[Sitting date: 27 June 2012. Volume:681;Page:3413. Text is incorporated into the Bound Volume.]
Dr RUSSEL NORMAN (Co-Leader—Green) to the
Prime Minister: Does he stand by his statement that “you can’t and wouldn’t want to” stop retail investors on-selling shares to foreign buyers under his asset sales policy?
Rt Hon JOHN KEY (Prime Minister)
: Yes. Shares are freely traded every day between New Zealanders and people of other nationalities. That is actually very much to New Zealand’s benefit. In terms of portfolio share investment, New Zealanders
currently own $47 billion of shares in overseas companies, while foreigners have $12 billion of shares in New Zealand companies.
Dr Russel Norman: Is he aware that the number of shareholders in Contact Energy has declined by two-thirds since it was privatised and that those remaining shareholders account for only 2 percent of the New Zealand population, and that if his privatisation follows that path, then we will lose control of these companies?
Rt Hon JOHN KEY: I will give that member an absolutely cast-iron guarantee here in the House today that it will not go on that path—one shareholder will own 51 percent majority control.
Dr Russel Norman: Is he aware that in the recent privatisation of Queensland Rail, two-thirds of retail investors had sold their holdings within a year, despite an extensive share give-away programme run by the Queensland Government?
Rt Hon JOHN KEY: No, but I am confident that retail shareholders in New Zealand will not sell within a year.
Dr Russel Norman: Given that Treasury documents show that only about 7 percent of New Zealanders are expected to buy shares in these companies, does he think it is more likely to be the 7 percent who got massive tax cuts under his Government, the 7 percent with zero or negative net wealth, or the 7 percent who are unemployed under his Government?
Rt Hon JOHN KEY: Within the rules that govern the Financial Markets Authority legislation, let me say that the Government is moving ahead with the mixed-ownership model, which will present opportunities for all New Zealanders, if they wish to, to purchase those shares. There are 1.8 million KiwiSaver accounts, which currently hold $12 billion worth of investments. What that member is saying to those 1.8 million KiwiSaver account holders with the $12 billion is that they should go to Australia and buy shares in its energy companies. If the member took just one moment to go and have a look at the share registry owned by the New Zealand Superannuation Fund he would see that they own pretty much most of the listed electricity companies and energy companies in Australia. I, for one, personally would rather see them investing in New Zealand than in Australia. If the member has a different view, well, he is welcome to go and put that to New Zealanders.
Dr Russel Norman: Does he think it is fair that the vast majority of Kiwi mums and dads who currently own these companies will lose the ownership of these companies, so that a handful of New Zealanders who have the money, and foreign buyers, can profit from their power bills?
Rt Hon JOHN KEY: There are so many parts of that question that are wrong, it is basically not funny. But let us start with power bills. They went up 72 percent under Labour, when these State-owned enterprises were 100 percent owned by the Government. So what happens to your power bill bears no correlation to the owner; it bears directly on the effects of the Resource Management Act and the capacity to bring new generation on stream. In terms of foreign owners, the companies will be 51 percent New Zealand - owned. New Zealand investors will be at the front of the queue. In terms of selling assets, that has been the biggest fictitious argument put up through this whole debate, because, guess what, we are going to go and buy $7 billion worth of other assets. At the end of this process, New Zealand’s balance sheet will be larger, not smaller.