New Zealand’s Approach to Climate Change Policy

by | Apr 23, 2020 | Alumni, Environment, Governance | 0 comments

I had the good fortune of arriving in New Zealand just as the election season was gathering pace. The formation of a new government in October 2017 led by Labour’s Jacinda Ardern in coalition with New Zealand First and with the support of the Greens ushered in an era of bold climate change policies. As early as the Speech from the Throne, the Prime Minister identified climate change as the greatest challenge of our time and outlined the need for New Zealand to do its part despite the relatively small size of its emissions, as the cost of doing nothing would be too high.

Soon afterwards, I joined the New Zealand Treasury to advise on the development of these new policies. These have included the passage of the so-called Zero Carbon Act that amends the Climate Change Response Act 2002, reforms to the Emissions Trading Scheme and the Climate Implications of Policy Assessment, which makes it mandatory for policy proposals that are designed to reduce emissions, or that are likely to have an impact on greenhouse emissions greater than 250,000 tonnes a year to be assessed before going to Cabinet. Other decisions made under this Government include banning new offshore oil and gas exploration permits, committing to planting a billion trees by 2028 and deciding the review the Resource Management Act.

The Zero Carbon Act

Certainly, the policy that has received the most international attention was the passing of the Zero Carbon Act that sets into law the following four requirements:

  • To set a new domestic greenhouse gas emissions reduction target for New Zealand to: a) reduce net emissions of all greenhouse gases (except biogenic methane) to zero by 2050; and b) reduce emissions of biogenic methane to 24-47% below 2017 levels by 2050, including to 10% below 2017 levels by 2030;
  • To establish a system of emissions budgets to act as stepping stones towards the long-term target;
  • To require the Government to develop and implement policies for climate change adaptation and mitigation; and
  • To establish a new, independent Climate Change Commission to provide expert advice and monitoring to help keep successive governments on track to meeting long-term goals.

It may be worth explaining why there is a specific biogenic methane target in the Act. New Zealand’s economy has two primary export sectors: tourism and agriculture. An important part of its agricultural production is livestock production: beef, sheep, lamb and dairy. As a result, 28.1% of New Zealand’s emissions come from agriculture, which sets New Zealand apart from other OECD member countries.  

The targets set in the Zero Carbon Act are bold and will require transformative change across the New Zealand economy to achieve. New Zealand has laid the foundations for climate change policy in the years to come with many key decisions on how to get there remaining to be made.

A distinct approach to policy-making

Working on the development of these policies from within the Treasury as opposed to other Ministries, meant using a system-wide lens when providing advice to Ministers. As in most countries, the Treasury occupies a central role in policy-making and can use this to provide insightful and impactful advice to the Minister of Finance and the Associate Ministers of Finance, which, in this Government, includes the Minister for Climate Change.

Working in a central agency such as the Treasury was in itself an enriching experience that was made all the more interesting and relevant because New Zealand’s Treasury has adopted an innovative and ground-breaking way of evaluating new policy proposals and budget initiatives. Instead of conducting the analysis using a traditional cost-benefit analysis, the Treasury is looking at new policy proposals and budget initiatives through the prism of wellbeing to increase the living standards of New Zealanders over time. This means challenging oneself as an advisor to think about the impact of policies from a new perspective that carefully considers the trade-offs between economic, social, environmental and cultural benefits as well as intergenerational equity. Another significant element of the work, which I discovered as a newcomer to New Zealand, was the importance of upholding the principles of the Treaty of Waitangi concluded between the Maori and the Crown in 1840 in the design and implementation of new policies. Both of these elements present examples of an approach to policy-making that could be usefully replicated elsewhere particularly in areas such as social and environmental policy.

I will look back with much fondness at my time at the New Zealand Treasury and will continue applying the lessons that I learned there in my future work.

Former advisor to the New Zealand Treasury in Wellington and now Head of Climate at ClientEarth in London


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