Hide Rodney: Telecommunications Amendment Bill — First Reading 
Hide Rodney: Telecommunications Amendment Bill — First Reading 
[Volume:632;Page:4086] 
RODNEY HIDE (Leader—ACT) 
: 
 I rise on behalf of the ACT party which is the only party to oppose the Telecommunications Amendment Bill. I will explain why ACT opposes it. In hearing the speeches today I noticed there were some indications of concern about this bill and I think those concerns will be more serious than we appreciate. 
If we are to transform our economy to develop technology and to have the services utilities and infrastructure that we so desperately and earnestly desire then that will take significant investment. When investors make their investments they do so on the basis of risk and return. They like to have a nice set of stable rules and property rights. This bill pinches a serious number of property rights off a private company—so much so that the Government announcement of this measure knocked $3000 million off the value of one private company. That is not a loss to the company; it is a loss to the shareholders and to the people who invested in the very infrastructure that this country so desperately needs. The fact that the Government could so casually make that decision to regulate telecommunications is not lost on other investors. We have already heard other people in this Parliament say we should do the same thing to the mobile phone companies or to this or that business. 
But why would anyone invest in roading in New Zealand in airports in utilities or in a water development facility or a dam when the Government could come along and say it does not actually like what is happening there—it does not like the price or it does not understand what is going on—so it will just regulate the return— 
Shane Jones 
: What about the public interest? 
RODNEY HIDE 
: The public interest is in getting a good telecommunications industry. What I am trying to explain to the member if he would pipe down and listen is that that requires investment. It requires people to look at New Zealand and ask whether it is a good country to invest in. 
I make this point about New Zealand. Countries like the United States the UK and even countries like Australia and the countries of Europe can afford to have dopey policies because no company can miss investing in them. But in respect of a country like New Zealand it is very easy for Vodafone to say things have just become too tough so it will not put in any more money. I ask Pita Paraone how much he thinks Vodafone has invested in New Zealand. It is serious serious money. If we go around and regulate robbing those companies and their investors of their return they will not invest in New Zealand. 
We should even look at the way this has been done in respect of Telecom. Not only did we pinch Telecom’s property rights and knock $3 billion of shareholder value south but the Minister David Cunliffe—who is supposedly a big courageous guy but who has done nothing brave in his life—turned around and said what Telecom should be doing with its profits and what its dividend policy should be. The Minister should not do that; it is the job of business to run business. I am pleased to see the Minister nod his head in agreement with that. But then we saw Helen Clark the Prime Minister launch a personal attack on the chief executive officer of Telecom. Apparently the chief executive officer of Telecom should have seen this decision coming although the chief executive officer of Telecom—somewhat misguidedly I guess—did not think the Government would be so stupid as to come along and pinch the property rights of the largest company in New Zealand. She was wrong; the Government was as stupid as that. We have to ask ourselves what sort of banana republic we are becoming when our Government can say that because it does not like the result it will pinch a company’s property rights without paying any compensation then decide what the dividend policy should be or regulate it and then have the Prime Minister launch an attack on the company’s chief executive officer for not seeing that coming. 
Another new development is that the Minister and the Government have come along and said that if they do not like what this company does they will cut it in half—split it up—even though they know nothing about telecommunications or how the company operates and the Government has not put a dollar in. Pita Paraone sits there. He has not put in a dollar towards providing telecommunications in New Zealand. But other people have. Why pinch it off them? That is my point. Why would the Government do that? I think there is a bit of a problem with the chairman of the Finance and Expenditure Committee Mr Shane Jones. He has not yet heard a submission on this bill but he has already made up his mind about it. What sort of signal does that send to the people who want to make submissions to the Finance and Expenditure Committee? 
I have two final points to make. One is that in a big regulatory move such as this we would expect to see some analysis. I look across to the Government members and ask them where even the rudimentary cost-benefit analysis of this proposal is. What we see is their assumption that pinching the property rights of Telecom will open up the market and add to GDP growth. 
Hon David Cunliffe 
: www.med.govt.nz. 
RODNEY HIDE 
: The Minister calls out but this is a very very serious piece of regulation. I say to him that if this move is as worthwhile as Pita Parone says it is and is in the public interest then that means it would have to create more than $3 billion worth of value for society would it not? It would have to mean that. In that case if it meets the public interest test in a cost-benefit sense why is the Government in the interests of society as a whole not compensating the losers? 
Let us understand this: those people own that copper wire and they own that exchange. I saw people get very upset—and rightly so—about the Government’s moves to regulate away the ability of iwi to go to court and have their claim for the foreshore and seabed heard because their property rights were being pinched. But what about the mum and dad investors in Telecom? And what about the big investors in Telecom who have had their property rights pinched—not just their opportunity to go to court but their property rights pinched? And if this move does meet the public interest test then the Government on behalf of each and every one of us would be able to afford to pay compensation for those rights because the gains would be large enough. 
Shane Jones 
: Parliament’s sovereign. 
RODNEY HIDE 
: Of course it is. No one is arguing that it is not. I know that the member gets himself into much trouble because he does not understand the rules of this place. I suggest to him that we are not arguing about whether Parliament is sovereign. I am not arguing that Parliament has no ability to do this; I am just arguing about whether it is a good idea. That is why I oppose this bill. 
If Mr Jones thinks it is wrong to pinch people’s property rights—and I know he does think it is wrong—and if he thinks it is wrong to deny people the ability to go to court but then says it is OK if it is in the public interest to do so then those people should be compensated. Of course if the plus is as big as the Government says it will be then the compensation can be afforded. 
Shane Jones 
: When did you give up on the consumers?  
RODNEY HIDE 
: Well I give up on Mr Jones because he is one of those interesting people who knows everything. He actually knows everything. 
I now turn to my friends in the National Party and I say I am a bit disappointed in them because the National Party should actually stand up for private property rights. It should be very cautious about the Government’s moves to come along and somehow regulate for competition—the belief that somehow pushing companies around and taking their property rights will lead to a more competitive environment. [ 
Interruption 
] He is witty Mr Jones is he not? It must be Thursday afternoon for him. I hope that the National Party will come to its senses and will when this bill comes back from the select committee see fit to oppose this intrusion of the State into business. That will be a cost to New Zealand. Thank you very much.