Delay no more

Australia's Prime Minister, Kevin Rudd, once described climate change as "the great moral challenge of our age", and there would be many environmentalists in agreement.

Mr Rudd's government last week, however, made known that its emissions trading scheme would be delayed for at least three years, to be replaced in the meantime by new energy efficiency measures which it hoped would otherwise meet the greenhouse gas reduction targets to which it has signed up.

In this country, however, business owners are trying to prepare budgets for the next year on the basis of an emissions trading scheme that will probably mean a 4% increase in electricity prices and perhaps an extra 4c a litre to the cost of petrol and diesel fuels.

If that procedure was not difficult enough, businesses also have to estimate the probable increase in GST as well as the impact of possible tax cuts.

Those who export to or in some way deal with Australia must inevitably now be faced with further competitive disadvantage.

Mr Rudd is not the only national leader in retreat from promised climate-change measures because of looming electoral considerations.

President Barack Obama, facing difficult mid-term elections in the United States, is of a similar mind.

It is germane to note that Mr Rudd wants to take account - three years on - of commitments which have been entered into by the rest of the international community.

What this really means is that Mr Rudd has sought and found political "wriggle room", and at the same time has freed some $2.5 billion over the next four years originally earmarked for compensation.

He has been able to do so because, internationally, a number of nervous political leaders are facing the unpalatable truth that there are very few positive votes available for additional taxes in any climate change minimisation regime.

A recent Australian opinion poll underlines the point: 72% agreed the nation needed to take action, but 33% said they were not willing to pay higher power bills to achieve it.

The chances of the New Zealand Government resiling in similar fashion are, however, most unlikely.

One reason for this is practical.

Australia does not yet have emissions trading scheme legislation; New Zealand does, and to defer it before July 1, when it comes into effect, would be impossible since it would require amending legislation.

However, the Government is not relying on this as a reason to proceed.

Having once claimed to be a "follower" of our trading partners in such legislation, New Zealand, the critics claim, now looks likely to be an international leader - out on a limb with a feigned carbon tax that may in time come to be regarded as either innovative or foolish.

Businesses, for one, have not been slow to remind the Government of this risk, arguing that the policy will make it even more difficult to trade successfully with other countries which have yet to implement climate-change responses, or plan to defer them.

They have asked for New Zealand's policies to be "aligned" with those of our major trading partners - a request that on the surface appears reasonable but is realistically impracticable.

It is certainly a waste of time asking the Minister for Climate Change Issues, Nick Smith, to back away from a policy in which the Government has sunk so much political capital in an effort to weaken support for the Green Party.

Dr Smith can claim the scheme is somewhat watered down from the original concept, has provided a "buffer" for businesses likely to be substantially hit with rising costs, provides incentives to plant carbon credit-generating trees, and will be reviewed next year - at which time his critics are likely to remind him of his leader's pre-election opinion that there was no sense in exporting emissions and jobs to another part of the world.

Dr Smith's firmness has, however, been somewhat diluted by his further comment that the Government would not proceed with full obligations and additional sectors "unless progress is made by New Zealand's trading partners".

Yet, if the world has so much to lose from climate change, then it behoves countries to take whatever steps they can to minimise the effects - as a matter of urgency.

A global solution is obviously required and Western nations, including New Zealand, must lead it, since they are in the best possible position to afford the costs and provide the technology and innovation to achieve it.

For New Zealand to now delay further what has already been a slow, step-by-step procedure, would deny pragmatism in favour of the changing winds of political fortune.

Boldness - and leadership - is required.

 

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