Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers Questions to Members 
Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers Questions to Members 
[Volume:676;Page:21716] 
6. 
Hon CLAYTON COSGROVE (Labour—Waimakariri) 
 to the  
Minister of Finance 
: In light of his statement yesterday regarding foreign-owned assets that “we need to generate the kind of savings that will help New Zealand buy back those assets” is it still the Government’s policy to sell State assets if it is re-elected given that up to 30 percent of the shares he proposes selling could go to overseas buyers? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 If re-elected in November it is the Government’s policy to extend the mixed-ownership model retaining 51 percent Government ownership in four energy State-owned assets and allowing investors to buy a greater share of Air New Zealand. Under the model the same one as Labour put in place for Air New Zealand the Government will retain 51 percent and Kiwi investors will be in the front of the queue. It is a win-win; New Zealand savers get to invest in good Kiwi companies—and we expect 85 to 90 percent local ownership—and the Government gets to free up $5 billion to $7 billion over 3 years to pay for new assets like schools hospitals and ultra-fast broadband without having to borrow more debt from overseas lenders and pay them interest rather than pay dividends to Kiwis. 
Hon Clayton Cosgrove 
: Has the Government formulated any policy to ensure that shares sold under his privatisation plan are not purchased by foreign buyers either at the initial float or subsequently; if not when will he be releasing such a policy? 
Hon BILL ENGLISH 
: The policy is pretty clear: Kiwis will be at the front of the queue. We would expect 85 to 90 percent local ownership and we are pleased to see that on the New Zealand Exchange local ownership has tended to increase in recent years. We would expect that under the mixed-ownership model State-owned assets would benefit from that trend. 
Hon Clayton Cosgrove 
: Given that by his own estimate confirmed today up to 15 percent of the companies he proposes selling would be bought by foreign investors would the subsequent loss in dividends to those foreign investors worsen or improve New Zealand’s current account deficit and overseas debt? 
Hon BILL ENGLISH 
: No and that party will have to explain how it will pay for schools prisons and hospitals without borrowing an extra $5 billion or $6 billion from foreign lenders. 
Michael Woodhouse 
: By how much are Government assets projected to grow over the next 4 years? 
Hon BILL ENGLISH 
: In a well-run and moderately growing economy we expect that Government assets will grow by about $34 billion over the next 4 years. That is the total value of Government assets will rise to $258 billion. However rather than borrow all of the extra $34 billion the Government will recycle the proceeds of the part-sale of some of its current assets so we can put that money into high-priority future investments like schools hospitals and broadband. Parties that campaign not to sell the assets will have to borrow an extra $6 billion or $7 billion from foreign lenders and pay interest to foreign banks rather than dividends to Kiwi savers. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. I just want to reflect on the answer to my question and I ask for your ruling— 
Hon Dr Nick Smith 
: What’s your point of order? 
Hon Clayton Cosgrove 
: Well if you shut up I will raise it. 
Mr SPEAKER 
: I think I can deal with this. The problem the member got into when raising his point of order was that he wanted to reflect on a supplementary question from a whole question ago. Points of order are not about reflecting on matters they are meant to be to do with the procedure of the House; they are meant to be expressed tersely. As for reflecting on an answer if the member had a problem with the answer he should have raised it straight after the question. It is most unusual to go back to a supplementary question. I do not want to deny the member the chance to be heard especially since there was an unfortunate interjection during a point of order on the other side of the House so I will hear him but it had better be a real point of order. 
Hon Clayton Cosgrove 
: In answer to my question which was whether the subsequent loss of dividends to those foreign investors would worsen or improve New Zealand’s current account deficit or overseas debt the answer the Minister gave was “No”. He then proceeded to attack the Opposition. No to what? How can the Minister address a question with an answer that is “No”? 
Mr SPEAKER 
: If the member wanted to make sure there was an answer that could not be misinterpreted in any way there should have been only one part to the supplementary question. 
Hon Clayton Cosgrove 
: There was one part. 
Mr SPEAKER 
: If there was only one part to the supplementary question then “No” therefore applied to it and was a perfectly reasonable answer. 
Hon Clayton Cosgrove 
: In light of Standard and Poor’s comments that “Downward pressure on New Zealand’s ratings could re-emerge if New Zealand’s external position continued to deteriorate” why will he not reverse his asset sales policy given that it will inevitably worsen our external position when dividends begin to flow offshore? 
Hon BILL ENGLISH 
: From the point of view of the rating agencies the alternative is significantly worse—that is having to go to international financial markets and borrow an extra $7 billion paying interest to foreigners rather than the partial sale of 49 percent of current State-owned enterprises which will mean the Government will get the money off Kiwis and be able to pay them dividends.