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Taxpayers to foot bill for Govt backdown

Taxpayers to foot bill for Govt backdown

Auckland May 6 2008 – New Zealanders will pay through their taxes for the Government's capitulation to big business, warns Greenpeace.

"The Government's commitment to tackling climate change is crumbling before our eyes," said Greenpeace Executive Director Bunny McDiarmid. "And it is scandalous that the people who'll suffer the most from this extraordinary backdown are ordinary New Zealanders.

"Every tax dollar spent by the Government to appease big business polluters by giving them free credits to pollute is money taken away from spending on public transport, hospitals and schools.

"Ordinary New Zealanders must be fed up with always bailing out politicians who give away taxpayers money to big business polluters rather than standing up for what is right in the long term interests of New Zealand and the planet."

The Government has just announced plans to further water down its emissions trading scheme (ETS) by giving away more free pollution credits to the loudest business lobbies. It will do so by delaying the start of the phase-out period for the free pollution credits and delaying the transport sector's introduction into the scheme.

The unfairness of giving free pollution credits to big business and agriculture at the expense of taxpayers was raised in March in a Greenpeace report into the ETS (1). "What's worse, under the Government's latest proposal, polluters will have less incentive to change their ways, thereby increasing our greenhouse gas emissions and our Kyoto Bill. The country will pay more overall just to appease loud big business lobbyists and the National Party," said McDiarmid.

Greenpeace argues the Government should auction pollution credits instead. "All those worrying about the unfair burden placed on householders should back Greenpeace's call for greater auctioning of pollution credits as this will allow investment in households so that ordinary New Zealanders can afford to adjust."

*****

(1) New Zealand's Expanding Carbon Footprint - Analysis of New Zealand's Emissions Trading Scheme; major flaws and barriers to emission cuts www.greenpeace.org.nz/ets-report. One of the report's authors, Dr Richard Denniss, is Associate Professor at the Crawford School of Economics and Government at the Australian National University. He said this about the Government's free allocation of permits: "This `generosity' on the part of the government is best seen as a transfer of production costs from individual polluters to New Zealand's taxpayers. That is, any permits that are `gifted' to polluters cannot be sold for a price at auction."

ENDS

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