To Jonathan Coleman from Alan N and back again- 17 August 2010
Subject: ETS SCHEME
Unfortunately National decided to push ahead with its ill conceived adoption of an ETS regime.
If it is still in place by the next election my vote, both party and individual, will be going to ACT. I will also do my best to encourage as many voters away from National as possible.
I had hopes that National would have proved to be a party of thinkers capable of making the types of decisions that would see New Zealand move forward economically.
Sadly they have done nothing since taking office to confirm my hopes. One tax reduction taken away by
Hopefully John Key can be persuaded that he does not need to sell us down the drain over the Foreshore and Seabed to gain Maori Party support. I very much fear I am about to be disappointed yet again.
Roll on election year.
From: Hon. Jonathan Coleman (MIN) [mailto:Jonathan.Coleman@parliament.govt.nz]
Sent: Wednesday, 25 August 2010 13:48
To: Alan N
Subject: RE: ETS SCHEME
Thanks for your feedback. Your support for me personally is very important, and I hope I am able to win it back. I will pass on your views as part of a report to Cabinet on the tenor of feeling in the electorate.
As regards the ETS, National did not oppose an ETS when in opposition- the issue was the crippling cost of Labour's scheme. Basically the issue is trade and the long term access to markets if we're not seen to act in this area. Yes, people argue it should be suspended until Australia have one, but we would be in a situation where we are constantly chopping and changing depending on what they do, and this creates huge uncertainty. Also note the Australian election, it is not clear what will happen across the Tasman. Household costs associated with GST on Fuel and electricity/gas are estimated to be $3.17 per week.
The rise in GST will help tilt the economy away from spending and consumption, and towards saving and productive investment. This aims to create a fairer tax system and to keep skilled Kiwis in New Zealand, and help families to get ahead. After across-the-board personal tax cuts and the rise in GST from 12.5 per cent to 15 per cent on 1 October New Zealanders will be better off. The average household is $25 a week better off and your average earner $15 a week better off.
Regarding the increases in your ACC levies, ACC Minister Nick Smith announced the levies last year. He noted at the time that the levy increases, while undesirable, are necessary because ACC's claims costs have increased by 57 per cent in the past four years. We moderated the increases by pushing out the full funding date to 2019, pulling back on extensions to the scheme made by the Labour Government, and putting in place a wide range of cost-saving measures. Setting the levies has been a difficult balance between minimising the cost increases and families and businesses, keeping the pressure on ACC to better manage its costs, and ensuring ACC's long-term sustainability. In 1999 the Government decided to change ACC from 'pay-as-you-go' to a 'fully funded' way of operating. That means we now collect enough money during each levy year to cover the full lifetime costs of every claim that occurs in that year. While this increase has come at the same time as the ETS costs and upcoming GST increase, the tax cuts will also come in on October 1st, meaning the average household will be better off. We believe that this will enable people to still have extra money in the hand.
Also to note, in addition to receiving an income tax cut, recipients of New Zealand Superannuation will be fully and permanently compensated for the increase in GST from 1 October 2010. This means people who receive New Zealand Superannuation will get a considerable increase to their after-tax income. The 2.02 per cent increase in payments to recipients of NZ Super to compensate for the increase in the rate of GST reflects calculations of the actual effect on prices of the rise in GST.
We are coming out of a recession, and times are still not easy. But we are committed to making reforms that will improve our economy and put money into vital services for our families. These changes are designed to help families to get ahead and get the budget back into surplus.
If you would like to come in to the Electorate office I would be happy to discuss any of these issues.
Hon Dr Jonathan Coleman
MP for Northcote
Minister of Immigration, Minister of Broadcasting
Associate Minister of Health, Associate Minister of Tourism
Ph +64 4 817 9849
Thank you for your comprehensive reply. At least it is more than the "form letter" that usually emanates from private MPs secretaries and I thank you for that courtesy.
I am glad that you are able to pass on my views in your report on electorate tenor. Unfortunately there is a large "silent majority" who view the ETS as I do but have decided that it is a waste of time making their views known -probably until election times rolls around and they are reminded of the impact.
However your reply does not do anything to lessen my concern at the introduction of the ETS, nor my decision on support for National at the next election. My support for individual candidates in my electorate is still open to review - there will no doubt be other contentious matters that will impact on my final decision.
I challenge any MP to come up with one resident in our trading partners who will make any purchasing decision based on whether or not we have an ETS or not. I see nothing that would lead me to accept the view that, without the ETS, we would be adversely impacted in our trade with Australia, China, America or the UK - in fact I see the reverse. We are even more expensive as a result of the ETS than we were without it. To forge ahead with scheme when it will make not one iota to Climate Change (I note that the original catch cry of Global Warming is finally being quietly dropped now that the figures to support it have been demonstrated to be false- even those used by our own NIWA) is bad enough but to hide behind Climate Change and the opinions of our Trading Partners is scandalous.
I guess every Political party has its albatross at one time or another. I predict Nick Smith will be the one for National this time around.