Cunliffe David: Mixed Ownership Model Bill — First Reading 
Cunliffe David: Mixed Ownership Model Bill — First Reading 
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Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 The most interesting thing about the speech just completed by John Banks is that it was a National slot in this debate. But where are the National Ministers? The previous National slot was taken by a Maori Party co-leader even though they are voting against the Mixed Ownership Model Bill—probably the most important piece of National legislation so far in this Parliament. Where are the senior Ministers? Was John Key going to speak to this? Oh no. 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: The member cannot refer to the absence of members. 
Hon DAVID CUNLIFFE 
: Why did John Key not take a call? Why did Bill English not take a call? I can refer to the fact that they did not take a call; it is a matter of fact that they did not take a call. Why did Steven Joyce the Minister for Economic Development so-called not take a call? Because they are politicians enough to know that New Zealanders know you cannot sell your way to a brighter future. You cannot sell off land sell off the law sell off our assets sell off our hope and have a brighter future. I agree with one thing the member who has just resumed his seat said: one New Zealander every 15 minutes is voting with their feet to get out of this broken dream they call Godzone. 
Louise Upston 
: I raise a point of order Mr Speaker. The speaking slots that are allocated to National the Maori Party United— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: That is not a point of order. 
Hon DAVID CUNLIFFE 
: What I want to do in the remaining 8 minutes or so of this speech is to go through some of the arguments the Government has put up and to show they have more holes than a block of Swiss cheese. The first one is that you need asset sales to solve public debt. Well here are the problems with that argument. Firstly 85 percent of New Zealand’s total international debt is private debt not public debt—only 15 percent is public debt—and this sell makes the private debt problem worse. Why is that? Because if “Joe Kiwi” instead of investing in their bank buys these shares the bank funds their debt offshore thus making private debt worse. Or if foreign buyers buy it and pay Kiwi dollars for it that makes the foreign private debt worse. So this will have the opposite effect. Do not ladies and gentleman allow this Government to pull the blue wool over your eyes. This is not a debt reduction measure; this is a “lining the pockets of the 1 percent in the ticket clippers” measure. That is what this is about. 
Andrew Williams 
: Helping their mates. 
Hon DAVID CUNLIFFE 
: Helping their mates. Two billion dollars as Russel Norman said lost per annum on the Government’s tax switch and the 1 percent who cleaned up are the 1 percent who will clean up these shares. The same people the Government has acted on behalf of so far will be the people who benefit from this.  
The next myth that needs busting is that somehow selling these is good money management. Well how can it be? These assets average a 6 percent return—a 16 percent total shareholder return including capital returns. They cost 4 percent Government debt to service. That is the Crown cost of capital; the public is making money on holding them. Why would a private investor buy them on the current prices for power? TrustPower said its hurdle rate is 8 percent. That is its weighted cost of capital. Infratil’s target rate is 20 percent. I was at its dinner last night; that is what its annual report says. Why would it buy these shares at these prices and not put power prices up? Because that is the only way you can get higher returns out of a power company.  
The second point: the Government loses $100 million a year because the saving of interest is $266 million but the loss of dividends is $360 million a year—a net deficit of $100 million a year worse off. That is excluding the $100 million to $300 million one-off cost of paying the ticket clippers: a year’s worth of dividends transferred to Macquarie Group the latter-day Fay Richwhite of this world and the other brokers and bankers so that this Government’s mates can give it a pat on the back. I want to see a very detailed financial disclosure from the last two elections. I want to know who has been lining the pockets of the National Party in response to that favour. 
Well the next financial problem is that you do not know what the returns are going to be because the Government does not know what the sale price is going to be partly for those reasons partly for the high cost partly because we do not know how much price rise the public will stand. That is why Bill English embarrassingly called it a guesstimate. At least he had the integrity to say he did not know and that puts him a step ahead of the Prime Minister who once again just made it up.  
The third myth that needs busting is that New Zealanders are at the front of the queue. My backside they are! If the Government wanted New Zealanders at the front of the queue it would have put a clause in the legislation preventing excessive foreign sale. But did it? No it did not. There is no clause in this bill to prevent sale to foreigners. Indeed Treasury’s advice is that that is absolutely necessary in order to maintain the sale price. No prohibition—and what does that mean? It means the “Kiwis at the front of the queue” line is just spin—just spin—and New Zealanders can tell the difference. Why should New Zealanders pay again for assets they already own? Why should they be asked to do that at a time when money is tight and most New Zealanders cannot pay their own mortgage let alone be told that the only way the country can pay its mortgage is to sell the house even if we end up paying more for rent afterwards? It is economic lunacy. 
Hon Tau Henare 
: What a silly man! 
Hon DAVID CUNLIFFE 
: Congratulations on the member’s wedding. I hope he gave his wife a better present than the one the Government is giving the public in this bill. 
What really worries me is that loss of control is inevitable. Here are three reasons why. The first is equity dilution. The Government first said it would sell 49 percent and then someone told it: “Well if you do and the new board which is not an SOE board has a profitable proposal you’re actually bound to put in more cash.” “Oh goodness!”—the Government members said—“Oh goodness! Well we won’t sell the whole 49 percent at once.” But they still think they are going to sell 49 percent. What happens when they have sold 49 percent and the next project comes along? Will they refuse to kick in the extra $100 million? Where are they going to get it from Mr Banks? This Government is winding the New Zealand economy down as fewer and fewer New Zealanders are left to power it up.  
There is no Treaty protection. Here is the sadness of Pita Sharples’ position. The Government cannot have it both ways. Either the whole asset is covered but the public the taxpayer is picking up 100 percent of the risk for 51 percent of the money or the Maori Party has been sold a pup. And there is Peter Dunne as always the swing vote. But unusually this time he matters. This bill is the “Peter Dunne Political Epitaph Bill”. He will go down in history as the perpetual 150-pound straw in the wind who this time blew the wrong way—who this time sold out a generation by selling off billions of dollars of their birthright. He can hang his head in shame. I like him—he is an integrity member. But I am sad for him because his legacy is now one of sadness and shame.  
New Zealanders do not want this bill. They know you cannot pay your mortgage by selling your house. They know your future should not be sold out by selling your past. They know the Government is not protecting them from foreign buyers. They know this is economic lunacy. Why does the Prime Minister not have the wisdom—I cannot question his courage—to take a call in this debate and answer these questions?