National’s ETS Forestry Excuses Not Acceptable

The Minister for Climate Change Issues Dr Nick Smith is running out of excuses for continuing with the Government’s ETS programme says ACT New Zealand Climate Change Spokesman John Boscawen.

"Dr Smith is defending the decision to proceed with the ETS on 1 July on the grounds that suspending it now would break commitments to foresters.  The rationale for continuing with the ETS gets thinner by the day," Mr Boscawen said.

"Dr Smith appears to not understand the points ACT Leader Rodney Hide made in his open letter to the Prime Minister on 29 April 2010:

• If the ETS is suspended, forest owners would be perfectly free to sell carbon credits to willing buyers, for example, parties subject to the EU ETS.

• Suspension for a short period - say to when Australia takes post-2012 action, if it does - would not be material for foresters as most operate on a 30-years plus rotation.

• The major taking of property rights occurred with pre-1990 forests.

• None of the planting in the 1990s, and little before 2005 was done with an expectation of subsidies.

• Planting in recent years has fallen away.  Much of it has been encouraged by afforestation grants, not the ETS.

• Foresters – especially integrated wood processors – will benefit from lower input costs for electricity and fuel if the ETS is suspended.

"If any forester considered their property rights were affected by ETS suspension, the government could entertain negotiations for compensation.  For the above reasons, the claims could not be large.  The costs to the economy of proceeding with the ETS would be far larger.

"National Party members around the country are increasingly urging their Party in government to abide by its election promise to not be a world leader on this issue.

"ACT believes it is folly to proceed with the scheme ahead of Australia and other trading partners at a time when the economy is still weak and being hit with increases in GST, ACC levies and electricity prices.

"ACT supports fair treatment for the forestry industry.  If the ETS was ultimately scrapped in favour of a low carbon tax, it should be matched by an equivalent subsidy for forestry sinks - which would leave foresters no worse off than under an ETS," Mr Boscawen said.