The Greens' proposed carbon tax policy could have dire consequences for New Zealand's dairy industry, endangering the competitiveness of our production and pricing ourselves out of the market, writes Chris Lewis.
The recent announcement of the Green's carbon tax policy was not so much a shock but a wake-up call to the reality of how vulnerable we are to the values and the whim of our Government.
A carbon tax for New Zealand would mean we would no longer be a competitor in global dairy trade, which means less in subsidies, fewer jobs, and more than likely a government back in deficit. Farmers are environmentalists too and have more in common with the Greens than one might think. For one their policy on stopping the urban sprawl is a policy we, at the Federation, share.
I think some of the Green's policies are quite good, such as the lowest corporate tax rate, managing our productive land in a ecological and sustainable way, and ensuring our rural communities are sustainable by developing essential infrastructure and making sure we have access to fundamental services. But the devil is in the details, and what we might agree on in the broadest of theories can see us very much divided on the definitions.
New Zealand is already a very low emissions exporter of dairy products and is investing in research constantly to further reduce its impact. A recent Food and Agriculture Organisation (FAO) study in 2010 estimated that globally emissions averaged 2.4kg of C02 equivalent (CO2e) a kilogram of milk, when New Zealand's emissions are estimated at around 1kg of C02e per kilogram of milk, according to DairyNZ, and Fonterra's carbon footprint results were 940g per litre of milk. So it seems detrimental to me, when things are in a positive downward trend of approximately 1.14 per cent reduction in C02 a year, to take away the carrot and introduce the stick.