Garth George: Political grandstanding a futile gesture

There are just eight days left for the Government to show some logic and common sense and to defer, at least, or abandon, at best, the costly, stupid and useless emissions trading scheme (ETS).

I don't accept what Act MP John Boscawen told a protest rally which gathered outside Parliament on Tuesday that the ETS is a fait accompli.

Rather, I go along with Federated Farmers president Don Nicholson, who said he still hoped the Government would back down at the 11th hour and that pressure would be applied to Prime Minister John Key at the federation's annual conference tomorrow.

Mr Nicholson said he believed the public had not been sufficiently informed of the secondary or indirect costs of the scheme.

"The direct costs might be obvious in the first month," he said, "but the flow through is not. And that is where the deception in this whole thing is ... farmers and public are just waking up to the high folly of this ETS."

I go along, too, with Family First national director Bob McCoskrie, who told the gathering that the nation's families will be penalised by a tax that will have virtually no affect whatsoever on the climate.

That should ring a bell with Climate Change Minister Nick Smith, the principal protagonist for the ETS, who in Opposition told Parliament in 2005, in an address that's as true today as it was then: "New Zealanders will be the only people in the world paying it. It will drive up the costs of living and undermine the competitiveness of New Zealand business for negligible environmental gain.

"A further concern is its impact on inflation, interest rates and the exchange rate. It will add to the costs of fuel and power and these flow right through the economy to basics like food. This puts pressure on inflation, which in turn drives up interest rates and the Kiwi dollar.

"The [Clark] government's carbon tax is a classic example of the way the government is making things tougher for the productive exporting sector. The worst aspect of the carbon tax is that it will not make one iota of difference to New Zealand's emissions."

Just why Dr Smith has undergone a 180-degree change in his perception of the ETS, even watered down slightly as it has been by the Key Government, is a mystery - except that he now has his hands on some levers of power. And we all know what power does to people.

Mr McCoskrie says that ETS will cancel out most of the benefit to families of the tax cuts announced in this year's Budget.

"While the tax benefits of the Budget won't kick in for families until October, the costs of the ETS will start to bite the budget of families in July," he says.

"The $25 a week average increase given to families will soon be swallowed up by the increased costs in energy and petrol and the flow-on effects ... will increase retail prices including basic food requirements. These are all eventually passed on to families."

Mr McCoskrie says the Budget indicated that most New Zealanders would receive roughly 0.5 to 1 per cent average increase in real disposable income.

Yet the Reserve Bank had estimated that the impact of the ETS on inflation would alone be at least 0.4 per cent.

"Families are being penalised by a tax that will have no effect whatsoever on the climate, and amid mounting evidence that the science behind global warming is not settled," McCoskrie says.

Meanwhile, last month the New Zealand Centre for Political Research presented a petition to Prime Minister John Key signed by 4400-odd people calling for his Government to follow the lead of Australia and suspend the ETS until 2013.

On behalf of the petitioners, the centre's founder and director, former Act deputy leader Muriel Newman, formally asked Mr Key to meet the petitioners' request ASAP.

"This is the worst possible time for a government to be increasing the financial pressure on families and small businesses through the imposition of an emissions tax," Ms Newman told Mr Key.

"Given the severity of the recession and the widespread impact of a rise in GST, the 5 per cent increase in the cost of power and 4c a litre increase in petrol and diesel will cause undue hardship."

So perhaps it's time for Mr Key to take another look at the words of his own personal boffin, Sir Peter Gluckman, who has said: "New Zealand is a small emitter by world standards - only emitting 0.2 per cent of global greenhouse gases. So anything we do will have little impact on the climate - our impact will be symbolic, moral and political."

Moral, be damned. Not when it's we, the people, who have to pay through the nose for this political symbolism.