Nick Smith explains the ETS [update 2]
This mock interview with Nick
Thick Smith explaining his Emissions Tax Scam was emailed to bloggers yesterday. I liked Whale Oil’s title for it:
UPDATE 1: John Boscawen outlines what upsets New Zealanders so much about Smith’s Emissions Tax Scam, and fisks the lies Smith is spinning:
“What upsets [New Zealanders] so much?
– That the unnecessary financial burden imposed on individuals and families, businesses and exporters, workers and beneficiaries by this unwanted and unwarranted ETS regime is unreasonable, irrational and unfair
– That Nick Smith and his leader have both repeatedly stated that New Zealand will not be a world leader in the imposition of an ETS on its citizens and yet are now pushing on to be THE world leader in ETS taxes
– That NONE of our largest trading partners, Australia, China and the United States, have imposed such a tax regime on its citizens and businesses…
“If you have emailed a National MP you may have received a standard email in return, containing these misleading pronouncements. I detail them below and also the truth of the matter so that you, the tax-paying citizens of New Zealand, can reach your own conclusions.
Misleading Statement Number 1
In the next 12 months the government has to pay $1.1 billion to foresters, in the form of emissions credits for forests planted since 1990.
Nick Smith’s own officials confirmed to me that this was not correct. This figure is a combination of payments for both pre 1990 forests and post 1989 forests. And there is a very important difference. The first is a lump sum; non-recurring payment ($420 million) and the second ($685 million) covers forests planted in 2008, 2009 and 2010 and has an ongoing recurring element of approximately $228 million per year. ACT says we should defer the ETS and compensate foresters who planted after the forestry aspect of the ETS came into effect on 1 January, 2008 . That would cost no more than $20 million.
Misleading Statement Number 2
The Government’s revenue in the first year from the ETS will be about $350 million.
Nick Smith’s official's also confirmed to me that this figure excludes the windfall profit gains from the three government owned electricity generators. So government revenue from the ETS will be in excess of $500 m, well in excess of the annual ongoing forestry cost. Where is the extra money going?
Misleading Statement 3
New Zealand is not leading the world with our ETS, because 29 other countries have one.
The New Zealand ETS is a single country scheme; no other country in the world has a single country scheme. The European Union as a trading bloc has a scheme which covers 29 countries. The European ETS imposes costs on the entire European trading bloc and 80 percent of European exports are internal. In contrast, our ETS will directly penalise all exporters.
The European ETS also excludes major parts of their economy, whereas our government has been very proud of the fact that our all gases/all sectors ETS is a world first.
Misleading Statement 4
New data shows that the moderated ETS has reversed the trend of deforestation which was a major worry under Labour.
New Zealand’s plantation forest area grew extensively through the 1990s. In the lead up to 1 January, 2008, there was excessive harvesting of forests, only because people rushed to fell them before January 1 so they wouldn't be subject to a bill of $17,000 per hectare. This would never have happened if it weren’t for the ETS.
The government has made a big point of saying that agriculture doesn't come into the ETS until 2015. This is correct with regard to animal methane and nitrous oxide from fertilizers. However, Meat and Wool New Zealand have calculated that by 2015 these costs will be less than one quarter of what a dairy farmer will incur, and about 50% of what a sheep and beef farmer will incur. By far the biggest cost to a farmer is the petrol, electricity and processing costs of dairy factories and meat works. And these costs start on July 1 this year…