Kiwiblog

Sarah Young in the Nelson Mail reports:

Labour is recruiting “captains” to “wipe the smug grin” from Nelson MP Nick Smith’s face, but he was not smiling about the ploy today.

Dr Smith says Labour MP Maryan Street’s letter to Labour supporters asking for help with election campaigning is “pretty snide, negative stuff”.

The letter, signed by Labour’s campaign co-ordinator Kate Reilly, calls on people to “make a difference” by becoming a street captain to “motivate and mobilise voters on the day”.

“If we get it right we can be rid of Nick Smith as an electorate MP.

“It’s not complicated but it is important if you want to wipe that smug grin off Nick’s face.”

When I was a campaign manager, I never advocated nastiness towards my candidate’s opponent (Marian Hobbs). To the contrary I made a point of only saying positive things her in a personal, not political, sense.

Most voters don’t like the personal nastiness, and while the stuff about Nick is pretty mild (for Labour) it perhaps helps explain why Street lost the seat by 8,500 votes.

Trevor blogged yesterday:

Chris is pretty badly hurt. And he is damaged. That is obvious. He has to decide what he wants to do.

My appeal is for us to be reasonable, forget the lynch mob mentality, and let him work out what is best for him, for Labour and for New Zealand.

And give him space to do that.

Trevor is right. I think people should show the same compassion and reasonableness to Chris Carter, as Trevor himself showed to Nick Smith when Nick got badly hurt and had to take some time off.

The Herald reports:

Nelson MP Nick Smith says he is “delighted” a $15 million defamation lawsuit against him has been settled out of court.

“It’s been a very draining five years. The settlement involved some payment but was less than the legal costs would have been for the scheduled six week hearing,” Dr Smith said outside court. …

Counsel for the parties appeared in the High Court today to announce an agreement had been reached, but the terms were confidential.

Dr Smith said that no public money was involved in the settlement.

Having a $15 million lawsuit hang over you would be no easy thing. Most defamation suits will punish but not destroy you. This suit would have, if successful, bankrupted Nick. No money, no house to live in, no job.

So it must be a great relief to have it settled. I don’t know the terms of the settlement of course but even the fact there has been one is significant because my understanding is Smith and Wakeling had been prepared to settle years ago, but the Plaintiff insisted on a day in court. However a recent case in appellate courts made the burden of proof harder for the plaintiff, so this may have helped encourage a settlement.

The Dominion Post praises Nick Smith:

Machiavellian, arrogant, hot-headed. ACC Minister Nick Smith has been called all those things and more. And by his friends. He has a reputation for throwing tantrums and flying off the handle when things don’t go his way.

Don’t worry – the praise is coming.

But Dr Smith is also a passionate advocate of his constituents’ interests and a minister who takes his responsibilities seriously. For that, taxpayers have reason to be grateful. It is because he keeps his ear to the ground and takes an active interest in his portfolios that a potential fraud has been uncovered within ACC. The corporation said this week that it had sacked a staff member – known to be its property manager Malcolm Mason – and referred “matters of concern” to the Serious Fraud Office.

Those matters relate to property transactions involving ACC in several different parts of the country and that appear to go back some time. However, it was not until Dr Smith queried the rent ACC was paying for its new offices in Nelson that anyone within the corporation thought to compare the prices it was paying for office space with the going rates. Dr Smith did so because local retailers were worried that the $346,320 a year ACC was paying to rent its Nelson premises set too high a benchmark and because other locals feared ACC was not getting value for money.

The advantage of a Minister also being a well connected local MP.

Dr Smith signalled his unhappiness by refusing to open the building. Contrast his attitude with that of Labour’s former internal affairs minister, George Hawkins, who ignored newspaper reports and industry concerns about the leaky building crisis for more than 12 months about 10 years ago because officials had not formally advised him there was a problem.

“One would expect that, if there was a problem, the people set up to deal with that would inform their minister,” he said at the time. “They did not.”

If Dr Smith had taken the same approach, ACC would still be unaware it was paying twice the going rate for office accommodation in Nelson and would not have uncovered irregularities in other parts of the country.

Irascible? Yes. Economical with the truth? Sometimes. But also an example to other ministers of what the public expects. The job of ministers is not simply to sign pieces of paper put in front of them by officials, open new buildings, bandy unpleasantries across the floor of the House and enjoy their generous salaries and perks. It is to actively represent the interests of voters.

Dr Smith has done so. He deserves to be congratulated.

On this issue, few would disagree.

The ODT focuses on the UN declaration:

The latest manifestation is the sudden – it has been described as “secret” – accession on Tuesday to the United Nations Declaration on the Rights of Indigenous Peoples with a statement delivered by Maori Party co-leader and Maori Affairs Minister Dr Pita Sharples to the United Nations in New York.

It has been met with tension, and what might be described as a tantrum, by the third party in the coalition Government’s bed: Act New Zealand.

Leader Rodney Hide has responded to the news with a display seldom seen even within the somewhat elastic emotional parameters of coalition politics. …

Mr Key and senior National Party figures will be gambling that this gesture towards the Maori Party will further enhance the mana of the latter, cement more tightly the political allegiance between the two parties, and deflate the more demanding ambitions of radical Maori – personified in Parliament in the character and rhetoric of Hone Harawira – while, in practice, giving nothing at all away.

They appear to have decided that the subtlety of principle should be subjugated to the symbolic glue of pragmatism.

It may make political sense, but while National retreats to the safety of descriptors such as “aspirational” and “non-binding”, it is hard to escape the conclusion that, on this matter, it speaks with a forked tongue.

Colin Espiner writes:

Regional councils charging late fees for rates payments are about to get some of their own medicine.

Environment Minister Nick Smith has outlined details of “financial incentives” for councils who fail to process resource consent applications within the statutory 20 days.

Under the changes, which the Government wants in place by July, councils that are up to a week late in processing a resource consent must provide a discount of 25 per cent of their fee. A further 5 per cent discount will be added for every week the consent is delayed, up to a maximum of 80 per cent.

An excellent initiative. Councils, like most organisations, respond to incentives. The threat of reduced income should lead to greater efforts to process consents within the legal time period.

Almost everyone seems to think Nick Smith’s call in of the Mackenzie Basin dairy consents was a good idea. Any doubts I had evaporated when I read this:

Environment Minister Nick Smith today called in three large dairy effluent discharge consents in the Mackenzie Basin and established a board of inquiry to decide on the applications.

“I have called in these discharge consents as they are nationally significant due to their scale, the fragile and iconic nature of the Mackenzie Basin environment, the importance of freshwater quality to the Government and the high level of public interest,” Dr Smith said.

“The effluent from these intensive farms is equivalent to a city of 250,000 people and raises quite legitimate questions over the long-term impacts on the water quality in the Mackenzie Basin.

That is (literally) a shit load of effluent!

The Nelson Mail report:

Nelson MP and Government minister Nick Smith faces trial later this year in a significant defamation case.

A six-week hearing in the High Court at Auckland is scheduled to start on June 8, but Dr Smith hopes it can be resolved out of court before then.

Timber preservatives producer Osmose New Zealand began legal action in December 2005 against timber preservation scientist Robin Wakeling and Dr Smith over statements they made in July 2005 about one of its timber treatments.

The company is seeking nearly $15 million in damages.

The legal costs to date alone has been massive for Nick, let alone what the trial will cost, and if Osmose are sucessful, any damages.

Dr Wakeling published an article critical of the Building Industry Authority (BIA), now the Department of Building and Housing, for approving the use of the treatment in timber framing of houses in 2004.

Dr Smith issued a press release later the same day critical of the then-Government and BIA, along with a copy of Dr Wakeling’s article. He was interviewed on the issue on radio and television.

Osmose’s statement of claim pleaded 11 causes of action. Five were directed at Dr Wakeling – two in defamation, two for injurious falsehood and one for breach of the Fair Trading Act.

The other six were against Dr Smith for defamation and injurious falsehood but did not include an alleged breach of the FTA.

Dr Smith said yesterday the legal action had become more complex with six other parties added to the action.

“That takes a little bit of the pressure off in that there are more people to fund the defence,” he said.

The legal costs of the various parties would be well over $500,000, he said.

Ouch.

Oh this is very very funny.

Artist Sam Mahon has created this sculpture of Nick Smith. He has made it from cow manure and it is up for auction on Trade Me. It is called “Nick Smith in the shit” and is currently going for $560.

Mahon explains:

The sculpture is light and hollow and highly polished. It sits on a steel stand slightly right of centre.

I wonder how much it will go for. Will Nick bid? Will any of his colleagues bid? Is it made of organic manure only?

Colin Espiner blogs on ACC:

I said I’d post something on ACC, so here goes. Oh dear, what a mess.

It’s hard to know where to start really. Is it all Labour’s fault for increasing entitlements but not premiums? Or the people at ACC, who seem keen to pay themselves large salaries but can’t apparently count? Or the recession? Or the fully funded model? Or all of the above?

When news first broke earlier this year of a hole in the ACC accounts, many of us – and I include myself – were a bit sceptical of National’s motivation, particularly given that excitable boy Nick Smith was in charge, and he is known for, well, exaggerating from time to time.

But the conspiracy theory peddled by Labour and the EPMU (i.e. Labour) that somehow this is all just a VRWC to derail the ACC, lower public confidence in it, and then sell it to the highest (or any) bidder just doesn’t ring true for me.

I can never work out if Labour is the political arm of the EPMU or if the EPMU is the industrial arm of Labour.

For starters, I can’t believe someone with chairman John Judge’s commercial background is going to put his reputation on the line just to help the Government push a particular political ideology. Judge is not going to claim that the very existence of the ACC is under threat if it’s not.

Second,  there have now been three relatively independent reviews of ACC’s financial position, and all of them have come up with the conclusion that it is in the poo.

I actually laugh everytime David Parker insists you can’t trust the Government’s figures, considering the last Government’s failure to mention the ACC blowout broke the Public Finance Act. This is not an area of credibility for them.

Third, there’s little doubt that the additions made to the scheme by Labour a couple of years ago – including things like lump-sum payouts for the families of suicide victims, and physiotherapy, simply aren’t affordable any more.

An employee on the average wage is now paying over $1,000 a year to ACC. That is a huge amount of money.

Having said all that, I do think Nick Smith has over-egged the pudding a little bit. At least some of the need for the big increases is because of the move towards fully funding the ACC.

Fully funding means that like a commercial insurer, ACC is required to hold enough in reserve to meet the claims it expects to have to pay out on over a given time. It has never operated like this before, but is now required to.

Originally this was to happen by 2014. The Government – and in fact Labour too – wants to push this out to 2019. You could question whether ACC should in fact ever be fully funded, but that’s another argument.

I want to cover this argument in detail one day. Michael Littlewood has written at length that a Government backed insurer does not need to depart from the old model of collecting enough every year to cover payments for that year.

The Government is also going to get some heat over the decisions it’s made, and so it should. The massive increases in levies for motorcycles seems grossly unfair to me, and smacks of National hitting a group of voters it doesn’t think are likely to be National supporters.

Sure, motorcycles are involved in more accidents, but how many of those were caused by car drivers? As a former motorcyclist myself, it was being knocked off my bike by some idiot in a car that prompted me to hang up my helmet.

Even under the changes, motorcyclists are being subsidised by other drivers. A motorcyclist is 16 times more likely to be involved in an accident. Not even if half are caused by motorists, that is still eight times more likely.

Ramping up motorcycle levies also flies completely in the face of all the rhetoric from the Government about reducing congestion, cutting carbon emissions, using less petrol, etc etc. Not to mention parking.

The purpose of ACC is not to incentivise people to cut carbon emissions, reduce congestion etc. You have other taxes and policies for that. The purpose of ACC is to cover the costs of accidents.

I hear National doesn’t have the votes to get the changes through Parliament yet, either, although it probably will manage it eventually because it’s cleverly set up a straw man in the form of even higher increases proposed by ACC that don’t require a law change.

Therefore if parties don’t vote for National’s bill, the Government can accuse them of agreeing to even higher imposts on the public. That is quite clever.

I don’t think it is clever. I think one should get 61 votes in favour before you announce the changes.

Also Whale Oil has a post on a payout to children of someone killed in an accident. I think there should be some initial support, but when did it happen that  ACC funds you until you are 18, if your parent dies in an accident. If your parent drops dead from a heart attack you get nothing, but if it is an “accident” you get ACC. The original scheme was about looking after people temporarily until they could work again – not social welfare.

Nick Smith has announced some changes to the ACC scheme, to make it more affordable and stop huge employee levy and vehicle levy increases:

• Reversing 2008 income compensation extensions covering casuals, part-timers, non-earners and abatements for holiday pay
• Reversing entitlements for wilfully self-inflicted injury and suicide
• Strengthening disentitlements for criminals
• Enabling safety incentives for employers and vehicles
• Extending full funding date from 2014 to 2019
• Requiring far more open reporting on ACC’s liabilities

The changes are hoped to reduce ACC liabilities by $2 billion.

ACC costs have risen by 57% in the last four years. So even with those changes, levies still have to increase. They are:

• a $32 increase in the motor vehicle levy taking the fee for a petrol car up from $136.44 to $168.46
• ACC petrol levy will rise from 9.34 cents per litre to 9.90 cents per litre
• Motorcycle levies to now vary by size going from $252.69 for all to $257.578 for under 125 cc, $511.43 for 125 – 600 cc and $745.77 for over 600cc

When I talk on blogging, I joke how most people are calm and reasonable in real life, but put them behind a blog and they turn into a foaming abusive person but that the opposite effect has been seen with Trevor Mallard in that he comes across on the blogs as far more calm and reasonable than he sometimes does in the House.

Generally I have been full of praise for Red Alert, and Trevor’s contributions specifically. But sometimes he goes too far. Yesterday Trevor blogged:

In 1999 and 2000, and again in the few days he was deputy leader of the National Party, Nick Smith has shown an inability to cope when the pressure comes on.

Widely circulating Beehive rumours now indicate that John Key has overloaded him giving him Climate Change and ACC at the same time.

Now this is just nasty stuff. Sure criticise a Minister on issues, and point out areas where he or she may be under stress. But Trevor is either fabricating or spreading rumours designed to remind people that Nick had some stress issues during his brief tenure as Deputy Leader.

I know of a Labour MP who once had a similar issue. I would never ever keep harping on about that on the blogs. I think it is great it is all behind them, and don’t see it as a weapon to be used against him or her.

Anyway I commented on Red Alert:

I must remember to link to this post in 2011, when reminding people why not to vote Labour.

This is just a different version of you yelling out “Take your pills” in the House. I think you forget how deeply unpopular such antics are.

My second sentence was censored on the grounds it takes it beyond Trevor’s limits. In fact it got censored because I was explicit at point out what Trevor was trying to say implicitly.

I probably shouldn’t say anything, as letting people show their nasty side is unpopular. This is part of why Labour was thrown out – their attacks on Key and others did look nasty.

I hope this is the last time we see that sort of post on Red Alert.

As I said a post criticising specifics of Nick’s handling of either ACC or climate change would be quite legitimate. But as I said, this is just a cyber-version of yelling out “Take your pills” in the House – something that only declined in frequency after the media started to report on why Labour were doing it.

Nick Smith hits back at media criticism over his owning of his electorate office. When I said last week that MPs often owned their electorate office not to make money, but to better serve the community, I was thinking very much of Nick.

The Dom Post reports:

A senior Cabinet minister has hit out at criticism of MPs over their allowances and says the media have got it “completely wrong”.

The Dominion Post has revealed a money-go-round that allows MPs to use their $65,000-a-year electorate allowance to buy up office space and rent it to themselves.

Seven MPs are using the allowance in that way, including Nelson MP and Environment Minister Nick Smith.

Dr Smith yesterday rejected claims that he had made a tidy sum from the property, which he brought in 1996 for $165,000 and is now worth $310,000. “I had to spend $152,000 to make it usable … I spent a total of over $317,000.”

And that is one reason an MP may seek to own an office – so they can restructure it as they want.

In 1996 he had brought a church hall and church manse next door and converted the two-storey hall into an electorate office and community hall upstairs.

The hall was used several times a week by community groups.

“You would find it has been a source of community charity, far from your accusation of me trying to make a quick buck.”

I’ve worked/visited there several times, and it is often in use.

Grahame Armstrong in the SST looks at the bad news:

Cabinet will tomorrow approve a bailout plan that also aims to safeguard ACC’s financial future. The proposed changes will be open to public discussion for four to five weeks before ACC makes recommendations to the government. …

Wage earners currently pay an ACC levy of 1.7% of what they earn, up to $110,000 (any income above that does not attract a levy). That is set to rise to 2.5%.

The Sunday Star-Times understands the ACC levy for a family earning $38,000 is likely to rise by $304 a year, plus an extra $52 to register the family car and 4c a litre more at the fuel pump.

If the government chooses not to increase the ACC petrol excise, which is now 9c a litre, the ACC component of registering a car, now $168, will go up even more – possibly by as much as $107.

Someone on the average wage of $45,000 will pay $360 more a year to ACC, plus the extra fuel and vehicle registration costs. The ACC levy for those on $65,000 will go up about $520 a year while those earning $85,000 will pay $680 more.

This is all because Labour kept adding on more and more entitlements, but didn’t fund them. It was fiscal folly. Don’t think this is just about the investment losses.

ACC chairman John Judge told the Star-Times ACC’s debt was worth about $3000 for every New Zealander, and it was going to take a “hard-nosed” approach – and possibly up to 10 years – to get it into a sustainable position. This would require “substantial” levy increases and legislative change to get people off the scheme and back to work quicker.

“In the last five years we’ve lost $9b. We need to act today because this liability is like a mortgage – if we don’t start paying it off tomorrow it gets bigger by $700 million-$800 million a year.”

Yes, the time has come to get the scheme under control. It really is about saving ACC, because if no changes were made the increased levy payments would be even more horrific.

ACC Minister Nick Smith said the choices for the government were “pretty ugly”.

“It is inevitable there will be levy increases,” he said. “The government’s preferred approach is to get savings out of ACC operationally and out of pulling back on some of the welfare-type entitlements … Without change, ACC is on course to go broke.

It has changed from a well intentioned scheme which provided support if you had an accident and were off work for a few weeks, to a massive extension of the welfare state.

Labour’s ACC spokesman David Parker said the situation was not as gloomy as the government was projecting. The ACC’s liabilities and costs were increasing but it was also the country’s biggest insurer, and the cost blow-out could not simply be blamed on poor management.

Oh yes we are going to believe Labour’s projections on this.

ACC has released its 2008/90 annual report. They lost $4.8 billion. Nick Smith says:

“This $4.8 billion loss for the 2008/09 year comes on top of a $2.4 billion loss for the year before and shows the ACC scheme is financially unsustainable,” Dr Smith says.

“The Government’s major concern is the growing gap between ACC’s assets and liabilities. It comes as no surprise that ACC’s investment returns have been lower through the recession and we are quite confident these will recover. The grave concern is the huge growth in the outstanding claims liabilities from $9.4 billion to $23.8 billion in just four years.

What a lovely Xmas present the last Government left behind for us.

Guyon Espiner interviews Nick Smith on Q&A this morning. I thought it was a good performance from Nick:

GUYON  What about here in New Zealand.  What sort of climate effects are we going to see here and by when if we don’t get this under control?

NICK Well if we take the sort of estimates that have been made by NIWA scientists, you know we’re looking sea level rises over the course of the century of about .6 of a metre, we’re looking at temperature rises of about two degrees. 

Great to have a politician not exagerrate the impacts. Nick correctly quoted the IPCC consensus of around 60 cm increase over 100 years. You get all sorts of hysterical nonsense about eight metre increases from some politicians.

NICK  Well the government’s commissioned this report from Infometrics and NZEIR to try and get a feel for what those numbers would be if we went for the target that Greenpeace is promoting of minus 40, that indicates a cost of about you know 15 billion dollars per year at 2020, you know that’s more than the entire expense of our health system,

This is what the Green Party is campaigning for. To spend more money on this, than we do on Vote Health. And that is $15 billion a year – not one off.

The report from NZIER is here – NZIER Infometrics Report 26 July 2009.

Their model basically says that the cost would be $3,000 per person per year for a 40% reduction. That is $60 a week.

NICK   Yeah I do, I think that argument is incontrovertible, you know how can we, emitting about 17 tonne a year, per New Zealander, say to the Bangladeshi who’s doing a tonne a year, hey guys you’ve gotta get your emissions down because we’ve got a global problem.  But the other part we have to understand is this, even if every one of the developed countries signs up to a zero target which is totally unrealistic, and you see the continued growth in emissions from China, India, Brazil, those countries, we are not going to beat this problem, you know the projections are that you’d get emissions up to sort of 650 parts per million, even with zero from the developed world, and so that really shows how important it is in Copenhagen that we get the developing countries to come on board. 

This is key. An agreement must include China, India and Brazil.

NICK   I want to reassure you, that in the government making its decision both on the ETS and the 2020 target, that needs to be at the front of our mind.  You know if we look at the new bill that’s in the United States Congress, they’ve specifically made provision there for tariffs against countries that don’t take climate change seriously, and so what the sort of balance that the government’s going to have to strike here, is one that has us not getting out too far of the pack.  What that economic report shows if you get too far out, the costs really escalate.

GUYON         So we could face a trade ban, so your 15 billion dollars pales into nothing if we are getting our goods boycotted by an international trading ban. 

NICK   Absolutely, and that’s why I say to farmers in the agricultural sector, look guys climate change has gotta be taken seriously, not only is it an environmental risk, it is a trade risk, and that’s where New Zealand needs to find this balance, recognise that we’ve got a tough job, but saying that look too far ahead, costs get too high, too far behind and the costs get ugly as well.

It is a balance. If we do nothing we will get hammered. If we try to be the most pure country in the world we will just get a lot poorer and possibly outsource our emissions to China.

NZPA report:

A Nelson man allegedly tried to buy a firearm to shoot Cabinet Minister Nick Smith yesterday before a threat forced Dr Smith to close his Nelson office.

Dr Smith, also MP for Nelson, was not at his office yesterday when police and the diplomatic protection squad dealt with the threat.

Senior Sergeant John Price of Waimea police said police were investigating an incident involving an allegation of a threat against Dr Smith, the Nelson Mail reported.

Dr Smith was told a man attempted to obtain a firearm and said he was going to use it to shoot Dr Smith.

When the man was refused there was an incident involving a knife and the police were called.

The diplomatic protection squad had been “escorting” Dr Smith since the alleged threat.

The man who made the threat was believed to have been involved with mental health services and was known to police.

That is very scary. The man sounds a nutter but it is the nutters who may just turn up and shoot you.

What is not clear is if the man is in custody or not?

One can’t be sure, but this sounds like a beat-up:

A Nelson man has laid a complaint with police that the city’s MP, Nick Smith, assaulted and abused him.

However, Dr Smith says it was he who was pushed and shoved and he now intends to make a complaint to police too.

Police say they hope to interview Dr Smith today.

Ross Cooper said he approached Dr Smith on Rutherford St just before noon on Saturday, when he saw the environment minister leaving the market.

Mr Cooper, who is on a partial invalid’s benefit, wanted to talk to the MP about his “disgusting” power bill.

However, he claimed Dr Smith, who was getting into his car, would not talk to him.

Dr Smith tried slamming his door twice, hitting Mr Cooper’s shoulder, and abused him, swearing at him to go away, Mr Cooper said. “I was leaning over on the car doorway, showing my bill,” he said. “He wanted to push me aside to get going.”

Mr Cooper said he had a sore shoulder as a result but was otherwise uninjured.

And the other side:

Dr Smith said he had been due to pick up his children and go on to the opening of Motueka’s community hospital on Saturday, and had told Mr Cooper this. He said he had a look at Mr Cooper’s power bill and told Mr Cooper to arrange an appointment to see him through Dr Smith’s office.

Dr Smith has had previous dealings with Mr Cooper.

That is interesting.

“He refused to allow me to leave. He pushed and shoved me and refused to allow me entry to my car.”

Dr Smith said he had tried to get into his car, including via the passenger door.

“I feel I was assaulted in that I was simply trying to get in my car because I was running late.”

Unless there is more to this than meets the eye, I can’t see it as significant.

UPDATE: NZPA report the Police say there is no case:

A number of witnesses were spoken to and confirmed Mr Cooper was agitated and acting in a loud and aggressive manner towards Dr Smith over his power bill.

Mr Winter said the witnesses also said Mr Cooper was trying to prevent Dr Smith from closing the door of his vehicle and driving away.

He said Mr Cooper was known to Dr Smith, whom he had previously tried to assist but who had repeatedly abused and intimidated his electoral office staff over a period of a decade.

Maybe Nick should have done a Prescott!

Nick Smith said:

A joint report by economic consultants NZIER and Infometrics concludes that a modified emissions trading scheme is the best way forward for New Zealand on climate change policy.

“This report is a useful contribution to the important debate on how New Zealand meets its environmental goals to reduce greenhouse gas emissions at least cost to the economy,” Dr Smith said today in releasing the report.

The report was commissioned by the Ministry for the Environment and provided to the Emissions Trading Scheme Review Committee as part of its terms of reference.

“This report concludes that a modified emissions trading scheme is the best way forward. I am releasing this report to assist with informed public debate on climate change.

“The report highlights that the costs to New Zealand’s climate change policy are significantly greater if other countries do not put a price on carbon. This reinforces the Government’s policy of aligning our response more closely with other countries.

Yep any post-Kyoto arrangement must include all major emitters.

Anyway let us look at the actual report. They note:

There are a number of policy options available to New Zealand to pay for any international liability. The options are all on a continuum between the following two ‘extreme’ bounds:

(i) The government purchases all of the liability offshore using general taxation to raise the revenue required to do so. In this scenario, no carbon price is introduced in the New Zealand economy.

(ii) The government introduces a price for all greenhouse gases in all sectors, with no exclusions. In this scenario, emitters face the entire burden of the international liability.

They conclude:

Our modelling shows that if the rest of the world takes steps to price carbon, and technological change is induced by this pricing, then a broad-based domestic carbon pricing scheme is the least cost way to meet New Zealand’s international obligations. Without action by the rest of the world or technological change, the least cost option can include the free allocation of permits and exemptions for some industries and/or gases.

My version of this is they say we should have an ETS. If the rest of the world signs up to a price on carbon, then our ETS should cover all sectors. If however major emitters (such as China and the US) do not sign up, then some industries should be exempted from an ETS – agriculture being my guess as the most likely.

Indeed I am right. They say:

On balance, our recommendation in the short run is to introduce an ETS with free allocation to competitiveness-at-risk sectors, with agriculture excluded if measurement of its emissions is prohibitively expensive. Free allocation should be output-linked and phased out as our competitors adopt carbon pricing. If agriculture is initially excluded it should be transitioned into the ETS, with free allocation if required, as measurement becomes economic.

It will be interesting to see what the Select Committee recommend.

Stuff reports that Nick Smith does not have swine flu, and so presumably all of the Cabinet are safe.

So this means ambitious backbenchers can stop texting John Key with their CVs.

I heard a rumour very early this morning that Nick Smith was in isolation, as he had Influenza A and it is possible he may have Swine Flu as he has been overseas on his honeymoon.

I forgot about the story until 10 minutes ago and finally rang up the Beehive to ask if it was true, and found the story had broken a few minutes ago on Stuff. If I had drunk less, I could have had a scoop!

We obviously wish Nick a speedy recovery, and hopefully he does not have Swine Flu.

If he does, then it is possible he has infected the Cabinet with it. And in Mexico it has a 6% mortality rate, and we have a Cabinetof 20 – so hey Nathan Guy may be getting a promotion from Chief Whip earlier than he thinks

Okay joking about it is a bit too bad taste – especially if anything bad does happen.

Talking of swine fly, I see we are being told we should no longer be calling it Swine Flu and the WHO wants to have people refer to it as “2009 H1N1″. Yeah right – that will catch on.

Labour and Greens are going on about how awful it is the Government has killed off the carbon neutral public service programme run by the Ministry of the Environment:

Nick Smith points out:

The Carbon Neutral Public Service was just a feel good slogan cooked up by the previous Government. Its only achievement was to cost this country millions of dollars. Ironically, since the programme was launched by the previous Government, emissions from the Ministry for the Environment increased from 656 tonnes in 2005/06 to 766 tonnes in 2007/08.

That is hilarious.

Humans tend to cause carbon emissions. So the quickest way to have a carbon neutral public service to to sack everyone

Nick Smith has just announced that John Judge will replace former CTU President Ross Wilson as Chairman of ACC. Other board appointments will be confirmed by the end of March.

Judge has a very strong background in financial management and governance. He was Chief Executive of Ernst & Young for 12 years and serves on a number of boards, and is the Chair of both Te Papa and the Auckland Art Gallery Foundation. So he seems well skilled at balancing financial objectives with wider social objectives. He also is on the advisory boards to both the Auckland University and Otago University Schools of Business.

Labour appointed Judge to the Te Papa Board in 2000, so presumably will find it difficult to attack his appointment to chair ACC.

Anthony Hubbard in the SST predicts some axes tomorrow:

ACC MINISTER Nick Smith is likely to sack ACC chairman Ross Wilson and several other board members tomorrow.

And embattled Corrections Department chief executive Barry Matthews is likely to be soon removed from his post by the State Services Commission.

We’ll find out tomorrow if that is correct or not!

Nick Smith makes a very good case for RMA reform in the SST:

Smith replies that he doesn’t so much want to alter the environmental outcomes of disputes under the law, but the process. At present, decisions are made by dozens of local bodies, some of them tiny, and then routinely appealed to the Environment Court. The result is often expensive and unnecessary delay.

Yep, it is not about getting different decisions made, but the idiocy that it takes longer to get a resource consent for a road, than it does to build it.

He offers a couple of examples. “TrustPower has applied for a quite controversial power scheme on the Wairau River in Marlborough. The process has been awful. It went to a commissioners’ hearing and it dragged out for more than two years, but everybody knew from the word go that it would be appealed to the Environment Court. I have sympathy with the Marlborough District Council, which is the administering body for the law. They don’t have a high level of expertise with a very large hydro development. They’ve never had one before.

“And an organisation like Fish and Game has spent hundreds of thousands of their environmental money [fighting the proposal] knowing all the time that the thing was going to the Environment Court.

“Another example is a highly controversial Mokihinui hydro scheme on the West Coast proposed by Meridian. Now Buller District Council is one of our smallest councils in the country. For them to be dealing with a $200m proposal… You’ve got a council with a population of 3000 or 4000 processing a consent that’s got major implications way beyond the Buller District.” The officer concerned with processing resource consent applications, he says, was probably also the dog control officer.

If it involves national infrastructure, it inevitably is dealt with nationally. This doesn’t mean no local input, just that the actual Councils may not be best placed to deal with it.

Smith wants to set up a new body, the Environmental Protection Agency, with a trained and professional staff equipped to do the administrative work with these complex proposals, which would be considered either by the Environment Court or a board of inquiry. Time-wasting and expensive hearings by tiny local bodies would be omitted.

The EPA may actually result in a better level of environmental advocacy.

The RMA, he says, is an impediment to efficient investment in infrastructure “and that’s not helping the environment either”. Auckland has a worse air pollution problem than Los Angeles, he says, with cars stopping and starting in congested traffic. A better roading network would help the environment.

The Greens have an extreme anti-road views, but the reality is that NZ’s future includes both more roads and more public transport. Only extremists think it is a choice of one over another. And delaying much needed roads does have a toll – on the environment, on the road toll, and on the economy.

The RMA, despite some changes by the Labour-led government, presented huge difficulties for the development of environmentally friendly electricity projects such as wind and geothermal. Smith believes there is great potential for green power in New Zealand. The geothermal area of the central North Island had the advantage that it was close to the major growth areas of Auckland and the Waikato. There was some potential for hydro although “we’re certainly not going to be damming every last river”, he says. “And there is some longer-term opportunity around tidal and wave energy.”

A considerable number of renewable energy projects have been killed off due to the RMA process.

The birthplace of Labour, West Coast-Tasman went to National on the party vote by 11%. In 2005 the had a 3% margin. Damien O’Connor had a 1,500 majority and lost to Chris Auchinvole by 1,000 votes. Auchinvole (who once famously told Parliament you pronounce his name like it was Dock in Cole or a rude version that is easy to work out) wan a strong campaign with 160 hoardings and a large campaign team. O’Connor is first in on the Labour List, so if Michael Cullen retires he will be back as a List MP.

National finally won the party vote in Nelson. Labour won it by 6% in 2005 but National has a 5% lead in 2008. And no one was surprised that Nick retained his seat, although his majority did shrink from 9,500 to 7,900.

Kaikoura was marginal in 2002 and today the party vote was won by 23%, up from 9% in 2005. Colin King doubled his 4,700 mJority to 10,100.

Clayton Cosgrove did well to hold on in Waimakariri with 500 votes against the competent and hard working Kate Wilkinson. National won the party vote by 15%, up from a 0.3% margin in 2005. Cosgrove’s 2005 majority on new boundaries was 5,000.

Christchurch East remains red with 45% party vote Labour to 36% for National. However that 9% gap is a lot less than 24% in 2005. Dalziel’s 11,000 majority halved to 5,500 – still very safe. However National now has a List MP in the seat and will have hopes for when Lianne retires.

Christchurch Central was a great battle. Labour won the party vote by 1.4% and held the seat by 900 votes only. Nicky Wagner ran a very strong campaign but seats ending in Central are very hard to win for National. In 2005 the party vote margin was 22% and the majority for Barnett was 7,800.

Ilam has National 53% to 27% on the party vote. Gerry Brownlee also drives his majority from 5,500 to 10,800. This may finally stop Gerry from referring to his seat as marginal

Wigram saw Labour win the party vote by just 2%. In 2005 it was 12%. And Jim Anderton scored a fairly safe 4,500 majority despite new boundaries.

Finally we have Port Hills. National won the party vote by 16%, yet Ruth Dyson held the seat by 3,100. In 2005 Labour won the party vote by 12% so there was a massive swing there, yet Dyson’s majority shrank from just 3,600 to 3,100.