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Opposition MPs call for transparency on ETS subsidies

Fuseworks Media
Fuseworks Media
Russel Norman
Russel Norman

Wellington, May 14 NZPA - About 800 greenhouse gas-emitting firms are in line for taxpayer subsidies under the emissions trading scheme (ETS) and those taxpayers have a right to know how much they will be paying in subsidies, Opposition MPs say.

Greens co-leader Russel Norman said the subsidies made climate change worse and added to the budget deficit, and the extent to which that happened needed to be made clear in next week's budget.

"At the moment (Climate Change Minister Nick Smith) only has to report figures in aggregate. This leaves doubt in the minds of those footing the bill: the people of New Zealand.

"There is a case for limited help for a small number of trade exposed firms, but it really needs to be a transparent process open to public scrutiny," Dr Norman said.

He said it was honest politics to allow the public to see why some emitters were being helped and others not, and also called for full disclosure of political donations so any connections could be traced.

Labour's climate change issues spokesperson Charles Chauvel said it was becoming clearer that changes the National Party made to the original ETS were "unaffordable, ineffective and unsustainable".

The 800 or so companies eligible for subsidies compared to 65 under the original scheme and that was a result of the Government deciding to adopt, across the board, an "intensity" model for measuring a firm's liability for emissions, Mr Chauvel said.

"This was the model at the heart of the Australian ETS, which was adopted in New Zealand by Nick Smith to harmonise New Zealand and Australia's emissions trading schemes, despite advice the two schemes were incompatible."

Mr Chauvel also called for information about the amount of subsidies going to polluters to be made clear in the budget.

Dr Smith has said the revamped ETS was fairer as it would not impact on the international competitiveness of small- and medium-sized businesses creating emissions.

Meanwhile, a New Zealand Institute of Economic Research (NZIER) report prepared for the Major Electricity User's Group said householders here would be worse off than their Australian counterparts following that country's recent decision to defer its ETS until at least 2013, and businesses here would also be competitively disadvantaged.

When the ETS changes were enacted here late last year (due to come into force from July) it was under the assumption that Australia would enact its scheme within a year or two.

The NZIER report said wholesale electricity futures decreased 6.1 percent in New South Wales the day after the announcement to defer the scheme, while in Queensland futures dipped 13.4 percent.

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