New Zealand

Aotearoa top 10 in global inequality index, but tax system’s inequality impact 136th

October 12, 2022

Oxfam Aotearoa communications and advocacy director Dr Jo Spratt said about the Commitment to Reducing Inequality index:

“The inequality index shows Aotearoa is doing pretty well overall, but there is still work to be done. The fact that rich and poor countries alike have exacerbated an explosion of economic inequality since the outbreak of the pandemic from 2020 is unacceptable.

“Billionaire wealth and corporate profits have soared to record levels during the Covid-19 pandemic, while over a quarter of a billion more people could crash to extreme levels of poverty this year because of coronavirus, rising global inequality, and the shock of food price rises supercharged by the war in Ukraine.

“Tax is one of the most powerful tools we have to fight inequality. It is disappointing to see New Zealand’s tax system contributing to the gap between the rich and poor. Especially in these extraordinary times, tax is crucial to boosting government resources to support welfare systems and public services.

“An excess profits tax on supermarkets could be used to support the poorest households most hit by the increase in food prices. Excess profits and windfall tax revenues can help tackle the biggest challenges of our times like the explosion in inequality and the climate crisis.”

The 2022 Commitment to Reducing Inequality Index (CRI Index) is the first detailed analysis into the type of inequality busting policies and actions that 161 countries might have pursued during the first two years of the pandemic.

New Zealand ranks eighth overall, and seventh in the world on tax progressivity. The index found that New Zealand’s tax system is effective at collecting revenue; however, this comes at a cost as New Zealand’s tax system makes a direct contribution to an unequal income distribution. On this, New Zealand ranks 136th in the world. Oxfam says the Government has made some progress since 2020 by slightly increasing the top income tax rate, but needs to do more by taxing wealth and exploring better ways to tax corporate profits.

The table below shows New Zealand’s ranking on the key indicators that make up the CRI.

INDICATOR	RANK
PUBLIC SERVICES
Education spending	98
Social protection spending	35
Health spending	9
Public service spending average of indicators	14
Public service implementation	18
Public service impact on inequality (Gini)	33
Progressivity of public services	22
TAX
Tax policy	91
Tax productivity	3
Tax impact on inequality (Gini)	136
Progressivity of tax	7
LABOUR
Labour rights	74
Women’s labour rights	29
Minimum wage	35
Labour policy average of indicators	50
Coverage of labour rights	36
Wage impact on inequality (Gini)	53
Progressivity of Labour Legislation	35
OVERALL RANK
Commitment to reducing Inequality	8

Oxfam reacts to Government’s farmgate emissions pricing system

October 11, 2022

In reaction to the Government’s farmgate emissions pricing system, Oxfam Aotearoa climate justice lead Nick Henry says:

“A system for pricing agricultural emissions is starting to shape, but there are some major holes that need filing if Aotearoa is to do its part in keeping global warming to 1.5 degrees. Farming is responsible for almost half of New Zealand’s emissions. The system must be transparent, fair and effectively reduce emissions.

“The governments proposed cautious approach does little to help people across the Pacific and beyond to keep their homes and their livelihoods. This is not a business deal; this is our future.

“We already know what it is going to take to tackle agriculture emissions: we need an effective system to price and reduce emissions, with support to turn around the farming sector from being Aotearoa’s biggest polluter, into a solution for tackling climate change and restoring nature. That involves a phase out of synthetic nitrogen fertiliser, and investing billions to support agriculture to transition to low emissions and regenerative agriculture.”

Oxfam responds to New Zealand International Climate Finance Strategy – Tuia te Waka a Kiwa

August 26, 2022

In response to Foreign Minister Nanaia Mahuta and Climate Change Minister James Shaw’s Aotearoa New Zealand International Climate Finance Strategy – Tuia te Waka a Kiwa, Oxfam Aotearoa Communications and Advocacy Director Dr Jo Spratt said:

“This is a substantial piece of work that was well-consulted, carefully considered and provides a solid framework to guide significant investment from the New Zealand Government. We are pleased to see a Pacific-led approach that makes way for our Pacific whānau to build climate resilience on their own terms.

“We are also pleased to see the Government acknowledge that too often communities are not included in how climate finance is allocated, and Minister Mahuta and Minister Shaw’s willingness to make sure communities are able to benefit from it. It is good to see a focus on equity and inclusion for the people who are so often left out and left behind.

“It is excellent to see recognition of both the economic and non-economic costs of climate destruction that communities cannot adapt to and the willingness of Aotearoa to promote countries’ access to finance to address loss and damage. We look forward to engaging with the Government on this in the lead-up to COP27 where loss and damage will be a focus. Other mechanisms, not just mitigation and adaptation, will be necessary to address the unavoidable loss and damage people in the Pacific and beyond face every day.”

Oxfam reacts to Commission’s advice on the New Zealand Emissions Trading Scheme

July 28, 2022

Oxfam Aotearoa welcomes the latest advice from the Climate Change Commission to the Government calling for an urgent decision about how it will prioritise emissions reduction in the New Zealand Emissions Trading Scheme (NZ ETS). Oxfam Aotearoa Interim Executive Director Dr Jo Sprat said:

“The Commission is on the right track: All sectors of Aotearoa’s economy, including agriculture, need to do their fair share in reducing climate pollution.

“Aotearoa can’t just rely on planting permanent pine forests, or paying other countries to reduce emissions for us. The role of international carbon credits and carbon off-setting, including whether these will be integrated into the ETS or kept separate is as clear as mud. The Government must urgently provide clarity, just as the Commission recommends.

“What also concerns us is how the Government will make sure human rights are upheld, including indigenous and community land rights. If it is not done right, using international credits as an alternative to reducing our own carbon emissions from industries like agriculture could do serious harm to communities – especially those on the frontlines, such as our Pacific friends and family who experience the worst impacts of climate destruction every day.

“The Commission’s advice underscores the urgent need for a comprehensive plan for a just transition, in consultation with tangata whenua and all communities, to support a move to a less polluting and more equitable economy in Aotearoa. We couldn’t agree more. A just transition would make sure the rising cost of carbon pollution in the NZ ETS doesn’t unfairly fall on those least able to pay.”

Stand with us, for climate justice now

Get frontline communities the loss and damage finance they need

It started with children planting trees. Thousands of them. In Kenya, Elizabeth Wathuti set up an initiative encouraging young children to love nature and be environmentally conscious. Now, Elizabeth is demanding justice for the people whose lives and livelihoods are threatened by climate breakdown. She is hoping to influence the most powerful people as they choose whether to do what’s easy or what’s right.

As many as 28 million people across East Africa are at risk of extreme hunger if rains fail again. Kenya has suffered a 70 percent drop in crop production and has declared a national disaster with 3.1 million people in acute hunger, now in need of aid. We cannot ignore the huge economic and non-economic damages that the climate crisis is causing.

But in the UN climate negotiations, rich countries including New Zealand, have fiercely resisted progress at every turn. This inaction continues despite calls going back 30 years for a global fund to support recovery from damages caused by climate change.

Elizabeth is calling on leaders to act now by delivering a dedicated finance facility to help frontline communities deal with the loss and damage they are already experiencing – and which we know will only get worse¹. This letter will be delivered to those in charge of negotiations at the UN Climate Talks later this year.

Scroll down to read Elizabeth’s full letter and add your name to demand climate justice now.

Diyaara stands among the carcasses of her family’s livestock. Kenya, Somalia, and Ethiopia are experiencing the driest conditions in 40 years with as many as 28 million people across East Africa facing severe hunger.

Elizabeth’s open letter:

Dear Minister Sharma and Minister Shoukry,

You are jointly responsible for guiding the UN climate change negotiations at what is a watershed moment in human history.

I urge you to meet this challenge with compassion and courageous leadership, which is what will be needed to keep the 1.5°C temperature goal of the Paris Agreement alive.

The loss and damage already being experienced by communities on the frontlines of the climate crisis is being cruelly compounded by the impacts of a war and global pandemic.

People who have contributed least to the climate crisis are right now suffering its worst impacts, and decency demands that finance be mobilised urgently through a loss and damage facility to help them.

This year I have been spending time understanding the lived experience of these frontline communities.

Recently, I visited Wajir County, which is about a day’s drive northeast of my home in Nairobi, Kenya.

What I witnessed there was a deeply shocking example of the suffering that the interconnected climate, nature and food crises are bringing to bear right now across the African continent.

Four consecutive failed rainy seasons have led to terrifying levels of food and water insecurity across the region.

I saw with my own eyes the terrible suffering that the community in Wajir is experiencing and the stories that local people had to share will never leave me.

Most people in Wajir depend on livestock for their livelihood, but thousands of their animals are now dropping dead of thirst and starvation.

Young girls are being pulled out of school because their families can no longer afford to pay school fees.

Babies are failing to thrive because their hungry mothers’ can’t produce enough milk to feed them.

Relentless drought has completely decimated local wildlife populations.

And natural ecosystems that should be a life source for all have been pushed beyond breaking point.

What hit me hardest, though, was to hear that some of the people I met feel hopeless about their situation – that only their faith now keeps them going as they pray to God for the rains to arrive.

Most of the people I met in Wajir do not know that decisions made in far away places might have something to do with the situation they are facing.

What would they do if they knew that the actions of others – rich, high-emitting nations in the global north – had something to do with their predicament?

Would they simply pray to God for the rains to come, or would they have something to say to world leaders and big companies who are increasing the likelihood and intensity of these kinds of disasters?

Communities on the frontline of the climate crisis, like the people I met in Wajir, are not responsible for causing the climate crisis – but they are suffering its impacts right now, well beyond what they can adapt to.

The global community must not simply abandon them to their fate.

Which is why it is critical that the COP27 climate change talks, to be held in Egypt later this year, deliver a dedicated finance facility to help frontline communities deal with the loss and damage they are already experiencing – and which we know will only get worse.

This is not just about money – because money can never replace what the people I met in Wajir have already lost.

This is about justice.

It is about building trust and solidarity.

This is what the global community needs if we are to solve the nature and climate crises together.

Yours sincerely

Elizabeth Wathuti

[1] Oxfam analysis shows that there has been an 800% increase in funding required for extreme weather events in the last 20 years, and nearly half of UN appeal requirements have gone unmet. Read the report, Footing the Bill: fair finance for loss and damage in an era of escalating climate impacts.

Oxfam reaction to the He Waka Eke Noa proposal

June 8, 2022

Following the release of the He Waka Eke Noa proposal, Oxfam Aotearoa Climate Campaign Lead Alex Johnston said:

“Under the ‘He Waka Eke Noa’ proposal, it will take 98 years for agribusiness to pay the same emissions price for its pollution that all other Kiwis pay at the petrol pump. It begs the question, are we really all in this together?

“The government’s target to reduce agriculture emissions by 4 percent to 5.5 percent by 2030 is not fair, practical or effective. Agriculture is responsible for half of New Zealand’s emissions, and yet is only going to contribute this small amount to our collective target under the Paris Agreement, which is to reduce emissions by 41 percent by 2030. This proposal doesn’t do what it says on the tin.

“I think about the farmers and fisherfolk on the frontlines of climate change in the Pacific. Those who just want to feed their families, but are struggling to do so due to the impacts of rising sea levels that are destroying their crops. We need our agriculture sector to show what developed economies with historic contributions to climate change can do to reduce emissions and avoid further devastation to farms and livelihoods across the Pacific.”

Oxfam calls for a stronger emissions price to make sure emissions will be reduced in line with the science of keeping to 1.5 degrees. In addition, Oxfam calls for:

Pricing to be set in a way that is designed to achieve the targets in the Zero Carbon Act and agriculture’s share of our Nationally Determined Contribution, not simply raise revenue to pay for technology adoption.
Emissions need to be priced now, not 2025.
The government must scrap the 95 percent discount – the agriculture industry should be paying their fair share.
The government needs to invest in equipping farmers to shift production modes and adjust land use to build a flourishing, regenerative organic food and fibre sector.

Notes:

Regarding the 98-year timeframe: Under ‘He Waka Eke Noa’ farmers won’t start paying an emissions price until the year 2025. There is also a price ceiling proposed by ‘He Waka Eke Noa’ being where the levy rate for each gas is no more than if agriculture entered the Emissions Trading Scheme with legislated 95 percent free allocation in 2025 phasing down by one percentage point per annum. ‘He Waka Eke Noa’ also proposes that the price for methane be frozen for three years of pricing.