Goldsmith Paul: Mixed Ownership Model Bill — In Committee Speaker Recalled In Committee 
Text is incorporated into the Bound Volume 
Goldsmith Paul: Mixed Ownership Model Bill — In Committee Speaker Recalled In Committee 
[Sitting date: 19 June 2012. Volume:681;Page:3074. Text is incorporated into the Bound Volume.] 
PAUL GOLDSMITH (National) 
: 
 Look I think it is worthwhile as we are working our way through Part 1 of this Mixed Ownership Model Bill just to step back and take a look at the broader context. The European debt crisis remains the biggest threat to the New Zealand economy by some margin. [ 
Interruption 
] Well aside from the Labour Party and the Greens actually in combination—you are quite right. In particular we are vulnerable to shocks transmitted from Europe through China and Australia and through any tightening of financial markets. So what goes on in Europe is not an isolated event happening on the other side of the world but is highly relevant to us. 
So if I could speak generally this is a very uncertain time for New Zealand New Zealand businesses and New Zealand households. No one is quite sure what is happening in Europe. No one is quite what it means for China and Australia and confidence levels are quite low which reinforces how important it is for us to stick to our economic plan. We need to continue to manage Government spending limit debt and maintain the confidence of financial markets. That is what this legislation is all about. It is about enabling this Government to continue on with its Future Investment Fund and its investment in growing this economy without adding another $5 billion to $7 billion to our overall levels of debt. 
I suppose the question we have to ask the Opposition parties is what they are going to do to get the money in order to make these same sorts of investments. I suppose they do have the option of not spending that $5 billion to $7 billion in capital investments. I suppose they could just not invest in irrigation not put money into the high-tech Crown research institutes and not put money into building new schools or I suppose they could raise the money from elsewhere. They could stick up a capital gains tax but of course that does not give us any money in the next 10 years. They could put up taxes on entrepreneurs but that never works very well or they could make us work longer for our superannuation. Or they could just add more debt. They could go out on to volatile international markets and increase the pool of debt that New Zealand already has and none of those options seem to be very good ones. 
I would like to debunk some of the comments that have been made about power prices. We hear again and again that somehow privately owned power companies are charging more. Well it depends how you slice the figures. Certainly Treasury advises that there are 21 regions listed on Consumer New Zealand’s Consumer Powerswitch website. In 14 of those regions the cheapest electricity company is privately owned in one the cheapest company is owned by the council and in the other six the State-owned enterprise is the cheapest. So it is hardly the most convincing argument that I have heard. When we have got 422256 customers changing electricity retailers in the annual year that shows that there is a huge amount of market flexibility going on. 
I also just wonder about the Greens’ objection that once the Government sells a minority stake in these companies a Government will not be able to fiddle with those companies quite so easily. It will not be able to get these companies to invest in its pet projects around green technology or something like that because minority owners might object. Well that is about as good a reason I can think of to actually go down this path. It seems like an eminently good sensible reason to be selling partial ownership in these companies to stop people like Russel Norman fiddling with these companies and making them ineffective and inefficient. That is one of the main benefits of having a minority stake owned by the private sector as it will bring private sector disciplines and good governance to these organisations. 
So I am not worried about not having access to the Ombudsman. I would far rather have access to the signal sent by market prices in an open market through the continuous disclosure requirements and from market analysts analysing these companies than I would have access to the Ombudsman. That is why that is a far more effective way of doing things. It is far better than having Mr Cosgrove and his colleagues in the Finance and Expenditure Committee asking the odd question. I would far rather have access to continuous disclosure requirements through the stock exchange and the signal that the market price delivers to the quality of these assets. 
I am also interested that Mr Parker suggested that the cost structure would be going up under partially privatised companies. I would love to see some evidence from Mr Parker that shows that State-owned companies have lower cost structures than privately owned companies. I would love to see some evidence from those members to back that claim up. And then we have heard from New Zealand First—