Rich Katherine: Estimates Debate — In Committee 
Rich Katherine: Estimates Debate — In Committee 
[Volume:632;Page:4290] 
KATHERINE RICH (National) 
: 
 We have already had a taste of what Mr Swain is going to discuss since he brought up his issues in the previous vote. It is interesting to see that the Minister Trevor Mallard is once again not able to take the chair but I note that Minister Cunliffe will be all ears listening to some of the issues the Opposition is going to bring up. In the area of State-owned enterprises there has been a subject of great debate over the last few weeks because of course the Minister announced a major change to State-owned enterprise policy. He asked State-owned enterprises to spread their wings and expand their operations. The Opposition was a little concerned by this not least because we had a concern that there was an opportunity for crowding out private sector investment but also we wondered about the expertise that some State-owned enterprises have. We raised some concerns but that coincided with research released by Victoria University which also stated that those board members surveyed had concerns about the skills they had around the board table and also concerns about some of the appointments that had been made more relating to political affiliation as opposed to skills. 
So I would like to hear the Minister in the chair explain how this new regime will work why he thinks the present board members around the table have the skills to take State-owned enterprises into this new realm and also how it will make any difference. Because in the last couple of weeks we have had quite a high-ranking ex - Labour Cabinet Minister say publicly that he does not think it will make any difference to the way State-owned enterprises are doing their business at all. He pointed out that State-owned enterprises have always had some flexibility and some ability to make commercial decisions and get into other areas without having this new announcement. 
I would also like the Minister to explain why he thinks it is OK that New Zealanders should feel confident that State-owned enterprise decisions are going to be good ones because Minister Mallard has said that he and Michael Cullen have the final sign-off. I would like to hear the Minister explain why he thinks those Ministers have the financial ability and business nous to make sometimes complex business decisions that traditionally have been made by those boards. 
I would also like him to explain the theory behind this new change. Because in all the advice from officials concerns have been expressed. The Ministry of Economic Development has expressed concerns. Treasury certainly did. The Crown Company Monitoring Advisory Unit expressed concerns about pushing State-owned enterprises into these new additional areas of commercialism. 
I would also like the Minister to talk about why he thinks this will contribute to economic transformation. Because when one ignores the big issues such as tax accident compensation the Resource Management Act employment law and trade policy why does he think expanding the area of State-owned enterprise work is going to make any difference to kicking New Zealand’s economy along? Yes there have been some successes but also there have ultimately been some failures or as Treasury euphemistically put it non-successes. I would like to hear about that theory underpinning this strategy when all officials pointed to concerns and clearly were unsure about what the spill-over benefits would be. 
I am concerned that State-owned enterprises are starting to be treated as extensions of the Government’s social agenda. Is that OK when one is talking about firms that basically look after over $2 billion worth of assets? If one has $2 billion worth of assets I do not think it is OK to use as one of the reasons for expanding State-owned enterprise areas that it is to make them more exciting and less boring places to work. When one is overseeing $2 billion worth of assets I do not think there is a business or a businessman or businesswoman in the country who would see that as being a good excuse to expand State-owned enterprise risks and investments. 
So in terms of the State-owned enterprises plan I hope the Minister will get on his feet and explain more about how this will contribute to the grand plan of economic transformation. Because it is not clear from what has been said—if anything the more the Minister gets interviewed on this the more murky the thinking appears to become. What kinds of projects are they going to get into? How will New Zealand’s economy fare better with expansion of projects from learning media etc.? I would like to hear from the Minister on that.