all of those potential errors out. Actually, I’m sure that we will find there’s an error in this bill somewhere along the line, but that doesn’t mean we shouldn’t necessarily support it. But it is an issue, and it’s something that this Government must stop doing. You’ve got to get your act together and line your ducks up and get this legislation going through proper processes. These processes have been set out for a very long time for a very good reason: because mistakes happen. It even happens when we’ve got a really good process, but this is incredibly complex and we’ve opened ourselves up to all sorts of problems.
The other thing I think that’s important to note here is that, actually, the Labour Party and the Green Party have always been keen on a carbon tax. And actually what we have is an ETS—they’re quite different beasts—and my concern, and, in fact, the National Party’s concern with this bill and other amendments that are being snuck into the process is we are moving the ETS more and more towards a carbon tax. And just to explore that a bit further, a carbon tax puts a price on carbon, and it’s obviously aimed at changing behaviour by that price. In contrast, an emissions trading scheme puts a cap on emissions and the price will be found by the market. They’re quite different approaches, but what we’re ending up with, with all these changes, is, I fear, some sort of hybrid which is going to end up in the middle and not doing much. We support an ETS, and, in fact, we have done for 20 years. It’s a very important and, I think, very good tool. In fact, the climate commission’s work in the report that’s just been released recently shows that we can get to 85 percent to net zero by having a carbon price of $35 a tonne—we’re at $40 now. At $50 a tonne, we get all the way to net zero. That’s really important, but what we don’t want is policies coming in over the top of the ETS which will blow the cost out needlessly. In fact, the Climate Change Commission’s own work shows that they believe the New Zealand unit price will be $250 at the end of it—five times what it needs to be because of the expensive policies they are recommending.
So it’s important we get this auction system right; it’s important that it works well. But policies like the oil and gas ban, for example, have simply caused a constraint on the ETS’ operation, because now we’re burning—well, we imported a million tonnes of coal last year because we don’t have the gas resources. In other countries, emissions trading schemes have led a swap-out from coal or a substitution with gas—half the emissions; that’s what the ETS actually does. It works really well, but we have to think about all these policies that we bring in and ensure that they don’t work against the ETS and foist needless costs on New Zealanders. And if anyone’s been checking the spot prices recently in the electricity market, it’s up to $500 a megawatt hour. That is the market working, but it’s being pushed that way because of needless policies that have very little basis in fact— it’s virtue signalling with an A+, which is something the Government’s very good at. What we want is real, positive policies that achieve what they set out to do.
The process—limited as it was—was useful. We had some good submissions on the bill. In fact, I think the committee worked very constructively to try and get to the best place with this bill. And the changes that were made were minor but important changes, I think, like requiring the Minister to not only consult with the Minister of Finance, but also to consult with the auction operator.
I’m going to introduce a Supplementary Order Paper (SOP) which will require the Minister to consult with the leaders of the parties not in Government. In the spirit of how the zero carbon bill came into being, in that it was a cross-party, united approach to what is a very long-term problem, and it is a very long-term issue that should not be one Government’s baby; it should be owned by everyone. This is an attempt to do that, because I believe, actually, this is pretty close to setting a tax. And going right back to our bill of rights, it’s Parliament that sets taxes, not Ministers. It should therefore be that the Minister should consult with the leaders of the parties not in Government, and that would maintain the confidentiality of the reserve price, and it would also maintain the
