Clendon David: Financial Service Providers (Pre-Implementation Adjustments) Bill — Second Reading In Committee 
Text is incorporated into the Bound Volume 
Clendon David: Financial Service Providers (Pre-Implementation Adjustments) Bill — Second Reading In Committee 
[Sitting date: 22 June 2010. Volume:664;Page:11948. Text is incorporated into the Bound Volume.] 
DAVID CLENDON (Green) 
: 
 Ata marie. The Greens are pleased to support the Financial Service Providers (Pre-Implementation Adjustments) Bill through a further stage. We do so with some regret. We regret the necessity for such a bill. One would have thought and hoped that in an ideal world amendments of this nature would be unnecessary that people in the financial industry giving advice to often ill-informed laypeople would have a moral compass and that their own integrity would determine that they actually gave good honest advice and protected the investments and assets of normal New Zealanders. But clearly that is not the case. 
I doubt whether anyone in the House does not have someone in his or her close circle of friends or family who has suffered some loss as a result of what has been quite well described as a Wild West cowboy approach to financial investment which we have seen far too much of over the last couple of years. I myself and my extended family know of a young couple who had accumulated a small nest egg that would have been a deposit for their first home. That is gone. The reason it is gone is that they quite wisely invested in two companies—companies that apparently were very sound and whose advertisements on television were fronted by well-known figures. That money is now gone. Basically they discovered they had invested in a daisy chain of debt speculation and overstated values that were not really there. Essentially their investments were simply taken away by people too greedy and too venal to be honest and up front about what was going on. 
It is really critical that we restore people’s confidence and trust in the notion of investment. People need to know that investing is reasonably secure notwithstanding that there will always be some risk. That confidence has been comprehensively lost as a result of the rorts the dishonesty the greed and the misrepresentation that we have seen far too much of for far too long. Restoring confidence is critical not least to the business sector. It is important that New Zealand business has access to capital and small to medium sized enterprise in particular are identifying that as one of the issues confronting them. Access to capital is an issue. We need to encourage people with capital to think that it is a safe bet to invest and to have a reasonable expectation that that money will be secure. 
I have to say that the select committee process for me as a relatively new member was a very positive process. That quite contentious and complex technical issues can be resolved to the satisfaction of people with quite different ideological positions demonstrated the power of select committees. I acknowledge the chair of the Commerce Committee Lianne Dalziel who had a very useful focusing mechanism. She kept using a phrase along the lines of “What is the harm we are trying to remedy?” which was actually quite a good strategy to keep bringing us back to the point of asking what the problem was what we were trying to resolve whom we wanted to capture and whom we did not want to include in the provisions of this bill. As a result of that organisations like credit unions—which are very robust reliable and straight-dealing organisations—are not unwittingly caught up within this legislation. We are not imposing compliance costs on organisations or indeed individuals who were not targeted because they have not displayed the sort of bad behaviour we are endeavouring to overcome here. 
Organisations like the Citizens Advice Bureaux made very good submissions identifying one or two instances where potentially they could have been captured by the provisions of this bill. Clearly not-for-profits like the bureaux were not the target; if they give incidental advice in the course of assisting people in the community that is well and good; the exemption of not-for-profits is a very sensible and strengthening provision of this bill. 
There was discussion for example about what constitutes a sophisticated investor recognising that we do not need to put many protections around people who are perfectly able to look after their own interests. Some useful and informed commentary—and indeed submissions—from individuals and organisations helped us define whom we were trying to protect and who can actually look after their own interests and be left to get on with it. 
That is probably as much as I want to say at this stage except to reiterate that the Greens support this bill and its intention and we look forward to seeing it progressing and to securing and protecting the investments of people who can expect much better and more reliable advice as a result of this legislation. Kia ora.