SpeechALASTAIR SCOTT (National—Wairarapa): Thank you Mr Speaker. Mr O'Connor invited us to picture what it would be like with this bill in place. He talked about asset sales with the Government Print he talked about drug dealing and he talked about investment. I'm not sure if he meant the venture capital fund would be investing in the drug-dealing or whether the venture capital fund would be investing in the next Government Print that might be an asset sale. He talked about education—venture capital into education. Well I'm all good with that; private sector money venture capital money into education. Fantastic idea Mr O'Connor but I don't think that's what he was really getting at.We are supporting this with some reservations. Now quite a few of the speakers on the other side talked about the gap in the market and I contend that the New Zealand capital market is not as small as the other side would have us believe. It is connected to the global capital markets. There are hundreds and hundreds of traders sitting at their desks every day looking for opportunity across the world. That includes opportunity in New Zealand; that includes opportunity in small privately held opportunities for venture capital. They get that information through the fantastic networks that we have in New Zealand. We have fantastic networks which promote and put out there the opportunities to invest in New Zealand. I'm talking about the chambers of commerce I'm talking about Business New Zealand. I'm talking about the venture capital funds that already exist in New Zealand; they're forever picking over proposals ideas. Icehouse is another example where across the country—very well-known facilitator of venture capital into new ideas.So the idea that no one understands what these ideas are that we have in New Zealand and therefore are not willing to invest is just nonsense. New Zealand is very very well connected. The venture capital markets are very well connected just as our New Zealand stock exchange is connected to the global capital markets. So I dispute that there is a thinness and a lack of understanding. The gap therefore in my view does not exist. In fact it was quite ironic that the other side were talking about the seed side of venture capital the beginning stuff—plenty of money there. The private equity side—that's the area post-venture capital if you like—loads of money there but not enough money in the little gap between where they're wanting to invest. There is capital on the planet so much money looking for a home that in parts of the world we have negative interest rates. There is so much capital that money that was printed in the last 10 years is looking for a home and it is looking for anything that it can put its hands on including venture capital. There is no shortage of capital out there. People can borrow at zero in some parts of the world swap it and bring that money into New Zealand—no problem. So I dispute the idea that there is a gap in the market.My problem with the whole idea of this venture capital fund is that we haven't learnt our lessons from the New Zealand Venture Investment Fund (VIF). I remember those days. I remember it was quite easy to access that free money. It was cheap money interest rates were a lot higher but for a venture capital fund to turn up apply one for one for the VIF fund they're very likely to have received the money. It was cheap money it was zero-interest loans and various other structures. But basically the taxpayer was subsidising the private sector investor into a venture capital proposition.So my question for the Minister is: if a professional investor is unwilling to invest in an idea why should the taxpayer? I've described the liquidity in that market—why should the taxpayer have to invest and take on that risk when a private individual is unwilling to do so?The other problem I have is that the venture capital sector is already being invested in by the Government or by the super fund. The super fund already allocates a certain amount of money to this end of the market; the venture capital end of the market. Just as the ACC fund invests a certain amount of their large portfolio into the venture capital; the high-risk end of the market.Hon David Parker: But they don't.ALASTAIR SCOTT: But they are able to and they are mandated to and they are not investing. [Interruption] Mr Parker says they don't—and this is the whole point: why would we want politicians to interfere in the professional judgment of a board of ACC or the board of the New Zealand Superannuation Fund when Mr Parker has just said they don't invest enough into the sector even though he knows that they are able to do so? So he's come across you know Government knows best. Labour Party knows best. And you will overallocate more money into this specific sector" because Mr Parker thinks that's the best thing to do.So the boards the governing bodies that we've set up over the years the fantastic performance the New Zealand Superannuation Fund has performed—and ACC fund as well by the way has outperformed the market—is at risk because Mr Parker wants to come across the top and direct them in how they are to invest. So that is the other problem I have with this model.The other issue I have is that for the very good reasons the fund is promoted the Minister talks about the idea of accessing and growth and productivity and access to market but then why not allow an apple orchardist to have funding to take on the global market? Why not a sheep and beef farmer or dairy farmer to take on some taxpayer funding to do what they want to do for their business? Why not a local engineering company to say "Look I've got a machine that I've built and I'm selling 10 per month and I think I can sell 100 per month overseas."; why can't they access this venture capital fund? And that's the whole point: they shouldn't be able to—they shouldn't be able to. They should be going to the private sector convincing their neighbours their families their friends and their banks to invest in the idea. And if it is a good idea they will invest in it. And if an Australian partner wants to invest great. Frucor was used as an example—I think as a good example by Mr O'Connor—as a New Zealand company that grew went and got some access to capital from I think he said Australia and now is associated with a large distribution company. Fantastic. Great story. It doesn't have to be 100 percent owned by New Zealand. In fact you don't want it to be; you want the distributors to own some of that change.So although we support this bill I do have some reservations and I think I've outlined them reasonably succinctly."