Goodhew Jo: Securities Disclosure and Financial Advisers  Amendment Bill — First Reading 
Goodhew Jo: Securities Disclosure and Financial Advisers  Amendment Bill — First Reading 
[Volume:652;Page:1558] 
JO GOODHEW (National—Rangitata) 
: 
 It is my pleasure to speak today on the first reading of the Securities Disclosure and Financial Advisers Amendment Bill. The bill is part of the National Government’s response to the current economic crisis. I have been very interested to hear previous speakers all traversing parts of the economy at the moment and talking about how they believe this Government should be addressing the current economic crisis. The previous speakers have spoken from their own experience of what is important to the people they know and the businesses they understand. This bill is typical of a National Government that is determined to look at all ways that we can reduce unnecessary impediments within the business world. Not for many decades has this been so important. 
It is probably a good idea to look back at how the problem was identified that necessitated this bill and others as well. In doing so I acknowledge the Capital Market Development Taskforce which was established back in July 2008. It was to produce a plan to develop New Zealand’s capital market and it released a report in response to the financial crisis. It focused primarily on increasing the availability of capital for New Zealand firms and reducing the costs of raising capital. I acknowledge the report which was released in November 2008 and the fact the task force was set up under the previous Labour Government. This bill is part of a process where we are responding to the current economic crisis. 
Today I would like to focus on the aims of the bill as well as more specifically focusing on National’s wider commitments to New Zealand and to New Zealand businesses. The overarching aim of the bill is as I have said to free up available capital for business and ultimately to help business to do business. The Securities Disclosure and Financial Advisers Amendment Bill responds to the current international crisis by removing the unnecessary impediments to capital raising while ensuring at the same time timely disclosure of relevant information to prospective investors. We all know from our own territory within New Zealand where we are the representatives of our local people how nervous New Zealanders are and how nervous businesses are right now. This bill will help to reduce compliance costs and it will help businesses through tough economic times. 
The bill principally provides for the use and regulation of a simplified disclosure prospectus. The new type of prospectus will in connection with regulations that will be made under existing regulation-making powers enable stock exchange - listed issuers to offer certain debt and equity securities but without the need to duplicate information that has already been publicly disclosed under their continuous disclosure obligations. I want to reflect on a couple of words within that description. We actually need to make sure that if there is duplication of information within our business environment we get rid of that. That is just one more of those compliance costs that New Zealand businesses have asked us to look at to make the environment they are working in more simplified and more user-friendly. 
The bill will amend two separate pieces of legislation—the Securities Act 1978 and the Financial Advisers Act 2008. The bill implements changes to simplify the process and reduce the cost of compliance within existing securities legislation. As I have already said the bill is part of the recommendations made by the Capital Market Development Taskforce. It made other non-legislative recommendations that the office of the Minister of Commerce is currently assessing. It is part of an urgent response to the current global financial crisis and it is part of the Government’s plan to actually come through the economic downturn. We want to enable our businesses to forge ahead when the recovery period is upon us. 
The Financial Advisers Act 2008 amendment corrects an error made by the Office of the Clerk when the Financial Advisers Bill was being prepared for Royal assent. It corrects the phrase: “This Act applies to a financial adviser service performed in New Zealand by a person in New Zealand regardless of where the person performing the financial adviser service is resident . . . or carries on business.” It changes that phrase to read: “This Act applies to a financial adviser service performed in New Zealand regardless of where the person performing the financial adviser service is resident . . .or carries on business.” That is an important little alteration. 
As I have said the purpose of the bill is to free up capital for business and to help businesses to do business. National is committed to cutting red tape for businesses and this bill is just part of the many steps that this Government intends on delivering for business. As other speakers before me have done I want to reflect on what is happening out there for business. National has already addressed some of the issues for small to medium enterprises in a package that was widely supported in the House. We know that those small businesses are vital to the New Zealand economy and we believe that that small and medium enterprise package unveiled last month will help to lighten the load on those small and medium sized businesses. They employ a large number of New Zealanders and employment and maintaining employment is of course uppermost in our minds right now. That package has five parts which included tax changes an expansion of the export credit scheme an extension of the jurisdiction of the disputes tribunal the expansion of business advice services and a prompt-payment requirement for Government agencies. It is only fair that Government agencies should be required to pay promptly as do private agencies. 
The package as a whole was aimed at urgently improving the business environment by reducing the impact of taxes on firms’ cash flows and improving firms’ access to credit thus importantly reducing business compliance costs. The reaction I have had in my own electorate of Rangitata has simply been one of people saying “Wow! This is just absolute common sense. This is what we have been waiting”—in some cases they tell us—“9 long years for.” In fact they are just common-sense measures to help our businesses to do business. 
National’s jobs and growth plan is also about keeping the economy running as strongly as possible easing the sharpest impacts of the recession and preparing our economy for future growth. Unlike the previous Government the National Government believes in creating a business-friendly economy. We are taking a hard look at any possible action from any angle to help business; this bill is part of that package. It is all about businesses staying in business and helping New Zealanders to stay in employment. We have seen action from this Government. Times have changed and again many constituents have said to me how wonderful it is to see action. In the first 100 days we have certainly seen this Government deliver on all 27 actions within our 100-day plan. Again we have had congratulations from many that the Government is getting on with the job of Government and adding to the confidence that New Zealanders can feel. 
New Zealand—and in fact the whole world—is in the midst of the worst financial crisis for decades and no one disputes that. Credit markets are in disarray and confidence is low and unfortunately falling. But this bill and other bills that are part of the measures to address what the task force identified as problems will help create some confidence—confidence of investors and confidence so that credit markets can in fact best meet our business needs. 
The bill will address the simplification of the disclosure prospectus that may be used by listed issuers subject to continuous disclosure requirements. The remedy is to amend the existing definitions for exemptions from standard disclosure requirements. This bill is about removing unnecessary impediments to capital raising while—importantly—making sure there is still timely disclosure of relevant information. That is absolutely essential for prospective investors. 
I look forward to participating as a member of the Commerce Committee as we examine this bill and as we hear submissions on it. I commend this bill to the House as others have done before me. I am pleased there is quite a lot of support for this bill and I look forward to seeing it again at the select committee.