PM defends fuel-tax reduction

Prime Minister Chris Hipkins doesn’t accept extending the 25 per cent cut to fuel excise taxes will increase emissions.

On the announcement that came only days after Auckland experienced first-hand the effects of climate change due to devastating flooding, he says: “We have to continue to work to reduce our greenhouse gas emissions [GHGs] and transport is a huge contributor to that.

“But forcing people to pay higher prices for fuel they have no choice but to buy isn’t going to be the way to do that."

However, Hipkins conceded in an interview with 1News on March 12 that he didn’t seek official advice to back that view.

According to a cabinet paper from June 2022 and obtained by Newsroom, officials estimated the policy is expected to lead to a one to two per cent increase in car travel while in effect. That amounts to between 11,000 and 20,000 tonnes of extra carbon-dioxide emissions per month.

Hipkins, pictured, believes allowing people to be priced out of motoring isn’t a sustainable way to cut pollution. He prefers other avenues, such as accelerating electric-vehicle ownership and half price public-transport fares.

However, officials in a different cabinet paper state that the impact of half-priced public transport on emissions is likely to be minimal.

“Our drive to reduce GHGs is undiminished. This is dealing with a much here-and-now challenge, which is the cost of living.”

Hipkins has denied this year’s election played a role in extending the fuel-excise tax cut, saying inflation has stayed higher for longer than anticipated.

He adds getting people in electric cars, ditching coal boilers and using more renewable electricity — potentially, including the adoption of new hydrogen technology, are things the government can do to make up the emissions gap and meet its targets. Click here to watch 1News’ interview with the PM.