12. CLARE CURRAN (Labour—Dunedin South) to the Minister of Finance: Does he stand by his statement to the Otago Daily Times on 21 April 2012 that he was not aware of KiwiRail’s decision to sell off the Dunedin Hillside workshop prior to the announcement?

Hon BILL ENGLISH (Minister of Finance) : Yes, I do. I understand that my office was notified later in the day, before the announcement. However, if the member is suggesting that the notification is important in the sense that either I or other Ministers would have intervened in the decision, then that expectation is incorrect. We would not have.

Clare Curran: Is he aware of the no-surprises policy outlined in the Owner’s Expectations Manual for State-Owned Enterprises, which states: “Under the ‘no surprises’ policy, shareholding Ministers expect to be informed well in advance of any material or significant events”; if so, given that the sale of Hillside is a significant event, how can he not have known that KiwiRail was planning to sell up?

Hon BILL ENGLISH: Well, I think I just gave the answer. Of course Ministers were aware that that was one of a number of things discussed, but I would have to say it was a small part of discussions with KiwiRail. The Government is investing $4.5 billion in a 10-year turn-round programme with KiwiRail. We expect the board of KiwiRail to make sensible operational decisions to back up the investment of $4.5 billion in turning round KiwiRail. We do not expect to be part of every single decision involved.

Clare Curran: If KiwiRail neglected to inform him and other shareholding Ministers well in advance of its intention to put the Hillside workshops up for sale, has he asked it to explain why it did not, given that it is a significant community event; and if he has not asked it, is he not then negligent in his duties as a shareholding Minister?

Hon BILL ENGLISH: No. We were aware that the discussions had been going on about the Hillside workshops. In fact, anyone in New Zealand who can read a newspaper would know that that has been going on for a number of years. However, it is a matter for the board to make the decisions. As I have said, the Government has committed $4.5 billion to a 10-year turn-round plan, including an injection of $750 million. We do focus on whether the overall plan is on track, and we have done.

Clare Curran: Does he support the KiwiRail decision to sell the Hillside workshops, and is it Government policy?

Hon BILL ENGLISH: The Government policy is to try to turn KiwiRail into a viable commercial business, and the taxpayer is going to invest, one way or another, $4.5 billion in achieving that. That is the Government policy. In respect of the Hillside workshops—

Andrew Little: Why won’t you keep Kiwi jobs?

Hon BILL ENGLISH: We cannot have it all ways. If we put in billions of dollars to upgrade the wagons and the locomotives so they are new, then they do not need nearly as much maintenance as when they were 50 years old. So by putting in a taxpayers’ investment to upgrade the gear, now we do not need the same maintenance capacity. The board has the responsibility of making those balanced decisions.

Michael Woodhouse: What reports has he seen on the involvement of Ministers in respect of State-owned enterprise decisions?

Hon BILL ENGLISH: The House might not be surprised to hear that an Acting Minister of Finance stated: “as a matter of policy the Minister of Finance, as shareholding Minister, does not intervene in the operational affairs of the airline.” That particular quote was from Trevor Mallard in respect of Air New Zealand, and I think it is a longstanding practice that State-owned enterprise Ministers do not try to run these businesses.

Clare Curran: Does his refusal to intervene in KiwiRail’s decision to sell the Hillside workshop and its reluctance to repair the Gisborne to Napier rail line not prove that this Government does not give a damn about regional economic development?

Hon BILL ENGLISH: I think that is an extravagant statement. In fact, the Government is investing—

Grant Robertson: You’re not saying it’s not true, though.

Hon BILL ENGLISH: Well, it is an untrue statement. The Government is investing $4.5 billion in KiwiRail, and that is going to enhance the infrastructure right through New Zealand, including in Dunedin. We want to make this into a viable, reliable rail company. The plan is well under way, and we are reasonably optimistic that it can be achieved.