Pine forestry plantations – and Māori forestry in particular – are subsidising the rest of the country through reducing net carbon emissions. While overseas companies are pocketing the cash from carbon credits, is Tairāwhiti locked into a political deal made in Wellington that will eventually destroy it? Aaron Smale continues a series on the slow destruction of Tairāwhiti.
Manu Caddie doesn’t come across as rash. In fact, he projects an understated calm.
So he seems surprised himself at his heated reaction to the Minister for Forestry Peeni Henare’s jawboning at a public meeting about an inquiry into slash.
What set Caddie off was Henare’s response to a question about how indigenous forestry fit into the Government’s plans.
“What got me was his comment that most of the region is not suitable for native plants to grow. What? It was alright for 40 million years. That was my response. And he was like, 'Oh, no, yeah, but I've read the research'. And I said, 'Who paid for that?' And then I thought, I can’t listen to this shit, so yeah, that’s when I just got up and walked out. Some people would say stormed out.” Several others followed.
READ MORE: * Part one: The colonial cul-de-sac: Land loss, land use and the devastation left behind * Part two: Decades of damage: Ocean bears brunt of Tairāwhiti erosion * Part three: The science of East Coast erosion * Part four: Bought out and sold down the river
Henare’s appearance at the meeting in Gisborne was to respond to ministerial inquiry into problems with slash that had been highlighted by the damage caused by Cyclone Gabrielle. The resulting report was a damning catalogue of failures in decision making across decades.
The first thing Caddie noticed when he got to the venue was there was a meeting before the meeting.
“I got there early just because I happened to get into town early and went in. There were a bunch of iwi reps and council. Industry got invited to a pre-meeting meeting to give them the download before everyone else got it. And I got told I wasn't allowed to go into that, which was a bit weird.”
Caddie says Henare actually short-changed the Government’s response with his presentation. Once he’d cooled down he went through the Cabinet responses to the inquiry’s recommendations. While he didn’t agree with all of them, he found there were a number of points that looked promising.
“He made these four announcements that were really kind of off mark. They really undersold themselves or could have packaged it a lot better than they did. In the long list of responses to each recommendation, there's quite a bit in there, but the way that they sort of pitched it in the meeting was these are the four things we're going to do in response to the inquiry. What? Is that it?
“I went through the actual responses later. It's all very sort of work-in-progress, and kind of has to be given the nature of the issues. We weren't going to solve it in three months. But there were some more tangible commitments in there that they didn't touch on. So I think they did themselves a bit of a disservice. I don't know who's advising him.”
It appears there is so much advice about climate change surging out of different agencies the Government doesn’t know what to do with it all. Along with the Ministry for the Environment and Treasury there is the Climate Commission and the Commissioner for the Environment. The latter two have been lobbing bland but significant criticisms at the Government over the past couple of years that essentially say the it is bumbling around like a drunk All Blacks’ fan after a World Cup quarter-final loss.
The report on slash sits within a larger context of climate change and environmental consequences of different land uses. And the decisions that current and future governments make on this global issue could prove to be even more consequential for Te Tairāwhiti than the clearing of the indigenous forest in the late 19th Century or the planting of pine from the 1990s onwards. Political decisions made now will go well beyond an election cycle and will continue to impact Tairāwhiti and its environment for generations to come, for better or worse.
New Zealand’s most significant political decision to date is the Net Zero Carbon Act. The passing of the legislation was a rare moment of bipartisan unity in Parliament. The Act passed with support from across the House, with members voting 119-1 in favour of the bill that was intended to reduce New Zealand’s carbon emissions to net zero by 2050. (Act opposed the bill but David Seymour, the party's only MP at the time, was absent when the vote was taken.)
But if there was unanimous agreement on the legislation, the devil would be in the detail of its implementation. And that devil is the Emissions Trading Scheme. While the scientific problem might be coming into increasingly sharp focus – and more volatile weather – the political and market response is getting more blurred.
The background to the legislation is a long one.
New Zealand, along with more than 100 other countries, signed up to the Kyoto Protocol in 1998, an agreement to reduce greenhouse gases over time to mitigate and reduce the harms of climate change. That agreement was superseded by the Paris Agreement, which New Zealand ratified in 2016. In both cases New Zealand signed on under National governments.
Both agreements have been the subject of political wrangling about their objectives on the global stage since their inception – Trump pulled the US out of the Paris Agreement only for Biden to rejoin on his first day in office. But the subject of climate change has literally been heating up in recent years, pushing what at first seemed like bureaucratic good intentions to the front of global politics as countries deal with the reality of an increasingly volatile climate driven by human activity.
Forestry operations at Gisborne port
Both agreements were the basis for setting up mechanisms to trade carbon, the details of which are being continuously refined (or, according to some, muddled). Producers of carbon pollution are supposed to pay towards mitigating that pollution by buying credits from those industries that store or neutralise carbon. The mechanism to do that is the creation of a global market in carbon credits. New Zealand’s version was a government-set-up Emissions Trading Scheme (ETS).
While there is increasing political and global consensus that something urgent needs to be done about climate change, things start to fragment when it gets down to the details. How carbon is measured, who should be obligated to buy credits to offset their carbon emissions, and who can claim carbon credits has generated highly contentious scientific, economic and political calculations.
There have been significant media and scientific reports that carbon trading is questionable if not bogus, a fragmented global market that may actually be making things worse.
But New Zealand is in the unique position for a developed country of producing around half of its greenhouse gas emissions through agriculture. Because you can’t significantly or quickly change the biology of a cow or sheep, agriculture has been given more lenient conditions and timeframes. That’s at least partly because it has made the most noise in lobbying against the requirements of the ETS. RNZ reporter Kirsty Johnston recently did a series on agriculture’s political lobbying to avoid bearing the costs of its emissions.
While emissions trading is gradually imposing a cost on some industries, forestry has benefited from the scheme by creating an income stream separate from the actual timber it grows.
Which means you can’t talk about forestry and carbon credits – and by extension the damage being wrought on the East Coast – without looking at both sides of the ledger in New Zealand’s carbon accounting. A large proportion of New Zealand’s increase in greenhouse gas emissions since 1990 is due to dairy. In the past 30 years the number of dairy cows in New Zealand has doubled from around three million to over six million.
But this is where agriculture has been offered leniency while forest owners – including foreign owners – are benefiting from planting more trees. New Zealand’s land-use practices – and the impact on the environment – have been distorted as a result. Based on New Zealand’s commitments to reduce carbon, one of its few options to bring down carbon emissions is to carpet even more of the country in pine forestry.
According to government figures, New Zealand's greenhouse gas emissions have been steadily increasing since the 1990s.
- Between 1990 and 2019, net emissions increased by 34 per cent - New Zealand’s gross greenhouse gas emissions in 2019 were 82.3 million tonnes of carbon dioxide equivalent (Mt CO2-e). - Gross emissions in 2019 comprised 46 per cent carbon dioxide, 42 per cent methane, 10 per cent nitrous oxide and 2 per cent fluorinated gases. - Between 1990 and 2019, gross emissions increased by 26 per cent (17.2 Mt CO2-e). This increase is mostly due to increases in methane from dairy cattle digestive systems and carbon dioxide from road transport. - The Agriculture and Energy sectors were the two largest contributors to New Zealand's gross emissions in 2019, at 48 per cent and 42 per cent, respectively.
The forestry sector reduced carbon emissions to 55.5 million tonnes, or a 29.6 percent offset.
The government’s decisions about its own land holdings are contributing to this increase. A huge amount of forestry on Crown-owned land in the Central North Island was cut down and replaced with dairy farms. Not only was the carbon-absorbing benefit of forestry taken out of the equation but methane-producing cows were added to the national inventory. Who pays for that? How does New Zealand compensate? Do other areas – like the East Coast – have to plant more trees or at least maintain current levels?
These kinds of questions underline that while the Net Zero Act might make a nice simple headline that makes us feel good about ourselves as a country, there are a lot of gross figures hidden in the equation that don’t stack up. And given the Emissions Trading Scheme is a political tool masquerading as a free market solution, it is vulnerable to the whims of politicians who think they know best.
This possibility was thrown into sharp relief when the Government released two discussion documents, one of which led to a collapse in the price of carbon credits. In the discussion document last year, then-Minister of Primary Industries and Forestry Stuart Nash and Minister for Climate Change James Shaw made a statement that suggested the Government was aiming for less exotic forestry, partly because of risk of an oversupply of carbon credits which would depress the price.
“It is important the NZ ETS incentivises enough emissions reductions to meet our climate targets," the statement said.
“Although exotic forestry helps reduce our net emissions quickly and at low cost, there are likely to be significant trade-offs for our economy and environment in the long term.
“There is also a risk that oversupply of forest offsets in the ETS could reduce the incentive for emitters to reduce gross emissions. We need to ensure our land use incentives achieve the best outcomes for our environment, economy, and local communities, in the short, medium, and long term.
“The Government is proposing to restrict exotic forests being registered in the new permanent forest category, prior to the new category becoming available in 2023.”
The statement led to the price for carbon credits plummeting from nearly $90 to under $40.
Te Kupenga Dewes, chairman of the Māori Forestry Association/Ngā Pou a Tāne, said at the time that even the suggestion of fiddling with the ETS could have massive economic impacts on Māori.
“In the weeks since the Climate Change Minister James Shaw announced the review, the ETS has completely collapsed, with the value of carbon units plunging from over $85 each to below $35.”
“That crash has taken the balance sheets of Māori trusts and farmers with it, carving billions of dollars out of land values, forestry assets, and the value of Māori Treaty settlements across the motu.”
Shaw’s announcement was likely a reactive statement to advice from the Climate Commission, an agency set up to give the government of the day advice on how to reach net zero.
The commission implicitly states that the only way New Zealand will become carbon neutral by 2050, under the Government’s current plan at least, is by planting (and replanting) more and more pine trees while the rest of the country dawdles on reducing emissions.
“The structure of the NZ ETS will likely result in extensive afforestation, allowing gross emissions to continue largely unabated.”
It highlighted the disconnect between different parts of the equation about climate change, the Emissions Trading Scheme, and the impacts on the environment and the Māori economy. The second discussion document in June wasn’t a great deal better, and some of its suggestions brought a sharp rebuke from Māori forestry interests.
One of the things that irked Māori forestry interests was that their plantations were often on marginal land that amounted to the leftovers of the land grabs of the 19th and 20th Centuries. Making any money from these remaining estates was extremely difficult and the ETS scheme seemed to offer a pathway to an income stream besides the intermittent revenue from the harvesting of trees every three decades.
But that investment is by its nature a long-term one, and any major changes to the scheme without considering the impacts on Māori can disrupt that revenue to the tune of millions of dollars. There is also frustration that the question of land use is not just an economic one for Māori.
“Our land, it's a taonga, it's part of the family, it's something that we relate to, and that we whakapapa to, and it holds a special place for us, the very little that we have left,” says Dewes.
“Māori traditionally don't subscribe to this ideology that land is to be locked up for conservation or ecosystem services value. We value our land in a symbiotic way. Not only are we responsible for our land, but equally our land is responsible for us. It's a symbiotic relationship, not one way. So it's not only there to provide ecosystem services, wairua, mauri, mana but it's also to provide wealth, and wealth is not always defined by economic value. But in the current worldview, there needs to be an economic element to it.”
Māori, like anyone running a business, value stability and certainty. But the government has been pushing out recommendations that Māori have already expressed opposition to, only to do a u-turn that creates instability and uncertainty. For Māori there has also been a sense of déjà vu, as their land becomes a play thing for the Crown, Dewes says.
“Māori are just a bit sick and tired of people telling us what to do with our land. And if I can be really ungracious about this, you can see what fuck-ups have occurred in the last three decades as a function of people telling us what's best for us to do, or five decades. Having lived through Cyclone Bola and lived through the planting boom up on the coast, it's just lurching from one thing to the next. So first it was, 'Clear your land, feed the Motherland, take out all the native and make it all into pasture and the world will be good. And by the way, we'll subsidise you to do that'. So we did that.”
“And then it was, 'Oh, actually, that's not a really good idea. I know, we’ll plant it all up in trees, and boy, have we got a good tree for you. It's called the pine tree, and we'll do it all over the coast. And it'll be great, it'll be awesome'. And so we did all that. And now we're left with managing a system that was incentivised or imposed, depending on how you want to look at it, across our landscapes. Where if we'd empowered a Māori way of doing it, we probably would have ended up with a different mosaic of forestry, agriculture and other things back on the coast.”
But it’s not just Māori who have been critical of the government’s messaging and lack of a clear strategy – some of its own agencies have been less than flattering in their assessments. After the PR glow of the Net Zero Carbon Act had worn off, the real work of developing actual policies to implement the legislation began. Or at least it was supposed to. So far it’s been aimless false starts and delays.
Just as the political parties were starting their election campaigns this year, the Parliamentary Commissioner for the Environment Simon Upton (another agency, more advice), told the Government that it wasn’t integrating the Climate Commission’s advice in a coherent fashion (Upton was the Minister for the Environment in 1998 when the then-National government signed on to the Kyoto Protocol).
Upton’s criticisms were not flattering.
“Ministers did not systematically turn their minds to the key choices and trade-offs they faced. Nor did they explore alternative pathways that could have brought those issues into sharper relief. While officials placed some key framing questions in front of ministers along the way, they did not present those questions as a coherent package, nor did they ask them early enough. As a result, ministers were unable to provide a coherent policy framework to guide the detailed work of officials.
“Neither officials nor ministers stood back and asked: how can we make sense of the commission’s advice in its totality?”
But the commission’s draft advice he was referring to had already warned the Government in 2023 that it was lacking any coherent strategy: “The NZ ETS is a tool, not a strategy in and of itself.”
The commission said the ETS didn't currently have a clear strategy to reduce emissions, which then put the burden on forestry to get the country to net zero, incentivising the increased planting of pine.
“The purpose of the NZ ETS needs to shift from focusing only on net emissions to ensuring gross emissions also reduce. This requires decoupling the incentives for gross emissions reductions and afforestation, so the amount of gross reductions driven by the NZ ETS is no longer dependent on the amount of (carbon) removals achieved by forests.
“It will be important for the Government to develop a clear view on the NZ ETS’s role in delivering reductions ... Failing to do this will undermine the effectiveness of the NZ ETS and hinder implementation of clear and stable climate change policies in line with the purpose in the Act.”
Upton was also critical of the Government’s lack of consultation with Māori. He said the Climate Commission’s recommendations were informed by engagement with Māori, but “the Government’s subsequent attempts to consult with iwi and Māori were limited and fell well short of what was ideal”.
Upton recommended a dedicated group should lead consultation with Māori and feed more directly into analysis and decision-making.
But the commission’s remit is to advise on climate change, which is about greenhouse gases in the atmosphere, not wider environmental issues like the impacts of land use on the land and waterways.
In many of the commission’s statements there is an implicit tension between the reductions of carbon that forestry represents versus the changes that will need to happen in the likes of the agriculture and energy sectors.
If 2050 is a generation away, the first target is just around the corner. The legislation says New Zealand has to reduce net greenhouse gas emissions to 30 percent below 2005 levels by 2030. But the commission concedes that increasing forestry now won’t address the 2030 target.
“It is too late for forest planting to help much with the 2030 NDC [Nationally determined contribution], due to the time trees need to start significantly sequestering carbon, although planting forests now would help with meeting future NDCs. Like other options focused on forestry, this would not increase the incentives for decarbonisation and may drive socially-unacceptable afforestation rates.”
Despite highlighting the over-reliance on trees to reach carbon targets, the commission continues to cheerlead for an increase in forestry, while warning that agriculture is getting major concessions that are unsustainable.
“To reach net zero long-lived greenhouse gas emissions by 2050, it will be necessary for the government to ensure continued incentives for afforestation over emissions budgets two and three.
“The effectiveness of the NZ ETS beyond the mid-2030s is at risk ... because not all gases included in that target are covered by the scheme, notably agricultural nitrous oxide.”
The only way New Zealand is going to reach its 2050 targets is by future generations shelling out billions of dollars to buy carbon credits from overseas and/or planting a lot more trees.
ETS, Māori forestry and Tairāwhiti
While it doesn’t state it outright, some of the commission’s figures and calculations can only lead to one conclusion – forestry, and particularly Māori forestry, is subsidising the reduction of the country’s carbon.
The commission noted that: “The Māori forestry asset base was estimated at $4.3 billion in 2018. This has been estimated to cover 48 percent of all production forestry land within Aotearoa New Zealand. This emphasises the fact that Māori collectives play a key part in sequestering carbon dioxide through the establishment of forestry.”
For some reason the relevant government ministers seemed to underestimate the commission's percentages. In a press release, Stuart Nash from Labour and James Shaw from the Greens said: “Around 30 percent of New Zealand’s 1.7 million hectares of plantation forestry is estimated to be on Māori land, and this is expected to grow to 40 percent as Treaty settlements are completed.”
Te Ture Whenua entities hold Māori freehold land of 1.4 million hectares.
If nearly half of the production forestry in New Zealand is sitting on Māori land, then Māori land accounts for a huge percentage of New Zealand’s carbon sinks. Does the Crown, and New Zealand more broadly, expect Māori to keep that land locked up in pine for the next 100 years so everyone else can take their time reducing their carbon footprint? To put it another way – does New Zealand expect Māori to subsidise its carbon emissions by continuing a land use that, in the Tairāwhiti at least, has created catastrophic damage to the environment? There is a double-whammy here – climate change is creating more extreme weather events and those events often make landfall on the East Coast first.
Te Kapunga Dewes has no hesitation saying agriculture is being subsidised by the taxpayer, and the bill for that subsidy is going to balloon into tens of billions of dollars once New Zealand has to start paying down its carbon debt.
“Taxpayers are subsidising agriculture, whether they like it or not. We are going to buy 100 million carbon units offshore, there's no dispute about that. Treasury has valued them between $4 billion and $23 billion, that's what it's going to cost us to buy them offshore. And if agriculture were paying its way, we could be doing half that. Or we could be doing a quarter of that. But agriculture is not paying its way. It's still doing everything it can to delay, to deny.
"Ten years ago it was fart tax. Now it's forestry is destroying rural communities, even though sheep numbers have been in decline when forestry has been in decline. But it's still forestry at fault. Which is bullshit. These things were happening in ag anyway, particularly in high country sheep and beef. The economics just aren't there anymore after the subsidies came off.
“We as a country are subsidising farmers, we're just not doing that overtly, it's covert. For every unit that they keep emitting, we as a country are going to have to pay for that one way or another. So we're either paying for it offshore, or we can plant some more forests.”
If taxpayers are going to be subsidising the greenhouse gas emissions of agriculture, then Treasury says New Zealand is going to be sending billions of dollars of subsidies overseas to offset our carbon emissions. In one scenario Treasury outlined in a recent report, the cost could be up to $23 billion. That cost would come out of the pockets of future generations of New Zealanders – a population that will be increasingly Māori – while this generation of farmers – who are predominantly middle-aged to elderly Pākehā – will dodge that bill.
The report says: “New Zealand’s level of reliance on offshore mitigation to meet its NDC1 is expected to be high relative to others.”
As a result “the Government is in the early stages of developing a portfolio for accessing offshore mitigation”.
Which continues a pattern started in the 19th Century – the Crown stripped Māori of their land and then gave it over to Pākehā settlers who could never have owned land in their countries of origin. The sale of that land also subsidised New Zealand’s infrastructure and generations of farmers were then subsidised to produce agricultural products that led to land-use practices that were often dubious, sometimes ridiculous. Then the government subsidised the planting of pine trees on the East Coast, which has some benefits, but which are now being outweighed by the environmental cost. Many sheep and beef farmers have sold their farms to overseas forestry interests at prices well above what another farmer would or could pay, thanks to the incentives around pine.
In a further absurdity, a huge chunk of the financial rewards of carbon trading from pine trees goes to overseas owners of forestry who cash in the carbon credits and leave the mess behind.
Ernslaw, for example, made $52 million in revenue from the sale of carbon credits in 2022, and $30 million in 2021. In 2022 it had a carbon credit inventory of $284 million.
Ernslaw’s financial statements (Oregon Group) state: “The carbon credits (NZUs) recorded in the group books are carbon units freely saleable as the quantity falls within the safe carbon limit of the group forest estates profile. These NZUs are not required to be surrendered to cover future harvesting liabilities.”
The East Coast has just over 150,000 ha of pine forestry which accounts for around 10 percent of the country’s pine plantations. Under the current settings for the ETS the Government essentially cannot afford to reduce pine forestry in this region, or its target of reducing greenhouse gas emissions becomes unattainable. In effect, the pine plantations on the East Coast are propping up the Government’s carbon credits regime and agriculture.
Regardless of how the targets are calculated or set, New Zealand is a long way off meeting them. Any reduction of pine becomes a carbon 'debt' that New Zealand has to make up elsewhere. Politically, regardless of which party is in government (and both major parties voted for the Net Zero Carbon Act), there is no incentive to reduce the amount of pine trees on the East Coast, even though it is causing massive environmental damage. But by signing up to international agreements and passing domestic legislation, and by increasing dairy cow numbers, New Zealand has locked itself into a situation it can’t back out of.
Pine versus native
One question that inevitably arises is whether the best option for the high-risk areas on the East Coast would be better protected if they were put back into indigenous forest.
From a purely environmental point of view the answer is yes. An MPI study quoted research that found mature Mānuka/Kānuka stands significantly reduced erosion when compared with pasture, which it attributed to the ability of the root systems to hold the soil.
But the time and cost to do that are significant and not without major risks – pest control in native forest would be an ongoing cost.
And to what extent could that be imposed on private landowners, including Māori? Indigenous forests cover about 6.2 million hectares in New Zealand, while pine forestry covers 1.7 million hectares. Part of the problem is the economic incentives. Currently the rates for carbon credits for pine and indigenous forest mean pine is the bigger earner.
The reality is that exotic forest species absorb more carbon faster than indigenous forest – figures from NZ Forest Service compared mixed exotics at 28 years old and found the exotics stored 650 tonnes of CO2 per hectare, whereas indigenous stored 240 tonnes of CO2 per hectare.
But the origins of the baseline used to calculate carbon credits for indigenous forests that absorb carbon is unclear, says Manu Caddie.
“The story is murky depending on who you talk to, and no one seems to have a definitive answer about where science for that actually comes from. But the critics say that it's based on some poor-performing East Coast Mānuka or something and should never have been used as the blanket native sequestration rates. I understand there's work being done on relooking at that.”
The irony is that what was colloquially referred to as scrub and was hacked, burned and crushed for decades and considered a curse to the hill country farmer, has in the past couple of decades been the basis of a multi-million-dollar industry of its own.
Te Kupenga Dewes says the science is clear – pine absorbs more carbon more quickly, largely because of its quicker growth rates early on.
“Roughly speaking, pine sequesters carbon at around eight to 10 times faster than native.
“So if we’re talking about monetising carbon, then pine trees are going to be the way to go. But whether pine trees are right for that land, that's a completely different story. It's not the same question.”
But there is also variation in indigenous forest that means the standard measurements that are used as a baseline do not always match specific measurements of different stands.
Furthermore, the ETS excludes pre-1990 forests – which includes old growth native forest – largely because the assumption is the carbon absorption rates occur predominantly in the early stages of growth. But this assumption is being tested.
One of the other hats Dewes wears is CEO of Interpine, which is doing trials to establish more data around how carbon is stored by older indigenous forest.
“We're hopeful that we will be able to prove that is additional carbon sequestration in these pre-90 forests, such that we can claim the carbon benefit. Given Māori are the second-largest owner of native forests in the country after DoC, this has got to be a benefit for Māori. All our native forests are all locked up, we're not allowed to do anything with it. We're not allowed to harvest it, we're hardly allowed to walk in it. So there could be some better monetary outcomes from the ecosystem services provided by the forests on Māori-owned land, which are currently unrecognised.”
A study published in 2017 by Niwa scientists, doctors Kay Steinkamp and Sara Mikaloff-Fletcher, indicated that New Zealand’s indigenous forests absorb much more than previously thought.
“The story the atmosphere is telling us is that there’s a big carbon sink somewhere in the South Island, and the areas that seem to be responsible are those largely dominated by indigenous forests,” said Mikaloff-Fletcher.
She says the results were surprising because it was assumed that strong carbon sinks are expected when there is a lot of forest regrowth.
“Carbon uptake this strong is usually associated with peak growth of recently-planted forests, and tends to slow as forests mature. This amount of uptake from relatively undisturbed forest land is remarkable and may be caused by processes unique to New Zealand or part of a wider global story.”
Storing carbon isn’t the only consideration – holding the land together over the long-term and the lack of employment opportunities while pine is growing is another.
After being treated as the farmer’s curse for generations and being burned and chopped and crushed, Mānuka suddenly found itself at the centre of a lucrative industry when Mānuka honey became a thing.
The Mānuka honey industry has gone through its own wobbles in recent years but it has also seen spectacular growth from a plant that was always here and needed no help growing in its natural environment.
But the other factor that sometimes gets overlooked in the discussion is that soil erosion releases carbon.
Mike Marden co-authored a research paper for MPI in 2013 on this very subject. One of the conclusions was that “landslide and earth flow erosion are significant influences on soil carbon stocks that need to be accounted for in the Soil Carbon Monitoring System (Soil CMS) model.”
The Soil CMS is the system used by the Ministry for the Environment to meet international reporting requirements for soil carbon stocks under the Kyoto Protocol and United Nations Framework Convention on Climate Change (UNFCCC).
One irony in the middle of all this is the role of the Ngāti Pōrou Runanga, which supposedly represents the interests of the major iwi in Tairāwhiti. The runanga’s owns Ngāti Pōrou Forests Ltd manages 15,000 hectares of forestry, and is also involved in carbon trading and joint ventures.
But its legitimacy is questioned by a number of people within Ngāti Pōrou who see it as out of touch and not looking after the interests of the people it is supposed to represent. Many of those who are critical don’t want to be named because of the influence the runanga has and the political power it wields in Wellington. Its involvement in the pine industry also creates a perceived conflict of interest in the discussion around the role of forestry on the East Coast.
Local, Lillian Ward, says iwi organisations were set up for the purposes of the government and often serve the interests of the government over the interests of the people they’re supposed to represent.
“When we think about iwi they're set up to be miniature constructs of government. So to receive government funding, you need to jump through certain hoops and set your entity up in a certain way. I think, hand on heart, back in the 80s the runanga made the decision on the information that they had at the time.
“Don't get me wrong. I'm not covering up for our iwi but we can't blame people that were there making decisions 30 years ago, based on information that seemed like it would benefit our people. Yes, it gave employment initially. And then we had that 25-year, 30-year lag until harvesting. So because we harvested all of those initial plantations, now we're seeing the devastation that it's causing.”
Graeme Atkins, who lives just out of Ruatorea, says the runanga were always operating in an unenviable position, trying to create an income from marginal land left over from the land grabs of the 19th Century.
“I know our iwi have got vested interests, especially in the carbon sequestration side of the forestry blocks that they own, because the best land was already gone for farming. So what we were left with was marginal land. There's not many incomes you can derive from marginal land. So I can understand, I see both sides of the argument. It's a bit of a tough one for our runanga and for our forestry company, because you’ve still got to pay the bills. But it comes at a terrible cost.
“These heavy rain events are more frequent, and even pine trees are not able to hold up a lot of those slopes. Because it's marginal land, when those trees are harvested there's a vulnerability period. Who'd want to be a forestry manager, when you roll the dice hoping that it isn't going to get heavy rain over three years or five years?”
Hilton Collier, who is the general manager of Pakihiroa Farm up behind Tokomaru Bay, says the runanga was effectively set up by the government to simplify Treaty settlements. Despite being operated by those from Ngāti Pōrou it can sometimes act in ways more in line with local and central government objectives.
"The runanga is recognised as being a Treaty partner because of legislation. Iwi are a construct of the government, but hapū signed the bloody Treaty, so let's get that right, firstly. But of course, councils don't want to have to go and engage with 50 or 60 hapū, they want to engage with a single organisation. So the runanga was pulled together to hold our resource and to represent us as a collective. But some of them seem to think they're the only ones who can speak and act on behalf of Ngāti Pōrou, which in my mind is bullshit, and it's made worse by too often we allow them to do things that may not be in our interest. But we're too disenfranchised to go and tell them we don't want what you're proposing."
He says the damage witnessed in Tairāwhiti originates in decades of decisions about how to make money out of different land uses without looking at the consequences of those land uses.
"The circus that we've seen is fundamentally a problem of land use. It's a problem of land use that's made murky, because we start to impose some perverse economic incentives to try and get rich, and we're happy to take the money. But we're not doing anything to mitigate the negative impacts of our land use activities, whether it's farming or forestry.
"We need to recognise we have a relatively young part of New Zealand. It's only about three million years old. So you've got all these problems with soft geology. And then we start to impose economic outcomes to get rich. And the problem with that is we ended up clearing the land, incentivised by government who paid us to clear the land. And then we got Bola. The government's response to Bola was the East Coast forestry project, which talked about the protection forests, but it became production forests. So the real sin is the dollar and what motivates people to do things in the pursuit of a dollar."
Collier says the land tenure system that came with colonisation emphasised the benefits of privatised individual title while ignoring the impacts on other sectors of the community and the environment.
"If you think about the history of privatisation or the individualisation of title, we had mana whenua converted into a thing called title, which was then passed on to Pākehā farmers, who then went and got very rich out of it. And when things started to go wrong whether it was erosion, sediment, greenhouse gas emissions, the rest of us were asked to pay for the transition to the next best land use. So essentially I'm leaving my crap on your farm, but you're gonna help me pay for the damage that I've done. It just makes no sense.
"So you've got all these perverse incentives. Even if we change the rules tomorrow, that's not going to solve the problem. Parts of the region should never have been cleared, so they need to go back into permanent tree cover, preferably indigenous. So how do you get there, who pays for it? And what's the transitional pathway?"
The new economic incentive now being chased is carbon trading. But by creating a carbon trading scheme, New Zealand is going to end up paying to buy carbon credits costing billions.
Collier says he'd rather see that being spent here on solutions that will have a real benefit.
"I'd rather we spend it here. That is a much better way to deal with a lot of the environmental problems. At the same time, though, we need to start penalising polluters for the pollution they're releasing."
Earlier this year Newsroom reported that the Māori Carbon Company, which includes people like Sir Mark Solomon, Murray McCully, Hone Harawira and Michelle Boag on its board when it set up, had bought Horehore Station behind Tokomaru Bay for $13 million. It sprayed the property around November and then Cyclones Hale and Gabrielle hit in January and February. Newsroom has been unable to directly verify the extent of damage on the property or the cause, but satellite images appear to show evidence of slips and heavy silting in the rivers on either side.
Other entities benefiting financially from forestry on the East Coast include local and central government.
Trust Tairāwhiti owns Eastland Group which owns the Gisborne Port. The trustees are appointed by Gisborne District Council.
The council also owns forestry interests, but is also the owner of a farm in land category 3A – the highest risk of erosion. This means it falls under regulations laid out in its own council rules requiring forest cover. A source has told Newsroom it is currently not meeting those regulations.
Individual politicians have also benefited from forestry. Stuart Nash, Labour’s previous Minister of Forestry, was a cheerleader for the industry until he was sacked for various indiscretions. Those included giving information to some of his donors that they weren’t entitled to, which suggested a relationship with donors that was a little too transactional. Newsroom previously reported that Nash had received around $50,000 in donations from individuals and entities connected to forestry.
It seems government is also somewhat blasé when it comes to taking its responsibilities seriously. Newsroom has previously reported Manu Caddie repeatedly contacted Environment Minister David Parker’s office in late 2022 and early 2023 about environmental issues to do with slash. Parker’s office finally replied on February 14, the very day Cyclone Gabrielle was battering the East Coast, to say it wasn’t under his portfolio but that it was the responsibility of the Minister for Forestry Stuart Nash. The main legislation the Ministry for the Environment is responsible for is the Resource Management Act, which forestry companies have to comply with in their harvesting in order to protect the environment.
Central government has deep vested interests in forestry going back decades and has made major decisions around the sector that are still playing out. It owns significant holdings of land in forestry on the East Coast, including blocks where the cutting rights are held by companies like Ernslaw. Other blocks are held by MPI as well as Pamu, a division of Landcorp. Many of the blocks now in foreign hands were once owned by the Crown.
But the Crown still receives substantial revenue from forestry – it received $44 million in rentals from Ernslaw alone.
After subsidising pine on the East Coast for 28 years and being aware of the problems now caused by that forestry, it took Cyclones Hale and Gabrielle to force the Government into directly addressing the issue.
An inquiry into land use and slash was launched by the Ministry for the Environment that was limited in time and scope and was led by chairperson and former National MP Hekia Parata.
The inquiry’s report made a number of recommendations that have been considered by Cabinet. But many of the boldest recommendations have either been declined, diluted or are under consideration indefinitely.
Forestry minister Henare’s press secretary was contacted about a public announcement held in Gisborne about the government’s response to the inquiry. She said there weren’t going to be any major announcements and that it was just an update. She mentioned a Cabinet paper, but didn’t send it through. There was a press release but that wasn’t sent through either. The release and Cabinet paper, when they were tracked down, were light on detail and heavy on platitudes.
Instead, what was sent through – from the Minister’s office – was a press release from the Eastland Wood Council and Hawkes Bay Forestry Group.
This could be interpreted as helpfulness. Or it could be interpreted as the Government working hand in glove with industry to put a positive spin on a sector the Crown has deep vested interests in.
The press release, which was sent out by the minister’s office in advance of the meeting, said the industry wanted to highlight “a suite of sector-led measures the forestry industry has implemented” as “the industry continues pushing for change”. The industry has not been continuing to push for change in the five years since the Queen’s Birthday storm in 2018. Otherwise there wouldn’t have been a continual problem with slash coming down in every major storm event since. Judge Dwyer’s judgment in the Ernslaw case showed a company that was flagrantly ignoring the law and which dragged out the hearing for nearly four years. That’s hardly pushing for change.
Chief executive of the Eastland Wood Council, Philip Hope, told the public that: “In Tairāwhiti, we have also voluntarily implemented intensive wood removal plans for high at-risk slopes where appropriate. We are working on an equitable wood debris programme to guide future remedial work with our partners, Gisborne District Council. There is no silver bullet, but there are a lot of initiatives under way that complement each other.”
Hope has been saying something similar since Gabrielle, and Lillian Ward won’t have a bar of it. “I heard Phillip Hope of the Wood Council talking about how the practices have improved. Like hell the practices have improved. He wouldn't have a clue what we see daily out Mata Road. Daily. We see the shoddy practices and they're from harvesting. So don't say that practices have improved. Because the latest lot of harvesting has happened within the last 18 months and that's all the crap that's going into our waterways at the moment. So there's been no improvement.”
One recommendation was that land with extreme erosion susceptibility be transitioned to permanent cover, such as native forest. The Government has responded that it would map areas of extreme erosion risk and would consider permanent canopy cover. However, the areas that are erosion-prone are well documented and have been for decades. A map in the government’s own report showed that in the Gisborne District, 38 percent (321,263 ha) was very high erosion risk, 15 percent (127,780 ha) was high risk, 34 percent (282,429 ha) was moderate risk, and 11 percent (96,178 ha) was low risk. But the low-risk areas appeared to be the areas in river valleys that ended up receiving all the eroded soil in the waterways.
The panel found “the forest industry has lost its social licence in Tairāwhiti due to a culture of poor practices – facilitated by the Gisborne Council’s capitulation to the permissiveness of the regulatory regime – and its under-resourced monitoring and compliance. Together, these factors have caused environmental damage, particularly to land and waterways, and they have put the health and safety of people and their environment at risk.”
The panel recommended ministers immediately halt large-scale clear-felling of plantation forests in Tairāwhiti and Wairoa, but the Government only said it would consider it.
In terms of overseas investment, the panel recommended approval criteria be reviewed and restrictions imposed. However, Treasury did not support this recommendation as “it may risk unintended investment settings across the board”.
The inquiry recommended a review of the ETS to include indigenous forest, which the Government said it would consider.
“Current land-use patterns are the result of both market and government incentives over the past 150 years. Subsidised pine forests have led to the damage communities have experienced. However, when those forests are clear-felled on highly erosion-prone land, the erosion control benefits are lost. More recently, the ETS and the rise in carbon prices have also incentivised afforestation.”
The report recommended that those applying to register for the ETS should be excluded if they are not complying with environmental conditions and lose credits already gained. The Government responded that applicants could have their registration rejected under current laws. It did not make any response to the recommendation that companies could lose carbon credits.
The Government announced it was setting up a fund of $10.5 million to clear up slash.
Caddie says some of the announcements were just throwing around big dollar figures to try to impress people. The Labour Government announced the $10 million to clean up the mess left behind by slash, after it already announced $200 million to clean up sediment and debris. The taxpayer is effectively being billed for the damage caused by overseas companies, which doesn’t include the cost of damage to infrastructure.
The Government’s response to the report maintains the status quo with a few minor concessions and a lot of platitudes. It’s hardly the sort of bold response Tairāwhiti needs, and could justifiably be interpreted as a government trying to get through an election without rocking the boat.
“Each of the report’s recommendations was carefully considered, and we are firmly focused on reducing risk and setting this region up for sustainable longer-term change,” Minister for the Environment David Parker said in a statement.
“Again, we recognise and thank the Ministerial Inquiry for their carefully considered report. We are committed to taking meaningful action in response."
Shortly before this story was to go to print the Government announced changes to regulations governing forestry practices, which included the requirement to remove harvesting waste above a certain size. The changes were welcomed by those spoken to for this series.
But the response from government and industry doesn’t address the illegal behaviour from overseas forestry companies that caused so much of the damage. The earlier statement from (Eastern Wood Council) that the industry was making “voluntary” changes ignores the fact forestry companies are legally obliged to prevent forestry debris from ending up in waterways and beyond, but those legal obligations have been breached again and again. You can’t “volunteer” to do something that the law requires you to do.
Collier says those who have done most of the damage are probably around six overseas companies who use their power to get their way.
"They're bastards. And I say they're bastards because they use their economic power to suppress opposition. You look at Wairoa. Wairoa Council wanted to increase the rates on forestry blocks to help pay for roading. The forestry companies ganged up and brought in the lawyers and poor little Wairoa District Council had to go and fight them. Our council in Gisborne rolled over for forestry companies to avoid getting into costly litigation. I don't know that they'd admit it. But looking in from the outside ... you look at the issue around the way our council managed resource consents. Why didn't they just go to those forestry companies and say, 'We're going to charge you more around your compliance. But of course, you're dealing with big corporates who just roll in the lawyers and who fight the fight."
Collier attended the same meeting Caddie did and found the Government response to the slash report tepid.
"It was, 'Here's a placeholder until we can actually work out how to deal with a multitude of issues identified in that report'. It was probably a bit close to the election for them to be courageous. But I don't see a government having the courage to say, 'This is where we need to go to, this is how we're going to pay for it and this is what the future looks like'.
"A whole lot of land-users, including farmers – so my industry is just as culpable, responsible for silt, woody debris and the slash that has devastated our region – but we're just not the ones who pay to fix it. So I've made a couple of bucks out of some land use decisions, it's landed in your backyard. It's your problem because it's in your backyard. But I've got rich out of taking a few shortcuts.
"We had some people take a whole lot of shortcuts, whether it's in the forestry management regimes, the way our council managed the resource consents and the compliance. It's little wonder that we have people feeling totally alienated from the system, all because some people are getting rich out of taking shortcuts."
There are more than 230 resource consents granted by the Gisborne District Council to carry out activities relating to forestry. None of those consents allow for slash to end up in waterways, on other landowners’ property, in the ocean or wiping out roads and bridges. In fact they prohibit it and stipulate measures those companies must take to prevent it happening.
And yet for at least five years that is what has happened repeatedly, causing hundreds of millions of dollars' worth of damage, not to mention the environmental destruction. Companies responsible for damage caused in 2018 were taken to court, but ended up paying fines totalling just over a million dollars.
Even so, prominent industry figures deny there’s a problem at all in the international media. Bert Hughes, chief executive of Forestry Enterprises, which logs in the Tairāwhiti region, told the Guardian shortly after Cyclone Gabrielle: “I have not seen any evidence that forestry practices have directly caused harm to neighbours … The damage and harm we are seeing is across all land use.”
And Philip Hope from the Eastern Wood Council concluded the Government press release by saying: “I am proud of the way our people have stepped up to help in the face of devastating weather events, but we are not done yet.”
Yet six months after Gabrielle there is still a massive volume of slash on beaches stretching from Tolaga to Te Araroa, not to mention in the ocean and in rivers and on private land.
Newsroom has been told the Gisborne District Council is using government funds to pay forestry companies to clean up the mess they’ve created.
Perhaps the most sobering and shortest sentence in the whole report was the last one in the introduction, which called for major changes if Tairāwhiti was going to survive:
“We have 10 years,” it stated baldly.
