The Haps 

ACT’s Alternative Budget for Real Change has been widely reported and discussed. Labour, the Greens, and Māori Party all attacked ACT for it, and that was just Tuesday. As Matthew Hooton wrote, it ‘sufficiently disturbed the Labour National duopoly.’ It shows that if there is to be real change in New Zealand, it will fall to ACT to provide the leadership. Meanwhile, in Tauranga, ACT’s Cameron Luxton is campaigning like a star in the by-election. People are showing up to his numerous street corner meetings and spontaneously donating funds. If you’re in Tauranga and would like to support Cameron, please click here.


The cost of living is New Zealanders’ number one issue, but inflation has no visible end. And yet, every other party is supporting the most costly and bureaucratic possible path to lower emissions.

When the Zero Carbon Act that now brings forth the Emission Reduction Plan was passed, ACT alone voted against it, 119-1. National, New Zealand First, Labour, and the Greens all voted for this abomination. David Seymour told Parliament at the time:

[T]he ACT Party opposes this bill, because not only will it be ineffective in achieving the goal of mitigating emissions, it will also be inefficient because of its requirement for New Zealanders to use New Zealand credits at almost all times, and therefore inefficient, and more expensive, and also pernicious, because it introduces a level of central control over economic decision-making that this country has not seen since 1984.

It remains good advice, but there’s more.

Yes, the Zero Carbon Act will isolate New Zealand from the world by rejecting foreign credits. If the rest of the world has access to cheaper credits, New Zealanders and their businesses will be hostage to the New Zealand price. Perhaps the Government thinks we are too competitive and wants to give other countries a chance?

Yes, the Zero Carbon Act allows climate tsars to ban technologies, subsidise other ones, and generally micromanage life and business in a way we haven’t seen since Sir Roger Douglas freed the New Zealand economy from central planning. That’s why one of the big controversies was whether or not restaurants would be allowed to install gas stoves any more. Maybe the Government thinks we have too much freedom?

Those are the obvious problems, but worst of all it is pointless. The Emissions Reduction Plan will not reduce New Zealand’s emissions by one gram. The simple reason is this: The Emissions Trading Scheme already places a cap on emissions.

How much carbon New Zealanders emit is already decided. NONE of the initiatives announced today will change that level. If you receive a subsidy to buy a more efficient car you will use less fuel. You will pay for less carbon credits and save money for doing so. But, remember, there’s a fixed level of emissions allowed under the ETS. The credits you don’t use are freed up for someone else.

Perhaps someone who didn’t insulate their house, drives a V8, or just drives a lot, will find themselves with more credits available thanks to your carbon frugality. The car rebate scheme will not change the total emissions from New Zealand, just who emits them and how.

It will make a big difference to the taxpayer, however. The only standard for measuring these policies should be ‘how much does it cost to save a tonne of carbon.’ At the moment the price for emitting a tonne under the Emissions Trading Scheme is $76. There are people out there who’ll reduce their emissions by a tonne and sell you the right to do it instead for $76.

What will policies like the clean car subsidy cost? Get this. The Government doesn’t know. But the Government says it copied California. Free Press found California’s Clean Cars 4 All has a per-tonne-of-carbon-saved cost of $920 USD, or about $1500. This scheme is 20x more expensive than what we’re doing now.

It really is that nuts. It is difficult to exaggerate how stupid this policy is. Remember, every party but ACT voted for it. But what would ACT do instead?

First let’s define the problem. Nothing New Zealand does affects the climate, but the climate policies we adopt could affect us. We need a Goldilocks policy, not too heavy and not too light.

Too heavy, and we force activity overseas to less efficient producers. It would be a shame to put New Zealand farmers out of business so that consumers can buy from foreign farmers who emit more to produce the same amount of food.

Too light, and we risk becoming a climate pariah. As a trading nation, we can’t give foreign Governments and consumers excuses to reject New Zealand exports. The trick is to strike a balance with a minimum of fuss.

A problem defined is a problem half solved. We need to 1) dump the Zero Carbon Act and Emission Reduction Plans, 2) set the ETS cap in line with our trading partners’ emissions, and 3) give ETS revenue back to families in a carbon tax refund.

This policy (costed into ACT’s Alternative Budget for Real Change), would give around $1000 to a family of four. It would tie our emissions to our competitors’ levels, give relief to families struggling with the high cost of living, and retain consumer choice. If you really want to spend your carbon tax refund fueling the V8 you can, but it will cost. If you reduce your emissions, it’s free money paid by those who didn’t.

It is not difficult to solve the climate policy problem, all it takes is common sense and political will. Unfortunately, ACT has cornered the market on those commodities. We need your help to fight for them.