To John Key, Nick Smith, David Carter, Tim Groser and Anne Tolley from Neil H 12 May 2010

Dear Prime Minister

I wrote to you last week requesting a meeting with you while you were in Gisborne if your timetable allowed. I realised this was a highly unlikely outcome, so we had a ‘Plan B’ in reserve. 
Now that I have seen your schedule for your visit to Gisborne I am amazed how much you squashed in. It begs the question as to whether wisdom would dictate you concentrated on issues of greater urgency.
Plan B was the group holding placards that greeted you at the airport. This group was small and by invitation only. It was deliberately low profile as a warning to you that you are not getting the real message of the sentiment of your electors, the people who elected you to power and who consequently hold the key to whether you stay in power in November 2011.
As one of our placards said, we elected a NATIONAL Government, not a LABOUR #2 Government. If all this Government is going to do is deliver more Labour policy, we may as well have them in power to do it. The frustration that has built in rural New Zealand and its provincial towns could well see this happen.  As yet vast numbers of people have no idea what the ETS will cost them. We talked to a few of these at the airport yesterday. Immediately they were in full support of our stand. Ordinary people simply cannot afford another 5% on the electricity bill and 4 cents/litre on their fuel bill.
Nick Smith was right in November 2005 when he said “The appetite of Dr Cullen and this Government for more taxes is legendary, ....The latest is the carbon tax.  It will add 6c per litre to the price of petrol, 7c per litre to diesel, 6% to all power bills and put the price of coal and gas up by 9%....
“The madness of the Government’s new carbon tax is that New Zealanders will be the only people in the world paying it.  It will drive up the costs of living and undermine the competitiveness of New Zealand business for negligible environmental gain....
I have heard him on the radio futilely trying to explain the difference between a carbon tax and the ETS. Both add on costs to fuel, energy, electricity etc. adding to the cost of everything else. Both have a negligible effect on the environment. If one is unacceptable the other is equally so.
We keep hearing we must push on to maintain certainty for businesses, but in the same breath we hear that there is a review next year. If this review has any teeth at all it immediately creates uncertainty, negating the reason for not delaying the ETS in the first place.
We keep hearing that Agriculture does not come in until 2015. The costs to farmers for their energy use will be significant from July 1 this year. Direct costs are estimated by Federated Farmers’, using MAF data, to be $86 million per year in direct costs with possibly a similar amount in indirect costs. Our competitors will not be paying this.
You continually say Australia is going to get an ETS. I cannot see where this conviction comes from. It was assumed they were going to have legislation in place about the same time as us, by the time of the Copenhagen Conference. Now six months later it is two and a half years away. By then the rest of the world will have woken up that man is not causing global warming and they will never get an ETS.
The biggest threat to farming though is not the direct costs of the ETS but the fact that forestry for carbon credits is now the most profitable land use for all hill country. Even at $25/tonne a forest will produce more than double the profit that sheep and beef farming will. It seems highly ironic that a country pushing the Global Research Alliance and the need to produce more food for a burgeoning world population wants to lock up more land in forestry forever.
You keep telling the nation that your scheme is much less costly. This is only true on day one. From January 2013 Mr Joe Citizen will be paying the full carbon price on his full emissions, just as he would have under Labour’s scheme. It is only agriculture and industry that continue to have a moderated effect.
But I have done calculations that show sheep and beef farmers will use up their entire Economic Farm Surplus (the money left after farm running expenses and needed for debt servicing, capital expenses and return on equity) to pay just one third of their emissions at a carbon price of $150\tonne (which is the carbon price the IPCC predicts by 2030). There is no way that mitigation technology and emissions intensity reductions will ever cover the difference.
Mr. Key, I could go on for much longer refuting the feeble case you and your colleagues keep popping out to justify your non action. We have watched as opportunity after opportunity presented itself to you to exit graciously from the ETS. Time and again you wasted the chance. With Australia pulling out until 2013 you spoiled your last chance. Your credibility is now under question. Every day you waste will add to the damage to your credibility. Every day is seeing more people turn away from National forever. Every day more people are showing a willingness to stand up in public and be counted.
I am sure the protest at Gisborne will be the first of many. We need our police on the beat to catch criminals. We don’t want them tied up ensuring protests stay orderly. Please help us achieve this aim.  You said in May 2005;
I rise on behalf of the National Party to give the good news to the people of New Zealand—that is, the Climate Change Response Amendment Bill is a load of rubbish and the National Party will not be supporting it, for very, very good reasons indeed.
It is time to delay the ETS now!
I believe I deserve a reply to this letter. I do not want the reply to come from Nick Smith because it ‘falls in his portfolio’ as I, and others, have had before. This is about an issue of leadership. The buck  stops at your desk.
Yours faithfully
Neil H


 click here to read Nick Smith's reply

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