MBIE on how emissions reductions targets interact with immigration policy





No, that blank space wasn’t a mistake.  It was the sum total of everything MBIE has written or commissioned (analysis, advice, research, or whatever), in the period since the start of 2014 on how the appropriate or optimal immigration policy for New Zealand might be affected by commitments to reduce greenhouse gas emissions.     At the start of the period the government was considering what commitments to make under the then-forthcoming Paris climate accord.    For the last couple of years, those commitments have been firm policy.     As a reminder. this is how the Ministry for the Environment describes New Zealand’s commitments

New Zealand has recently formalised its first Nationally Determined Contribution under the Paris Agreement to reduce its emissions by 30 percent below 2005 levels by 2030. The Paris Agreement envisages all countries taking progressively ambitious emissions reduction targets beyond 2030. Countries are invited to formulate and communicate long-term low emission development strategies before 2020. The Government has previously notified a target for a 50 per cent reduction in New Zealand greenhouse gas emissions from 1990 levels by 2050.

In their recent annual stocktake, the Ministry for the Environment listed “a growing population” as the first item on their list of three particular challenges New Zealand faces in meeting the emissions reduction target.    It might not have been an issue had New Zealand chosen to specify its reduction target in per unit of GDP terms, as for example Chile did.  But instead we specified the target in terms of total reductions of emissions, and set a target for reductions that was similar to (say) that of the EU, even though our population growth rate is rapid, and the population of the EU isn’t increasing much at all.    As the Ministry for the Environment belatedly recognised, rapid population growth matters.   A large chunk even of New Zealand’s total emissions result directly from human activity (vehicles and power generation), and most of the remainder result from farm animals, with pastoral farming remaining by far the largest chunk of our export industries.

I say that the Ministry for the Environment seemed to recognise the point belatedly because I asked whether they had any analysis, research or advice on the implications of, say, our immigration policy –  which directly boosts the population, all else equal –  either before or since the government set the emissions reduction target.   Their response was on time and in full.  There was nothing at all that fitted the terms of my request.  I also included in my request whether they had raised the issue with MBIE, the government’s prime advisers on immigration policy.  They hadn’t, at all.

In parallel, I lodged a request with MBIE.    Had they perhaps thought, whether when the government was setting the emissions reduction target, or more recently when they were reviewing the residence approvals target, about the connection between  more people, and the adjustment costs of meeting the emissions reduction target.  At least in principle, it looked like one more reason why one might be cautious as to whether immigration policy was in fact likely to make New Zealanders as a whole better off.

MBIE took their time to reply, but they also replied in full.  There was nothing –  no analysis, no research, no advice or briefing to any of their ministers, no sign of any effort to flag the issue with Mfe and perhaps seek their input.  Nothing.

I’m not really sure whether to be surprised or not.   For all the rhetoric about “joined-up government” (one of the arguments for creating mega MBIE in the first place), there has never been much sign of it working well.   And for both departments there were probably sacred cows they didn’t want to touch.   Perhaps many of the MfE people are “true believers” who think the world might be a better place if we quickly moved to a carbon-free economy, regardless of the costs of doing so.  And MBIE seems to have plenty of immigration “true believers” who seem implicitly to believe –  even if they never attempt to demonstrate –  that the benefits from immigtration to New Zealand are so great that any issues around the emissions reduction target must be trivial at best, and not allowed to distract from the great project of a bigger New Zealand.

But, even allowing for all that, I’m enough of a naive and idealistic enough former public servant that in fact I am a little staggered that neither department had anything at all on the issue –  not so much as a discussion note by someone in one department or another willing to think just slightly out of the mainstream.    Perhaps it was just a response to the preferences of respective ministers –  the government after all appears to have a strong commitment to “big New Zealand” regardless of any other costs –  but even if that is the answer, it still looks like a significant failure of officialdom, which has a responsibility to point out uncomfortable tensions and costs, offering free and frank advice even (perhaps especially) when it might be unwelcome.

In earlier posts, various commenters struggled to see why the issue mattered.  It is pretty straightforward.  For all the optimism about new technologies, if they were already economic they’d already be being adopted.   Adjusting to substantially lower emissions is therefore almost certain to come at a real economic cost, and that cost will be greater the more the population pressures drive up the baseline level of emissions.  People will drive and fly, people will need/want electricity, goods need transporting and so on.   And New Zealanders demand for imports needs exports, and there is little sign yet of any systematic strong growth in the non natural resource based sectors.  Impose a heavier burden on those farm sectors –  which might be well-warranted on environmental grounds –  and it will undermine the competitiveness of those industries.  If we can’t keep selling as much stuff abroad, we can’t import as much.  Our living standards will be lower than otherwise.

If our population by 2030 was say 10 per cent lower than current immigration policy will make it, all else equal, we’d be much closer to meeting the emissions reduction commitment, and would need to impose fewer (inevitably costly) restrictions or intensified price signals to achieve the balance of the reduction target.   It is simple as this: when we use policy to import more people that means more intense pressure on all of us, and all emitting industries and activities than is otherwise necessary, to achieve the emissions reduction target the government has set itself.   That cost needs to be properly evaluated, in a robust assessment of whether the possible gains to New Zealanders from the immigration itself are large enough to outweigh the additional costs and burdens imposed via the given emissions reduction target.  At present, neither MBIE or ministers are able to (or even really attempt to) demonstrate such benefits at all.

When, in the privacy of closed seminar rooms (or even in ministerial offices), senior officials and their associates sit down to hardheadedly review immigration policy –  assuming, as I do, that this does happen on occasion –  the implications of our emissions reduction target really needs to begin to be factored into the discussions.  It is quite staggering, in a country with such an unusual immigration policy, that it has not happened until now.   It might be a question for the State Services Commissioner to look into: quite how did such significant departments overlook completely such a significant potential connection between two major areas of policy.