Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 

ETS Changes to Cost $1.3 Bn – and an Eternal Transitition

ETS Changes to Cost At Least $1.3 Billion – and an Eternal Transition

Media Statement – 12 July 2012

The total cost to taxpayers of changes to the ETS is at least $1.3 billion, based on the $25 per tonne carbon price the government currently uses to assess policy options.

And the removal of dates for an end to so called ‘transitional provisions’ means there is now an Eternal Transition until a government is willing to make the case for imposing meaningful charges.

80% of the total additional cost of the changes arises from what the government describes as the “big ticket item”. This is the extension of the concession that allows polluters to pay just one emission unit for every two tonnes of carbon they release. This change is estimated to cost $80 million a year - and it alone represents a considerable break with the pre-election promise that “our changes to the ETS will be fiscally neutral”.

The government puts the total cost of the package of changes at $328 million. While this is based on the carbon price it regularly uses in its accounts – the current market price – at present that is a very low $6/tonne. When undertaking analysis to assess future liabilities arsing from climate policy, the government uses projections of future market prices. It has until recently used $50/tonne for this but has lately reduced this to $25/tonne. A future price is a better measure of the value at stake and at $25/tonne, the changes will cost taxpayers $1.3 billion in lost revenue.

Yet these estimates are only for the period until June 2016. A further review of the ETS has been signalled for 2015, but the Cabinet paper outlining the changes makes clear that no date will be set in legislation to end the extended holiday for polluters.

So if the transitional measures are not abandoned by June 2016, the taxpayer will continue to sacrifice revenue for every additional year. And as the ETS makes polluters pay for a greater proportion of their emissions over time, the annual loss will rise each year.

The potential cost to taxpayers of the change in legislation is therefore much greater than the $1.3 billion for the first three and a half years covered in the Cabinet paper. As there is no certainty when the Eternal Transition will be abandoned, the full potential loss is the revenue forgone for many years ahead. And as carbon prices are expected to rise over time, this would further push up the losses.

The practical effect of setting no dates to end the holiday is that the ETS becomes the Eternal Transition Scheme. It changes from something that provides a limited holiday period for polluters, to something that presents no real incentive for change until a government has the courage to make the case for meaningful emission charges.

The government has given up holding the threat that the scheme will bite at some defined date and is resting with a regime that does not even have gums.

ENDS


© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines


Gordon Campbell: On The George Floyd Protests

Poverty, discrimination and repeated acts of police brutality all help to explain the rage being expressed on the streets of American cities right now after the death of George Floyd but there is a more immediate cause as well: Decades of research on police shootings and brutality reveal that officers with a history of shooting civilians, for example, are much more likely to do so in the future compared to other officers... More>>

 

Gordon Campbell: On The Twitter Wars, And The Muller Muddles

Whatever the failings of our own politicians, spare a kind thought for the majority of Americans who did not vote for Donald Trump. Sure, it was depressing this week to watch Todd Muller clinging for dear life to his talking points on Q&A, ... More>>

ALSO:

Green Party: Statement On The Death Of George Floyd

“Today and every day we stand in solidarity with George Floyd’s family, friends and community who feel pain and fear about his untimely death at the hands of Minneapolis police”, said Green Party Co-leader and Māori Development spokesperson Marama ... More>>

ALSO:


Government: Freshwater Package Backed By Comprehensive Economic Analysis

Decisions on the Action for Healthy Waterways package are supported by comprehensive environmental and economic impact analysis by leading New Zealand research institutes, universities, and private sector firms. More>>

ALSO:

National: "Todd Muller Announces Shape Of Next Government"

National Party Leader Todd Muller has announced the line-up of the next Government. “New Zealand is facing perhaps the toughest time that almost anyone alive can remember. “We are borrowing tens of billions of dollars to get us through this crisis. There ... More>>

ALSO:

Lockdown Rules: Government Must Explain Why We’re Still At Level 2

The Government needs to explain to New Zealanders why it won’t consider a move to Alert Level 1 for another week, Leader of the Opposition Todd Muller says.
“Kiwis have made enormous sacrifices to flatten the curve, but if their efforts still aren’t enough to move to Level 1 then the Government must explain why.... More>>

ALSO:


Gordon Campbell: On National’s Day Of Reckoning

Congratulations. You are one of the 55 members of the National caucus being called together tomorrow to choose who will lead you to either (a) catastrophic or (b) honourable defeat on September 19, thereby saving some (but not all) of the jobs currently on the line. Good luck. Your decision process starts NOW... More>>

ALSO:


Budget 2020: Jobs Budget To Get Economy Moving Again

Investments to both save and create jobs in Budget 2020 mean unemployment can be back to pre COVID-19 levels within two years and could see the economy growing again as early as next year. More>>

ALSO:

Government: Queen's Birthday Honours List 2020

The New Zealand Order of Merit The Queen has been pleased, on the occasion of the celebration of Her Majesty's Birthday, to make the following appointments to The New Zealand Order of Merit: DNZM To be Dames Companion of the said Order: Distinguished ... More>>

Government: Support For Arts And Music Sector Recovery

A jobseekers programme for the creative sector and four new funds have been set up by the Government to help our arts and music industry recover from the blow of COVID-19. Thousands of jobs will be supported through today’s $175 million package ... More>>

ALSO:

Government: New Zealand Joins Global Search For COVID-19 Vaccine

Foreign Affairs Minister Winston Peters, Research, Science and Innovation Minister Megan Woods, and Health Minister David Clark today announced a COVID-19 vaccine strategy, which will enable New Zealand scientists to contribute to global research efforts ... More>>

ALSO:

The Dig: Steady State Economics: We’ve Got Some (systems) Thinking To Do

In this time of impending economic and ecological crises, we urgently need to aim for a sustainable or ‘steady state’ economy. In order to get there, we will need to adopt a ‘systems-thinking’ outlook taking into account the interconnections of our complex world.

In short, we’ve got some systems thinking to do... More>>

ALSO:

Election 2020: Parties Get Into gear

The Green Party is pleased to reveal its candidate list for the upcoming election. With a mix of familiar faces and fresh new talent, this exceptional group of candidates are ready to lead the Greens back into Government. Using the most democratic list ... More>>

ALSO:

Insight Into Regenerative Agriculture In New Zealand

There is a fast growing movement in New Zealand that has been happening out in paddocks, fields, gardens and hill country across the nation. It is a movement that holds the promise to reshape our productive land use industries towards systems that work with the natural environment to regenerate the land. The movement is that of regenerative agriculture. More>>

ALSO:

Covid-19: Tracer App Released To Support Contact Tracing

The Ministry of Health has today formally released the NZ COVID Tracer app to support contact tracing in New Zealand. Kiwis who download the app will create a digital diary of the places they visit by scanning QR codes displayed at the entrances to ... More>>

ALSO:


Govt: Deep Concern At Hong Kong National Security Legislation
Foreign Affairs Minister Winston Peters today reiterated the deep concern of the New Zealand Government following confirmation by China’s National People’s Congress of national security legislation relating to Hong Kong.... More>>

ALSO:


 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 


 

InfoPages News Channels