Flavell Te Ururoa: Limited Partnerships Bill — First Reading 
Flavell Te Ururoa: Limited Partnerships Bill — First Reading 
[Volume:641;Page:11320] 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
Tena koe Madam Speaker. Kia ora tatouiteneipo. Hei wawahitakukoreroiteneipo ka huringawhakaaro ki Turangawaewae ki Ngaruawahia ki teneirangiwhakahirahira te raipotaengia a KingiTuheitia hei Kingimo te motu. E taku Ariki tu mai tu mai tu mai ra. KingiTuheitia ko koe tenei e whaianaingatapuwae o ratoukuangaro atu i te tirohanga kanohi. Ko koe tenei e arahineiito iwi Maoriieneirangi. Tu mai tu mai tu mai ra. Kia ora mai tatou. 
[An interpretation in English was given to the House.] 
[ 
Greetings to you Madam Speaker and to us this evening. By way of prefacing my address thoughts turn to Turangawaewae and Ngaruawahia to this wonderful day when King Tuheitia was made a monarch of the land. To His Excellency arise arise rise up before us. King Tuheitia this is you following the footsteps of those who are no longer among us leading your Maori people in these times. Arise arise rise up before us. Greetings to us all. 
] 
I did wonder with regard to the nature of the title of the bill the Limited Partnerships Bill whether we were talking about something very dear to my heart Te Tiriti o Waitangi. I think about the numerous parliamentary petitions court cases tribunal findings pilgrimages to Buckingham Palace Court of Appeal hearings and members’ bills that have emerged and that remind us that the Treaty partnership is indeed a limited one—for sure Madam Assistant Speaker—fore shore! You see a Treaty partnership that honoured the commitment of its signatories would have resulted in tangata whenua being self-determining in all that we do. My vision of an unlimited Treaty partnership would be seen in Maori having an economic base that is not restricted by the stranglehold of Government dependency but that enables us to manage our own resources in our own way. 
I do have confidence however that the contribution Maori are making to the nation is demonstrated by a growing and flourishing Maori economy—an economy that is generated out of our expanding asset base in fisheries forestry and land-based businesses; an economy in which over 16000 Maori are in business; and an economy created by Maori whom the Global Entrepreneurship Monitor has confirmed as the third most entrepreneurial people as Mr Tanczos alluded to earlier. Yet it is an economy I am told in which the Maori untapped employment potential is around $45 billion—an economy in which Maori businesses are threatened by a lack of business expertise financial skills and experience in acquiring capital particularly sustainable capital. That is the Maori Party’s key interest in this bill. We know that Maori business has become a major contributor to the New Zealand economy and that everyone prospers from improvements that could assist Maori businesses to succeed. As the saying goes: “What’s good for Maori is good for Aotearoa.” 
Will limited partnership models be good for us? This legislation sets up a new business structure: limited partnerships. It sets up an internationally recognised legal and tax structure through which venture capitalists can invest meaning that we can attract more foreign venture capital investment. Much like a company limited partners will provide investors with limited liability. The legislation is set out so that limited partners are liable for the debts and liabilities of the partnership only to the extent of their contribution to that partnership. Another key aspect lies in the taxation structure known as flow-through tax status where the partnership itself is not taxed but where each limited partner is taxed individually at his or her personal marginal rate in proportion to his or her share of the partnership’s income. 
So how can this be good for Maori? It is all to do with maintaining the momentum. What we know is that Maori and non-Maori have a similar proportion of start up but the difference is felt in the staying power of the new businesses where currently non-Maori firms have it all over Maori as Mr Tanczos spoke about earlier. So although Maori are great at starting up businesses only 37 percent of Maori entrepreneurial start-ups survive 3½ years compared with 62 percent in the general population. If Aotearoa was to adopt a limited partnership structure consistent with international norms businesses would be more able to access some of the $20 billion to $29 billion that a recent survey predicts will be invested by venture capitalists in the United States in 2007. 
Some of our people would ask: “Why on earth should Aotearoa open up opportunities for wealthy international investors to come to our shores with their fat chequebooks in their pockets?”. We will be looking to the advice of these critics to guide us as to the risks of overseas investors coming here to invest in return for shares equity a measure of control and even the possibility of moving the centre of control from outside of our shores and away from the business owners themselves. Last year Richard Jones Chief Executive of PoutamaMaori Business Trust discussed the potential for venture capital funding to help grow Maori businesses. Although he noted that many Maori businesses are in need of capital he warned that most Maori businesses would be too small to even get a look in. He also warned that such capital comes at a price stating: “they will want to have a stake in the business as well as have some control even to the point of running it so investment of this nature is not for the faint hearted”. 
But we are keen to hear from others involved in Maori business faint-hearted or not and the investment industry to learn whether there are opportunities that limited partnerships and the access to venture capital investments it facilitates may provide. As they say: “Where there’s a will there’s a way.” and if there is one thing that Maori businesses show us it is that will to succeed. The challenge we have always faced in any business ventures we were involved in was the ability to gain long-term sustainable investment on our terms that would provide the general capital to support our ideas. Sure Te PuniKokiri funding is limited to engagement funding—facilitating networks—but it was always insufficient to support the range of business ventures we were keen to explore. 
The challenge for Maori business operators is twofold. First they must attract investment by presenting a proposal that has sufficient credibility to convince genuine investors that the project will be sustainable and yield long-term results. Second they must have done the due diligence in the first place to guarantee that risks have been analysed and to know the market and the capacity of the investor to support their project in the long term. One of the ironies of the Maori business sector in Aotearoa is that although Maori businesses are present right across the export and domestic spectrums there are serious shortfalls in their capacity to attract and achieve sustainable funding. Maori businesses have told us that in reality there is often more likelihood of wealthy international investors being interested in their projects than our own local sources of funding. 
The million-dollar question is to work out the basis of the allegation that New Zealand funders have a prejudice against Maori businesses in the first place. What is the nature of the institutional racism that prevents domestic investors from investing in Maori business entrepreneurs in a way that will achieve long-term meaningful success? I remind the House of the urgent and pressing reality of New Zealand’s demographics. By 2050 it is estimated that half of the population will be brown. So with the right investment today Maori and Pasifika businesses will play an integral role in the economic sustainability and strength of New Zealand’s future. Although answers must be demanded as to why Maori businesses are not attracting local investment the Maori Party will support any initiatives that can open doors for securing a positive investment. 
We look to the new limited partnership business structure as a way of supporting Maori business start-up and expansion and particularly to the high-tech developments favoured by venture capitalists such as telecommunications biotechnology information technology and software development. Our people have a proven track record for technological innovation and we need to be given every opportunity to develop our resources on our own terms and consistent with our own tikanga. The Maori Party will be looking for sufficient security in the legislation to safeguard investment. The last thing we want to see with this legislation is that it opens up Aotearoa to rogue investors and to a further plundering of our natural resources. Maori will do everything in our power to prevent that from happening. 
Over the last few weeks the nation has been grappling with social issues that critics and commentators have been ever so quick to label the “Maori problem”. But when outfits like Bridgecorp fail and many mums and dads lose their savings no ethnic group is identified with that failure. I wonder why that is. As with those issues and given the wealth of people development innovation technological strength and productivity demonstrated in Maori businesses the challenge I would put to members of this House is to ask why those businesses are not receiving the investment funding they should. The demand for strategic investment in Maori small-business enterprise is heavy—at start up early stage development expansion and the ongoing viability stages of business. 
The Maori Party celebrates Maori successes and our international reputation as formidable entrepreneurs. We look forward to the select committee process to see if and how Maori businesses stand to prosper from the Limited Partnerships Bill. Kia ora tatou.