Goff Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
Goff Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
[Volume:670;Page:16577] 
1. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he stand by his statement on the sale of State assets that “we do want to sell to Kiwi mums and dads as a priority”? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes. If we were to go ahead with a mixed-ownership model in some Crown-owned companies we would want to sell shares to Kiwi mums and dads as a priority. There would no doubt also be demand from KiwiSaver accounts and other New Zealand managed funds as well as from iwi the New Zealand Superannuation Fund and other Crown financial institutions. 
Hon Phil Goff 
: Will the mums and dads be free to onsell their shares to foreign investors? 
Rt Hon JOHN KEY 
: Yes but history indicates that they are less likely to do that. 
Hon Phil Goff 
: Actually does history not indicate that when National sold Contact Energy the shares to the so-called mum and dad investors that it talked about then quickly flowed to the corporates and to foreign investors and that most of the dividends from that company now flow out of this country? 
Rt Hon JOHN KEY 
: Unfortunately for Mr Goff no. The proportion that was originally sold was 31 percent to retail investors. It will be remembered that 51 percent was sold to Edison Mission Energy. That has now fallen to 22 percent in 12 years. But interestingly enough the member might be interested in the report that I am holding and I suggest he takes it away and reads it. It is by Pattrick Smellie. Let me just quote a little bit from the report: “One of the least defensible criticisms of the Key Government’s partial privatisation plans have been regular references to Contact Energy as an example of a privatised company which lost control to foreigners. Yet nothing could be further from the truth. The reality of the Contact share register is it remains possibly the most widely held share by domestic New Zealand investors. What it shows is that many small-scale investors have piled into privatised companies like Contact precisely because they want to retain control and as much New Zealand ownership as possible.” 
Hon Phil Goff 
: When the Prime Minister said “no” to my last question was he denying that the majority of shares are now owned by foreign owners and that the majority of dividends that are paid back therefore go out of the country? 
Rt Hon JOHN KEY 
: No. What I was saying was that initial public offering started with a 51 percent offering to an offshore party. Any initial public offering that we might do would have 51 percent control by the Crown. On top of that would be the New Zealand Superannuation Fund with its $17 billion ACC 1.6 million KiwiSaver accounts many New Zealand mums and dads up and down the country and iwi who are interested in buying in. It will not be foreigners who will own those companies; it will be New Zealanders. 
Hon Phil Goff 
: Is it not dishonest to talk about sale to mum and dad investors when in fact all Kiwi mums and dads currently own those companies and the result of his sale will be that those shares go only to those who can afford them and to foreign corporates? 
Rt Hon JOHN KEY 
: No because 51 percent will be controlled by the Government. There are 1.6 million KiwiSaver accounts. What is interesting about those KiwiSaver accounts is that firstly they need investments for the long haul because they are largely dominated by younger people; secondly the economic distribution of those 1.6 million accounts is very much skewed to low and middle income New Zealanders; and thirdly the New Zealand Superannuation Fund will be buying on their behalf along with ACC. I think the member should give up and try another question. 
Hon Phil Goff 
: I will if I get a better answer than that one. Can the Prime Minister guarantee to mum and dad consumers that prices for electricity will not go up at an even faster rate as the private shareholders seek to maximise their dividends and increase the directors’ fees as in fact happened with Contact Energy when it was privatised and as happened in Australia with privatisation? 
Rt Hon JOHN KEY 
: I am pretty sure I can guarantee that they will not go up by 72 percent as they did under the previous Labour Government in 9 years. Secondly members need not take my word for it. We can check out the statements of Consumer New Zealand which is an independent body. Its chief executive Sue Chetwin stated that she “agreed with Mr Key’s assessment that electricity prices would not increase with partial privatisation.” 
Hon Phil Goff 
: If it is demonstrated that a clear majority of New Zealanders are opposed to these sales will the Prime Minister ignore their views and go ahead and sell the assets off anyway? 
Rt Hon JOHN KEY 
: On 26 November we are having an election. I think we will find that their views will be demonstrated through the ballot box.