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Source: New Zealand Parliament – Hansard


First Reading

Hon SIMEON BROWN (Minister of Transport): I present a legislative statement on the Land Transport (Clean Vehicle Discount Scheme Repeal) Amendment Bill.

ASSISTANT SPEAKER (Teanau Tuiono): That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon SIMEON BROWN: I move, That the Land Vehicle (Clean Vehicle Discount Scheme Repeal) Amendment Bill be now read a first time.

ASSISTANT SPEAKER (Teanau Tuiono): The question is that the motion be agreed to.

Hon SIMEON BROWN: Today, I’m introducing the Land Transport (Clean Vehicle Discount Repeal) Amendment Bill into the House, which gives effect to the National Party’s commitment to ending the ute tax within our first 100 days. This piece of legislation is also part of our coalition agreement with the ACT Party, who made the same commitment: ending the scheme—which is reflected in our coalition agreement between our two parties.

This is good news for our farmers and tradies who have been hammered by the last Government and who were forced to pay exorbitant fees buying the vehicles they needed to be able to do their jobs. This bill ends the unnecessary, regressive, and fiscally irresponsible ute tax and Clean Car Discount Scheme and it is an important priority for the Government and it is one of our actions in our first 100 days. Axing the ute tax is one of the policies New Zealanders voted for and which they expect us to deliver, and which we are delivering on.

This bill does a number of things. Firstly, what it does is it repeals the legislation to ensure that the scheme ends on 31 December 2023, both for the discounts and also for the tax. It repeals the legislation which the last Government put in place, and requires that scheme comes to an end. This scheme needs to come to an end for three very important reasons: firstly, it is fiscally irresponsible. The scheme has cost taxpayers hundreds of millions of dollars, and it will only continue to cost taxpayers more and more money the longer it stays in place. Through to 30 November 2023, $579 million was paid out in rebates, $13.5 million was spent in cost to establish and operate the scheme, while $290 million has been received from charges. This has meant that taxpayers had to foot the bill by an eye-watering $302.5 million deficit paid to New Zealand Transport Authority via grants from the Crown—that is taxpayers’ money. Now, on this side of the House, we respect taxpayers’ money, and we know that money doesn’t just grow on trees. I think that’s the philosophy of the former Government—and that is one of the reasons why they are now in Opposition, because they had a view that money simply grew on trees.

So this scheme was fiscally irresponsible, and to address that, what the Crown would have had to have done to continue with this scheme was to do a number of potential changes. Firstly, possibly lowering or restricting rebates to electric vehicles—effectively not continuing with the high subsidies that were put in place by the former Government. Secondly, increasing charges even more for ute buyers, making it even harder for our farmers and tradies who needed to purchase the vehicles they need to be able to do their job, or providing even more Crown funding. And the former Government thinks money grew on trees—that probably is exactly what they would have done, and thrown more taxpayers’ money into a scheme which is fiscally irresponsible. So by ending this scheme by 31 December, we don’t need to do any of those actions. Instead, we can ensure that this fiscally irresponsible scheme comes to an end.

But we also need to look at the inequities that this scheme was providing, and one of the key facts which I highlighted yesterday in question time was around how this scheme was taking money from people who had very little choice around the types of vehicles that they could use. And I hear Grant McCallum, the excellent member for Northland, who is doing a great job in that electorate and who needs his ute to get around his electorate and his farm. And the reality is it was taking money from people like him—people who don’t have the choice around purchasing an electric vehicle for their type of work and then subsidising people who do have the choice. In fact, over $122 million was provided as subsidies to people purchasing electric vehicles over worth over $70,000 in the last 18 months. Taking money from people who have little choice—

Hon Dr Megan Woods: Oh well, anyone who didn’t like it can pay it back.

Hon SIMEON BROWN: Well, I hear the former Minister for a lot of things—emphasis on “former”—complaining about this bill. I look forward to her speech a little bit later. But the point is, this policy was taking from those who didn’t have a choice and giving it to people who could afford to pay for those vehicles, and so by ending this scheme we are ending the reverse Robin Hood scheme. I thought the party opposite were the party for workers—I thought they were the party for workers. They’ve tried to spend the last two days trying to tell everybody in this House how much they care about the workers. But actually, what they are the party of is—they want to subsidise people who can already afford to buy a very high-end electric vehicle and provide them more subsidies; that is actually who the party is, over on the other side. And so by removing this scheme, we remove the inequities that it was providing.

Finally, by removing this scheme, we’re able to actually focus on what is required to actually improve the uptake of electric vehicles in New Zealand which is what will make a real difference, and that is investing in the electric vehicle charging infrastructure that we need across New Zealand. And on this side of the House, we are the party of infrastructure; we are the party which gets things done, and we will be rolling out policies to implement 10,000 electric vehicle chargers by 2030 to actually ensure that people purchasing electric vehicles have the confidence to be able to charge their vehicles and travel around New Zealand, because what we know is that car manufacturers around the world are switching to electric in all of their production chains; we don’t need to be providing very expensive subsidies to make them do that. In fact, we are such a small part of the car market in New Zealand—what we do makes a very little difference.

In fact, those cars will be coming here—and I note even Ford announced yesterday that on 1 January, the day after this scheme ends, they are reducing the price of their vehicles by $5,000. And so the car industry will be keen to make sure the vehicles they are manufacturing around the world will be coming to New Zealand; that New Zealanders will continue to have the choice and the range of electric vehicles, and we’ll provide the electric vehicle charging infrastructure so that they can have that uptake so we can electrify our fleet here in New Zealand—we have a positive plan to do that. We don’t need an inequitable scheme which is fiscally irresponsible, which is what the past Government did. I commend the bill to the House.