44054 (2024). Chlöe Swarbrick to the Minister of Climate Change

44054 (2024). Chlöe Swarbrick to the Minister of Climate Change: What modelling, if any, is the assumption in the draft second Emissions Reduction Plan Technical Annex that “over the long term, however, employment is assumed to return to its long-run trend levels, reflecting an expectation that over the medium to long term, employment will shift from contracting to expanding sectors of the economy,” based on, and what work, if any, is being done to mitigate the impacts of New Zealand’s climate change response on workers who will need to transition into different sectors?

Hon Simon Watts: The Computable General Equilibrium (CGE) model incorporates an assumption commonly used in CGE models that over the medium to long term, the labour market will return to full employment. This assumption reflects the expectation that real wages in different sectors will adjust to incentivise workers to transition from contracting to expanding sectors of the economy. The Government is committed to managing the impacts of its emissions reduction policies. New Zealand has effective existing support systems that can temporarily assist workers through times of uncertainty or when they need help to adapt. This includes existing Government financial assistance and employment services, including transition advice for workers that need to transition. It also includes the Apprenticeship Boost scheme for those looking to retrain in another trade. We are continuing to improve our understanding of possible impacts on workers through further modelling and analysis, and through feedback in the consultation period. This additional information will inform final decisions on options to mitigate distributional impacts, and the updated analysis and decisions will be included in the second emissions reduction plan.