National will now need to rely on Supplementary Order Papers (SOPs) delivered on the floor of the House and on last minute negotiations with the Māori Party if it is to get its ETS amendments through Parliament before the Copenhagen Climate Change Conference next month.
This gives rise to two scenarios: either National and the Māori Party get a deal and the modified ETS is passed with Māori Party add-ons this year, or the talks fall over and National has to rely on ACT to keep the existing ETS on ice until a majority can be found for new legislation.
Either way, the next few days and weeks will be crucial to what form of ETS we start the New Year with. Chapman Tripp will continue to monitor and keep you informed of developments.
Not one report from the select committee but one each
Instead of a select committee report, all five parties on the committee presented separate minority reports. Labour’s was the longest at 14 pages followed by the Greens on 4, ACT on 3, the Māori Party on 2 and National on 1 page.
The well-telegraphed failure of the select committee to achieve agreement leaves National with a lot of work to do and little time as there are only six House sitting days set down before the Copenhagen talks begin on 7 December and even to get it passed by Christmas will be tight.
Quite why the Government has put itself under this pressure is a mystery because, while it would have been tidier to go to Copenhagen with the new law in place, it is scarcely essential. Australia is struggling to get a majority for its Carbon Pollution Reduction Scheme (CPRS) and there is a developing pessimism about how much progress will be achieved at Copenhagen anyway.
Where to from here?
The committee’s inability to reach agreement means that National will now have to introduce its changes by SOP during the committee stages of the House. This does not allow the same level of deliberation (nor provide business with the opportunity to respond to the changes) as when amendments are proposed through the select committee process and raises the likelihood of serious error. It is worth noting that the Electoral Finance Act, since repealed, was passed by the previous Labour Government under similar circumstances and that no-one, not even Labour, would call that Act a success.
National, the Māori Party and the Iwi Leadership Group are in negotiation. The Māori Party has not yet agreed to support the Bill on second reading but National is hoping to be in a position to announce a deal preparatory to bringing the Bill back to the House next Tuesday. The negotiations are around:
the inclusion of a “comprehensive” Treaty of Waitangi clause within the ETS to recognise and accommodate “the full breadth of Treaty rights and interests”
agreement for iwi to enter contracts to plant forests on marginal Department of Conservation or other Crown-owned land, including an “afforestation fund” to cover the cost of the planting
measures to improve outcomes for Māori businesses in fishing, farming and forestry, and
increased support for vulnerable households in the form of an expanded home insulation package.
Scuppered by the committee’s failure to agree are those changes which National was persuaded of through the submission process. National refers in its minority report to amendments “both technical and material” but does not provide any detail as to content.
If affected parties want comfort that the matters they raised at the select committee will be addressed, they need to focus their communications on National or the Māori Party in the first instance if they want the SOPs to reflect their concerns.
ACT gives National a Plan B
Although ACT remains resolutely opposed to the ETS, it has offered National a lifeboat, saying: “ACT is prepared to support National in any legislation to delay the commencement of the existing provisions, to give the Government time to make a considered study of what changes are necessary for the long term”.
This means that, if National is unable to get the Māori Party over the line or if the Māori Party’s price is too high, National can rely on ACT’s vote to keep deferring the provisions of the existing ETS until there is sufficient support for an amended scheme.
This is important as if the existing ETS is not modified, the stationary energy and industrial processes sectors are due to come in to the ETS on 1 January next year as opposed to 1 July 2010 under National’s proposal.
For further information or assistance in preparing an SOP, please contact the lawyers featured.