Tuesday, April 23, 2024

Whiff of party politics in emissions mix

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O’Connor likely under pressure to be seen to take action before the election, Allan Barber says.
Minister of Agriculture Damien O’Connor
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The government’s announcement about the planned introduction of the emissions reduction plan met with the agricultural sector’s universal disapproval in spite of Agriculture Minister Damien O’Connor’s claim that it was the result of consultation with industry leaders. 

Unfortunately he seems to have omitted to tell Federated Farmers, Beef + Lamb NZ (BLNZ) and DairyNZ what they had apparently agreed to before going public on the plan.

He is quite right when he says the industry leaders “have reiterated their commitment to taking a collaborative approach on agricultural emissions through the sector partnership He Waka Eke Noa [HWEN] and acknowledge work is needed to meet our climate targets”. 

But he appears to have taken them all by surprise with the timing and content of the announcement, which makes me wonder what exactly the government’s intention is. 

A cursory reading suggests it is pretty close in several aspects to the point the parties to HWEN had reached – confirmation of the split gas approach, measurement and reporting of farm-level emissions, recognition of sequestration in the Emissions Trading Scheme (ETS), and emissions pricing to be set as low as possible.

However, the main flies in the ointment are the start dates for mandatory reporting of on-farm emissions from the fourth quarter of 2024, and pricing from Q4 of 2025, as well as the lack of any information about what sequestration will actually be recognised. Nor is there any recognition of the science that is available to prove that the targeted levels of methane reduction are not justified, despite a request from BLNZ for this.

The representative organisations have all reacted with horror and frustration to the sudden announcement after nine months of “radio silence” with no information at all on the form of mandatory reporting, the basis and level of pricing, mitigation solutions, or a date for recognising on-farm sequestration. 

Federated Farmers president Wayne Langford calls the government’s response “tone deaf” and DairyNZ chair Jim van der Poel cites a “dire lack of detail” that “continues the uncertainty hanging over farmers since 2018”.

It is hard to escape the conclusion that the minister has found himself under pressure, whether from colleagues or lobby groups, to be seen to take action before the election, when obviously, with Parliament having risen, there is no chance of anything happening. 

The statement makes much of pressure from multinational customers to prove our sustainability, although there is no reference to the undeniable fact that New Zealand would be the first country in the world to introduce a levy on its farmers, while our livestock producers are already among the most carbon efficient in the world.

The minister’s statement proudly claims: “It’s important that the system to manage and price agricultural emissions is workable, effective, fiscally responsible and set up to last. That’s why we’re taking a measured approach to its implementation, ensuring farmers are prepared, informed and well supported. It is vital farmers can accurately measure and manage their emissions, prior to the start of farm-level pricing.” 

Unless they are totally unwilling to accept the need for any action to counter climate change, I doubt any farmers would disagree with this statement in principle. 

But there appears to be a big gap between intention and reality, which is a hallmark of this government’s track record over the past three years if not longer.  

Given the amount of work to be done, it is highly unlikely the government will have a robust measurement and reporting system in place by the end of 2025 that farmers have confidence in.  The failure to set out an achievable plan to measure on-farm emissions, involving a pilot scheme at a regional level before setting a timeframe for the whole country, is an example of the muddled thinking that unfortunately kneecaps all attempts to introduce new programmes. 

The slow introduction of the NAIT traceability scheme is the most recent example of poorly thought-out implementation (sheep traceability is as far away as ever and it beggars belief to think we could ever handle an outbreak of foot and mouth disease without it) and this latest one looks as though it will follow a similar pattern. 

The latest government announcement can be viewed as a backstop position from which the industry can negotiate a way forward in the event of a Labour/Greens coalition having enough votes for a majority after October’s election. 

In the alternative scenario of a National/ACT government, all bets would be off with each coalition partner having a policy position that provides the sector with more time to work through the issues. 

It would be unfortunate if the second outcome were seen as an opportunity to change direction from the present course, which has seen significant progress towards achieving a credible position on the sustainability of the sector and its commitment to emissions reduction. 

Critics of agriculture will never see anything other than economically unacceptable progress as sufficient, but it is more important to move at a realistic pace – one that ensures New Zealand’s position is at least as good as that of its trading partners. 

The present government has unfortunately found itself on the horns of a dilemma, which has arisen from a combination of its commitment to achieve net zero by 2050 and its eagerness to appease the environmental lobby, including Climate Minister James Shaw, as well as trying to convince the agricultural sector it is only doing what the sector’s leaders have agreed. 

This has resulted in the attempt to impose a scientifically unjustified reduction in methane targets while making the range look achievable at the lower end, when declining livestock numbers will achieve a more realistic target in any case. 

At the same time the government has persisted with policies that incentivise the wrong outcomes, or at best has modified them too slowly, to the detriment of NZ’s biggest economic contributor.

For the sake of the country’s future economic prosperity, and that of its farmers, this state of affairs cannot be allowed to continue. 

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