Shearer David: Local Government Borrowing Bill — Second Reading 
Shearer David: Local Government Borrowing Bill — Second Reading 
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DAVID SHEARER (Labour—Mt Albert) 
: 
 It is my pleasure to speak on the Local Government Borrowing Bill. As we have indicated we are supporting this bill. We believe that it is a good move and a good means by which capital can be raised for important infrastructure projects that are offered by local communities. It is very cost-effective. It is looking to save local authorities about $25 million a year which is a big saving and one of the big reasons why we support it. 
As one of my colleagues said an additional reason we are supporting it is that it means that we do not have to flog off assets in order to buy other assets. We can actually do this through people investing in their own infrastructure within New Zealand at the local level in order to get the infrastructure that they require. 
Just to give some background to this particular legislation the idea of the local government bond bank was floated at the Job Summit about 2 years ago—2 quite long years ago—and it is only now coming back to Parliament. I believe that the Government has really dragged its feet on moving this bill through despite the fact that particularly in the Auckland region that I know best we need it urgently. 
The concept of a local government bond bank was also proposed by the Capital Market Development Taskforce back in 2008 under the Labour Government—again we signalled that we were in favour of it way back then—and reported to the National Government in 2009. So on the one hand it came up through the Job Summit and on the other hand it was actually a formal recommendation from the Capital Market Development Taskforce. Both of these ideas came to the same conclusion of a very cost-effective way of raising money for infrastructure yet it has taken until now for it to go through. The Government set aside $5 million in an establishment fund in Budget 2010 but here we are nearly 18 months later in 2011 and we are only now going through the bill’s second reading. 
The funding agency as I said is a win-win both for local government and for New Zealanders—Kiwis—looking for new and safer ways to invest. We have certainly had a calamity within the investment market particularly with the finance companies falling over. People are still wary about the stock market. The property market at the moment is up and down. People are looking for more secure safe ways to invest their money. I also believe that they feel quite strongly and perhaps patriotically that they would like to invest their money in their own communities through this sort of mechanism. 
We hear so much from the other side about mum and dad investors when National members are talking about flogging off our key electricity assets Air New Zealand and things like that. But we know that their shares will end up going offshore as they have done in every single case where this has happened before. But in this sort of case mum and dad investors know that their investment is good for the community and will help Kiwis retain ownership not lose it to an Australian or a US corporation that will simply send the proceeds offshore. They will control those assets— 
Hon Tau Henare 
: Those dirty Americans eh. Those dirty Americans. I’m glad you like Americans. 
DAVID SHEARER 
: I can see that this is a sensitive point. I know that at the National Party conference there was a lot of discussion from the floor about who was going to own those assets. The rank and file of the National Party know for sure that the assets are all going to go offshore. 
Hon Members 
: Were you there? 
DAVID SHEARER 
: I absolutely know that for a fact. It was reported in the media that the National Party rank and file were asking why National was doing this and they were saying that it could lose National the election. 
The ASSISTANT SPEAKER (Eric Roy) 
: Just come back to the borrowing bill. 
DAVID SHEARER 
: I am sorry Mr Assistant Speaker; I was responding to some—I was going to say “intelligent comment” but I will not go as far as that—comment from the other side. The point about this legislation is that rather than assets being flogged off mum and dad investors—and they are mum and dad investors in this case—know that their investment is not only secure but good for the community and helps them to retain ownership and control of the assets that will build up for decades. So they know that their children and their children’s children will be able to enjoy the infrastructure that that money goes towards. 
I think this is a very good bill that we are supporting here. It supports the very things that Labour stands for which is ensuring that money goes into building assets for our community that those assets are enjoyed by the community now and in the future and that the savings that these people put their money towards are secure and safe and provide a good return. 
When we look at the demand for these sorts of funds we see that it is pretty apparent certainly in the Auckland City area with the type of spatial plan that was put in front of us just a few weeks ago regarding the Auckland City rail loop and the $2.4 billion that Minister Joyce is hugely reluctant to commit to despite the fact that Aucklanders are overwhelmingly in support of it that this is the sort of thing that perhaps a fund like this could actually put money towards. This is the Minister who in question time today stood up and crowed about the development and progress being made on Auckland’s rail yet all of the areas he was talking about were actually put in place by the Labour Government. In fact a lot of the funding for the project which was supposed to be met by central government when the National Government took away the regional fuel tax is now actually being pushed back on to Auckland City ratepayers. What a con. The Government takes away the regional fuel tax it says that central government is going to fund those projects that the tax was going to fund and now yet again it is putting it back on to the Auckland ratepayers to pick up the cost. It is a complete con. Steven Joyce has the audacity to stand up in this House and crow about the various projects on rail that this Government has proceeded with when they were actually put in place by a far-thinking and visionary Labour Government back in the mid-2000s. 
Coming back to the purpose of this bill which is to raise funding for local government I say again that we support the bill. We support the bill because it is a cost-effective way of raising the money for the infrastructure projects that are so needed by local bodies throughout the country. In addition to that it provides the mum and dad investors who will put their money into this sort of scheme with the security of knowing that their investment is safe and with the knowledge that the things they are funding are going to be good for the community that they will not lose ownership that they will get the benefit of them and that their children will get the benefit of them as well. So rather than funding something that we know will be flogged off we support this legislation. We are sad that it has taken so long to get here but we are happy to see it proceed with haste now.