The politics of climate change is more complex than they may look at first sight.
The first casualty may be Shane Jones’ “One Billion Trees” campaign as an unholy alliance of farmers and environmentalists move to sink it or at least make it one billion indigenous trees.
But if they are successful in getting more restrictions placed on converting farmland to forestry, will New Zealand be able to meet its ambitious “Net Zero” emissions target by 2050.
Submitters to a Parliamentary Select Committee yesterday argued no.
In 2018 Associate Finance Minister David Parker cracked down on foreign investment in land in New Zealand, tightening up the criteria overseas investors had to meet to purchase land.
But he offered an exemption if the land was either an existing forest or was to be used to plant a forest.
The changes streamlined consent pathways for overseas investors.
The main criteria the overseas investor had to meet was to undertake to replant the forest once it had been harvested.
But amending legislation now proposes a more complex test than the special forestry test; it requires in-depth consideration of the benefits the investment brings relative to the current use of the land and involves greater discretion for decision-makers.
It is a u-turn by Parker on his 2018 legislation.
In its regulatory impact statement on the Bill, Treasury said that with the 2018 changes, the operating context for the forestry sector had changed.
“There has been a significant shift in the economics of investing in production forestry driven by the additional revenue from carbon credits (as a result of the $40 a tonne increase in the carbon price since 2018,” it said.
The statement said that since the 2018 changes, nearly 37,000 hectares of land had been acquired for forestry conversion, with over 23,000 hectares of proposed new planting.
“The proposed new planting under the special forestry test is 0.25% of the over 9 million hectares used for beef cattle, dairy cattle, and sheep in 2019,” it said.
Seventy per cent of New Zealand’s forests are currently overseas-owned.
Federated Farmers are the main opponents of allowing foreign investors to buy more farms to convert to forestry.
The Feds’ Gisborne-Wairoa President, Toby Williams, told the Committee his neighbouring property had just been sold for about $16,000 and was about to be planted in the pine trees.
“I think if you’re a sheep and beef farmer, you could realistically afford to pay probably about half of that and make ends meet and still farm it as a farm,” he said.
“That’s the distortion we’ve seen from the value of carbon driving those land values up.”
He said the purchases were destroying small rural communities on the East Coast.
“One of the farms currently for sale hosts a school,” he said.
“If that farm goes to forestry, that school goes and then those parents will have to drive about an hour to the local primary school to take the kids.
“It’s very difficult to get stuff on a property where you’ve got to travel an hour to take your kids to school every day.”
Treasury’s Regulatory Impact statement said conversion of farmland to forestry had broader wellbeing impacts, “including the loss of indigenous biodiversity on some of the land.”
But in written submissions, Edwin Jansen, a forest consultant, said agriculture had been the main driver of biodiversity decline.
The well-known Taranaki investment forest promoter and manager, Roger Dickie, in his written submission, said his company managed more than 35,000 hectares of forest, of which 80 per cent had been planted on converted farmland.
Dickie referred to the Climate Change Commission’s call for the plantation forest area in New Zealand to increase by approximately 40% (680,000 hectares) across the next 15 years.
“Being an active buyer in the hill country property market, we get a very good insight into the functioning of this market,” he said.
“It is evident that the breadth of domestic buying of farmland for forestry conversions would leave New Zealand a long way shy of reaching the levels of afforestation needed to meet New Zealand climate change initiatives.”
Dickie also said many of the domestic forest buyers of farmland were not planning to harvest their forests and instead simply receive the carbon credits for their trees, “a method that strongly lacks in future economic, social and employment benefit to New Zealand.”
The Forest Owners Association, whose submission made it clear they opposed any removal of concessions for overseas investors, claimed the change appeared to be driven by a political move to appease the agricultural lobby.
And they also had a conspiracy theory as to why the Government wanted to slow the conversion of farmland to forestry.
That was “a concern by officials that New Zealand is going to get too much afforestation and that will work against carbon emitters taking action because it will suppress the price of carbon.”
Their technical manager, Glen Mackie, told the Committee there were actually 80,000 fewer hectares of production forest in New Zealand than there were 20 years ago.
“So when people say that forestry has been marching over the landscape and schools are closing and so forth, this has been during a period of forestry declining,” he said.
The former Land Information Minister Eugenie Sage who reluctantly joined Parker in 2018 to introduce the special concessions the Committee is now looking at revoking, asked Mackie why, if forestry was more profitable than some types of farmland, foresters could not meet the same high test that were applied to overseas investors wishing to buy farmland to farm.
“I can tell you that just the changes that you’re proposing now have meant two of our members have actually pulled out of investment in New Zealand forestry,” he said.
“So this is actually spooking overseas investors.”
But Federated Farmers found an ally in one of their more usual protagonists, the Environmental Defence Society.
In a written submission, EDS argued that the proposed should also seek to encourage native afforestation and indigenous biodiversity rather than simply permitting widescale pinus radiata forests.
“A combination of increasingly favourable investment incentives and the ability to easily satisfy the special forestry test’s checklist requirements has led to significant conversion of productive farmland to pinus radiata forest,” the submissions said.
“The result is that about 90% of New Zealand’s plantation forests comprise Radiata pine monocrops.”
Instead, EDS suggested that to enable better scrutiny of whether a forestry conversion was likely to benefit New Zealand, “we would therefore expect, at minimum, that applicants would be expressly required to submit a forest management plan which identifies negative impacts and external costs – increasingly relevant for proposals to plant exotic monocultures.”