Greenhouse Mechanisms Doomed to Fail New Zealand

Farmers are seeking assurances that processors of agricultural produce will not be excluded from the Government's Climate Change mechanism, says Federated Farmers of New Zealand (Inc) National Board member Neil Barton.

The Government took another step in its piecemeal approach to Climate Change today when it confirmed details of both its Projects and Negotiated Greenhouse Agreement (NGA) mechanisms, both of which are designed to protect firms, as they adjust to emissions charges.

"Agriculture is an integrated supply chain from pasture to plate where costs incurred along that supply chain are ultimately passed back to farmers, said Mr Barton. "Although farmers will likely bear this cost they will have no way of mitigating the downstream costs resulting from yet to be developed carbon taxes.

"Eligibility restrictions severely limit the ability of firms to make use of the mechanisms. If this is not changed the Government will miss the opportunity to encourage emissions reductions and as well as protect economic growth.

"Excluding agricultural processors suggests that the Government does not understand that its policies are doomed to undermine the competitiveness of its key export sector. Instead of excluding agriculture from the impact of carbon taxes the farming community is likely to bear the full brunt of the impacts Mr Barton concluded.