4. Dr RUSSEL NORMAN (Co-Leader—Green) Link to this
to the Minister of Finance
Does he agree that a more sustainable economy is preferable to a less sustainable economy; if so, what measures has he taken to specifically promote cleantech and greentech businesses in New Zealand?
Hon BILL ENGLISH (Minister of Finance) Link to this
As I said yesterday, it is important that the economic recovery and new jobs and growth are all sustainable, and not built on unsustainable Government spending and housing speculation, which were the hallmarks of the last decade. It is also important that we balance our economic opportunities with our environmental objectives, and in that context the Government has put in place several measures to promote clean-technology businesses. The most significant is the amended emissions trading scheme, which puts the right incentives in place for all households and businesses that are using carbon-based energy to use clean technology. The Government has also put in place the waste levy, which I understand the member’s party lobbied for when it was in support of the previous Government.
When he announced in his Budget $321 million worth of expenditure in research and development, why did he not target even a fraction of that spend on greentech and cleantech industries such as renewable energies, sustainable agriculture, greentech manufacturing, and energy efficiency?
I think the member is right that the Government process has the opportunity to do that. The matter of priorities is determined largely by the Foundation for Research, Science and Technology, and it is my general understanding that significant projects across the science community are focused on those things. But now that the member raises the issue, I will have a chat to my colleague the Minister of Research, Science and Technology just to get more detailed information.
Dr Kennedy Graham Link to this
Interpreting the Minister’s response to the primary question, that he believes a more or less sustainable economy is preferable, why did he cut funding to the Organic Advisory Programme and the Sustainable Business Network, which are two organisations that are leading in their own fields the greentech, cleantech economic shift?
We take a general approach rather than highly specific interventions and funding arrangements that can easily be the subject of political fashion. We have put in place the amended emissions trading system, which has a blanket impact across the whole economy, and in my experience it is leading to everybody, from aluminium smelters to tomato growers, trying to work out how to run more efficient production systems. We have gone for an impact across the whole economy rather than highly selective ones.
Dr Kennedy Graham Link to this
Does he then accept that by introducing, through blanket impact, a full carbon price on electricity we will encourage the production of low-carbon electricity, such as wind, geothermal, and potentially tidal; if so, will he commit to ensuring that the electricity sector pays a full price on carbon, with protection for low-income households?
The Government has set out a path for the carbon price and we believe it is a sensible one, particularly given the significant recession the economy has had. I think the member raises a reasonable issue that one of the constraints on moving to a full carbon price would be the impact on low-income households. I might say that there are signs of success. The mix of energy has moved significantly in favour of new renewable energy sources, whereas under the previous Government, for all its good intent, the non-renewable proportion of energy rose quite dramatically.
Does the Minister agree with business leaders, such as Rob Fenwick, Rob Fyfe, Jeremy Moon, Sir George Fistonich, Sir Stephen Tindall, Phillip Mills, and Geoff Ross, who see clean technology as an economic opportunity for New Zealand, rather than seeing it as a cost?
I think the answer to that is probably yes. I have been involved in discussion with a number of those individuals as, I think, a number of other Ministers have. I think we need to be a bit careful not to “sloganise” this next-generation environmental fashion. The fact is that the emissions trading system, which I know the member supports, will have a pretty significant impact on the pressure for all businesses and households to work out more efficient ways of using non-renewable energy and swing more to cheaper, renewable energy sources.
With regard to the list of business leaders I gave earlier, does he agree that clean technology is an opportunity to achieve the kind of knowledge-led economy about which there has been enormous talk over many years while at the same time improving our environment and enhancing our clean, green image, and does he agree that that requires more focused attention than a broad price signal?
I think I would probably agree with the member’s first statement. In respect of his second statement, I would not say that we need more focus than a broad price signal. I think there is a broad price signal out there, which we all agree is the right kind of signal, although we probably disagree on how strong that signal should be at the moment. But these kinds of discussions would be in addition to that broad price signal, not a replacement for it. We are interested in hearing about any entrepreneurial or innovative ideas people have, particularly about the use of public resources to achieve those ends.
Does he accept that the economy to some extent has been based on the premise of simply mining more, farming more, and consuming more, that we need to make the transition to a greentech, high-tech solution, both for economic and environmental reasons, and that although the beginnings of a price signal around the emissions trading scheme is a start, it will require more effort from the Government to make that transition?
I do not agree with the member’s first statement. I do not agree with the analysis that New Zealand’s economic growth has all been based on the unsustainable exploitation of resources. Our fundamental resource is soil and its productive capacity, and the New Zealand farming industry has shown an extraordinary capacity to sustain the productive capacity of our soils, our grasses, and our forests over 150 years. So I think we already know a lot about sustainable production systems, but, of course, technology can help us add to its productive capacity.