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Benson-Pope: NZ Paperboard Packaging Assn

25 May 2006

Hon David Benson-Pope Speech Notes

Leading from the front - Speech to the NZ Paperboard Packaging Assn (NZPPA) AGM

Ellerslie Novotel Hotel, Auckland 5:00pm - 6:00pm

Good evening, thank you for this opportunity to meet with you following your Annual General Meeting.

I hope that you had a successful meeting and that there was time for reflection on some of the great achievements you have made as an industry.

Your results within the Packaging Accord I will touch on shortly, but in short, yours is an industry clearly committed to leading from the front.

Many of the investments the government has made over the past six years have been about positioning New Zealand in just such a way. I would like to take a moment to mention just some of the achievements we have made as a country and how that positions us all for the future.

Under a Labour-led government we have enjoyed the longest period of sustained growth in the last thirty years, growing at an average of nearly four per cent over the last five years.

This rate of growth was for the most part significantly ahead of the OECD average, and faster than our major trading partners.

The last six years have added some 313,000 full time equivalent jobs to the economy, and we now have one of the lowest rates of unemployment in the OECD.

Finally, the last six years have brought a marked improvement in a variety of social indicators, including falling crime rates, a 30 per cent drop in the number of beneficiaries, fewer suicides, and better participation in early childhood education.

That brings us to last weeks' Budget. I hope as an industry you are aware that Budget 2006 continues a broad strategy of investment in increasing New Zealand's productivity.

The Budget committed $2.1 billion of new operating funding and $1.5 billion of new capital funding over the next four years to a set of strategies to enable us to produce more value for less cost.

It included a substantial additional investment of $23.7 million in the Performance Based Research Fund for tertiary institutions, and it included $47 million into research capability and linkages between tertiary institutions and industry partners.

All of this supports the development of a research-led culture of entrepreneurialism in which more New Zealand businesses can become globally competitive.

The Budget also continues the government's programme of human capital investment.

For example, the Budget includes:
- Funding of $34.4 million to expand the number of Modern Apprentices to 14,000 by the end of 2008;
- A further boost to industry training of $15.6 million;
- New initiatives costing $33.5 million in improving the literacy, numeracy and language skills or the workforce; and
- A major investment of $8.1 million in the Gateway programme, which assists school leavers make a successful transition into the workforce.

In short, Budget 2006 adds to an already impressive set of investments in the last six years aimed at boosting the skill levels of the New Zealand workforce, and increasing our ability to thrive in the global, knowledge-based economy.

It is into this economy that we believe industries like yours will flourish.

I would like to congratulate the performance of the paper sector during Year One of the New Zealand Packaging Accord.

An impressive achievement of 72 per cent recovery of paperboard packaging was recorded for the year up to the 31st of March 2005.

As you will all know, this success exceeds the Accord target of 70 per cent by 2008, set for the paper sector.

And you certainly make a mockery of the recent comment by Green's Environment Spokesperson Nandor Tanczos when he said: "The present voluntary Packaging Accord has proved to be a remarkable failure."

In fact, national targets for the recovery of paper, plastic, aluminium, glass and steel, by weight of consumption, are all tracking towards their 2008 targets. These recycling targets are of course comparable with those overseas, for example Europe, and the current recovery rates in New Zealand are similar to those achieved in regulated jurisdictions.

I appreciate that the paper sector enjoyed favourable market conditions during this period, but it is certainly an effort to be celebrated.

The Packaging Accord is all about continuous improvement and you may consider setting additional targets or goals to strive for with the overall objective of reducing waste and increasing recycling and reuse of paper.

The New Zealand Paperboard Packaging Association's "Together we can close the Loop" project is another example of smart thinking by the paper industry demonstrating great business sense.

I am pleased that funding through the Ministry for the Environment's Sustainable Management Fund (SMF) helped to set up and implement this initiative, which ultimately aims to increase the recovery of paper-based fibre in New Zealand.

A key outcome of the initiative was the development of the Code of Practice. I am informed that nearly 70 per cent of your members now use this code and that there are some outstanding initiatives that have won environmental awards.

Your mission must be to lift further the level of use of the code within your industry.

I am encouraged that further funding through the Sustainable Management Fund for the next financial year has been approved to further the goals of this initiative.

I would also like to congratulate the wider paper sector for the formation of the New Zealand Paper Forum this year, enabling the broader paper sector to work collectively on environmental sustainability.

It is an initiative to be commended and I will be keen to see developments through the forum including the effects that this will have on recycling.

And it is my challenge to you to ensure that the good work being done through the broader paper industry is communicated through to the public.

I have been asked to talk to you about the Government's approach to waste management.

The Government's desire is to grow our economy while maintaining a healthy environment.

Like many other countries, New Zealand is concerned at the strong linkage between economic growth and the generation of waste.

The Government is committed to the New Zealand Waste Strategy, published in 2002, as the overarching framework to minimise the impact of waste on society and the environment.

The Waste Strategy provides the direction for New Zealand's efforts to reduce the waste we generate.

Product Stewardship (as "extended producer responsibility') and waste levies were both tools signalled in the New Zealand Waste Strategy as worthy of consideration in helping to meet the targets of the strategy.

With the current developments in this area that I am sure you are aware of, I would like to explain to you how we see these two tools working together.

Product stewardship encourages producers, brand owners, importers and consumers to help manage the environmental effects of products throughout their life cycle in the most efficient manner.

This includes product design for environment, reduction in excess materials, recycling or reuse of end product right through to environmental considerations at disposal.

Like the Packaging Accord you are involved with, there are a number of voluntary product stewardship schemes currently operating in New Zealand. These include schemes for things like used tyres and used oil. In all these cases the Ministry for the Environment has assisted their development.

There are others, however, where businesses have taken up initiatives completely independently, such as Fisher & Paykel's take back scheme for domestic appliances, and Resene's levy on paint to fund their take back scheme for unwanted paint.

In some cases, particularly with certain types of special wastes, there can be limits to what a voluntary approach can achieve.

There also remains the issue of "free riders' who don't want to participate and, sometimes, unwillingness by industry to effectively address problems.

The Ministry for the Environment is working on policy development that would allow regulation to be used as a backstop measure for significant waste problems as they arise.

A product stewardship discussion document was released in July 2005, resulting in 130 submissions.

This document set out product stewardship options to deal with wastes that are particularly hard to manage or dispose of, or that contain hazardous substances - such as electronic waste, cars, and used oil.

I reiterate that the preferred option is voluntary agreements by industry, but legislation would remain an option if we cannot get the desired level of co-operation on those difficult wastes.

The Ministry for the Environment has worked closely with industry groups to understand the range of opportunities and challenges.

This continued interaction will ensure that the product stewardship policy meets the needs of as many industry players as possible, and supports those who are willing to take action while managing those who are not.

The timetable we are working towards is for Government to be in a position to introduce legislation into the House by the end of this year.

So how does this affect you?

As I see it, you are already living product stewardship through the New Zealand Packaging Accord and doing a great job.

The product stewardship policy being developed is designed to reach those who are not currently taking this responsibility.

Another major tool that would contribute to the goals of the Waste Strategy, and one that is also currently under investigation, is the development of a levy on waste.

A waste levy is about providing incentives for the efficient use of materials through a market signal on the cost of waste disposal. Such a levy is effectively used overseas to fund the development of recycling and initiatives to utilise the materials diverted from the waste stream.

There have already been discussions around a waste levy, which a number of your members have been a party to. I understand that a proposal will be coming to me with an indication of the level of support for the concept by the end of June.

This is an initiative that I welcome and will become part of the policy mix for further consideration.

So how do we see the relationship between waste levies and product stewardship?

These are complementary tools, which seek to improve productivity and resource efficiency.

Product stewardship and waste levies have successfully run side by side in other countries for a number of years.

A waste levy is a broad tool that seeks to reduce waste of all types going to landfill by encouraging users to consider other options for disposal.

In addition, waste levies may provide a fund to assist the setup of product stewardship schemes or support the development of recycling initiatives.

Product stewardship on the other hand is a more focused tool that would apply to specific products.

Product stewardship encourages business to consider impacts of their products throughout the lifecycle of the product and encourages the most efficient means of minimising these impacts.

The Government has in principle approved the policy of product stewardship.

The Government has not yet formed a final position on national waste levies. However, I have asked officials to report back to me on the issues by the end of July and I would envisage taking a position to Cabinet for consideration shortly after.

I am sure you are all aware that the Green Party's Waste Minimisation Bill has recently been drawn from the ballot.

Fundamentally the purpose of the Bill and the principles behind it are broadly compatible with the Government's waste policy as articulated in the New Zealand Waste Strategy.

This Bill, however, is concerned only with solid waste and many, including me, consider that it is excessively detailed and prescriptive. We have, after all, made huge progress on waste issues already using voluntary approaches, which I strongly support.

The provisions of the Bill cover a number of policy elements already under consideration by the Government, such as waste levies and product stewardship, and could provide a statutory basis for these initiatives.

We need to explore how we could work with this Bill to take forward some of our initiatives and what the views of the community are on those issues.

The Government will, therefore, be supporting the Waste Minimisation Bill through to the Select Committee stage. I strongly encourage you to participate in the Select Committee process and to make submissions that clearly argue your interests.

Concern for the environment has become a shared and common value among all New Zealanders, and protecting and enhancing our environment is a priority for this Labour-led government.

The NZ Paperboard Packaging Association has been clearly leading from the front.

Your results under the Packaging Accord speak for themselves. I am also very encouraged by the establishment of the New Zealand Paper Forum.

I look forward to working closely with you in the future towards our shared goal of environmental sustainability.

Thank you.


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