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Strong Government push needed on green procurement

22 September 2006

Media Release

Business leaders: Strong Government push needed on green procurement

Business leaders hope a major Government push to throw its $6 billion-a-year purchasing power behind buying sustainable products is in the raft of climate change measures now being considered by, or due to go before, Cabinet.

The New Zealand Business Council for Sustainable Development, whose member companies' annual sales of $40 billion equate to about 30% of the country's gross domestic product, says the Government can give sustainable practices - which also lower greenhouse gas emissions – a "serious shunt" by requiring its departments to buy on the whole-of-life cost of goods and services, rather than the day-one price.

The Business Council's Chief Executive, Peter Neilson, says in a speech today to a Trans Tasman Business Leaders conference at Queenstown that it will be far better to promote sustainable business practices here, many of which lower emissions, than send up to $600 million a year off shore under the Kyoto agreement if New Zealand does not meet its emissions reduction targets between 2008 and 2012.

Mr Neilson says the Business Council, instead, wants the Government to adopt a range of policies, which polling shows will win widespread support among New Zealanders.

These include directing its own agencies to buy sustainable goods, and especially to usher in a national branding programme for sustainable goods and services. This will allow New Zealanders to buy from the "good guys" who are price competitive, but also doing the right thing by the environment and the community. A national branding scheme which is heavily promoted by the Government will especially help small to medium enterprises which have neither the time nor resources to develop their own brands.

Mr Neilson says whole-of-life procurement of products will deliver massive savings to the Government and taxpayers, while also lowering long-term costs and, in many cases, greenhouse gas emissions.

He cites the example of one Auckland hotel, switching 5000 light bulbs to energy efficient ones, even though the bulbs cost more on day one. The hotel is making five year net savings because the bulbs need changing five times, not 22, and the power bill drops dramatically. Applied over the 27 hotels in the group, the power bill saving alone each year is more than $2 million.

"The benefit falls straight to the bottom line and to the community. Less energy means fewer emissions – and a contribution to climate change management," Mr Neilson says.

Similarly, the Business Council wants the Government to make cash grants of up to $3000 to buyers of fuel efficient, low emission cars. The move would see 430,000 low emission vehicles enter the terribly old national fleet over five years – and save the country millions in health and emission bills.

"We would like to see the Government give the lead on everything it buys," Mr Neilson says.

"We know policies like this will enjoy extraordinary support among voters, because they preserve and improve our quality of life, while tackling climate change and other issues in very down-to-earth practical ways."

"Both business and the New Zealand public would welcome policies that are more carrot and less stick to promote sustainability."


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