Guy Nathan: Insolvency Law Reform Bill — In Committee 
Guy Nathan: Insolvency Law Reform Bill — In Committee 
[Volume:634;Page:6060] 
NATHAN GUY (National) 
: 
 Following on from Mr Finlayson it is good to take a call on Part 8. I think everyone would fundamentally agree that something such as this Insolvency Law Reform Bill needs to happen as there have not been any substantial changes to the insolvency legislation since 1967. But the reality is that Part 8 is the fundamental part in this whole bill that will turn things upside down. 
 Those people who were fortunate enough to sit on the Commerce Committee know that most of the submitters—I think close to 100 percent of those who submitted—had concerns about the priority status of the Inland Revenue Department. What I cannot understand is why the Government has not addressed that in Part 8. That is the biggest concern to me with this part. All creditors should be treated equally. That is fundamentally I would have thought a common-sense principle but no under this part the Inland Revenue Department gets its dibs on its loot no matter what. The Inland Revenue Department can vote to put someone into liquidation and it seems to me that that is fundamentally flawed and unfair. It seems to me that it is very like bully-boy tactics. 
We heard earlier from Mr Bennett about high taxation being used to build up a big war chest for the next election about how this Government is very much about big tax and about how there will be a big lolly scramble in 2008. But in essence we do not want to see in Part 8 the Inland Revenue Department being the first cab off the rank and having the ability to force people into liquidation. 
I refer to the National Party’s minority view in the select committee report because I think it is really important. Following on from the point I made earlier all the submitters on this provision—I am talking about voluntary administration—were unanimous in their view that unless the Government addresses the issue of the priority status of the Inland Revenue Department the voluntary administration scheme will be severely compromised. That should send alarm bells around this Chamber. The minority view states: “The select committee did not pursue in-depth ways to ensure that the centre-piece of the bill will be effective to the satisfaction of New Zealand National members.”—in other words we were unheard; the committee did not listen. “We do not believe that Parliament should pass another piece of redundant legislation when there is a groundswell of opinion from practitioners who believe that it will not work without the removal of Inland Revenue’s priority status.” In other words the committee has not listened to National’s minority view. 
I think it is important to look across the Tasman to our Australian counterpart. It has abolished the priority status. When we look across to the UK we see that it has ditched priority status. We do not seem to be following the OECD’s best practice. We seem to be out on a limb with Part 8. Fundamentally parts of this bill are necessary but Part 8 is of great concern to me and should be to many of us in the Chamber. That is why National cannot support Part 8.