Climate change initiatives

to be granted. If developments along those lines occur, the Cost of Living Payment may take on a quasi-permanent complexion.

Ministerial statement

“Climate change is the most pressing long-term challenge we face. It will have a significant impact on New Zealanders’ living standards in the coming years, impacting the natural environment, our health, and our economic, social, and cultural wellbeing.”

Editorial comment

It is unsurprising that the climate change initiatives contained in Budget 2022 immediately follow the cost of living initiatives in the Minister’s Budget speech, given the attention that the topic of climate change currently attracts and the concerns many members of the New Zealand public have about the impacts of climate change in the future.

The climate change initiatives in Budget 2022 come off the back of the release of the Government’s first “Emissions Reduction Plan” just a few days ago, and several of the climate change-related initiatives in Budget 2022 have already been announced in that plan.

Budget 2022 allocates $2.9 billion of funding to investments to be made by the Climate Emergency Response Fund (CERF). The Minister’s speech comments that the climate investments announced in Budget 2022 are funded by those who pollute, not from increasing debt or other revenue. This is a reference to CERF’s funding being sourced from cash proceeds from the Emissions Trading Scheme.

The CERF investments mentioned in Budget 2022 include the following transport-related initiatives: „ $569 million of funding to implement and operate a vehicle “scrap and replace” scheme that provides funding and

“in-kind support” to low-income households to shift to low emission alternatives, upon scrapping their vehicle „ $375 million of funding for what is termed in the Budget papers a “Mode Shift and [reduction of] Light Vehicle

Kilometres Travelled”, with the funding to be committed to 4 indicative investment areas: the rapid rollout of urban cycle networks, the creation of walkable neighbourhoods, support for safer, greener, and healthier school travel, and provisions for more reliable and user-friendly public transport, and „ $41 million of funding to decarbonise the public transport bus fleet. The Budget 2022 papers explain that the initiatives to be funded would include deploying zero-emission buses or investing in associated infrastructure.

Absent from the Budget 2022 papers is any mention of tax concessions directed at encouraging the uptake of transportation that could assist with reducing New Zealand’s carbon emissions, such as an exemption from fringe benefit tax for employer-subsidised public transport or use of electric vehicles.