1. RODNEY HIDE (Leader—ACT) Link to this
to the Prime Minister
Following her statement to the House last week recognising “the important contribution of forestry to climate change mitigation strategies”, by how much can New Zealand forestry mitigate climate change, and what is the level of her Government’s commitment to New Zealand forestry?
Hon Dr MICHAEL CULLEN (Deputy Prime Minister) Link to this
The Government is very committed to New Zealand forestry playing a role in climate change mitigation. The extent of this, of course, depends on both the general levels of investment and disinvestment in the forestry industry.
Why, then, did this Government remove the large part of the incentive that existed to plant trees during the 1990s by confiscating the forest owners’ carbon credits that were recognised as a property right, the result of which has seen a slump in confidence in the forestry industry, with plantings falling from an average through the 1990s of 65,300 hectares of new forest to just 8,000 hectares, and the unprecedented result of the planted forest cover in New Zealand getting smaller each year rather than growing?
Hon Dr MICHAEL CULLEN Link to this
The member should not believe everything Mr Dickie tells him. Firstly, the credits were created by the Kyoto agreement, and the vast majority of our forests pre-date that agreement. Those credits were an intrinsic property right of existing forests. They were created by Governments, and the liabilities pertained to Governments—the credits are owned by Governments. That is the nature of the agreement. That is the most important point in that regard. Secondly, deforestation and a lack of planting have been caused not by that; they have been caused primarily by low prices for timber and high prices for dairying, which have incentivised, therefore, conversion from forestry to dairying, given that there is no penalty attached to that.
Tim BarnettWhat initiatives have already been actioned or proposed to encourage forestry to play a constructive role?
Hon Dr MICHAEL CULLEN Link to this
Last year the Government launched the Permanent Forest Sinks Initiative. It is already attracting investments such as that from Ngāti Porou, which will alone sequester up to 75 million tonnes of carbon dioxide. There is also significant Government investment in the Forest Industry Development Agenda, and, of course, the proposals out for consultation include the possibility of cash grants or carbon credits for new forests planted.
Hon Dr Nick Smith Link to this
Why has the Minister excused the deforestation on the basis of changed economics rather than Government policy, when in the same period in which this Government has seen a 40,000 hectare deforestation Australia has been able, under exactly the same economic conditions, to expand its forest estate by 400,000 hectares; how does the Prime Minister equate all her rhetoric about carbon neutrality with New Zealand’s appalling record compared with Australia’s?
Hon Dr MICHAEL CULLEN Link to this
The member might well ask himself exactly the same question, given that between 1996 and 1999 forest plantings more than halved in New Zealand.
R Doug WoolertonWill Dr Cullen’s proposed incentives for exporters include specific measures to encourage the planting of new forests above and beyond current projections?
Hon Dr MICHAEL CULLEN Link to this
The Government is certainly looking at proposals to encourage new plantings of forest, because obviously additional plantings would be a significant contribution to meeting our Kyoto obligations. There is also a necessity to look at methods—for example, the inclusion of “cap and trade” systems—that provide some kind of disincentive to deforestation and conversion to other land uses.
Te Ururoa Flavell Link to this
Kia ora tātou. Why is the Government on the one hand championing the climate change cause, then on the other hand using taxpayers’ money for Landcorp to destroy 23,000 hectares of pine forest north and south of Taupō?
Hon Dr MICHAEL CULLEN Link to this
That land is not owned by Landcorp. It is simply that Landcorp has the management contract for that process, which would have been carried out by somebody else if Landcorp had not carried it out.
Hon Dr Nick Smith Link to this
Why does the Government not just rule out the proposed deforestation tax, which is causing even more trees to be felled and making the climate change situation for New Zealand worse in respect of the balance; noting that the Government had to do a U-turn on both the carbon tax and the animal emissions levy, why does the Government not just cut its losses and back down now?
Hon Dr MICHAEL CULLEN Link to this
It is always possible to be scared of ideas, but I would encourage the member to just dip his toe in the water occasionally and try the odd one, and to slither around a little before rejecting it.
Madam SPEAKERHon Dr MICHAEL CULLEN Link to this
What I am saying to the member, to put it bluntly, is that there is a discussion document out there. Some people are having a rational discussion; Mr Dickie is getting into a sort of foaming hysteria mode.
In having this discussion about ideas, has the idea ever occurred to the Prime Minister that when people plant trees, they look at the costs and at the returns, one of the returns they might be looking at being the fact that there is an expectation they will get a carbon credit per hectare worth thousands and thousands of dollars—in fact, more than the cost of planting that hectare—and one of the costs they might be thinking about when they plant a forest being whether they can convert it to something else without having to pay a tax to the Government of $13,000; or are the Prime Minister and the Government so out of touch with New Zealanders that they think those basic—
Hon Trevor Mallard Link to this
You were away last week. You don’t need to make up for it this week.
Look, please—would the member ask a question and not give a speech. And we will not have unnecessary interruptions, please.
In speaking about ideas, has the idea occurred to this Government that when people are looking to invest in a forest, they do have a regard to the return and the costs, that a big part of the return that was expected in the 1990s was the carbon credits that had been widely touted—indeed, credits the Government had promised would belong to the owner—that one of the costs was what one could do with the land at the end of the forest’s life, and that in terms of lowering that return and increasing that cost, this Government is the reason that trees are not being planted in New Zealand?
Hon Dr MICHAEL CULLEN Link to this
Most of the trees that have been cut down were planted long before the Kyoto agreement. If the member really thinks that the people planting those trees thought they would get carbon credits for an agreement that did not exist, then he thinks those people showed an enormously large understanding of the future. But the member might well ask himself the question whether, if trees can be cut down and the land converted to higher polluting usages, and there is no cost at all attached to it, that encourages disinvestment in forestry and conversion to other land uses.
Hon David ParkerIs the suggestion that property rights attach to carbon credits inconsistent with the viewpoint taken by other parties that no property liability attaches to existing emissions?
Hon Dr MICHAEL CULLEN Link to this
That is indeed a very, very good point. But as usual, of course, what we are hearing from the Opposition is that one capitalises one’s gains and socialises one’s losses. That is a longstanding tradition of the National Party.
Does, then, the Prime Minister disagree with Mrs Gillian Robertson from the New Zealand Anglican Church Pension Board, who wrote about its forests: “No wonder forest owners are desperately cutting at present, even at losses, with the Government threat of owners having to pay a levy equal to more than what the current harvest is worth.”? That is what Mrs Robertson and the Anglican Church Pension Board are writing, and the board actually owns trees, unlike this Minister.
Hon Dr MICHAEL CULLEN Link to this
With all due respect to members of the Anglican Church Pension Board, I say that if all new ideas had been rejected in the first place, the Anglican Church would never have existed.
I raise a point of order, Madam Speaker. I know that when this Minister gets into trouble, he tries to get out of it with a—
Hon Annette KingIt is a point of order, so would members please just settle. I know we started late today and it is a little different from usual, but would the member please make his point of order succinctly.
—but they cannot be an answer to the question. The Minister said to this House that he wanted to debate the ideas. We are putting up the ideas and the experience of people who are actually growing trees, yet all we get is abuse of the people we refer to.
Hon Dr MICHAEL CULLEN Link to this
Let me put it again, in a somewhat different way, for the benefit of the member. If there is no penalty on deforestation and conversion to land uses that have a higher value otherwise, then there will be a strong economic incentive to deforestation. That is what the current economic position is.