Today the Climate Change Commission released its final recommendations for the Government.
You might read in the media that the Commission has softened the hard edges of some of its targets (like electric vehicles and renewable energy). But working through the detail I’m sad to report that the plan doubles down on its most egregious and costly elements.
Let me be very clear: this plan will not improve our ability to fight climate change. It deliberately shuns the “least cost” approach and the Emissions Trading Scheme in favour of a “transformation” of the New Zealand economy.
This isn’t me saying this. The Commission’s own experts say that the ETS would actually get us to our emission’s targets without radical interventions.
You read that correctly: The Commission’s own fine print once again concedes that the ETS has put us on a track to meet our “net zero” target. This should be in the headline of every news story about the plan.
Eva, this plan is not actually about reducing emissions. It is about a “transformation” of New Zealand’s economy and lifestyle. Ironically, some of those interventions will actually result in higher net emissions!
The worst parts of the plan
Where to start.
Obsession with ‘gross’, not ‘net’ emissions: The Commission barely bothers to justify why it’s focused on slashing ‘gross’ emissions, and not ‘net’ emissions. Slashing gross emissions means radical and costly regulation of local sectors. Meanwhile, affordable ways to reduce net emissions are ruled out. The Commission uses the bogeyman of pine forests dominating the New Zealand countryside to pooh-pooh a net emissions focus. But it’s a bogeyman of their own creation: we could simply plant forests offshore, but the Commission rules says offshore mitigation should be a ‘last resort’.
High-cost approach: The Commission doubles down on its decision to avoid a ‘least cost’ approach. In other words, the plan knowingly does far more damage to our economic welfare than is necessary to achieve emissions targets.
Politicians empowered: The Commission’s report has been welcomed by the Prime Minister and James Shaw, and it’s not hard to see why. This report urges politicians to be ‘as ambitious as possible in each sector’, and James Shaw is saying that all Ministers will have to think of themselves as Climate Change Ministers. This opens the floodgates for radical interventions at every level of our economy and lifestyles.
Politicisation by the Commission: The Commission was set up to ‘take the politics out of climate change mitigation’ but at every turn Rod Carr and his collegues have done the opposite. He’s taken it on himself to outline what he has acknowledged are the most radical reforms of the New Zealand economy since the ’80s
Such radical plans deserve real scrutiny, but Rod Carr has even politicised that. In today’s lock-up briefings, media and independent analysts were given less than an hour to absorb a 400-page document, and while favoured media were invited, opponents of his draft plan were excluded. That’s outrageous.
Some “odd” changes to the draft recommendations
After thousands of Taxpayers’ Union supporters swamped the Commissioners with submissions, we hoped we’d see some fundamental changes to the draft recommendations.
We didn’t. Aside from some minor adjustments to various targets, here are the changes we’ve noticed:
- The Commissioners have renamed natural gas (a comparatively clean form of non-renewable energy) as ‘fossil gas’. It’s literally now using the terms employed by Greenpeace!
- The Commissioners have tried harder to work in the principles of the Treaty of Waitangi into their recommendations. The Treaty is mentioned 193 times and the report recommends “a Māori-led approach to ensure an equitable transition.”
- The Commissioners have ruled out the option of paying ETS levies out to taxpayers as a dividend, i.e. as compensation for all the economic harm.
- The Commissioners are pushing harder for an increased waste levy (a rubbish tax).
In other words, we’ve gone backwards.
We must push back
The ball is now in the politicians’ court. The Government has until the end of the year to decide whether to adopt the Commission’s suite of recommendations.
I have to be honest: the politicians will be keen to adopt the Commission’s plan because it gives them the mandate to expand their regulatory powers. That’s why we need to step up our campaign and fight back.
There is hope. Remember the Tax Working Group’s capital gains tax? Sir Michael Cullen proposed one of the most aggressive CGTs world over. The Government was once emphatic in its support for the idea, but eventually the public backlash became too much.
The Taxpayers’ Union is working to expose the costly, ideological nature of the Commission’s plan. We have to expose the elephant in the room: that many of the proposed measures actually take us backwards in terms of net emission targets! And at a huge cost.
But to do this, we need support for our efforts.
All the best,
New Zealand Taxpayers’ Union
PS. Earlier today I sat down again with former senior advisor to Sir Bill English, now Senior Economist at the New Zealand Initiative think tank. Matt’s worked through the details of the report. Have a listen to our conversation here.