Land Transport (Clean Vehicle Standard) Amendment Bill

Members, the House is in committee on the Land Transport (Clean Vehicle Standard) Amendment Bill. Members, we start with the debate on clause 1. Clause 1 is the debate on “Title”. The question is that clause 1 stand part.

Thank you, Madam Chair. This bill has seven clauses. This first clause is the title clause. The title clause states very clearly that “This Act is the Land Transport (Clean Vehicle Standard) Amendment Act 2024.”, and it has that name simply because it amends the standard in relation to the setting of it and in relation to it being user-pays, rather than a Crown-subsidised, scheme. It’s very simple; what it says is what it does.

Point of order. Thank you, Madam Chair. I just want to seek some clarification from you as we embark upon this stage of the process. The Minister of Transport has made some introductory comments that purely relate to the title. I refer you to Speaker’s ruling 127/1, which relates to basically the exact situation that the committee does find itself in, and you may be familiar—

CHAIRPERSON (Barbara Kuriger): I’ve actually brought the clause with me.

TANGI UTIKERE: Fantastic, you’re very diligent as per usual—we are on the same page.

Speaker’s ruling 127/1 basically says that “Members haven’t had a chance to view the bill and haven’t had much notice. There haven’t been any public submissions, so therefore clause 1 will be a more fulsome debate around the bill, but I will still require members to address the bill that is in front of them.” So in giving questions or speeches around the title—that can go wider than the title but not wide-ranging into the other clauses too much. Just be careful that we don’t debate the whole bill in the first clause, but it is more wide-ranging than just the title.

Hon David Parker: Madam Chair.

CHAIRPERSON (Barbara Kuriger): The Hon David Parker. Is this a point of order or a speech?

Hon David Parker: No, I didn’t call a point of order, no.

CHAIRPERSON (Barbara Kuriger): OK, so the member wants to speak. The Hon David Parker wants to speak on clause 1.

Thank for that honour, Madam Chair. Well, my comments are, in particular, in relation to the title, but I do have to cross-reference the relevant clause 7 of the bill, amending section 175 of the Land Transport Act, which talks about “Targets … reducing carbon dioxide emissions”, because I want the Minister of Transport to clarify that, in fact, the changing of those targets for carbon dioxide emissions could actually, given the breadth of that power, make the standard less onerous—i.e., vehicles would be less clean—which calls into question as to why the name is the clean vehicle standard if it could be made dirtier, so my question is whether that is—

Tim van de Molen: Point of order. Thank you, Madam Chair. Look, I just wanted to come briefly to the comments made or raised by Mr Utikere in his point of order. I was just quickly seeking some clarification. As I understand, this bill was introduced during the Budget urgency session, so there has indeed been plenty of opportunity to consider it. It hasn’t just been introduced to the House today—

CHAIRPERSON (Barbara Kuriger): Yes, that’s true, Mr van de Molen, given that we’ve had a period of time between that bill, but the Opposition have not had a chance to debate it at this point in time.

Tim van de Molen: But they have had a chance to view the bill.

CHAIRPERSON (Barbara Kuriger): Yes, they’ve had a chance to view it, but it has not been and it will not be going to a select committee.

Tangi Utikere: Speaking to the point of order—thank you—since Mr van de Molen has raised that, Speaker’s ruling 127/1—

Tim van de Molen: Well, she’s already ruled.

Tangi Utikere: Well, she had already ruled, but it didn’t stop you from doing anything about it.

CHAIRPERSON (Barbara Kuriger): OK. Move on with your point of order, Mr Utikere.

Tangi Utikere: Yeah, so I think what Mr van de Molen has done—

CHAIRPERSON (Barbara Kuriger): We’ll have points of order in silence, please.

Tangi Utikere: Thank you, Madam Chair. Thank you for the clarity. I didn’t get a chance to respond to that. But I think what’s important here is that, yes, the bill has been in the public arena, but the other components in that Speaker’s ruling are also that there have not been any public submissions. And also this is a very unusual step in which this bill is being considered clause by clause as opposed to part by part—and the House is in urgency. So it’s not just the fact that the bill hasn’t been able to be viewed, I take, by your interpretation and confirmation of that ruling, that there are many other aspects to that.

CHAIRPERSON (Barbara Kuriger): Yep. That’s fine. The Hon David Parker.

Hon DAVID PARKER: Yes, I will just briefly recap my question to the Minister: Could he confirm that the effect of this bill is to allow a change to the clean vehicle standard, which could in fact increase carbon dioxide emissions rather than decrease them?

What this bill does is it does two simple things. One, it enables the standard to be set by regulation, and, secondly, it allows for a cost recovery of the cost of operating the standard. Those are the two simple things. Outside of this debate, there’s been—I think section 175A of the Land Transport Act requires that the Minister must undertake a review of the targets.

Thank you. Further to my colleague the Hon David Parker’s question and the Minister of Transport’s answer there, I direct the Minister to the departmental disclosure statement where it said that “The CRIS developed for this bill did not address the aspects of the Bill relating to the modification of the Clean Car Standard’s emission targets.” So I think given that the regulatory impact work did not address the issues around the emissions targets, I think the question that my colleague put to the Minister has not been adequately answered to the satisfaction of the Opposition in terms of understanding where the Minister is coming from, given that that analysis has not been undertaken and the departmental disclosure statement states that. So I’d like the Minister to state what evidence he is relying on—given that there has not been that regulatory impact analysis done on the Clean Car Standard’s emission targets—that this will indeed fulfil the title of being a clean vehicle standard and not a dirty vehicle standard?

One, this bill doesn’t repeal the clean vehicle standard; there will still be a clean vehicle standard. Secondly, this bill does not change the standard, and so there is no change to the standard by this bill.

I acknowledge that the Minister of Transport is correct and it doesn’t repeal the clean vehicle standard, but what this does is bring forward by three years the Minister’s ability to change that by regulation. So given that he still hasn’t answered the fact that there hasn’t been the regulatory impact analysis done on the emissions target aspect of this, I’d also like to know what evidence he’s relying on that this will still be a clean car standard. But I’m also interested to know what the Minister is going to say in terms of fulfilling the name of the bill on the tin—the Clean Car Standard—what the criteria for decision making around changing those regulations will be, and whether he will be putting that in the bill, and, if not, why not?

If the member read the entirety of the principal Act, she would find in section 175A that the Minister must not initiate a review later than 30 June 2024. In section 175A(2), it outlines the factors that the Minister must take into account.

Thank you. I ask the Minister of Transport how he responds then to the open letter from the Hon Simon Upton, the Parliamentary Commissioner for the Environment (PCE), who, in the absence of being able to go through a select committee process, has very clearly written to the Minister—the very clause that the Minister is saying makes it all OK, the Parliamentary Commissioner has got some questions around. So I’d like to know the Minister’s response to that; how it is going to fulfil being a clean car standard when the Parliamentary Commissioner’s advice very clearly says—

Simon Court: Point of order, Madam Chair. I detect in the member’s question the same line of questioning that she has already pitched twice, the Minister has replied to twice.

CHAIRPERSON (Barbara Kuriger): The member’s actually brought new material into this question. I think it’s fine. Thank you.

Hon Dr MEGAN WOODS: Thank you, Madam Chair. So the question I put there is the paragraph in the PCE’s letter that said “Parliament clearly intended that any regulations, that are made to set targets, would be subject to review. To ensure this is carried through in your amendment bill, I suggest you make a minor amendment to the drafting of section 175A(a)”—which, of course, is the clause that the Minister referred to in his previous answer—“so that the text that follows ‘carbon dioxide emissions set out in section 175’ is replaced with ‘and not later than 30 June 2025, for targets prescribed in any regulations under section 167C(1)(j)(iv)’.” What does the Minister say to that?

I always enjoy receiving open letters.

Thank you, Madam Chair. I have a series of questions about both aspects that the bill brings in. One is: firstly, who has the Minister of Transport consulted with in deciding to bring this bill to the House under urgency? What specific organisations has the Minister consulted with before bringing this bill, under all stages, in urgency, to the House?

The second question is: how can this bill be increasing certainty when it’s removing targets that have been publicly available to the industry and to all of New Zealand for several years, and replacing it with none? What process is the Minister intending to use on consultation on any new standards he might be putting in for the years 2025, 2026, and 2027 before those are brought in through regulation? I’ll carry on with more questions after I get those answers.

Tangi Utikere, thank you for your patience.

Thank you—thank you for your diligence, Madam Chair. Clause 1—I have a number of Amendment Papers that have been tabled in advance, so the Minister of Transport has had an opportunity to, hopefully, look at those. They all suggest specific changes to clause 1, and I think that’s important because the title, in effect, reflects what is contained elsewhere in the bill. So I am interested in the Minister’s responses to those, the first of which is Amendment Paper 42—they’re actually 42, 43, 44, 45, 46, and 47; they all relate to clause 1—and whether the Minister is comfortable with some of those suggested amendments or whether he might have another few on that. I also think that it would be helpful—I don’t know if you want me to pause or—

CHAIRPERSON (Barbara Kuriger): Yep—carry on.

TANGI UTIKERE: I don’t know whether the Minister wants to elucidate on his response to the Hon Dr Megan Woods. I mean, the Minister might enjoy receiving open letters, but I think it’s highly unusual that, effectively, an Officer of Parliament has bevvied into this process and has taken the effort to point out what seems to be a very straightforward suggestion. I think it is only proper that the Minister might wish to have the opportunity to reflect on that and to perhaps provide a response to the letter, given that he is an Officer of Parliament. Perhaps I’ll leave it there and come back with some other questions.

A simple question for the Minister of Transport. It relates to one of my suggested amendments for this bill, about the title. We’ve had some back and forth in this House about whether the cost recovery mechanisms in this bill, alongside the ability of the Minister to set a standard which would, essentially, require the industry to change its behaviour in terms of what cars it imports—whether that would be seen as a tax. So there are amendments in my name that propose to the Minister that he should include “Budget Measures” in the title of the bill, which is the tradition in the way that this Parliament delineates its cost recovery or its revenue-gathering legislation which often accompanies Budget legislation and is the type of legislation which is usually introduced around Budget time.

Because this is part of their Government’s broader Budget urgency motion, it would also not be unusual for the legislation to include this in the title. And what I’m asking the Minister here is: is he interested in including “Budget Measures” in the title because he does see this as a revenue-gathering tool, or not? It would be useful for him to clarify, because some of his own members of his own party in their calls have been confused about whether this is a revenue-gathering instrument or whether it is not intended to gather revenue.

Well, I thank the member for her question. This is a bill which I think the title is very clear in relation to what it does. In terms of the issue of cost recovery, it is a bill which has a cost recovery mechanism included in it, and, as a result of that cost recovery, it means that the general taxpayer won’t be required to pay for the operation of this scheme.

Thank you, Madam Chair. In terms of clause 1 and the title of this bill, I recognise, as we’ve also heard from my colleagues, that there are some concerns around whether the title itself gives enough clarity on the purpose of this bill. I think one of the things is in one of my tabled amendments for this as well, because this particular bill looks like two components. The first one is looking at enabling the target to be set in secondary regulation, which then ties into what previously the Hon Dr Megan Woods mentioned in terms of the clean vehicle standard element of it. But, again, what we are hearing is that there is a second component to it in terms of the cost recovery scheme. So, again, we are in support of the amendment that has been put forward by both Tangi Utikere as well as Arena Williams around this because of the fact that there is clarity that is needed with regards to the title.

In terms of my amendment, in order to address both elements of this bill, I wondered if the Minister of Transport is open to the suggestion of amending it from “(Clean Vehicle Standard)” to “(Clean Vehicle Standard and Levy Charges)”. Now, I know that the term “levy” potentially is controversial, but based on the intention of this cost recovery we are looking at—and this is, again, something that maybe the Minister is happy to clarify. When we are looking at these cost recovery measures, are we looking at a potential levy? Because I know the term “tax” has been thrown around, but is this more akin to a levy? If it is more akin to a levy, would the inclusion of “levy charges” be something that is worth mentioning within the title to cover both elements of this bill?

I think the answer to that question is that those matters are dealt with inside the bill.

Thank you, Madam Chair. I’ve followed this with great interest—as most Kiwis should. The departmental disclosure statement says in here, “This is critical to ensure that any changes to targets can be made quickly to increase certainty for the vehicle industry.” So a question to the Minister of Transport is: is he planning to make changes to this on a regular or semi-regular basis to clean vehicle standards? Because in a meeting I had with a senior executive from one of the biggest international car firms, her concerns were that New Zealand was able to change the standards, thereby offering uncertainty to companies like that, which actually made them less enthusiastic about even looking at our market. So the question to him is that given the statement here implies changes can be made quickly, how often is he going to make them?

Well, the Land Transport (Clean Vehicles) Amendment Act that the last Government put in place allows for the standard after 2027 to be changed by a regulation. We are simply allowing for the standard in the years up to 2027 to also be able to be made by a regulation and making it consistent.

Thank you, Madam Chair. Look, I appreciate the clarification by the Minister of Transport because, as I said, in my meetings, the issue of concern around change was one made by the motor industry and the fact that we’re such a small market. So if the Minister’s now implying that change will be made before 2027, then that offers more uncertainty. And so can he confirm that or, otherwise, whether he intends to make a change prior to 2027?

This is a bill which simply makes a change to allow the standard to be amended by regulation, just as it can be after 2027. It’s just simply about consistency. So it’s a very simple piece of legislation. And also, the Land Transport Act requires the Minister to undertake a review and commence that review before 30 June 2024. So in order for that to be able to happen, if there is to be any change, there also needs to be the ability for that to be changed by regulation. So that is why this bill is before the House. It’s a very simple piece of legislation.

Thank you, Madam Chair. And I appreciate the Minister of Transport’s attempt to clarify, but he completely avoids the question that I ask, and that is: is there an intention by Government? Because what we see in other areas of secondary legislation and in regulation is that the Government has implied economic concerns will override environmental concerns or animal welfare concerns, as the Associate Minister of Agriculture has implied with the National Animal Welfare Advisory Committee. So my question is: is the Minister going to use the powers that this new bill will allow him to change before 2027, and, if so, for what reasons?

The Land Transport Act requires a review. The review must take into account the matters, including in section 175A. Those are the matters that I will take into account.

Thank you. I’m going to call Hon Julie Anne Genter. Some of the questioning is moving a little away from clause 1 and may be able to be pursued further down. So let’s—if we stick to the broad title.

Madam Chair, I actually stood up just based on the conversation that the Minister of Transport was having right now. So am I able to continue questioning—

CHAIRPERSON (Barbara Kuriger): Given that we’ve started the conversation, I’ll let you have a question on that, but I’ll make it the last one, given you’re already on your feet—the last one for now until we get down into that part of the bill.

Hon JULIE ANNE GENTER: Thank you, Madam Chair. I wanted to ask the Minister: with the changes, which are brought in under this legislation, to the ability to change the standards for 2025, 2026, 2027, is it then possible for the Government and for the Minister to put in, through regulation, standards that are more ambitious than what was set out in the legislation?

The legislation allows the Minister to make and set those standards and those standards could be above or below. But, ultimately, under the legislation that’s being proposed, just as it is, after 2027, up to the Minister by Order in Council to set it then, it is the same under this particular piece of legislation for those years preceding that.

Thank you, Madam Chair. One of the things that I’m still waiting for an answer from the Minister of Transport, that he hasn’t addressed in relation to us, as a House, is understanding whether this bill does what the title purports that it does, in terms of the Land Transport (Clean Vehicle Standard) Amendment Bill. I am still waiting to hear the Minister give some kind of meaningful reply to the suggestions that the Parliamentary Commissioner for the Environment has made, who is an Officer of Parliament and I think deserves the respect of this House.

In particular, the piece that I’m interested in—now, the Minister tells us this is a very simple piece of legislation. What I’m seeing is a Minister struggling to understand this very simple piece of legislation. What I’m wanting to know is exactly what the Parliamentary Commissioner has set out, that “Parliament clearly intended that any regulations, that are made to set targets, would be subject to review. To ensure this is carried through in your amendment bill, I suggest you make [these] minor amendment[s]” to the very clause that the Minister is saying is the way that he can ensure that the Clean Car Standard is going to be maintained and therefore fulfils what is on the name at the front of this bill—the Minister needs to address this. He cannot just dismiss, in a committee of the whole House, in a bill going through urgency, some very real and meaningful questions from an Officer of Parliament.

As I have said before, this bill amends the legislation which legislates the clean vehicle standard. It is not removing the clean vehicle standard and so therefore it is the Land Transport (Clean Vehicle Standard) Amendment Bill.

Thank you, Madam Chair. I’m still waiting to hear a response from the Minister of Transport in relation to my suggested amendments to clause 1—

Hon Member: No.

TANGI UTIKERE: Well, the members opposite might say “No.”, but in fairness, these are clauses that have actually been put on an Amendment Paper. They have been made available earlier in the week, so this has not just been tabled late; they were tabled, basically, three weeks ago when the House was sitting. So I wonder then, given the Minister hasn’t given a response around those, if perhaps I do need to go in some detail as to what each of them actually identifies.

I did note that they were on Amendment Papers 42, 43, 44, 45, 46, and 47, and I was prepared to give—

Hon Dr Megan Woods: So sequential!

TANGI UTIKERE: They are. I was prepared to give the Minister an opportunity to just come back and say “Actually, no, I don’t agree with them” or not, but he hasn’t done that. So I will, I think, have to go through each of them.

Let’s turn our minds to Amendment Paper 42, clause 1. Now, I actually think this is very similar to what my colleague Arena Williams had said, and, actually, I would be very comfortable if the Minister preferred Ms Williams’ amendment over mine—I’m OK with that. But we do need to hear from him around that. He should tell us; he should be very clear around it. It seeks to insert, after “(Clean Vehicle Standard”, “and Budget Measures”. Ms Williams has articulated the very view that often when it comes to bills that are introduced to the House in urgency as part of the Budget urgency motion, this is a common approach, and so I’d be interested to hear from the Minister on that.

Moving now to Amendment Paper 43, this seeks to “In clause 1, after ‘(Clean Vehicle Standard’ … insert ‘and Targets for Reducing Carbon Dioxide Emissions’.” So we hear a lot around the label being what is on the tin. I’d be interested whether the Minister thinks that that would be an appropriate description for that, given that he hasn’t had an opportunity to respond to that. The next one is on Amendment Paper 44.

Hon Members: No.

TANGI UTIKERE: This is after—well, again, the members opposite might not like it, but maybe that’s the view, and they’re speaking for the Minister, but we have not heard from the Minister yet. This is “after ‘(Clean Vehicle Standard’ … insert ‘and Regulations Relating to Cost Recovery’.” Now, the Minister may actually be supportive of that and thinking about it, because he himself has said that it does relate to cost recovery and it was perhaps a suggestion from himself. So I’m happy, actually, if the Minister wanted to take that Amendment Paper as one of his own Amendment Papers—I’m very happy for that. We’re happy to do the work. He can have it. He can take it. He can have it in his name.

Moving on to Amendment Paper 45. It is in relation to replacing “(Clean Vehicle Standard)” with “(Transport Budget Measures)”, so this is no reference to “(Clean Vehicle Standard)”. And, actually, given that we haven’t had justification as to what that means or what it might look like, that might be an appropriate title for the Minister to consider. But yet he hasn’t replied to that, so we’ll wait and see whether that is in his purview or not. On to Amendment Paper 46—

Hon Member: Well, that’s good.

TANGI UTIKERE: Well, I think someone over there said that was good, so clearly they’ve read it. It’s “clause 1, replace ‘(Clean Vehicle Standard)’ … with ‘(Reducing Carbon Dioxide Emissions)’.” And so that might be something that the Minister might be interested in.

Then, finally, I think—and I do apologise to the committee, but I feel as though I’ve had to do that, given the Minister has not given a response—is Amendment Paper 47, and this is “In clause 1, replace ‘(Clean Vehicle Standard)’ … with ‘(Cost Recovery of Clean Vehicle Standard)’.” Actually, that’s probably more in line with the Minister’s thinking, so he may want to take that. I think we are still waiting to hear from the Minister about his views on those, and it might be that he agrees with some of them or none of them or all of them. That’s fine. But at the moment we have not heard from the Minister as to what his view is, so I do hope that he will take up the opportunity to do that, and I look forward to a response from him.

I apologise to the member for not sharing my views more clearly and loudly, but I will do so: Amendment Paper 42, no; Amendment Paper 43, no; Amendment Paper 44, no; Amendment Paper 45, no; Amendment Paper 46, no; and Amendment Paper 47, no. The bill is very clear as to what the bill is, and it is the “Land Transport (Clean Vehicle Standard) Amendment Bill”.

Members, the time has come for me to leave the Chair. The committee of the whole House will resume at 9 a.m.

Debate interrupted.

Sitting suspended from 11.59 p.m. to 9 a.m. (Thursday)