Reduced income after ‘ethical investment’ decision

Ethical investment decisions made by the Dunedin City Council last year have led to substantially reduced returns from investment funds.

ODT reports: City pays cost for divesting

Some of the Dunedin City Council’s divestment decisions have cost the city, it was revealed at yesterday’s council finance committee meeting.

Group chief financial officer Grant McKenzie said the Waipori Fund had realised some losses as a result of the council’s decision to divest from some sectors, but the total amount was not clear.

The council voted last May to scrap any investments the fund had in the munitions, tobacco, fossil fuel extraction, gambling or pornography industries and to bar future investment in those industries.

While they are now forbidden areas of investment I haven’t seen any claims that there were any investments in munitions, tobacco or pornography.

Is oil, coal and mineral extraction really on the same ethical level as them? To the Greens perhaps. Or they wanted to make ‘ethical investment’ sound better when their target was primarily mining and drilling.

The ethical investment policy gave the fund two years to exit those industries, but Mr McKenzie confirmed yesterday the last of its positions – BHP Billiton and Rio Tinto – were sold earlier this year.

But there were investments in mining, something Greens want to stop – and there’s a definite Green lean to the Dunedin City Council.

‘‘We are now in a position that we have completely divested in those shares,” he said.

The fund had produced $783,000 in profit during the eight months to February 29. However, this was $1.657 million down on the budgeted $2.44 million profit.

Some of the unfavourable variance was because of divestment losses, Mr McKenzie said.

  • Budgeted $2.44 million profit
  • Actual $783,000 profit

That’s a significant reduction to under a third of budgeted returns.

Green anti-mining and anti-drilling policies appear have come at a significant cost to Dunedin ratepayers.

And we still need oil and mineral products.

And we don’t seem to have made millions from clean green alternatives.

David Parker’s environmental credentials

David Parker has responded to critics with a post at Red Alert, posted in full here:

I seek leave to make a personal explanation …..

Posted by  on July 30th, 2012

I see I am getting a bit of gyp from critics in the blogosphere whose latest fantasy is that I lack an environmental ethic.

Their mistake is they think that a healthy environment stands in opposition to a healthy economy.

I don’t rise to the bait too often, but on this occasion I will bite and lay out my record.

Some of these critics should do their homework.

I am 52 years of age. I tramp, ski, and swim in rivers and the sea. I have been fighting for environmental causes most of my life.

As a lawyer I fought for conservation orders that now protect many of the south island’s rivers including the Mataura, the Buller, the Ahuriri, the Greenstone, the Dart, the Lochy, the von, and the Kawarau.

I am still active in river protection. This year I am appearing pro-bono as an expert witness on energy policy in support of the Fish and Game application to protect the Nevis river from damming.

As Minister of Energy I halted the decline in renewable electricity as a % of total generation, set an objective of 90% renewables by 2025 and put in place a myriad of initiatives to achieve that end. That objective has survived the change to National, and good progress is being made towards it. Together with Jeanette Fitzsimons, I also promulgated the most ambitious energy efficiency and conservation strategy we had ever had, and played a strong hand in the design and funding of the insulation retrofit programme that National continued with.

As Minister of Energy I added substantially to the lands protected from mining by extending schedule 4 protection to all parts of national parks not then protected, including Kahurangi.

As Minister of Land Information I revamped tenure review, helped form a number of conservation parks, including the Otiake Park in the Hawkduns, stopped tenure review around lakes and rebalanced the relationship between the Crown and lessees. National has reversed some of those changes.

As Acting Minister for the Environment I unblocked the national policy statement on freshwater quality. Trevor Mallard continued this work culminating in the very good NPS proposed by Judge Shepherd et al, which was then neutered by National.

As Minister of Climate Change I successfully legislated to price greenhouse gases in all sectors of the economy covering the 6 main gases covered by the Kyoto protocol. New Zealand remains the only country in the world to have achieved that. I was named Environmentalist of the year in 2008 by the Listener for that and other initiatives.
Changes by National and a loss of momentum internationally collapsing the price of carbon have undermined it, but the architecture remains sound. It is Labour’s policy to bring agriculture in to the ETS.

While in government I read about set nets causing the deaths of Hector’s and Maui dolphins. After confirming with Chris Carter that this was intend a serious problem I approached Helen Clark who, with Jim Anderton’s help, vastly expanded the areas where set nets were banned.

I have had high profile run-ins with proponents of lignite developments, including Solid Energy’s Don Elder.
As Labour’s then spokesperson for conservation, I helped lead Labour’s successful campaign against National’s plans to allow mining in schedule 4 National parks, Coromandel, Great Barrier Island etc. For those with a sense of humour, my Christmas interchange with Gerry Brownlee on the issue, in which Gerry starred, remains the most watched clip from parliament.

I have spoken often on the need to better protect our albatross and petrels from being killed as by-catch. Similarly, I am a defender of lowland wetlands against reclamation, and against degradation caused by intensification of nearby land use.

I have been a defender of the RMA, while wanting to improve its reputation by addressing some of its arcane and hard to defend processes.

I am happy to stand on my record on environmental matters.

Which is why it annoyed me to be told I am out to lunch on mining issues.

Having a clean environment means making sure we use our natural resources responsibly. It doesn’t mean we stop using all of them.

That’s why, outside of schedule 4 areas, mining applications can and should be considered case by case.

As I said when interviewed, there is legitimate public concern about deep sea drilling arising from the Gulf of Mexico catastrophe and the limitations of New Zealand’s response to the Rena shipwreck. We must ensure that world’s best practice is followed and that the safety devices needed in the event of mishap are available and can be deployed. Even then, it may be that the deepest of wells are too risky and ought not to proceed.

In terms of lignite, I reiterated that Labour believes its use as an energy source using current technology is a dirty greenhouse gas intensive practice. We are also unconvinced it is economic, especially if environmental consequences are included, and have said government money should be  spent on renewables instead.

Our position on developments in the EEZ is that RMA type principles should apply. We sit between the Greens (who would ban most development activities) and National, whose EEZ legislation, while initially supported by the Greens, is inadequate.

We can develop our resources responsibly and make responsible decisions for our future – and a sustainable economy requires it.

Shane Jones on mining versus ‘Greenies’

Most New Zealanders back the Government’s plan to increase exploration for oil, gas and minerals, a Herald-DigiPoll survey suggests…

It has also been welcomed by Labour list MP Shane Jones, who sees mining as the best bet to stem the flow of Northland Maori leaving for better prospects in Australia.

27% supported the Government’s aim to increase oil gas and mineral exploration
40% (almost ) cautiously supported it.
30% strongly strongly opposed or leaned towards opposing increased exploration.

Mr Jones said the result was a rebuttal for those opposed to mining in his Northland home region.

“We in Maoridom must not buy uncritically into the hostile rhetoric from the Greenies.

“It’s about time they showed as much concern for the brown Kiwis disappearing to Aussie as for the habitat of the brown spotted kiwi.”

A big quandary, industry and jobs versus conservation. This balance will be challenging for a Labour/Green government to manage.

Russel Norman, jobs and mining

On Backbenches last night (not yet online) the first question put to Russel Norman was on the proposed opening up of  mining in Northland, and related jobs for the highly unemployed far north.

Norman didn’t answer directly, but his response made it clear about his priorities – he thought the long term “need” to leave mineral resources untouched in the ground outweighed what he called short term jobs.

Mining and Drilling

There is Green policy and campaigning on stopping and preventing mining, stopping fracking and preventing drilling.

On Lignite:

It makes no sense to destroy valuable farmland to dig up coal that harms our 100% Pure brand. Instead, we need to invest in jobs and a vision to create a future which we all can enjoy.

So they want to stop and prevent some job opportunities. Where are the Green jobs going to come from?


Jobs were one of the big three Green campaign issues in the 2011 election.

Our plan will create 100,000 new jobs through direct government investment in housing, by ensuring our state-owned energy companies capture the massive export opportunities in the renewable energy sector, and, most importantly, by shifting the drivers for green jobs in the private sector.

From 100,000 green jobs for New Zealanders:

How we’re going to do it
Our plan is detailed and fully-costed. It includes plans for direct government investment, building sustainable infrastructure, supporting the greening of our small and medium enterprises (SMEs), driving innovation, introducing smarter
regulation, getting the prices of resources and pollution right, protecting our brand, reforming capital markets, making our workplaces fairer, and measuring progress differently.

Here are three of the highlights:

  • Direct investment
    We will ramp-up the Heat Smart home insulation programme ensuring it is rolled out to a further 200,000 homes over the next three years, costing $350 million and employing 4,000 people directly — 10,400 if you include indirect and upstream employment effects.
  • Keep it Kiwi
    We will retain ownership of our state-owned enterprises while creating the right incentives for them to partner with clean tech entrepreneurs in the private sector and develop renewable energy solutions that we can patentand export abroad. With the right incentives in place, if we can capture just 1% of the global market for renewable energy solutions, we’ll create a$6 to $8 billion export industry employing 47,000–65,000 people in new green jobs.
  • Support for Small and Medium-Sized Enterprises
    Through a mix of government procurement policies, tax incentives, startup funding, and a $1 billion boost to R&D funding, we’ll support SMEs to step up and drive new job creation in the cleantech sector.

The Heat Smart home insulation programme has already been going for the past few years. They don’t say if the jobs they claim will be created are additional, nor how likely they are to happen. It depends on availability of resources, and the willingness of people to install insulation.

“If we can capture just 1% of the global market” – if. Wishing doesn’t make it happen. National has discovered how hard it is to improve the job market.

Green solutions seem to be to stop some industries (like mining and drilling), pour money into creating jobs that may or may not eventuate, and may or may not provide a return on the investment.

At the same time they want to increase the costs for many businesses – farming is the most important industry we have, Greens want them to pay more for emissions, more for water, and more tax. They haven’t “detailed and fully-costed” the effects of this.

There’s no doubt the Green Party provides an important “voice” in Parliament. It’s good to be made aware of and debate the issues they raise.

The big question facing voters is how much Green do we want? This especially important when viewd alongside the continued weakness and turmoil in Labour.

What if our next Government is one third Green? Something around there is quite likely, unless Lanbour miraculously sees what it’s been doing wrong and reforms and rebuilds.

What if our Government is one half Green? That’s probably a stretech for 2014, but that’s a long way away.

It’s quite likely we could see a more balanced combination of Labour, New Zealand First and Greens.

We need to at least start seriously considering the likley effect of a Green Associate Finance Minister and a Green Minister of the Environment. Minister of Transport?

Greens have until now been more of an interesting sideline. To date Labour have managed to keep them out of Government, and Greens won’t go in to Government with National.

But our next Government could be the first time we see a significant Green component. There are competent Green MPs, but none have any experience about the reality of being in Government.

How Green a government can we risk? Alongside a weak Labour and a more inexperienced NZ First?

The next election will be interesting.