That's the blunt assessment of the Ministry of the Environment in their Briefing to the Incoming Minister [PDF]. First, they highlight the yawning gap between our emissions and our targets:
As for the ETS, the mechanism which is supposed to drive these changes, they're equally blunt. In th eexecutive summary, they say outright that "current settings are not driving meaningful emissions reductions". Later, they go into more detail:
The NZ ETS is a sound framework and is designed to be adjusted to suit different economic and international conditions. The current settings and weak price signal neither incentivise behaviour change nor prepare us for a transition to rising future carbon prices.
Its a theme echoed by Treasury, who have prepared a special report on Climate Change - Important Decisions Between Late-2014 and Mid-2015. Mostly this focuses on target setting and the need for a weak target to control costs (which are expected to grow significantly as both emissions and international carbon prices rises). But they also highlight the need to actually link the ETS to our international target, and to signal those changes so polluters know what to expect. But they also suggest "institutionalis[ing] regular reporting on long-term targets and regulatory settings" so that we can see whether policy is actually doing what the politicians say they want it to do. Its a good idea, but as it will increase government accountability I expect National will consign it to the same place they sent the Social Report (which reported on social policy outcomes): the bin.