Wednesday, September 22, 2010

A closer look: The Land and Water Forum

Water is one of the most controversial environmental issues in New Zealand at the moment, with serious problems around water quality and allocation. In an attempt to find some sort of consensus on the issue, back in 2009 the government asked the Land and Water Forum - a private stakeholders group - to expand its membership and try and come up with a consensus solution. The forum released its report [PDF] today. So what does it say?

Firstly, they're clear that we have a problem and we need to do something about it. Central government and regional councils have failed to set effective limits on water use, resulting in overallocation and pollution. Monitoring and enforcement can vary significantly between regional councils, so even the weak restrictions are frequently not enforced. Meanwhile, there's a lack of investment in water research, meaning that our knowledge about water is sometimes uncertain.

On the solutions front, they propose setting limits on water use and requiring regional councils to meet them. They suggest managing allocation by abandoning "first in, first served" in favour of rules in regional planning documents, and possibly a resource rental. They also want to see greater ability to transfer allocations, which points to a tradable permit system. While this is a good idea for managing a scarce resource if done properly, the two examples of such systems we have in New Zealand - the fisheries Quota Management System and the Emissions Trading Scheme - give me no confidence that that would happen. Both are overallocated, with the cap effectively set by politics rather than science. In the case of the ETS, we also have massive ongoing free allocations which turn the scheme into a giant pollution subsidy. If that's how "cap and trade" works in New Zealand, then we should eschew such mechanisms in favour of a regulatory system combined with usage charges.

Oddly, they promote water storage schemes as having environmental benefits. But water storage is about increasing intensification, which increases pollution. Farmers want water storage schemes; the rest of us, who care about the environment, should oppose them.

One area which ought to be cause for deep concern is the Forum's proposal for a "non-statutory" National Land and Water Commission to advise the government, draft a formal National Land and Water Strategy, and advise on how money should be spent. These are key government functions, but they will effectively be exercised by a private body, unelected, unaccountable, and with no transparency (as a non-statutory body, the Commission will not be subject to the OIA). This is deeply undemocratic and deeply unconstitutional. But it seems to be par for the course for National at the moment.

Overall, there's some good stuff in here. But the devil is going to be in the details. While everyone agrees that there should be limits on use, there is going to be massive disagreement about what those limits should be, and they are going to be the subject of endless lobbying and litigation. The apparent unity on this issue is an illusion, an exercise in papering over the cracks. The real struggle is going to be to ensure the setting of limits doesn't end up as an ETS-style resource and wealth transfer to farmers.