Coleman Jonathan: Mixed Ownership Model Bill — First Reading 
Coleman Jonathan: Mixed Ownership Model Bill — First Reading 
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Hon Dr JONATHAN COLEMAN (Minister of State Services) 
: 
 That speech from Grant Robertson really was an audition for the Labour leadership quite honestly and I can see by the smiles on the faces over there that Labour members actually think that was not bad fare compared with what they have seen from their leader over the past few weeks.  
It is a pleasure to be here today and to be speaking in this debate on the Mixed Ownership Model Bill. As the Hon Tony Ryall said this is a debate about debt. Grant Robertson wants to send New Zealand on the road to Athens down the road to southern Europe to more debt and a failing economy. We know what these people in Labour are about: they are about nothing at all. All we hear from them is what they are against. Quite frankly they have no credible economic plan to get New Zealand out of debt. Tony Ryall is right: this is about debt.  
There are two stark options here. The very very stark option is borrowing more and that is what the Labour Party would have this country doing. It has no plan to balance the books. We have said we will keep debt below 30 percent. We are doing that but at the same time that presents a challenge: how are we going to afford the vital infrastructure that this country needs? How are we going to afford the hospitals the broadband and the schools? Well this is how we are going to do it: this partial float of these four energy companies is going to free up $5 billion to $7 billion which is going to go back into purchasing crucial infrastructure in order to build New Zealand and make it the great nation that it is and will continue to be.  
So I ask you what is the plan from that side of the House? Grant Robertson said something about getting a petition together and that this is a confidence issue. It is a confidence issue and we won that confidence issue at the election. John Key and the National Party campaigned very very clearly about what we were going to do with regard to the mixed-ownership model. We explained it very clearly to the New Zealand public and the New Zealand public actually said “You know when you put the whole package together with this Government’s priorities to build the economy to rebuild Christchurch and to pay down debt it makes sense.”  
I can tell you another thing: for Grant Robertson to get up here and say that power prices are going to go up that blatantly ignores the fact— 
Hon Nathan Guy 
: Wasn’t that what happened under Labour? 
Hon Dr JONATHAN COLEMAN 
: Under Labour over 9 years power prices went up 72 percent— 
Paul Goldsmith 
: How much? 
Hon Dr JONATHAN COLEMAN 
: —and you have not heard them saying anything about that. Seventy-two percent over 9 years. It was a completely disgusting embarrassment and Labour did nothing about that. What this bill is going to do is enable New Zealanders to invest their money in something that is going to produce them a good return.  
What was Labour offering? Finance companies. 
Hon Nathan Guy 
: CGT. 
Hon Dr JONATHAN COLEMAN 
: That was Labour’s answer: finance companies. Oh yeah and of course the future plan for Labour was also the capital gains tax.  
When it comes down to it it is a matter of this country facing a serious problem with debt and I can tell you we are going to be back in surplus by 2014-15. It will be us the Koreans and the Australians. If these guys in Labour were in charge debt would be going up up up. If there is one thing that New Zealanders hate it is debt.  
All I have heard from David Shearer over the time he has been here is some vague mumbling plan about a series of speeches he is going to give. There is no plan from Labour about getting debt under control and no plan for how we are going to actually purchase the infrastructure we need. Well this bill is a very concrete plan. I ask you if this is such a bad idea why did Labour not take the opportunity when it was in power to buy back the bit of Air New Zealand that the Government did not own? Why did Labour not do that? Because quite frankly it had no plan about this.  
In fact there was quite an interesting conversation between Larry Williams and David Shearer on Newstalk ZB on 24 February. Larry Williams said to Mr Shearer: “Do you think it would be a good idea to buy the remaining 25 percent of Air New Zealand that the Crown don’t own?” and David Shearer mumbled and said: “That’s not a bad suggestion but I don’t know if—” and Larry Williams said: “No it is a nutty suggestion. Thanks Mr Shearer. Good afternoon.” Frankly that is where the commentariat are at on this.  
You know Labour has been very very inconsistent on this over a long period of time but what we are going to do is keep New Zealand’s debt down. That is the key message. On top of that we are going to free up that $5 billion to $7 billion to build the infrastructure that we need. If we do not get that money how are we going to build the schools and how are we going to build the roads?  
We are not going to be decreasing New Zealand’s overall asset base. The country owns $245 billion of assets and over the next 4 years that is going to increase to $267 billion. So in actual fact the total public ownership of assets is increasing but we have to use our balance sheet in a sensible way. There is a sensible very strategic plan there which we have taken to the public. We have the mandate and when the public actually look at the choices they can see that when we are faced with a very difficult financial situation this makes sense. 
 Tony Ryall made a very good point. He is saying that in the UK they are going to be laying off 700000 public servants. We do not want to get to that position and that is why we actually have to take some choices that make sense.  
We have made five major guarantees around this. We have said that the Government will be the major shareholder. You know that. These people know that. The priority will be for New Zealand’s shareholders. So we know that New Zealanders—ordinary New Zealanders—will be first in the queue to own these shares. We know that it provides new investment opportunities for New Zealanders and it is going to provide new public assets. The Prime Minister has said that. He has made very clear commitments and we are honouring those commitments.  
When it comes down to it there is a pretty clear case for the public having the opportunity to buy a stake in these four energy companies. When you look at the cost of the debt that we would be incurring if we did not do that that is going to exceed the price of the dividend payment. If you look at it historically State-owned enterprise dividends averaged 4.1 percent over the past 5 years compared with a cost of debt of 5.2 percent. So when you look at it it does not make sense to accrue more debt. Not the least of the reasons for that if you look at Portugal Ireland Greece and Spain— 
Andrew Little 
: We’re not in Portugal! 
Hon Dr JONATHAN COLEMAN 
: We are not in Portugal—exactly. And we are not going to be there because we are taking a sensible attitude to balance sheet management. The burnt-out old unionist hack over there is trying to preach 1970s union economic policy—“Greek-onomics”—in a modern world where we are facing very serious challenges. I can tell you that if Andrew Little ever became Prime Minister there would be strikes which he would be supporting there would be debt which he would be supporting and we would be becoming like Ireland Greece and Spain which presumably he would be very happy with as well.  
But you know when you come back to what Labour is saying—trying to convince people that power prices are going to go up—we know that that is not going to happen because we have got professional management in there. We know that compared with what happened when Labour was in power there is no chance of a 72 percent price rise over 9 years. I think it is a disgrace that the party that claims to be for the average mum and dad the ordinary working New Zealander allowed that catastrophic turn of events with regards to power prices to happen over such a long period.  
Do you know what the real issue is? I do not think those people over there understand basic economics. I do not think they understand how this bill is going to work and they certainly do not understand the importance of paying down debt. That is the mantra across every modern economy: get down debt. If you are going to buy new stuff you have to fund it off your balance sheet. This is what we are doing. We are freeing up that $5 to $7 billion of cash that will buy crucial new infrastructure.  
There are some senior Labour MPs over there. I challenge David Cunliffe when he speaks to get up and tell the New Zealand public how they are going to afford the infrastructure that New Zealand needs over the next decade. Because David Shearer sure will not tell us. I am sure that New Zealand First members are going to have a lot to say about this as well. Of course I do not know what they will be saying but obviously with their leader having signed off the prospectus for the Auckland International Airport float in 1998 and supporting of course what happened with selling Kiwibank we will expect some sort of turn-round in the position they have been articulating in question time so far on this matter.  
So when you come down to it this is a debate about debt about sensible management of the economy and about how we are going to actually afford the infrastructure that New Zealand needs over the next decade. These people on the Labour benches have some real explaining to do. Thank you.