Jacinda Ardern is defending the Government's eligibility criteria for rebates on electric and plug-in hybrid vehicles, arguing the $80,000 price cap will likely not affect New Zealanders who wish to splash their cash on a more expensive model.
On Sunday, the Government revealed its newly minted Clean Car Package, a policy designed to increase uptake of electric vehicles (EVs) and drive down emissions. It's hoped the measures will help New Zealand meet its 2050 carbon-neutral target.
As part of the package, the Government is incentivising Kiwis to go electric by offering big discounts for both new and used vehicles. Starting July 1, New Zealanders who purchase a new EV - priced under $80,000 - will receive a rebate of up to $8625, while those who opt for a used model will be rewarded with a refund of up to $3450.
To fund the rebates, the Government will impose a fee on newly imported, higher-emitting vehicles in January 2022 - a plan that has prompted push back from those who rely on dirtier models, such as utes, for work. The package has also sparked concern for lower-income families, many of whom are unable to afford the premium price tag associated with electric or hybrid vehicles.
The Government's decision to cap the rebates at vehicles priced under $80,000 has also sparked backlash. Some are arguing that wealthier New Zealanders who wish to purchase a pricier model should still be rewarded for doing their bit to help the environment, with former cricketer and The AM Show's sports presenter, Mark Richardson, noting that "wealthy people value money as well" and will still benefit from a rebate.
Speaking to The AM Show on Monday morning, the Prime Minister argued that New Zealanders who are willing to buy a vehicle priced over $80,000 will likely not be affected by the cap, insinuating those with that level of wealth can comfortably afford to splash the cash without the need for a rebate.
"When you start buying a car over that price point, you're less likely to be affected by the price point," Ardern said. "I don't think that's an unfair assumption to make."
Host Duncan Garner pressed back, arguing why wealthy New Zealanders - who pay more income tax - shouldn't also benefit from the scheme.
"Because they're probably in a better position to be able to pay for it at that point - we're talking about vehicles that are more than $80,000 - and there is a whole range of fantastic EVs that sit below that price point," Ardern shot back. "You've got to draw the line somewhere."
The Prime Minister also argued that if a rebate was important to a customer, they would opt for an eligible vehicle priced under the $80,000 cap to ensure the discount would be applied.
"If you value your rebate, get a car that comes in at a $60,000-$70,000 price point."
Ardern acknowledged the tax on higher-emitting vehicles would hit some New Zealanders a little harder in the pocket. There are not yet electric alternatives for utes and vans frequently used by farmers and tradespeople, meaning those looking to buy a newly imported model next year will be paying a premium.
She reiterated that the second-hand market will not be affected by the tax, so people can still purchase pre-owned, higher-emission vehicles already in New Zealand without being affected by the fee.
It's hoped in the next year or two that brands like Toyota will introduce an electric ute or larger low-emission model to cater towards people who require a bigger vehicle.
Ardern said she hopes Kiwis in the market for a new ute will delay their purchase until that point.
"Eight out of 10 of the most popular imported used vehicles will either have no impact, or will receive a discount as a result of the policy. So for those who say it will have a negative effect on lower-income families, that's what I would point to," she added.
Discounts will also not be available for vehicles that sit below a three-star safety rating to avoid incentivising unsafe cars.
The Government will continue to monitor the fees and rebates to ensure the scheme is "paying for itself".
