Prime Minister Christopher Luxon at Southern Field Days in Waimumu. Photo / Gregor Richardson
Prime Minister Christopher Luxon at Southern Field Days in Waimumu. Photo / Gregor Richardson
Opinion by Thomas Coughlan
Thomas Coughlan, Political Editor at the New Zealand Herald, loves applying a political lens to people's stories and explaining the way things like transport and finance touch our lives.
In February, the National Party found itself in the familiar throes of a panic attack – not over polls portending electoral ruin (the first one-term National Government in history), but over something far more existential than just next year’s election.
It came in the form of apress release that oozed out of the office of Climate Change Minister Simon Watts shortly after 8pm on a Thursday, a time usually reserved for the announcing deaths and expulsions, but which was chosen in this case for the gravitational effect recent climate announcements have had on the ETS price.
New Zealand would be upping its emissions reduction ambition under the Paris Agreement, Watts said.
Watts needn’t have bothered with the secrecy. Everyone from caucus to the Taxpayers’ Union seemed to know about the announcement before it was made. MPs in rural electorates saw their political careers evaporate before their eyes.
At a caucus meeting in February, Watts faced a chorus of criticism from mostly rural MPs who felt Watts, who represents Auckland’s wealthy North Shore electorate, had sold them down the river.
The party’s rural MPs have been getting an earful from constituents since before they entered Government.
As the shadows lengthened on the Key-English years, some farmers felt a sense of abandonment as National moved to embrace urban concerns like stringent freshwater regulation (the party didn’t put up a strong fight when Labour published far more strict rules). The thinking in those days, even among rural MPs, was that the election would be won or lost in Auckland, while the rural vote could be taken for granted, and Aucklanders, at that point, were becoming increasingly concerned about the health of rural waterways.
Climate Change Minister Simon Watts on a visit to Mitimiti, in the Far North, announcing new water investment. Photo / Northland Age
Things got worse in Opposition. The party was left without a farmer on the board in 2021 and the party went through a string of non-farmer agriculture spokesmen. The current minister, Todd McClay, isn’t a farmer. The last Nat to hold a similar portfolio in government, Nathan Guy, could at least be relied upon to know which end of a cow does what.
This wasn’t just significant for how farmers felt about the National Party, but how the National Party felt about itself – a large part of the party’s identity is tied to its role as the political representative of middle New Zealand.
Watts, rather unenviably, found himself at the centre of this in late 2024, when the Government began consulting on setting New Zealand’s 2035 emissions reduction target under the Paris Agreement – something known as an NDC.
The Paris Agreement splits up emissions reduction targets into five-year increments. The first, a target for 2030, was set by the Key-English Government and strengthened by the Ardern-Hipkins Government.
It obliges the Government to reduce emissions to 50% below gross 2005 levels by 2030.
Watts, in January 2025, set NDC2, the target for 2035. He decided on a target of reducing gross emissions by 51% to 55% by 2035.
Watts found himself a man besieged: to those on the right, he’d taken an excessively ambitious 2030 target and made it even worse. To those on the left, it suggested New Zealand would do next to nothing to reduce emissions between 2030 and 2035.
At the heart of Watts’ woes is a policy dilemma. New Zealand’s domestic emissions reduction will not be enough to allow the country to hit the 2030 target – this was the case under both Key-English and Ardern-Hipkins. Instead, the Government will probably need to ink deals with other countries that will reduce their emissions on our behalf at a cost of $3.7 billion to $23.7b.
The 2030 NDC as it currently stands was set by the Ardern Government. Photo / Mark Mitchell
The second problem is that Article 4 of the Paris Agreement obliges each NDC to be both the highest possible ambition for a country and that each NDC be more ambitious than the last.
In New Zealand’s case, this means that having forked out to hit the 2030 NDC that was too ambitious to hit domestically, Watts needed to set another, even more ambitious target.
There were risks to failure: New Zealand has Paris written into trade agreements with the UK and EU, the latter of which is itching for an excuse to fall back on its instinctual protectionism.
But this wasn’t how Federated Farmers saw things. In a December 2024 submission on NDC2, the Feds said they were concerned about some of the assumptions in the Climate Change Commission’s modelling, warning that if some of the rosier ones did not come to pass (industrial-scale pine planting and a methane vaccine by 2030), New Zealand might have signed itself up to a deeply unachievable target – one that might force farmers to sacrifice production.
They reckoned New Zealand should copy other countries and take more time to submit a 2035 target (only 16 countries hit the deadline for submitting one, including New Zealand). They also wanted the Government to consider a liberal interpretation of the rule that requires each NDC to improve on the last – an interpretation that could mean taking “leadership” on a split-gas approach rather than leadership on the overall reduction in emissions.
Despite being popular among MPs, the submission did not get much traction with Watts. The Feds made two attempts to meet him and were unsuccessful.
There was tension between National and Federated Farmers too – many of National’s urban MPs felt the arrival of Groundswell in 2020 had forced the Feds to take ever more radical positions to keep rural New Zealand onside.
The January announcement went down poorly. Watts found his social media posts clogged with reaction from angry farmers. Act and NZ First began to ponder leaving Paris altogether, championing the views of the farmers who have flocked to those parties as National has become more urban.
The problem began to touch the leader, Christopher Luxon. Watts and Luxon are close. They were the only North Islanders elected to National in 2020 and for a time had adjacent offices. A problem for one of them can quickly become a problem for the other.
Christopher Luxon and Simon Watts entered Parliament together. Photo / Mark Mitchell
The fightback from the Beehive was swift. Watts began a “debunking” exercise, meeting farmers, hearing their concerns and assuring them meeting the NDC would not be put ahead of their interest. Later in February, Watts told a meeting of Waikato Federated Farmers he wouldn’t be sending money offshore to meet the 2030 NDC.
“Some [countries] meet them, and some won’t just because [of] national circumstance. You have to have the intent to meet it and if you don’t meet it, no one sends you an invoice,” he said.
This was interpreted as an admission that New Zealand will not hit the 2030 target, as there is simply no way, under current forecasts, of hitting it without sending money offshore.
Green Party co-leader Chlöe Swarbrick spied this and began asking questions of Luxon in the House: would New Zealand hit the 2030 NDC?
Luxon wouldn’t say yes. Instead, he said New Zealand was only “working incredibly hard” to do so.
“We’ll continue to put Kiwis first and make sure that we’re acting in our own national interest,” he said.
The comms offensive seems to have worked. Watts has had several meetings with Federated Farmers since January and that relationship has healed.
The caucus is now much calmer about the NDC, and National’s political fortunes, than it was in February. This is mainly because the rural MPs have been assured the interests of farmers take precedence over meeting the NDC.
The compromise has brought calm to the caucus for now, but may lead to pain later on. National is in a losing three-way race for rural votes with NZ First and Act. Those two parties can do things like flirt with leaving Paris. National cannot.
The current strategy delays the problem for another day and turns a problem with National’s rural support into a problem for its urbanites. What happens as 2030 approaches and the Government makes good on its pledge to write no cheques? New Zealand risks becoming a climate laggard.
The rise of Australia’s climate-friendly Teals at the expense of National’s sister party, the Liberals, should be a warning to any party that doesn’t take climate change seriously. National has avoided a Teal problem thus far. It may not avoid it forever.
National won Auckland in 2023 in large part because Labour’s Covid policy turned the Super City into the world’s largest open-air prison. That memory will fade. The party can’t rely on the memory of Covid to win the city in future elections.
The Auckland-centric electoral calculus that saw National slowly abandon farmers might have been cruel, but it wasn’t wrong. Say what you want about the Key and English government, it never polled as low as this one.
Thomas Coughlan is the NZ Herald political editor and covers politics from Parliament. He has worked for the Herald since 2021 and has worked in the Press Gallery since 2018.
