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Last Saturday’s BFD poll asked readers which scam hit New Zealand the harder financially out of two choices: Covid or climate change.
Of course, government policies will inevitably cost more than budgeted government expenditure; for example, climate change policies increased fuel prices by shutting down fossil-fuel development and production, and Covid policies meant lockdowns, which caused business closures and productivity drops.
This discussion simply compares government spending to date on Covid with what they are spending on climate change.
All political parties supported both Covid and Climate Change policies, indicating that all things being equal, a change in government won’t change the government spending on policies going forward.
I found it surprising that just over half of BFD poll responders, 54%, correctly identified Covid.
Treasury budgeted a whopping $61.6B for the Covid-19 Response and Recovery Fund (CRRF) over the last three years.
Just $5.7B has been allocated to the Climate Emergency Response Fund (CERF) to date.
To date, the CERF has allocated $5.7 billion in climate-related spending. This includes $865 million of commitments prior to Budget 2022, a $2.9 billion package at Budget 2022 to implement the Government’s first Emissions Reduction Plan, and a $1.9 billion package in Budget 2023 to remove barriers to emissions reduction and enhance our resilience to climate change.
Wellbeing Budget 2023
Our obligation under the Paris Accord is a promise to reduce emissions by 41% by 2030. The cost of this was estimated in 2021 by Treasury at $2.56B a year, giving an estimated cost over the next seven years of $18B. Add the $5.7B already spent and it’s not even half the amount of money spent on Covid.
The Treasury paper dated 7/10/21 calculated $2.56 billion as the annual cost of offshore carbon credits required to meet New Zealand’s emissions reduction target of 41% by 2030.
However, the paper stated that “These costs would be in addition to costs associated with domestic mitigation, international climate finance, supporting a just transition, and costs to government related to adaptation, meaning that the overall climate transition costs are likely to be much larger.”
Treasury Response to an OIA February 2022
Given the huge disparity in government spending, it is even more surprising that 46% of BFD poll readers got it wrong. Given that we should be better informed, why do you think this was?
