Climate Change Minister Nick Smith says he is making no apologies for using taxpayers' money to send two Iwi Leadership Group members to the upcoming climate change talks in Copenhagen.

National negotiated with the group over forestry policy as part of today's deal to pass an emissions trading scheme (ETS) with the support of the Maori Party.

Those iwi with pre-1990 forests wanted the right to clear their forests and plant elsewhere to avoid penalties under the ETS and Kyoto Protocol agreement.

Climate Change Minister Nick Smith said this was not allowed under current international agreements.

Instead he gave those iwi with treaty settlements the right to plant trees on crown land and keep the carbon credits.

This will not help iwi or any other foresters with pre-1990 forests, but Dr Smith said New Zealand hoped to negotiate a change to international climate change rules.

As part of today's deal the Iwi Leadership Group nominated Roger Pikia and Chris Karamea Insley to go to Copenhagen as part of New Zealand's official delegation.

Dr Smith said he made "no apology" for the decision, saying the two men had relevant experience and as indigenous people would be able to strongly put the case to developing nations about the need to change the forestry rules.

Cabinet had yet to finalise who else would be travelling to the negotiations as part of the official delegation.

After years of debate New Zealand is set to have a working emissions trading scheme (ETS) in 2010.

The centrepiece of climate change policy will come into force after National and the Maori Party today reached a deal to amend the existing ETS put in place by the outgoing Labour government.

The original ETS was put on hold by National and the amendments water down parts of it and further delay many industries facing the full cost of their emissions, but Dr Smith said it was an "important first step".

Dr Smith said without the deal the ETS would have been put on hold until 2011.

The deal as announced makes little difference to the design of the ETS as put forward by National earlier this year, however it does soften the blow for sectors and groups with large Maori representation.

Under the deal:

* Another $24 million will be spent on insulating the homes of 8000 low income people;

* A Treaty of Waitangi clause will be inserted in the ETS legislation giving the Crown the obligation to consult Maori on ETS regulations;

* Iwi who felt the ETS unfairly undermined their treaty settlements will get the rights to plant 35,000 hectares of crown land and claim the carbon credits worth an estimated $25 million to $50 million; and

* A tree planting incentive policy will be reviewed.

Included in the deal, but already announced by National was a softening in the price increases on fuel and power bills, as well as more carbon credits for the fishing industry.

Ngai Tahu had been pushing for changes to the rules which punish owners of pre-1990 forests if they cut down trees and don't replace them on the same land.

Foresters want to be able to plant elsewhere to offset the loss of trees, Dr Smith said this was not possible without a change to international rules which the Government is pushing for.

He said allowing Ngai Tahu and others to use crown land was an "elegant" compromise which removed the threat of litigation from the iwi.

Others would be able to plant permanent forests on crown land, but they would have to share the carbon credits that accumulated.

Prime Minister John Key said the ETS would balance economic opportunity with environmental responsibility.

Maori Party co-leader Pita Sharples said the deal and the ETS would benefit all New Zealanders.

Dr Smith said he still hoped for cross-party consensus on climate change policy and said the differences between Labour and National's scheme were minor.

He said the scheme that will be in place next year was not as strong as Labour's for the first two and a half years, much the same between 2013 and 2018 and from there had a slower phase out of the impact of the ETS on polluters.

The ETS would be regularly reviewed to take into account international agreements and new technology.

There appeared to be little hope of any cross-party accord on climate change in the near future with Labour leader Phil Goff slamming the ETS.

"Today's quick and dirty deal with the Maori Party lumps taxpayers with a $110 billion bill allowing big polluters to continue polluting," Mr Goff said.

The Government has disputed the $110 billion figure saying it was a long term number dependent on many highly variable factors, they also say it is not a cost but forgone revenue from polluters.

Mr Goff also said Mr Key was using the threat of legal action as a smokescreen to justify the deal, as there was a legal opinion that the iwi had no chance in court.

"Mr Key needs to explain to New Zealanders why he's making these concessions which give preferential treatment to Maori companies which other forestry companies do not get from the Government," Mr Goff said.

"Let's be clear this deal will not benefit Maori as a whole, it is a deal done with a handful of iwi to guarantee Maori Party support for National's shambles of an ETS."

Dr Smith said the amended bill would be passed in Parliament this week under urgency with the support of the Maori Party and Peter Dunne.

Political parties would be briefed on the deal and the ETS amendments tomorrow.

Once the law was passed detailed regulations would be drawn up and the ETS would start working in July next year.

The ETS will eventually bring all sectors of the economy under a regime designed to reduce greenhouse gas emissions through a carbon trading scheme.

- NZPA