Bayly AndrewANDREW BAYLY (National—Port Waikato): Thank you Madam Chair. I know we've spoken on this clause for a long time but first of all I want to respond to what the Minister of Local Government said before and that is that in the context of balance sheet separation she implied that taking the assets and liabilities out was actually going to help the councils.My first question to the Minister is: which councils will end up with a stronger balance sheet if they remove their assets and liabilities that relate to their waste-water services? A classic is Auckland Council. The asset value of the water assets in Watercare Services is about $12 billion and I think the debt's about $7 billion or $8 billion by memory. So their balance sheet will have a hole in it to the tune of roughly $4 billion. Are there any councils that will have their liabilities exceed the value of their assets? If the Minister can't answer that question or can't give us an assurance to that I would suggest to the Minister gently that every council will have a hole in its balance sheet. That's my first question.Secondly I want to come back—and I know that the Hon David Bennett is an excellent accountant. He worked at KPMG in Hamilton I think. Anyway this issue around equity was one that we canvassed at the Finance and Expenditure Committee and I have to say I've never yet had an adequate response from the officials during the select committee stage. This comes back to what a share is. A common definition of a share is one of equal parts into which a company's capital is divided entitling the holder to a proportion of the profits. Now in all definitions of equity capital which is what we're talking about here there are normally rights first of all to receive dividends because that is the return you get on a share. What we find in clause 166(1)(b) is specifically that a territorial authority must not receive any equity return directly or indirectly from a water services company. That strikes at the first and main principle of what an equity share is.The second thing about an equity share is that you are able to participate in capital raising. If the company or entity wants to raise more capital as an equity shareholder it is by law a requirement and if you go to the Takeovers Code or the New Zealand Stock Exchange code she—and I'm looking at the Minister—will be locked up in jail if she was to suggest that existing shareholders could not participate equally in any capital raising of a share by a company. Yet what do we find in clause 166? In clause 166(1)(c) the territorial authority owner must not give a water services entity any financial support or"—wait for it—"capital;". So now you've struck—and I'm saying this to the Minister—this piece of legislation which takes away the two fundamental rights of being a shareholder in whatever business or whatever it is and we're talking about water services here.So the first thing I would say to the Minister is my reading of this—and I raised this at the select committee and I wasn't able to get a proper answer from the officials—is that there is no way that the councils will be able to deem this as a share. In my view there is no way they could place a value on these shares because they're not entitled to any return and not in fact specifically in the bill precluded from acting and participating as an equity shareholder. I would suggest to you—Madam Chair I would like to carry on if I may—[Time expired]"