Mr SPEAKER: When the debate was interrupted the Hon Darren Hughes was speaking. However, I have been advised that this call will be a split call and that the Hon Annette King will take the remaining 80—8 minutes and 40 seconds.

Hon ANNETTE KING (Deputy Leader—Labour) : You are feeling very generous today, Mr Speaker! Mr Hughes, our spokesperson on transport, made a start in this debate on Tuesday evening. In his few brief minutes of speaking, he expressed the Opposition’s concern that the Minister is requiring such a very short report back—

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I may have missed something here. I apologise to the member if I have just interrupted for no good reason, but am I to assume that Mrs King is now taking the balance of the speech for another member?

Mr SPEAKER: That is my understanding of the situation. As I understand it, she is entitled to do that.

Hon Gerry Brownlee: So it is a split speech?

Mr SPEAKER: Yes, indeed. I am sorry; I thought I had announced it as a split call.

Hon Gerry Brownlee: I genuinely apologise to that member for not hearing that. I certainly would be appreciative if her time starts again.

Hon ANNETTE KING: Thank you, Mr Speaker. I am so happy the House is feeling incredibly generous today. I think it must reflect the fact that our Speaker is getting married on Saturday, and that we are all feeling very joyous for him—especially those of us who have happy marriages ourselves. We genuinely hope that he has a wonderful day, and a long and happy marriage.

As I was saying, Mr Hughes, our spokesperson, made a start in the debate on this bill on Tuesday. He had only a few brief minutes to speak but he raised a concern that I would like to repeat now, which concerns the Minister’s requirement that there be a report back of this bill by 21 July. Of course, that is a mere 19 days away, and in the middle of that time there is a 2-week adjournment, so Labour is very concerned that there is a very short time frame in which to look at this bill. In fact, the Minister has given no justification and no explanation as to why he needs such a short time frame to look at this bill, and we would like to note our concern at the process. We are happy to accommodate the bill, and if he wants to talk to us about it we would certainly be very happy to do that. But we would have liked to know the whys and wherefores of the need for this bill to be rushed through in a mere 19 days.

This bill, the Road User Charges Amendment Bill, proposes to amend the Road User Charges Act 1997, and it has two outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges. The second is to provide a 42-day notice of increases to the road-user charges to all diesel motor vehicle owners, and to—

The ASSISTANT SPEAKER (Hon Rick Barker): If members want to have a discussion, would they please move into the lobbies. There is a lot of noise around and it is disturbing the member speaking.

Hon ANNETTE KING: Thank you, Mr Assistant Speaker. The second part of this bill is to provide 42 days’ notice of increases in road-user charges to all diesel motor vehicle owners, and to minimise the potential revenue loss caused by pre-purchasing of road-user charges by the trucking industry, following notification of an increase. The bill provides that a heavy vehicle road-user charge licence will expire 1 month after the increase comes into effect.

We support both of these measures. We strongly support the removal of road-user charges from electric vehicles; it is a great idea. It reinforces a lot of the work that we as a Government did towards the introduction of electric vehicles in New Zealand. In fact, when we issued the transport strategy last year, part of that strategy was the inclusion of a commitment to electric vehicles. I have to say that at the time there was a certain amount of tut-tutting and pooh-poohing by the National Party about the importance of electric vehicles in New Zealand, and the part such vehicles would play. I did point out that we were at that time making our own electric buses in Ashburton, for example, and that when we looked internationally we could see that the need for electric vehicles was growing and the commitment to them was growing. So when a Government puts together a long-term strategy, it should include electric vehicles in it; I say to Dr Smith that I am glad that the National Government has seen the light of day, and that it supports Labour in the commitment to enhance the manufacture and use of electric vehicles in New Zealand. We will see greater use of electric vehicles over the years to come, and taking off road-user charges from those vehicles—certainly in the early days—I think will help towards that.

The second part is around the area of road-user charges. If anybody knows this issue, it is certainly me. If anybody knows the heat of this issue, it is certainly me, who, as the previous Minister of Transport, faced the revolt of truckdrivers when I put up road-user charges last year with no notice. Of course, at that time I increased road-user charges because it had been my experience the year before, when we had increased them—along with increases other motor vehicle owners had—that I had given a certain amount of notice only to see a lot of forward purchasing of road-user charge certificates. In fact, a large amount of revenue to the Crown was lost through that forward purchase. It was made clear in my meetings at that time with the head of the Road Transport Forum, the Hon Tony Friedlander, that the forum would want to work with the Government to put in place a regime that was fair to the Government but also fair to the forum—to increase road-user charges without a great loss of revenue to the Crown but also with sufficient notice in particular to truckies who were purchasing the road-user charge certificates. So this bill actually addresses what came out of the inquiry I set up, and it was announced by the new Minister of Transport in May this year.

The working party report that was done on road-user charges recommended that 6 weeks’ notice be given of any future increases in road-user charge rates; in fact, this bill gives 42 days’ notice of such an increase. But what is just as important is the provision that those who purchase road-user charge certificates in that time will have only 1 month to use them. So the bill will close the loophole whereby people could go out and pre-purchase a lot of road-user charges at an old rate, thereby saving themselves money, and then use them indefinitely until they ran out. Under this proposal, people will be able to use them for up to 1 month, and then if there are any left over they will get a refund. I think the bill has come up with a good solution.

However, we have a couple of questions that we would like answered in the select committee. We would like to know—and perhaps it will not be possible at that time to tell us, but I hope it will be—how the legislation will actually work in practice. I mean, a lot of these things sound good, but I know that the Hon Maurice Williamson, who has had something to do with this in the past, knows that often we can make these changes only to end up creating even bigger problems. So I think we would like to know how this requirement will work and what it will cost—how many more staff will need to be employed, will the legislation mean additional resources in the ministry in order for it to be implemented, and what avenues will exist to enable trucking firms in particular to rort the system? Everybody is saying that we need to be fair to everybody, but we do not want to see rorts in the system. And what would be the total leakage of funds that would not be gathered from the Government? Does the Government have any idea? One of the issues in this whole scheme has been the leakage of funds.

I am pleased that the review supported the continuation of the road-user charge system. I think that it is, in the main, a pretty fair system; this bill will certainly help its fairness even more. Labour will certainly support the bill, but we will be looking, in the very brief time we have, for some of those questions to be answered.

Hon Dr NICK SMITH (Minister for the Environment) : I am very enthusiastic about supporting the Road User Charges Amendment Bill, which has been brought to Parliament by the Hon Steven Joyce. About this time last year New Zealand was in gridlock as a consequence of the mismanagement by the previous Government of the relationship with the road transport industry over the issue of road-user charges. New Zealanders and truckies were angry that the previous Government had gone back on its word to provide notice of increases in the road-user charges, and it was an issue that caused New Zealand great grief. The member who triggered that protest needs to take some responsibility for the way in which she mismanaged that issue, and the way in which the new Minister is now fixing it up.

I speak with particular enthusiasm about the exemptions from road-user charges that are provided in this bill for electric cars as an incentive for that new technology to be taken up. The provision in this bill very much provides a contrast between the approach of this Government and that of its predecessor. Let us remind ourselves of what the previous Government did around electric car technologies: it came out with a strategy. You see, in every area that the previous Government moved there was always a strategy. There were dozens of them—hundreds of them! It had a strategy that 40 percent of the car fleet by 2040 would be electric. The problem: was there any element of policy that would actually achieve that? The answer is: not a single iota. We searched under the desks. We looked under the chairs. We looked in the nooks and crannies right through the Government bureaucracy to try to find whether there was anything the previous Government had to be able to meet this big, bold target of 40 percent of the New Zealand car fleet being electric by 2040. The answer was that it was a hollow, empty strategy without anything to achieve it. The second feature is that in so many areas of the climate change debate the previous Government went for regulation. It went for the good old nanny State. It decided to tell New Zealanders how to live their lives in so many ways. This bill contrasts with that approach. This bill tells people to look at the new, exciting technologies out there, like electric cars, which provide a way forward for a cleaner transport fleet. We are not going to compel people to buy them, but we are going to provide an incentive. This bill, in exempting those electric cars from road-user charges for a period of 4 years—it would then be reviewed—is a good way in which to give a kick-start to those new technologies.

I will debate for the House a number of the reasons why I think electric car technology has great potential. The first is that the electric motor is an order of magnitude more efficient than the internal combustion engine. A revolution occurred 100 years ago from the old steam engine that had about 6 percent efficiency to the internal combustion engine that had about 20 percent efficiency. It is my personal view that this change to electric technology moves that efficiency from 20 percent to 75 percent. The truth is that the vast bulk of the energy in our cars is produced in heat, not in motion. The first big gain from electric car technology is an order of magnitude more efficient in converting energy into motion for our traffic fleet. The second thing that is quite exciting about electric car technology is that normally when we put our foot on the brake, all that energy is wasted in the brake pads. With electric car technology, that energy is used to revert the electric motor into a generator to recharge the batteries. That adds another order of magnitude of efficiency to electric cars. The third gain that electric cars offer us is the issue around, not carbon dioxide, but particulate pollution. If we look at a city like Auckland, one of the big contributors to air pollution, particulate pollution, is vehicles. Electric cars have absolutely zero contribution in terms of particulate pollution, and that has a big flow-on benefit for people’s health and also in terms of the broader issue of New Zealand living up to its clean, green reputation.

The last point I want to make about electric cars is that they are beautifully quiet. I have one of the Hyundai Getz electric cars, which was manufactured and altered in Australia by Blade Electric Vehicles. The greatest danger of this car is that it cannot be heard. It is as silent as a baby. One has to be quite careful when one is around pedestrians. It is so quiet, and that is an added advantage. I also note that New Zealand is in a unique position to be able to advance electric car technology. The reason is that if someone has an electric car and the electricity that is used to charge its batteries is produced from burning coal, we are going backwards. Sure, we do not have the emissions going out the tailpipe of the car; we have it going out of the coal-fired power station. Where New Zealand is uniquely placed is that it has a higher proportion of its electricity produced from renewables than anywhere in the world. If there is any country that can get real climate change benefits and reductions in greenhouse gas emissions from the transport fleet, in moving to electric cars, it is New Zealand. That is why it makes good sense. I acknowledge some of the innovators around New Zealand, whom I have met, who have developed their own electric car technology. There are people like Rex Nowland in my own constituency who raised this issue with me. His frustration was that, as the owner of a Volkswagen that has been converted to electrics, the previous Government’s policy required him to have a sticker on his electric car saying “This is a diesel vehicle”. We can understand the frustration. Someone goes to all this effort to convert a car to electrics, and such an identification has to be carried.

The further point I wish to make is that this policy provides some equity with other technologies. This Government also has a policy of exempting ethanol that is produced sustainably from the equivalent of the petrol excise tax. The Minister of Energy and Resources, Gerry Brownlee, has brought in an initiative that will provide for a grant scheme for bio-diesel. Effectively this policy, as provided for in this bill, provides the same financial incentive for ethanol, for bio-diesel, and for electric cars. It provides a kick-start for those new sustainable transport technologies, so that we might sensibly make the shift. I note that the benefit of this is probably about $400 or $500 per year for those electric car owners, and that $400 or $500 a year over the life of a vehicle comes to quite a substantive amount. We are hopeful that it will see more New Zealanders able to purchase those vehicles, and the likes of those companies, such as Hyundai and Mitsubishi, that have produced electric vehicles, able to come up with an affordable technology that will be more sustainable. I note that 20 percent of New Zealand’s greenhouse gas emissions come from the transport sector. It has been increasing strongly. This initiative of exempting those electric cars from road-user charges is one of a package of complementary measures that the Government will be advancing as part of its broader climate change package.

The last point I want to make is about the other part of this bill, with regard to road-user charges. This bill enables the Government to give notice to road transport operators. What is unfair about the old law applied by the previous Government is that when charges are increased overnight, it makes it very difficult for the pricing of those road transport operators in terms of the service charges they pass on. This bill is a sensible provision that provides for a period of notice for those—

Hon Annette King: It was changed in 1999, actually. You don’t know that, but you changed it.

Hon Dr NICK SMITH: The previous Minister of Transport triggered the biggest protest by truckies that we have seen in decades, and now we have the new Minister of Transport, Steven Joyce, sensibly fixing up the law to ensure that there is such notice given. I hope it will be a measure that all members of this House support.

DARIEN FENTON (Labour) : It is pleasing to take a call on the first reading of the Road User Charges Amendment Bill. I am really disappointed that on a day in the House when we have agreement on a bill like this, one of the members opposite could not help himself. He does not have the generosity to put the past behind him and to work together with the Opposition on this bill.

I also want to make it clear that the former Minister of Transport, Annette King, gave no guarantees to the industry, either on increases or on notice. It is absolutely incorrect to allege that. I want to make sure that that is on the record.

As I said, Labour supports this bill’s referral to the select committee where we hoped it would be thoroughly considered, but obviously that will not happen. We will have a very few number of days to consider the bill. I did hear the introductory comments made by my colleague Darren Hughes, when he spoke briefly on the bill the other night. He observed that this is becoming a bit of habit of this National Government. We are very concerned about that. People need to have the right to comment on bills that are put before Parliament. They do that through the select committee process, and it is called, as my colleague said, democracy.

Labour thinks that supporting an uptake in the use of electric vehicles is a great idea, and it adds to the good work that Labour did in promoting electric vehicles. Electric vehicles are the future, and Labour already had plans in train for a nationwide set of recharging stations for plugging in electric cars when drivers are a long way from home.

Labour instigated the review of road-user charges, and it is interesting to note that the road-user charges system in New Zealand is unique in the world. We instigated a review because there had not been one in 18 years. During that period the ratio of trucks to cars had changed enormously, as had the weights being carried by those trucks. That meant there was a great inequity between trucking firms and private motorists over who was paying for road maintenance. Motorists felt they were subsidising truckers, and that heavy trucks causing substantial damage were not paying their share.

Last year Annette King announced a working party that would look at the formula for road-user charges for heavy vehicles. She also announced that the Government intended to amend the Road User Charges Act 1977 for vehicles weighing more than 3.5 tonnes in order to restrict the period of time in which pre-purchased licences could continue to be used after a road-user charge increase. The purpose of the amendment was to allow the Government to give a reasonable period of notice of increases, and I note that that is what this bill proposes to do.

The bottom line for Labour in that review was that all road users must pay their fair share—it was all about being fair—towards maintaining our roads, building new roads, and improving passenger transport. We wanted to ensure that the formula for setting road-user charges delivered fairness for everyone.

Well, that was then, and this is now. The working party reported back to Steven Joyce, the new Minister of Transport. And guess what? A key recommendation was that the current road-user charges system be retained with some work around the margins, which the Minister says he is looking at—and this, I suppose, is the first part of that. The report recommended that 6 weeks’ notice be given for any increases to the rates of road-user charges, and the result is this bill, which provides for 42 days’ notice but also provides a mechanism to minimise the impact of pre-purchasing.

The bill proposes to amend the Road User Charges Act in order to achieve two outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges, and the second is to provide 42 days’ notice of increases to road-user charges to all diesel motor vehicle owners. In order to minimise potential revenue loss caused by the pre-purchasing of road-user charges by the trucking industry following the 42 days’ notice, the bill provides that heavy vehicle road-user charges licences will expire 1 month after an increase comes into effect.

Part 1 provides for a road-user charge exemption for light electric motor vehicles. As I said, we support that, and I was looking forward to hearing from various parties at the select committee on the whole topic of electric motor vehicles and where we are heading with that. Labour supports the notion of new electric vehicle technology and the contribution that that makes for the efficiency of the motor vehicle fleet, but currently availability is low, purchase prices are at least double that of conventional vehicles, and manufacturers do not rate New Zealand as a priority market. The Minister confirmed to the select committee this morning that the main reason for ownership rates being low is the cost of the vehicles.

Although Labour supports incentives for moving the vehicle fleet beyond its current reliance on fossil fuels and encourages the reduction of greenhouse gases and harmful emissions, this measure would appear to have a very minor influence on the decision of an individual or business to purchase an electric motor vehicle. But that does not mean we should not do it. Labour thinks we should be among the leading countries to widely deploy electric vehicles and plug-in hybrids for a new era of energy independence and low emissions in transport. We expect to see electric cars arrive and start to be used in New Zealand between 2010 and 2015. The numbers will grow slowly at the start, but they will increase as supply increases and the costs go down. However, this is a tiny gesture by a National Government, and it does lack imagination.

The recession calls for innovative thinking and searching out opportunities to create new jobs and be a leader in green technology. Denmark, for example, is investing in the development of the electric car industry and green transport. The UK Government is investing £250 million to promote low-carbon transport over the next 5 years. Motorists will be offered subsidies of up to £5,000 to encourage them to buy electric or plug-in hybrid cars under plans announced by that Government. The US and China are in a race to produce electric cars and hybrid cars. As I said, although Labour supports this measure, by international standards it is pretty timid, and the facts are that 5 years from now it is unlikely that we will have more than 500 electric motor vehicles on our roads.

I have to note the apparent inconsistency in the National Government’s position. National has said that electric motor vehicles decrease reliance on fossil fuels, but just before Christmas it rammed through, under urgency, a bill that repealed the obligation for oil companies to sell a proportion of the petrol and diesel blended with biofuels. A few hundred cars is progress, I suppose, but that pales in comparison to what could have been achieved had National not reversed the measures that Labour already had in place.

I return now to the select committee process. I want to go over the questions that my colleague Annette King talked about. There are some real issues there, and I hope that we will get time to get these questions answered in the very, very rushed process we will have in the select committee. Those questions are how this will work in practice, how much it will cost to implement this requirement, and how many staff will be employed. What avenues would exist for trucking firms to rort the system? That is really important, because we do not want to have a new measure and go through a process of rorting. Also, what would be the total leakage of funds not gathered by the Government?

Labour supports this bill. As I said, I was looking forward to a very interesting debate at the Transport and Industrial Relations Committee. I guess I will not have much of an educational experience about electric cars, but, as I said, it is a start, and we support the bill.

JEANETTE FITZSIMONS (Green) : Light electric vehicles are capable of making some small contribution towards a more sustainable transport system in New Zealand. I say “small contribution” because they will be extremely expensive—roughly double the price of ordinary cars. Because most New Zealanders cannot afford to buy new cars, they buy second-hand cars. But there will be no second-hand electric cars in New Zealand for a long time. Interesting data, given to the Transport and Industrial Relations Committee just today in its review of the estimates, showed that the Ministry of Transport expects the penetration rate of electric vehicles into the New Zealand fleet to reach 1 percent by 2020. That is way fewer than even the prediction that the Ministry of Economic Development made in 2007.

Electric vehicles are being made at a very slow rate overseas. The reason is that their price is so high; a lot of that price is the battery technology. To be able to store enough energy to run a motor vehicle 100 or 200 kilometres on a charge takes an enormous amount of battery power—far more battery power than it takes to run our house. Running our house takes eight deep-cycle batteries the size of a truck battery. One cannot carry those around in an electric car, so we have to devise a battery that is very low weight for high energy storage. That is very expensive. Electric cars will be a luxury for the very well-off for quite some time.

The Government is asking that ordinary motorists—ordinary people on the minimum wage living on the edge of a city because they cannot afford the property prices closer to town—completely pay for the use of roads by people driving electric vehicles. Let us be quite clear that that is what we are doing: we are asking all road users—rich, poor, and unemployed—to pay the road-user charges for those who can afford to buy electric vehicles. We have to have a very good reason to do that. What might that reason be? Well, we have an urgent need to move away from fossil fuels and the internal-combustion engine, and, in the view of the Green Party, we should be making major efforts to improve public transport and rail freight in order to reduce the need for those fossil-fuelled energy sources, and for individual vehicles where shared vehicles are perfectly adequate.

There is no doubt that electric vehicles can make some contribution to that goal, because there will still continue to be uses where one person in one vehicle is the only way of getting there. What bothers me is that the Government seems to see the one person in one vehicle approach, where one cannot move anywhere as a human being without carting a ton of metal, as the main solution. It sees things like travel demand management, walking, cycling, and public transport as fringe activities that a few dopey people decide to engage in. We see it the other way round.

So what is our position as Greens on the Road User Charges Amendment Bill? We want to encourage the new technology, even though we know that, like many new technologies, it will be used by only those who are very well off, like the Minister opposite. We therefore see it as appropriate, for a short period, to encourage those vehicles into the market by giving this incentive, recognising that the vehicles are very expensive. We would be very concerned if the subsidy were to go longer than the 4 years that is proposed. We will be very firm about that at the select committee. We think that once those vehicles start to come into the country they will develop their own momentum. But to encourage the first movers—those who are prepared to bite the bullet and get into a new technology earlier—some subsidy is worthwhile. It will not be hugely expensive, initially. The Ministry of Transport believes there may be 30 of those vehicles in New Zealand by 2010, and that it will take until 2020 before we have 30,000. Well, the subsidy will run out a long, long time before that.

We will support this legislation. The thing that concerns me most about it is the extremely short select committee period. I do not see how we can possibly give the legislation due consideration and hear from the public in such a short period. I urge the Government to consider taking this process a little slower. After all, how many electric vehicle owners will be inconvenienced if we take an extra month at the select committee to consider this subsidy, how long it should last, and how it should be paid? We will not vote for that very early select committee report-back date, but we will vote for the bill.

RAHUI KATENE (Māori Party—Te Tai Tonga) : There was a line in a song from a movie that used to represent the dizzy heights of aspiration we might reach in thinking about the latest trends in cars. The song went:

Why this car is automatic

it’s systematic

it’s hydromatic

Why it’s greased lightning

With this bill today, that song becomes so last century.

Hon Maurice Williamson: Sing it.

RAHUI KATENE: I do not need to; I have my backing group right here. Once this bill goes through, the song we will be singing is: “This car is electric.”, or, to be more precise: “This car is a motor vehicle whose motor power is wholly or partly derived from an external source of electricity and whose gross laden weight is 3.5 tonnes or less.”

It may not be a chart-topper, but the electric car is destined to revolutionise many homes faster than even greased lightning. Although to be clear, it is not as though these electric cars are breaking the sound barrier with the speeds they can muster. The 2008 model Subaru R1e electric car, I understand, has a range of 50 miles and a top speed of 62 miles per hour. What is revolutionary about these cars is that they can be charged overnight on an ordinary household current. One just plugs it in next to the toaster.

The bill we are debating today will enable regulations to be made that, effectively, exempt light electric cars from road-user charges. The hope is that by amending the Road User Charges Act with this legislation, New Zealanders will be rushing out to purchase such vehicles, along with the Minister.

The current road-user charges for a light electric car weighing 3.5 tonnes or less are $36.07 per 1,000 kilometres. In sum, this costs the owner of a light electric car approximately $432 per annum, based on an average travelling distance of 12,000 kilometres per year. So why would the masses rush out to join the Hon Nick Smith in hopping into one of these new electric cars? Top on the score card must be the impact electric cars have on preserving our clean, green image in Aotearoa. In essence, an electric car is an alternative fuel car that uses electric motors and motor controllers instead of an internal combustion engine. They are far more energy efficient, in that they can recapture the energy of braking, with the electric motor becoming a generator. Electric cars also create less pollution than gasoline-powered cars, so they are an environmentally friendly alternative to gasoline-powered vehicles. Particulate or chemical pollution from exhausts will belong to the days of the past.

Electric cars are also far quieter, we have heard, than conventional internal combustion engine vehicles, with no exhaust, no vibration, and no noise. That becomes important in the context of carbon dioxide emissions. New Zealand’s total greenhouse gas emissions are the 12th highest per capita in the world. Within that, transport emissions currently represent around half of the emissions from the energy sector, and are growing at an unsustainable rate. Bold action is required.

This is all well and good, but the big question that has to be asked is how realistic is it that we will be seeing these flash electric cars cruising in Murupara or even in Ahipara some time soon. The New Zealand Transport Strategy, which was launched last August, set the very broad target that New Zealand should become one of the first countries in the world to widely use electric vehicles. That is great, but the strategy was a strategy without any actual dates and numbers of vehicles to be in the fleet. But most important of all, it was a strategy with no funding attached. At the beginning of the year, Mitsubishi and Hyundai unveiled their latest models, promoting these new electric cars as costing about a third less than a petrol car to run. Indeed, if we were to believe the promos, Hyundai’s Blade Electron can travel 100 kilometres for just $1. That is pretty impressive.

Hone Harawira: That’s awesome.

RAHUI KATENE: Yes, but so is the price tag, at around $55,000. The Ministry of Transport has confirmed, as if we did not know, that these vehicles will be expensive. Its 2007 paper, Electric Vehicles and New Zealand—Identifying Potential Barriers and Future Considerations, put the aspect of cost into the wider context. It concluded that buying a new car is already financially beyond many New Zealanders, and electric vehicles are not at the low end of the cost scale. Unless prices fall dramatically, or second-hand Japanese imports start appearing, the current generation of vehicles is simply too expensive to allow a widespread uptake. Māori are even more unlikely to be able to splash out on an electric car. Māori average hourly wages, at $17.58, lag well behind the general economy at $21.41. In general, the Māori working population is also younger and less qualified than other groups, thereby increasing the risk of their vulnerability in the recession with the threat of job losses.

We may be on the brink of an exciting energy revolution, but it is revolution for the rich. And it is not looking like it will change quickly. Global production of light electric cars is very low and will remain so for the next 10 years. The current prediction is that by 2020, only 5 percent of new car sales will be for electric cars. Low-income earners and families will be the last to be able to afford to purchase electric cars, and the last to benefit from the fact that once the initial purchase price has been met light electric cars are cheaper to run than conventional internal combustion engines.

Until economies of scale start to reduce prohibitive battery costs, early electric cars will have a price premium of roughly double to quadruple that of a conventional car. If that is not bad enough, marginalised communities will become even more vulnerable to rising petrol costs as oil gets more expensive. However, never let it be said that the Māori Party will not leap at the opportunity to take up an initiative if it is in the best interests of the people.

There are many advantages to be said for the establishment of electric cars. We know that they will decrease the nation’s reliance on fossil fuels, improve energy security, and reduce vehicular emissions affecting air quality and greenhouse gas levels. With 40 percent of New Zealand’s carbon dioxide emissions coming from vehicles, and with peak oil upon us, there is an urgent need to reduce dependency on oil.

Hone Harawira: It’s urgent, urgent.

RAHUI KATENE: It is very urgent. There is no question that these electric cars will make a difference—they will—and because of that we support the decision to exempt electric cars from road-user charges as one strategy that can help encourage New Zealanders to venture into such innovative frontier technology. But it must be a case of a vote that is “Yes, but.” Yes, we support it, but until wider penetration happens, transport spending needs to focus on sustainable and affordable alternatives, particularly for low-income earners and families. Kia ora.

CHRIS AUCHINVOLE (National—West Coast - Tasman) : I am pleased to follow the erudite speaker who has just completed her speech, Rahui Katene. I will be expressing the same sorts of sentiments as she did. I am pleased to have the opportunity to speak on the Road User Charges Amendment Bill, sponsored by my esteemed colleague the Hon Steven Joyce, who is having such an impact in his portfolio.

The proposed exemption is transitional and limited in scope. It is not intended to set a precedent for road-user charge exemptions. This bill delivers on National’s election promise to exempt light electric motor vehicles from road-user charges, and it is a pleasure to see evidence of the fact that this is a Government that delivers on its promises. The reason we want to exempt light motor vehicles from these costs—and, indeed, it is meritorious to do so—is that we want to encourage the uptake of light electric motor vehicles.

We see private vehicles continuing to be the most significant mode of transportation for most New Zealanders. We have seen all sorts of attempts to change that situation over the last few years. I remember the subject coming through select committees where we encouraged Government departments to use car pooling systems where cars were provided. I was careful to ask at select committee meetings whether this was happening to any great extent. The systems seemed to be very hard to schedule and organise and, frankly, it did not happen. Whether or not we want to share, even though there are lots of vehicles going in the same direction at the same time, car pooling does not seem to be particularly catching on in New Zealand. In the more isolated parts of the country, for instance down on the West Coast—which is an area that is very dear to my heart and I am sure to Assistant Speaker Rick Barker’s heart, as well—if people driving through smaller communities see people hitchhiking, it is common practice to stop and pick them up, because there is no available public transport. Hitchhiking has developed into an art form in Tākaka, in Golden Bay, where it is really part of the community structure that drivers automatically try to get more than one person in a car.

But we see private vehicles continuing to be the most significant mode of transportation for New Zealand. It is therefore important that we use incentives to encourage the use of alternative fuel technologies as they are developed in order to help meet our environmental obligations over time. The wonderful thing about these light electric motor vehicles is that they improve the efficiency of the overall motor vehicle fleet. There are people with quite a lot of experience in assessing the age of a motor vehicle fleet, and I think their view of New Zealand’s fleet is that it is not particularly flash, in terms of emissions, age, and technology. If we can decrease the reliance on imported fossil fuel, improve energy security, and reduce vehicle emissions affecting air quality and greenhouse gas levels, it must be a good thing. It is my belief that by combining highly effective electric motors with a competitive advantage in renewable electricity generation we can reduce the greenhouse gases produced by the transport sector. That sector is one of the largest producers of greenhouse gases, as well as of the harmful emissions affecting air quality.

As the debate on climate change continues, it takes me back—

Hon David Cunliffe: It’s Labour policy.

CHRIS AUCHINVOLE: Well, it has to be a shared policy, really. It really does. I was very taken with some of the comments made that at last Labour is perhaps seeing the way to joining in discussions to see whether we can get things together. It is a little like—

Hon Annette King: Chris, you opposed it last year.

CHRIS AUCHINVOLE: All I can say to the deputy leader of the Labour Party is that we do not look backwards; we look forwards. I am sure she will join us in that with this particular bill. We are indeed looking forward.

It is true that electric cars are expensive vehicles. For example, the light electric motor vehicle equivalent of a conventional car that cost 20,000 bucks would cost in the region of $40,000 to $80,000. I think the Green Party member had more specific figures. But the global market for those vehicles is constrained, with no immediate hope of an improvement, no thanks to the low production volumes of first-generation vehicles. This is one of the traps of mass production that we live in. New Zealand is not, at this stage, seen as a priority market. There is not a light electric vehicle manufacturer in this country. We do not have them. However, the Government plays an important role in the uptake of electric motor vehicle technology. After all, my esteemed friend the Hon Dr Nick Smith has an electric vehicle, I believe. It does happen; they are around. Part of the role of Government is to remove barriers that could prevent, delay, or dissuade people from engaging in the uptake of a market for light electric motor vehicles in New Zealand. One such barrier is road-user charges. The perception of that barrier is perhaps slightly disproportionate to the barrier of the large capital outlay for an electric vehicle, but that is a consequence of the general negative perception about road-user charges. And there is a general negative perception. I think the National Government has gone a long way to enhancing the view of road-user charges by making sure that the money that comes off the road goes back on the road.

Hon Annette King: That was our legislation last year, Chris.

CHRIS AUCHINVOLE: Indeed, yes; with our encouragement. That just shows we do share things.

Hon Ruth Dyson: You opposed it last year.

CHRIS AUCHINVOLE: Well, yes, but then, with a convincing argument and a little bit of modification, it was worth doing. That is the benefit of give and take.

Let us have a look at the consequence of changing this policy. The view was reinforced by the Energy Efficiency and Conservation Authority market research in 2008 in which 52 percent of 524 respondents stated that having to pay road-user charges would affect their decision to buy a light electric vehicle. It is easy to see why, if we analyse how much it would cost in road-user charges for an electric car on an annual basis. Based on an electric vehicle weighing 2.5 tonnes or less and travelling the average distance of 12,000 kilometres a year, the cost would be $432, which is a significant amount of money. At the same time, forgone revenue costs are small, because there are very few electric vehicles in the fleet. The exemption will come into effect on 1 October this year, if the legislation goes through all stages, and will apply until 2013, when the initiatives will be reassessed. I think it is quite an important part of this legislation that the initiatives will be reassessed. So we are talking about $130,000 for a year at the number of vehicles we have.

Hon Maurice Williamson: Put a spark into it.

CHRIS AUCHINVOLE: It is an electric car! I believe that the 42 days’ notice is a very good idea, and will avoid the embarrassment that occurred last year through the unforeseen consideration of the sudden introduction of charge increases without notice. So the 42-day notification part of this bill will improve businesses’ ability to operate by providing them with time to pass on the costs of any road-user charge increases.

In conclusion, I tell the House that this Government believes in incentivising behaviour that has positive benefits and disincentivising behaviour that has negative consequences. The main thrust of the bill delivers the former. Road-user charges are a barrier to the uptake of light electric vehicles. We are removing this barrier, to incentivise people to buy light electric vehicles, because they are much better for the environment than the conventional car. They will improve the efficiency of the motor vehicle fleet, decrease reliance on imported fossil fuels, improve energy security, and reduce vehicle emissions affecting air quality and greenhouse gas levels. The whole thing is extremely meritorious. Thank you.

CAROL BEAUMONT (Labour) : I rise to give Labour’s support to the Road User Charges Amendment Bill to go through to the select committee. The aim of the bill, as others have mentioned, is to amend the Road User Charges Act 1977 to enable regulations to be made to exempt light electric motor vehicles from road-user charges, to provide 42 days’ notice of road-user charge increases, and to provide for the expiration of heavy vehicle road-user charge licences 1 month after an increase comes into effect.

The reason for those changes, first of all, is to encourage the uptake of light electric motor vehicles, which are expected to improve the efficiency of the motor vehicle fleet, decrease reliance on imported fossil fuels, improve energy security, and reduce vehicle emissions affecting air quality and greenhouse gas levels. Secondly, the changes are to provide that heavy vehicle road-user charge licences will expire 1 month after an increase comes into effect in order to minimise potential loss of revenue caused by pre-purchasing of road-user charges by the heavy vehicle motor industry following the notification of a road-user charge increase.

First of all, in relation to electric cars, it seems that we would all have to agree that this is a great idea. This is an important idea, and one that reflects and reinforces the work that Labour did in promoting electric vehicles. Secondly, this new electric vehicle technology can improve the efficiency of our vehicle fleet. Such vehicles are certainly very expensive, but they are much cheaper to operate per kilometre than conventional motor vehicles. However, because availability is currently low, the purchase price is at least double that of a conventional vehicle, and manufacturers do not rate New Zealand as a priority market, the take-up rates are understandably low. It is the role of the Government to encourage the uptake of new technology by removing barriers, as is the case with this bill. One barrier is the road-user charge. As Mr Auchinvole mentioned, this view was reinforced by the Energy Efficiency and Conservation Authority’s market research in 2008. A majority of respondents stated that having to pay road-user charges would affect their decision to purchase a light electric motor vehicle.

Road-user charges fund road use, and they are required for all motor vehicles not eligible for an exemption. A light electric motor vehicle is not exempted under section 4 of the Act, so would therefore be required to pay a road-user charge. For a light electric motor vehicle weighing 3.5 tonnes or less, the road-user charge could cost $36.07 per 1,000 kilometres. That would cost the owner of a light electric motor vehicle approximately $432 per annum, based on an average travelling distance of 12,000 per year. Of course, the upfront capital cost of an early electric motor vehicle would be very significant. In comparison, the road-user charge would appear to be quite a minor influence. None the less, the negative perception about road-user charges, particularly from owners of petrol motor vehicles who have not previously paid the charges, would make it a barrier to the uptake of electric motor vehicle technology. So the preferred option being promoted by this bill is to exempt light electric motor vehicles from paying road-user charges until 2013. The exemption would last 4 years, from 1 October this year to 1 July 2013; we would probably see about 300 light electric motor vehicles in the fleet by the end of that period. The expected loss of revenue from that exemption will be about $88,000.

I want to talk about the view of the Labour Party in relation to electric cars and other vehicles, because our ambition, which we stated very clearly in our manifesto, was to be among the leading countries to widely deploy—

Hon Dr Nick Smith: How?

CAROL BEAUMONT: Yes, “our”—the Labour Party manifesto. Our ambition was to be among the leading countries to widely deploy electric vehicles and plug-in hybrids, to mark the beginning of a new era of energy independence and low emissions in transport. The preparation for a large-scale roll-out of electric vehicles included establishing a vehicle emissions reduction group focusing on electric vehicles. We expected to see—and I think this expectation is probably still right—vehicles starting to arrive and being used in New Zealand between 2010 and 2015. The numbers would grow slowly at the start, but the volumes would increase as the supply increased and the cost decreased.

Labour also, in our manifesto, talked about building clean, green electricity generation to develop partnerships with electric vehicle manufacturers. There is certainly a role for the Government in establishing an environment that facilitates the uptake of electric motor vehicles. We had a plan for the introduction of nationwide infrastructure to recharge electric vehicles. Clearly, there are a number of issues about the public infrastructure required for people to charge their vehicle during a journey. This sort of technology is likely to be expensive, especially for the high voltage facilities that allow shorter charging times. Obviously, work is going on in a number of other jurisdictions that are ahead of us on this, and we could clearly learn from that work.

As others have mentioned, it is a shame that the process around this bill will mean that the select committee will not get an opportunity to really analyse some of these points in any sort of detail. From the speeches given in the House today, I think that we can see there is a fair degree of interest in electric motor vehicles.

I repeat my point by saying Labour is supporting this temporary exemption from road-user charges for light electric motor vehicles because we had initiated a whole raft of strategies to combat climate change, and this is an area that could assist in that process. I also make the point that at that time National politicians such as Nick Smith were still in denial over climate change. A lot of groundwork was done by Labour to activate a strategy that would increase the size of the electric car fleet. I think it is quite interesting if the National Government thinks that it can claim any mana from any initiative to reduce carbon emissions, given its response in that area. I ask members to look at things like the emissions trading scheme, the future of which is still uncertain. The legislation is still before the special select committee, the Emissions Trading Scheme Review Committee, and there is no clear plan to outline how the emissions trading scheme legislation will be amended. Labour has offered to have some talks with the Government about a bipartisan approach in this area, because it is very important. This is a matter for the survival of our planet. We will be approaching and have been approaching this task in good faith. We want to see a system that will be durable and in the best interests not only of New Zealand industry but also of our environment.

It is important that we do not look at electric vehicles as the only solution. Electric vehicles might provide a nice photo opportunity, but given the size of the fleet—and we have all talked about the fact that potentially we are looking at something like 500 electric motor vehicles on our roads in the next 5 years—this exemption by itself is not going to be the solution to climate change. I was recently in the UK as part of a Commonwealth Parliamentary Association trip, and we were lucky enough to have a briefing while we were there by the Department of Energy and Climate Change. One of the important things was that the department has a comprehensive plan in place around climate change and ambitious goals. In fact, the department is seeking to have an 80 percent cut in greenhouse gas emissions by 2050, and it has a comprehensive range of mechanisms on how it will do that. Clearly, the situation for the UK is very different from ours. It is in a situation where methane is not particularly an issue but carbon dioxide is a much greater issue. But the country has a plan. We are well behind the eight ball on this. It made me feel particularly concerned to think that we had a number of initiatives in place, but here we are, with the emissions trading legislation still before a select committee, and with no real plans in place, while other countries are powering ahead.

In conclusion, I take this opportunity to say that this is a critically important matter for us. Thank you.

NIKKI KAYE (National—Auckland Central) : I support the Road User Charges Amendment Bill. First, I acknowledge Rahui Katene in this House today. What a voice! I think that she did an incredible rendition of “Greased Lightnin’ ”, and I do think that the atmosphere in the Chamber this afternoon is “electric”. I will also make a response to Carol Beaumont’ speech, in terms of what she said regarding Labour’s manifesto and its strategy to deliver in this area. That is another example where Labour talked a lot but did not deliver, so I am very proud that we are here, delivering on a key election promise regarding electric cars.

We are here today to enable regulations to be made that exempt light electric cars from road-user charges. In summary, we want to get more people into electric cars. I know that the fact has been raised already today that electric cars can be seen as possibly unaffordable for some, but the whole purpose of one of the parts of this bill is to try to make electric cars more affordable. The exemption of electric cars from road-user charges for 4 years will enable us to help to get more people into electric cars. We know that the exemption will come into force on 1 October this year, and will apply until 2013 when the initiatives will be reassessed.

People might ask how much the average person will save from using an electric vehicle. The calculation we have is that an electric vehicle weighing 3.5 tonnes or less costs about $37 per thousand kilometres to run, so the owner of an electric car would be saved about $432 a year, based on an average travelling distance of 12,000 kilometres a year. That is a significant saving over 4 years. It is potentially over $1,600.

The other point I will make is that our Government is very focused on public transport. We heard the announcement today by the Minister of Transport, Steven Joyce, regarding the fact that the Auckland Regional Council and the New Zealand Transport Agency have reached an agreement to advance a range of public transport projects in Auckland that were to have been funded by the Auckland regional fuel tax. Some of those projects include new rail stations at New Lynn, Manukau, Onehunga, Grafton, and Avondale. They will receive a subsidy of up to 60 percent from the New Zealand Transport Agency. That is positive. But I also make the point that although we are all for public transport, private vehicles will be a significant mode of transport in the future. We will see that, moving forward, which is why it is so important that we can encourage the use of alternative fuel technologies to help to meet our environmental obligations over time. The key thing about this bill is that technology can make a significant contribution to improving the efficiency of our vehicle fleet.

That is where the other key benefit comes in, regarding electric cars—the benefit for the environment. We all know that in New Zealand emissions have increased. I made that comment the other day and I know that Mr Hodgson was not happy with me, but he acknowledged the fact that emissions had increased over the last period. They increased in 1990, and we acknowledge that as well. But a key source of those emissions is from transport. The figure I have here is that 40 percent of New Zealand’s carbon dioxide emissions comes from vehicles, so there is real potential there for electric cars to make a huge difference, given that we have an issue in terms of transport emissions, and that we have a bill aimed at ensuring that we try to keep those transport emissions down in the future. I think we are really well-placed as a country to do that with this legislation. The real key benefit here is that it will help us to decrease our reliance on imported fossil fuels and improve our energy security.

The other point I will make is that this legislation is not an isolated measure we are implementing, to enable us to improve our energy security and to decrease our reliance on imported fossil fuels. If we combine the legislation with our competitive advantage in renewable electricity generation—which will help to reduce the greenhouse gases produced by the transport sector, as well as the harmful emissions affecting our air quality—we see a real thrust from the Government aimed at aligning the treatment of electric vehicles with that of biofuels, via the previous announcement we made in respect of bio-diesel and bio-ethanol. The key point is that not only is it a great incentive for New Zealanders who care about the environment to do their bit to reduce emissions but also it is aligned with the rest of our Government policy, such as the previous announcement in respect of bio-diesel and bio-ethanol.

I know that a number of people have made the point this afternoon that this may—in the short term, at least—apply only to a small number of cars. But I do think that the principle is very important. We are moving forward to provide incentives in this area, to enable good technology to be available in New Zealand that will enable us to help to reduce emissions. I note that in February of this year, when the Minister for Climate Change Issues, the Hon Dr Nick Smith, welcomed the announcement that electric cars would be commercially available in New Zealand, he said: “This is the beginning of an exciting energy revolution as significant as the economic transformation from the steam engine to the internal combustion engine more than a century ago.” So it is a bit of a watershed moment, I feel. Even though it applies to what some people might not consider to be a large number of cars, it is a significant moment.

The Minister for the Environment has told me that he has an electric car, and I know that he is doing his best to use it well. One thing people tell me when they say they worry about electric cars is that perhaps if they do not charge it—and they have issues around charging their phones—then they might suddenly run out of energy. The Minister has shared with me a little bit of a story that one day happened to him. I call him a bit of a trailblazer; not only is he out there charging up his electric car but he has told me he gets a bit of stick from his son, Logan, who has called it a bit of a nana car. I think that part of the movement, moving forward, is not only to have this great technology but also to enable young people out there to realise that electric cars are not nana cars; they are cool. I know that the Minister of Youth Affairs would agree with me that electric cars are not nana cars, and I am sure that the Minister for the Environment will pass that comment on to his son.

The other key aspect of this bill is that it gives 42 days’ notice of any increase in road-user charges to all diesel motor vehicle owners. Giving transport operators 42 days’ notice of a road-user charge increase provides them with time to pass on the cost of any road-user charge increases. This will give the Government the ability to minimise the potential revenue loss caused by the pre-purchasing of road-user charges by the heavy motor vehicle industry, following notification of an increase. In respect of those road-user charge increases, we know there was quite an uproar last year. We were all aware that the truckies were out there protesting when the road-user charge rates were increased without notice, at a time that coincided with pretty high fuel prices. People were pretty upset at the time, and transport operators were unable to pass the increases on to customers straight away. They publicly demonstrated in Auckland. A lot of people—and I remember this—were tooting at the time, and they were pretty upset with the Labour Government. For heavy motor vehicle operators, road-user charges represent a major cost of doing business. Changes in road-user charge rates that cannot be passed on to customers in a timely manner will significantly decrease marginal profitability. This 42-day notification will improve businesses’ ability to operate, by providing them with time to pass on the cost of any road-user charge increases. I make the point that this is positive, particularly as I am sure many truckies out there will see this as a very positive aspect, in terms of this bill.

In conclusion, I tell the House that this bill is aligned with the rest of the National Government’s policy, both in terms of public transport and of the environment. I am very proud to be here standing up for electric cars. They are cool cars, not nana cars. I look forward, hopefully, to one day being able to afford to have an electric car. This is great legislation, and I commend the Ministers involved in it. Thank you.

SUE MORONEY (Labour) : It is very interesting to listen to Government members filibustering on their own bill this afternoon. We certainly did not have the luxury of doing anything like that when Labour was in Government because we always had to take short and succinct calls to get through the business, because we had so much on the Order Paper. We had so much business to get through that we were under the opposite instructions from those that the National Government backbenchers seem to be under. The National Government obviously has a light workload on the Order Paper. It is becoming very noticeable because we had to have Nikki Kaye talk for probably about 2 minutes of her 10-minute speech about nana cars and cool cars. Enlightening as it was, that clearly was a filibuster and it tells us that the Government is in a bit of trouble with its programme of action.

I will, of course, come to the first reading of the Road User Charges Amendment Bill. Labour is supporting the bill through to the select committee in its first reading. I will not be on the select committee to hear the submissions but I wish the select committee well in its deliberations. I know that at least one of the Ministers was a bit confused the other day as to whether I am a member of the Transport and Industrial Relations Committee. I am not, and, therefore, Kate Wilkinson was quite wrong to draw to the attention of the House my supposed absence from that committee when I was not even a member of it. But here I am speaking in the House on a bill that is going to go before that very committee.

It is a bill with regard to road-user charges and it has two particular outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges. Labour supports this and of course Labour has been working along these lines for quite some time. But I note that the light electric motor vehicle seems to be the nemesis for everything that National does in transport. Although light electric motor vehicles will form a significant part of transport policy in years to come—

Chris Auchinvole: Eventually!

SUE MORONEY:—eventually, they will—they are not the silver bullet for transport issues, and I am pleased to see at least some of the National members acknowledging that. I have certainly had debates in my home patch of Hamilton with some of the National MPs there. I notice that when David Bennett was arguing against establishing a passenger train between Waikato and Auckland—that is right, folks, he was against something that would actually help his constituents—his reason for that was, first of all, that in the next 5 years everyone would be driving electric vehicles. I noticed that he has started to change that position now, and he is saying it will be sometime in the next 20 years when everyone—apparently everyone—will be driving electric cars of some description, and that the entire fleet in New Zealand is going to be electric cars in the next 20 years. I suppose we will just have to wait and see what happens on that front, but I certainly do not believe that will happen in the course of the next 5 years.

I wonder at times whether National members understand the economics of ordinary people who buy cars, and how frequently they can afford to turn over those cars, and how frequently families, particularly in this economic climate, will be able to afford to buy the newest car that—I acknowledge—one of the Ministers appears to have. But not every family will be in a situation where it will be able to afford the newest thing on the market—the electric motor vehicle. I do not know whether Dr Smith knows of many families in his electorate of Nelson who have stepped up to the electric motor vehicle. I ask Dr Smith how many he would see driving around Nelson these days.

Hon Dr Nick Smith: Rex Nowland has been an innovator—converted his V-Dub!

SUE MORONEY: That is one. So a man named Rex in Nelson can afford one of these but not many other families could. I would strongly suggest that those thousands of New Zealanders who are losing their jobs every week, sadly, in the current economic situation are not going to be looking to replace any motor vehicle in their family for quite some time to come. That is going to put back significantly the planned approach. It seems to be the silver bullet approach that National has: that everyone is going to be driving an electric vehicle sooner or later.

I think there are just a few small things in the way at the moment but nonetheless this is a good approach: to enable the exemption of electric motor vehicles from the requirement to pay road-user charges. I also wonder whether the National Government might take the opportunity, when it is listening to submissions on this particular bill, to think about diversifying even further in its transport portfolio. Could it consider using our rail network as part of the transport policy rather than seeing it as a competitor with roads and, therefore, something that cannot possibly be used? One of the arguments I have heard against having a passenger train service between Auckland and Hamilton is that National will not have that because it might compete with the concept of its precious Waikato Expressway. Another way of getting from Hamilton to Auckland might put the Waikato Expressway at risk. How ridiculous is that!

Clearly, people have different transport needs. Certainly, I am a strong proponent of establishing that passenger train between Hamilton and Auckland because it is going to be a much safer way and a much more energy-efficient way for hundreds of people who commute daily between Hamilton and Auckland—that is between the largest city in our country and the fourth-largest city in our country. They are only 120 kilometres apart. We have a train track and the Government owns the trains now, so I am not quite sure what the big objection is from National members for establishing a passenger train service between Hamilton and Auckland. Does the Government think that somehow it will undermine the use of roads? Does it think that is somehow going to get in the way of this bill? I certainly cannot see what the issue is, but David Bennett is extremely opposed to establishing that passenger train service.

The second objective of the bill before us is to provide 40 days’ notice of increases to the road-user charges to all diesel motor vehicle owners and to minimise potential revenue loss caused by pre-purchasing of the road-user charges by the trucking industry following notification of an increase. The bill provides that heavy vehicle road-user charges licences will expire 1 month after an increase comes in effect. I think this is a very sensible way through a very tricky issue. We all like to know in advance when our costs are going to increase to our businesses. We all want to have this knowledge so that we can take it into account when we are doing our forward planning with our finances. Removing the road-user charges for electric cars is a great idea and it reinforces all the work that Labour did in promoting electric vehicles.

We know that electric cars are the beginning of a new era of energy independence and low emission transport, but I hope that National is in no doubt whatsoever that it cannot claim any mana from any initiative to reduce carbon emissions by putting more electric cars on the roads when it continues to dither and dilly-dally over what it will do about the emissions trading scheme. I think until National actually gets its act together around that issue, anything that it does in regard to this particular bill will absolutely look like tinkering around the edges. I hope that in the submissions coming forward people will support this bill. I think it has much to recommend it, but I also hope that submitters will take the opportunity to talk about the broader issues concerned with emissions from vehicles. I hope they will take the opportunity to put forward pressure on this Government to look at the whole ambit, to do something, and to take leadership over the emissions trading scheme issue. In conclusion, I recommend the first reading of the Road User Charges Amendment Bill to the House. I look forward to hearing the report back from the select committee on the submissions that it hears.

Hon NATHAN GUY (Associate Minister of Transport) : For those who were listening, I say that the previous speaker was Sue Moroney. She spent most of her time speaking about what is obviously a pet project of hers: a railway line between Hamilton and Auckland. Listeners need to know that Sue Moroney is, indeed, a list MP, and is not representing the people of that area. No one in that area is listening to Labour right now apart from the local MPs, who are doing a fantastic job. TheRoad User Charges Amendment Bill is vitally important. I am sure the bill will pass its first reading today, judging by the speakers that have already spoken about it in the House this afternoon and last week. It is a very, very important bill, and it is important that we crack on with it. That is why it has been given a report-back date of 27 July—the end of this month.

I want to make some introductory remarks and talk a little about electric cars and the road-user charges that are proposed in this bill. I think the important thing is to realise that this bill is very forward-thinking about electric cars, and it might be a while until—I think it is 2011—we get up to a predicted 500 electric vehicles in this country. But we need to ensure that we are ready for that, and that we are encouraging it. Indeed, the first reading of this bill today shows that this Government is very much prepared to listen and think ahead to the future. The important thing is that we need economies of scale to kick in to bring the charge of these vehicles down, because right now they are very expensive. There is the battery cost, and there is a premium to purchase one of these vehicles on the market. That vehicle premium might be in the vicinity of 50 percent or maybe 70 percent more than what one would endeavour to purchase a new vehicle from a motor vehicle dealer for. Across the world, New Zealand may not initially be a priority market for manufacturers focused on large subsidised markets that can absorb the technology premium. Although New Zealand is not a light electric motor vehicle manufacturer, the Government plays a very, very important part in endeavouring that we are getting on with this technology. Part of that role is to remove the barriers that could prevent or delay the uptake of the market of light electric motor vehicles in New Zealand.

The other important comment I want to make is on road-user charges, and, yes, a review was done last year when the previous Labour Government was in office. Of course, many in this House will remember the gridlock that was created by the previous Minister of Transport, the Hon Annette King, when she came out and said that road-user charges would increase. Truckies across New Zealand were up in arms about it and there was gridlock across Auckland City, Wellington City, and most of our cities throughout New Zealand. Trucks came in protest from my electorate, from Kapiti and Horowhenua, down State Highway 1. So it is important that we get this process right. This 42-day notice of any increase in road-user charges to all diesel motor vehicle owners does that. It gives forward notice. Giving transport operators 42 days’ notice on road-user charge increases provides them with time to pass on those costs to any of their consumers if they wish to, which most probably they would choose to do. To minimise the potential revenue loss caused by pre-purchasing of road-user charges by the heavy motor vehicle industry, following a notification of an increase the original road-user charges will expire 1 month after an increase comes into effect.

This is a very important bill. It is very forward-thinking. We need to be aware that there will be zero pollution with electric vehicles. Right now across the country—and, indeed, across most of the world—we are having the climate change debate. More electric cars will mean that there is less pollution. Of course, we need to be mindful of the fact that those vehicles are a lot quieter, which is interesting. When I was walking in Wellington recently, a Segway went racing past me and nearly knocked me over because I had not heard it coming. Mr Assistant Speaker, I am not sure whether you have any down in Invercargill. One stands on them, and they are driven by electricity. They are very, very quiet and they transport people around communities; they are seen mainly in cities. These Segways are about 11 times more efficient than the average-sized American car. They cost about $15,000, Mr Assistant Speaker; they would be very good down in Invercargill for you to get around and see your constituents. The point I am making to the House is that electric cars are the way of the future, but I guess there will be a road safety component—particularly for pedestrians. They might be used to hearing a vehicle, and it may indeed be a diesel vehicle, which history shows tends to be a bit noisier than petrol vehicles. But these electric vehicles will be a lot quieter. As I said, I nearly got caught out by a young gentleman motoring past me on a Segway the other day. I make that contribution in this debate.

I also wish the Speaker of the House, the Hon Dr Lockwood Smith, all the very, very best for his wedding in the weekend. Indeed, in the House this afternoon we have the Minister for the Environment, the Hon Dr Nick Smith, who has an electric car. I wonder whether he has offered his car to the Speaker of the House, the Hon Dr Lockwood Smith, as an opportunity for him to transport himself to his wedding with his soon-to-be bride. That is an opportunity that the Minister for the Environment may have already offered to the Speaker of the House. We know that the Speaker has a tendency towards larger-engined vehicles, so that opportunity may be turned down. I know that the Minister for the Environment had his electric car at his recent wedding. On that very light note, I wish this bill all the best for its passage through the Transport and Industrial Relations Committee, with a report back towards the end of the month on 27 July. I commend this bill to the House.

• Bill read a first time.

Hon STEVEN JOYCE (Minister of Transport) : I move, That the Transport and Industrial Relations Committee consider the Road User Charges Amendment Bill, that the committee report finally to the House on or before 27 July 2009, and that the committee have authority to meet at any time while the House is sitting (except during oral questions), and during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House, and outside the Wellington area during a sitting of the House, despite Standing Orders 187, 189(a), and 190(1)(b) and (c).