Nash Stuart: Westpac New Zealand Bill — In Committee 
Nash Stuart: Westpac New Zealand Bill — In Committee 
[Volume:672;Page:18837] 
STUART NASH (Labour) 
: 
 We are talking about clauses 1 and 2 the title and commencement clauses of the Westpac New Zealand Bill. Lianne Dalziel brought up a couple of good points. It is always good following Lianne—apart from the fact that she steals a lot of my arguments—because she poses questions. One of the words of the title clause “This Act is the Westpac New Zealand Act 2010.” is “Act”. Lianne Dalziel brought up an important point. I know as the member in the chair Craig Foss will also know that consideration was given to using the Westpac New Zealand Act 2006 but it was considered to be unfeasible because it was not drafted with the intention of being used for a second vesting. This is why the new bill was necessary. I wonder whether with the 2006 Act the then Parliament thought that Westpac would not get any bigger than it was and then here we are in 2011 and we are saying it will not get any bigger than it is now. Are we going to have the same sort of approach in 2016 and say it will not happen again? One just never knows. 
The bill is the Westpac New Zealand Bill 2010. It got me thinking and the other thing I would also like to ask is whether when the bill receives Royal assent it will be changed to the Westpac New Zealand Act 2011. 
Hon Lianne Dalziel 
: It will. I checked with Pete Hodgson. He knows everything. 
STUART NASH 
: He does. That is good to know. So the “2010” of the legislation at the moment will change. The Act will be the Westpac New Zealand Act 2011. 
Hon Lianne Dalziel 
: The Clerk will fix it before it goes for assent. 
STUART NASH 
: The Clerk is very good like that. 
There are a couple of things we talked about. In 2011 the bill will receive Royal assent. That has been talked about before. A couple of amendments to the Westpac New Zealand Act 2006 came into effect retrospectively on 31 March 2008. There is another amendment from September 2006 probably just after the original Westpac New Zealand Act came into force. This bill is largely based on the Westpac New Zealand Act 2006 and like that Act the bill facilities the vesting by providing an overall legal framework for the transfer of assets and liabilities from Westpac Banking Corporation to Westpac New Zealand. I suppose in a way it is good because it means that the New Zealand banking sector is growing. The facilities that are demanded by New Zealand companies need to be bigger. Perhaps the economy is expanding. 
One thing Mr Cunliffe talked about is that the bill is called the Westpac New Zealand Bill. He said that Westpac New Zealand is overseen by the Reserve Bank of New Zealand. But the sad thing is that Westpac is not a New Zealand - owned bank. All the profits that Westpac New Zealand will make will go back to its Australian shareholders. The profits will not come back to New Zealanders. 
An interesting fact is that Westpac has its 150th anniversary next year. It is a very old bank. I think it started out as a New Zealand bank but somewhere along the line it was sold. If we look at all the major banks here we see that ASB Bank which used to be called the Auckland Savings Bank was sold to Australians. All its profits go offshore. ANZ National Bank—the “National” stands for what was the National Bank of New Zealand—was sold. It is gone. “BNZ” used to stand for the Bank of New Zealand. It is gone. All the major banks of New Zealand even though they are controlled by the Reserve Bank are owned by Australian parents. All the dividends that are earned by the four major banks in New Zealand return across the Tasman to their parents not to the pockets of New Zealanders or back to the Government in terms of revenue. They go to Australia. That is a great shame. 
I suppose the one shining light is that Kiwibank is still New Zealand owned. I hope and pray that it will continue to be New Zealand owned. Mind you if I look at the agenda of the Government when it talks about selling assets I wonder whether— 
The CHAIRPERSON (Eric Roy) 
: This is the title clause and the commencement clause. Although both  
McGee 
 and Standing Orders state that members can summarise the debate the member is not summarising; he is introducing new material. He should please contain himself to what is required. 
STUART NASH 
: I will. I was talking about the title of the bill the Westpac New Zealand Bill. The reason it is called the Westpac New Zealand Bill as Mr Cunliffe put down is that it is about the Westpac New Zealand branch. The bill governs the rules around the prudential requirements of the New Zealand branch of Westpac Banking Corporation. As we know Westpac Banking Corporation is based in Australia. Westpac New Zealand is a branch of Westpac Banking Corporation but as I was saying the vast majority of the dividends—in fact all of the dividends—from Westpac go to its parent company which is a real shame. 
I was saying that the transfer will mean that Westpac New Zealand will increase in size. We know that. We talk about $42 billion worth of debt against the agricultural sector. I wonder how much of that debt is vested with Westpac Bank. 
David Shearer 
: A considerable amount I would say. 
STUART NASH 
: A considerable amount. I suppose even though Westpac is growing which is the reason for the bill we have to be a little bit careful when we look at a growing bank not to just simply assume that this is growth in the New Zealand economy. Part of it is growth in the debt profile of these banks and a large portion of that is to the agricultural sector. I am not too sure how much Westpac New Zealand has of that but maybe one of the reasons we are debating this bill is that the liabilities of Westpac New Zealand are such that it needs to increase that prudential rate above the $15 billion. Westpac is still a significant bank of that there is no doubt but I am unsure whether it is the biggest bank. This term being my first I am unsure whether we have passed similar legislation titled the “ANZ New Zealand Act” in 2000 and something or whether there has been the “BNZ New Zealand Act”. Would that not be ironic—the “Bank of New Zealand New Zealand Act” regulating a New Zealand branch of the BNZ? 
There are very good reasons for the bill. It is very sound legislation. It protects the interests of all customers all suppliers and all employees. We made that very clear as it went through the select committee process. It is good legislation which is why I commend it to the Committee. Thank you. 
Clause 1 agreed to. 
Clause 2 agreed to. 
Bill to be reported without amendment presently.