Lotu-Iiga Peseta Sam: Financial Markets (Regulators and KiwiSaver) Bill Securities Trustees and Statutory Supervisors Bill — Second Readings 
Lotu-Iiga Peseta Sam: Financial Markets (Regulators and KiwiSaver) Bill Securities Trustees and Statutory Supervisors Bill — Second Readings 
[Volume:671;Page:17517] 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I am also honoured as a Government MP to stand to support the Financial Markets (Regulators and KiwiSaver) Bill and the Securities Trustees and Statutory Supervisors Bill. The Financial Markets (Regulators and Kiwisaver) Bill establishes a new financial sector regulator the Financial Markets Authority which will be a super-regulator bringing a number of powers and functions from various Government bodies into a single body. 
The work we have done in the Commerce Committee particularly our inquiry into finance company failures has made us realise as a group that there has been a fragmented approach to regulation of the securities and financial industry and that such a move as the creation of this authority would be welcome. It is overdue and we certainly welcome the establishment of the Financial Markets Authority to regulate the financial industry. 
As has already been noted tonight finance company failures continue to dominate our news. We saw another example this week in a court case that began with charges against directors of finance companies. This legislation is about maintaining the integrity of our financial system. It is about bringing together confidence and trust for mum and dad investors as well as corporate institutional investors in our financial markets and capital markets so that we can have a fluid market and facilitate access to capital for our businesses. The National Government is focused on boosting growth and creating jobs and fluid financial markets certainly facilitate a stronger economy financial security real opportunities for growth of our economy and more opportunities for our people. 
As has been mentioned some changes were made to the bill during the select committee process. The bill addressed some really good work that was produced by the Capital Market Development Taskforce and issues raised in respect of the global financial crisis as well as the finance company failures that I have already alluded to. 
The bill ensures that the Financial Markets Authority has the right tools to keep our capital markets working for investors. As Mr Parker has said it gives power to the Financial Markets Authority to exercise investors’ rights of action when it is in the public interest to do so. That is an important criterion because as we saw with a lot of the inaction over the last 4 to 5 years in terms of finance company failures the Securities Commission did not have the power to take action against some of the rogue parties in our financial markets. 
So what does the bill do? One of the other important areas that were looked at was that of lowball unsolicited offers. That is where predatory investors make lowball offers that are well below the market price for securities to mum and dad investors who may or may not be ignorant of the market price in order that they will take up the offer. Often those offers are unsolicited and the result is a large degree of market loss for those mum and dad investors. This bill includes a regulation-making power that will enable greater regulation of unsolicited offers including minimum offer and cooling-off periods as well as the requirement to show on the offer documents a disclosure of the market price. I think that is particularly important. It will allow mum and dad investors to see through the predatory behaviour of some of the investors. 
In summary it is clear that New Zealand needs a single market regulator and a culture of proactive and timely enforcement which has sadly been lacking in recent years in respect of some of the finance company failures. It is undoubtedly about market confidence for our investors—institutional individual and mum and dad investors—and the critical role that the Financial Markets Authority will play in the regulation of the industry. This bill will consolidate the functions of the Securities Commission as well as parts of the Ministry of Economic Development and the Government Actuary and the regulatory function of the New Zealand Exchange. 
We will talk in the Committee stage about how the bill will do that. It is certainly a commendable bill. I am happy to see that there is multiparty support on the Commerce Committee for the bill and for it to proceed and for the Financial Markets Authority to be established this year. Thank you.