ACT leader suggests ETS scheme threatens supply and confidence deal with National

Rodney Hide suggests ETS may threaten coalition govt

ACT leader Rodney Hide suggested in parliament today that ACT could question its current Supply and Confidence coalition agreement with the ruling National Party if National pushes ahead with implementing the Emissions Trading Scheme on July 1. (Updated with Hide saying a withdrawal is not planned)

Here is the full Hansard record of the exchange in parliament between Hide and Prime Minister John Key. Judge for yourself, but Hide seems to be a bit cute with the question line. He seems to be applying some pressure without quite pulling the trigger. Hide later said ACT had no intention of leaving the agreement, but this exchange suggests tensions between ACT and the government over the ETS.

 Hon RODNEY HIDE (Leader—ACT) to the Prime Minister: Has he received any reports regarding the comment attributed by the New Zealand Herald to National MP Shane Ardern that “Mr Hide could stop the ETS if he wished by reconsidering his party’s confidence and supply agreement with National”; and what is his view of the ETS and the confidence and supply arrangement?

Hon JOHN KEY (Prime Minister) : I am aware of the comments. My view of the emissions trading scheme is that strikes a good balance between our economic opportunities and our environmental responsibilities. My view of the confidence and supply arrangement with the ACT Party is that it forms the basis of a very positive and healthy relationship. I thank the ACT Party for its contribution in our stable and balanced Government, and, in particular, I thank the Minister for the great work he has done in reforming Auckland.

Hon Rodney Hide: Does he share ACT’s concern that the entire net gain from tax cuts for the 550,000 households earning between $40,000 and $85,000, shown to be 0.4 percent of their income on page 9, in the Minister’s Executive Summary, in the Budget, is eaten up by the 0.4 percent extra cost of the emissions trading scheme, as shown on page 65, in the Economic and Fiscal Update—that is, that what Bill English has given back, Nick Smith has taken away for over a million middle-income New Zealanders?

Hon JOHN KEY: No, because the estimates I have are that the emissions trading scheme will cost the average household around $3 a week, and the tax cut for someone on $50,000, even if they consume the lot, net of GST, is about $14 to $15 a week.

Hon Rodney Hide: Is the Prime Minister, therefore, saying that the figures contained on page 9 in the Minister’s Executive Summary and on page 65 in the Economic and Fiscal Update, showing, respectively, the extra income for middle-income households earning between $40,000 and $85,000 and the extra costs of the emissions trading scheme are wrong?

Hon JOHN KEY: No; but the answer is that one is a measure of the CPI, and one is a measure of their general income