Copeland Gordon: Westpac New Zealand Bill — First Reading 
Copeland Gordon: Westpac New Zealand Bill — First Reading 
[Volume:630;Page:2306] 
GORDON COPELAND (United Future) 
: 
 I want to take a fairly brief call on behalf of United Future on the Westpac New Zealand Bill. Firstly I say we support the passage of the bill. There are two underlying rationales and reasons that Westpac should incorporate in New Zealand and therefore operate in this country through a separate subsidiary company of the international Westpac Banking Corporation. 
The first of those reasons has already been well canvassed by other members of the House and it is to do with the prudential supervision by the Reserve Bank. The Reserve Bank’s analysis quite rightly was that in the event that the parent company of what until now has just been a branch in New Zealand came under stress or God forbid failed then the people who had deposited with Westpac bank in New Zealand could be at a disadvantage. In fact because Australian rules are framed in a way that gives preference in that situation to the depositors who are Australian residents it is almost certain that through the existing branch structure New Zealand depositors would have been disadvantaged in that eventuality so this bill is necessary from that point of view. 
The second reason I welcome the bill is to do with taxation which has been touched on by Sue Bradford. It is quite clear as has been conceded by the Commissioner of Inland Revenue to the Finance and Expenditure Committee recently that the tax rate for companies which is lower in Australia than it is here is actually an incentive for Australian-owned companies operating in this country to manage their affairs to try to minimise their tax bill in New Zealand to the advantage of Australia; in other words there is no longer a level playing field. Therefore this incorporation will also make it much easier for the Inland Revenue Department to police its new thin capitalisation rules in order to ensure that the Westpac Banking Corporation pays its fair whack of tax and that currently means 33c in the dollar—and no less than that figure. 
 In that regard the track record of Westpac Banking Corporation in recent years and indeed other Australian-owned banks is less than impressive. As Sue Bradford has mentioned not only are they now under the new rules paying an extra $500 million per annum in tax than they were but in addition a significant figure—well in excess of $1 billion—is also in dispute with those banks. I think that is a scandal when compared with the fact that every nurse who is working in an intensive care ward in a New Zealand hospital every teacher who is teaching in our schools and in fact all of the Kiwi battlers out there pay their fair whack of tax because they have no choice. It is taken off them through PAYE. Good corporate citizenship in this country means paying one’s fair whack of the tax burden. 
I also must express my disappointment that 85 percent of our banking sector has ended up in the hands of Australians. In many ways we are a very naive non-commercial and non-savvy country when it comes to these kinds of things. The Australians of course have a four pillars policy in place which ensures that these banks will always be owned by Australians. They do not play by the kinds of rules that we played by when we decided to put these banks up on a block and let them go into overseas ownership. Of course we are left basically with the Taranaki savings bank which is a great bank and I am also a great fan of Kiwibank. I think it is good that Kiwibank is here and I wish it great success in the future because I believe we need to see an increasing share of the banking sector back into the hands of Kiwis. 
For all of those reasons I signal United Future’s support for the first reading of the Westpac New Zealand Bill.