Labour leader Chris Hipkins says farming emissions policy ‘under review’

Labour might not campaign on putting agriculture into the Emissions Trading Scheme at the 2026 election, saying the longstanding policy is “under review”, along with the rest of Labour’s policy.

Asked about Labour’s policy on agricultural emissions, Hipkins told Herald Now’s Ryan Bridge “we’re reviewing all of that at the moment”.

“We’re talking to the farmers about that as we go through that review process,” Hipkins said.

He said no decisions had been made and he was “actively” talking to the sector about the policy.

“We have not made any decisions on that yet and we are really actively talking to them.

“We are looking at the science as well, we’re not just talking to farmers we are talking to the researchers who are doing the work in this area too,” he said.

Hipkins made the remarks ahead of the agriculture trade show, Fieldays, which is this week.

Hipkins said he remained committed to the overall goal of reducing emissions but Labour was “not committed to a particular way of doing that at this point”.

He said there were “technological solutions as well” to fixing the agricultural emissions problem.

“There is fantastic science happening in New Zealand funded by the last Labour Government about how we can... reduce methane emissions through more sustainable farming practice,” he said.

Labour has supported agriculture going into the ETS, or some form of agricultural emissions pricing, since it created the scheme in 2008.

What is currently unclear is the extent to which the policy is under review. Labour, since being turfed out of government, has put its entire policy platform under review.

Some policies may re-emerge from the review in a similar form to the 2023 manifesto, while others may be very different.

The only guide is the party’s policy platform, which acts as a constraint on what the party’s candidates can campaign on.

The Fifth Labour Government created the ETS in 2008. The responsible Minister David Parker, who retired from politics this year, structured the scheme so sectors of the economy entered it gradually.

Agriculture was set to enter the scheme in 2013, but the Fifth National Government amended the legislation, keeping agriculture out.

At the time, Prime Minister John Key cited concerns New Zealand’s trading partners were not taking climate change seriously and putting agriculture in the ETS would make New Zealand farmers less competitive.

Labour consistently tried to bring agriculture into the scheme, forcing the sector to pay a price for its emissions, although Labour only ever proposed a heavily discounted price.

In 2017, Labour campaigned on slowly bringing the sector into the ETS, at a discounted rate of 90%, meaning farmers would only pay 10% of the prevailing emissions price.

Prime Minister Jacinda Ardern with, from left, ministers James Shaw, Damien O'Connor and Kieran McAnulty, announcing the new farm emissions plan. Photo / Mark Mitchell

In coalition negotiations with NZ First this discount was lifted to 95% along with other caveats.

ater, the He Waka Eke Noa process was launched to work out a separate emissions pricing solution for agriculture to begin in 2025. If that work fell apart, agriculture would have entered the ETS as a backstop.

The proposal the Labour government decided on, accepted most of He Waka Eke Noa, but rejected some significant ideas, like giving the sector a large say in its own emissions price.

National initially backed He Waka Eke Noa, but later pulled away. In 2023 National promised not to put agriculture in the ETS and no emissions price until 2030.

The current coalition government ended He Waka Eke Noa and removed the backstop.

The latest Greenhouse Gas Inventory, published by the Ministry for the Environment using StatsNZ figures showed agriculture was responsible for 53% of New Zealand’s gross greenhouse gas emissions.

The bulk of these are from methane, which is a short-lived gas. The fact it is short-lived has seen an argument mounted by the Government that it should be treated differently to long-lived gasses.

The challenge for policymakers is that lifting the burden for emissions reduction from agriculture generally means pushing down more heavily on other sectors.