Shanks Katrina: Financial Markets (Regulators and KiwiSaver) Bill Securities Trustees and Statutory Supervisors Bill — Second Readings 
Shanks Katrina: Financial Markets (Regulators and KiwiSaver) Bill Securities Trustees and Statutory Supervisors Bill — Second Readings 
[Volume:671;Page:17520] 
KATRINA SHANKS (National) 
: 
 It is my pleasure to take a call tonight on the second reading of the Financial Markets (Regulators and KiwiSaver) Bill along with the Securities Trustees and Statutory Supervisors Bill. First I thank the officials for all the work they have put into this legislation. There was a fairly tight time frame and it is a significant piece of work. It was quite complex. It took the Commerce Committee a fair amount of time to get to grips with the extent of the legislation which is far reaching and very important when we are looking at improving investor confidence in New Zealand. 
The Financial Markets (Regulators and KiwiSaver) Bill establishes a new financial sector regulator the Financial Markets Authority and makes important changes to the governance of KiwiSaver schemes. It is clear that New Zealand needs to have a single market regulator with a culture of visible proactive and timely enforcement. On too many occasions in finance company collapses we have heard of investors’ money falling to the floor through gaps between regulators. The select committee has undertaken an inquiry which is still ongoing into the finance company collapses. Investors feel frustrated that they had nowhere to go because the regulations or the legislation were not strong enough to enforce some of the issues where money was lost so those investors had no recourse to enforcement action. 
That situation has undoubtedly damaged New Zealand and the confidence of our mum and dad investors. Once a sector has lost a significant amount of money which happened with the finance companies—and these were the same investors who in 1987 lost money in the stock market crash and who lost it around 2000 in managed funds when they took a big dive—the confidence of those investors is damaged. Because those investors had been burnt on the stock exchange and burnt by the fund managers they went to what was considered to be the next-lowest risk which was the finance companies only to be burnt in that sector. So the confidence of our mum and dad investors of our retirees is pretty damaged. It is important that we put some— 
Aaron Gilmore 
: It’s munted! 
KATRINA SHANKS 
: As Aaron Gilmore beside me would say it is munted which is a Christchurch word. 
We have to do something pretty significant in order to get those investors back into the markets. Without investment in New Zealand by Kiwis we cannot strengthen our capital markets. The Financial Markets Authority has a critical role to play in rebuilding that confidence. Everyday investors need to feel more confident about where they are putting their savings and to understand the basics of investment: how to get advice they can trust and how to make truly informed choices. The issue is not just about the risk of an investment being 2 percent more than a bank— 
Mr DEPUTY SPEAKER 
: I am sorry to interrupt the honourable member but the time has come for me to leave the Chair. 
Debate interrupted.