wind it up, and I was about to. I was going to say that this is a very sad, sad state of affairs, and that this Government should be ashamed of themselves. They say, “We’re going to keep to our budgets.”, yet there is nothing that they are doing to reduce emissions.

Hon Shane Jones: Algebra.

Hon RACHEL BROOKING: Now, Mr Speaker, there’s just been a very curious interjection of “Algebra.”

ASSISTANT SPEAKER (Teanau Tuiono): I was trying to make sense of it myself.

Hon RACHEL BROOKING: Well, it doesn’t make much sense because, of course, if you do nothing—or if, in fact, you go beyond doing nothing and you cut $3 billion of funding for doing things—then you are not going to reduce emissions. This Government has total magical thinking on this, and it’s going to hurt the economy in the long run because we’re not going to have those trade agreements that we’ve signed up to at the moment when countries realise that we are doing nothing. What this Government is doing is putting our farmers and our wider economy at real risk, and they should be ashamed of it—get on and make a plan, and do some things.

Thank you, Mr Speaker. I am pleased to take this call in the second reading of the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Bill—a mouthful.

Now, I’ve got to convey that I wasn’t actually part of the Primary Production Committee that actually sat for this here, but looking at the report, clearly a good number of submissions came forward, and obviously there was a good percentage of supporters amongst those submissions for the actual bill itself. In my mind, the heart of this bill is about feeding people with food that has been produced by farmers who are among the most efficient in the world at growing and producing products with the lowest emissions footprint.

We do this while, at the same time, having to transport our products vast distances around the globe. New Zealand’s ability to feed the world should not be underestimated nor trivialised. It is said that New Zealand feeds 40 million people around this world, and I’ve also heard commentators say that New Zealand contributes 10 percent of the diet of 400 million people. Just look at Fonterra. It exports to 130 countries or thereabouts. Silver Fern Farms exports to about 60 countries.

Hon Damien O’Connor: Point of order, Mr Speaker. I don’t like doing this, but to a member who knows so much about this topic, or should do, reading a speech is probably not the best thing in this House. There have been rulings from the Speaker on this.

Tom Rutherford: Yeah, at the discretion of the Speaker.

Hon Damien O’Connor: But the member knows—should know—about this topic.

ASSISTANT SPEAKER (Teanau Tuiono): I appreciate that reflection from the member, and I’m sure David MacLeod has taken note of that, and so I would invite him to do less reading.

DAVID MacLEOD: Thank you, Mr Speaker, and thank you for the input. Much appreciated. I was going to say, just before I was interrupted, about another very good company in New Zealand, called Zespri. They actually export to 59 countries. We’ve got some amazing countries in our agricultural sector, and everywhere you look at it, New Zealand is a significant contributor to the world when it comes to food.

Why would we ever want to pressure the agricultural industry and its sector to the point where the production is reduced here in New Zealand? All it does is allow that production to take place in some other country that doesn’t even produce it with as good a footprint as us. It is exporting—in fact, it’s actually increasing the global footprint of the emissions that are released globally. It just doesn’t make sense to me.

The future advancements to reduce the agricultural emissions, already spoken about by many people on both sides of the House, are working, but we also need to concentrate that in the future. That answers the question, what’s next? It’s all the investment and all the policy changes that this Government is making that’s going to help us to achieve these gains that we need. We need to be as good as we can because, yes, we need to be competitive for the important customers, just like Nestlé that the member on the other side of the House actually talked about.

This bill provides a pragmatic approach. This bill is an approach that is good for global emissions. This bill is an approach that will deliver some of the much-needed positivity to the agricultural sector and an approach that makes sense. A good day is coming for the agricultural sector. Coming from a very proud agricultural area, a rural sector, I back our growers. Everybody on this side of the House backs our growers. I commend the bill to the House.