Friday, December 1, 2023

Sector urges Govt to phase in HWEN costs

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Rushing legislation before the general election will create issues and undermine its credibility, says sector leaders
BLNZ chair Kate Acland says the awards are an opportunity to feel proud of the sheep and beef industry.
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By Neal Wallace and Gerald Piddock

Farming leaders are calling for the phasing in of the He Waka Eke Noa agricultural pricing process, saying rushing legislation through before the general election will create issues and undermine the system’s credibility.

Several sector leaders said the policy’s complexity is causing delays that make it unlikely the farm-level emissions pricing scheme will be law before the October 14 election.

As at May 1, Parliament was scheduled to sit for 31 days. 

Farmers Weekly has been told that a policy paper on He Waka Eke Noa (HWEN) is yet to be considered by a cabinet committee, which acts as a forum to discuss and consider issues before they go before the cabinet.

Farming leaders are asking the government to agree to a dry run to test the process – a period when farmers monitor and record their greenhouse gas emissions but are not required to pay for them.

“Our position is that because of that uncertainty and complex detail still to be worked through, it is not appropriate to start pricing emissions by 2025,” Beef + Lamb NZ chair Kate Acland said.

Other industry leaders said that by monitoring and reporting emissions, farmers will meet the requirements of processors and consumers.

Agriculture Minister Damien O’Connor said he remains committed to HWEN and to getting an effective emissions pricing system in place.

He said in a statement that decisions on emissions pricing are still being considered by the cabinet, that he is aware of the legislative timeframe and is working with farming leaders.

His focus has been on the response to Cyclone Gabrielle.

Climate Change Minister James Shaw said in a statement that he understands the frustration with the uncertainty around the process, but the government remains fully committed to the partnership.

Farmers Weekly has been told that O’Connor and Shaw are split on 10 to 12 issues within the HWEN policy.

The industry is seeking further details on how sequestration will work and aspects of emissions pricing.

Sources close to the issue, who spoke on condition of anonymity, said former prime minister Jacinda Ardern had a thorough grasp of HWEN and acted as a referee in disputes between the two ministers.

Her successor, Prime Minister Chris Hipkins, has not had time to get fully up to speed.

There are also concerns within the government at the impact of an emissions charge on already high food prices.

Another issue is the variable accuracy of the 11 emission calculators currently available.

There is some speculation that the government may introduce a tax, such as that on fertiliser, to fund the development of a more robust and accurate calculator.

O’Connor declined to answer questions on these claims.

DairyNZ chair Jim van der Poel said while HWEN looks unlikely to be in place by 2025, legislation needs to be passed preventing farming emissions from being folded into the emissions trading scheme (ETS).

“There is legislation drafted at the moment that will have us in the ETS in 2025 and we have to get that changed,” Van der Poel said.

That legislation – the Climate Change Response (Emissions Trading Reform) Amendment Bill – puts agriculture into the ETS at farm level for livestock emissions and processor level for fertiliser emissions in 2025.

“We had an agreement in place before Christmas and the industry has met all of its deadlines and now we’re waiting for the government to say whether they still support that or that they have a different view,” he said.

Beef + Lamb NZ chief executive Sam McIvor concurred.

“The government has acknowledged that agriculture shouldn’t be in the ETS, and our sector has done its part, so it’s up to the government now.”

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