30 April 2002

Government's Preferred Policy Package On Kyoto Requires Close Scrutiny

"The government's preferred policy package on Kyoto requires close scrutiny by all sectors of the economy," says Federated Farmers President, Alistair Polson.

"On first reading there is nothing in the Policy Package to justify early ratification.

"Farmers can take some comfort from the fact that the Government has rejected a flatulence tax on agricultural emissions. But significant fishhooks remain.

"While the Government proposes farmer-funded research as the answer to reducing emissions from the agricultural sector, there are no silver bullets on the horizon. Research takes time, the results are highly uncertain, and the costs need to be factored in. Furthermore, the potential for adverse consumer reaction to the thought of manipulating livestock digestive systems cannot be ignored," says Mr Polson.

Farmers will also be affected by the proposed carbon charge on fuel and energy, as agriculture is the basis of an integrated supply chain from paddock to plate.

Given that over 90% of New Zealand's agricultural production is exported, and those agricultural exporters are price takers, the negative impacts will flow back to the farmer, undermine their competitiveness and ultimately impact on the wider community.

"Committing New Zealand to ratification before our major competitors is naïve and exposes the New Zealand economy to unnecessary risk.

"By proceeding with ratification now the government is refusing to acknowledge that the protocol is likely to place even greater demands on New Zealand in the future," concluded Mr Polson.

ENDS

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