INDEPENDENT NEWS

Air NZ: Lessons Too Late For The Learning

Published: Fri 14 Sep 2001 04:08 PM
Media Release
14 September 2001
Air NZ: Lessons Too Late For The Learning
New Zealand First Leader Rt Hon Winston Peters has released the following statement regarding Air New Zealand from Tauranga today:
We have noted that while there has been justified criticism of the Air New Zealand Board the Government is also clearly culpable.
Although New Zealand First supports the recapitalisation of Air New Zealand it does not support the means by which this has been achieved. The New Zealand Government has not learned the lessons of experience and has followed the Airline Board into the mire of bad investment decisions.
The effects of the rescue package are that: the private (and now foreign) company, Brierley Investments, has again been bailed out by New Zealand taxpayers; the cap on foreign ownership in our national airline has again been raised and will continue to be so; and, taxpayers’ funds have been risked without any of the benefits of ownership or control.
When Air New Zealand was hocked off by Labour in 1989, along with the rest of the country’s assets, taxpayers received $660m. Now the bulk of that is being risked with one more throw of the dice by a government that has fiddled while Ansett, Air New Zealand, and the nation’s tourism and trade have burned. And worst of all our international reputation lies in tatters, which will make the turn around of Air New Zealand in international markets even more difficult. Immediately offshore Australians of every political persuasion are not going to forgive us for what has happened to their iconic Ansett.
Brierley Investments should have been required to divest its shareholding as they have long failed to satisfy any reasonable test of New Zealand ownership. Its convoluted trust arrangements are a device contrary to the spirit and intention of the law.
For months now the Government has had the opportunity to reinvest in Air New Zealand, to secure the future of our world class carrier, and to protect it from foreign raiders.
Our nation has a serious balance of payments crisis exacerbated by the repatriation of dividends overseas and by high interest payments to overseas lenders.
By far the best outcome would have been for the Government to have used its investment to acquire BIL’s equity interests and gain oversight of the new Board.
A second-rate option has been taken by a second-rate Government whose inaction and belated decisions have undermined the credibility of our country and its institutions. It is an option that has the effect of socialising the losses and privatising the profits. It is an option that demonstrates that this Government has not learned any lessons from our turbulent economic past.
It begs the question, why is the Government bailing out another company for the umpteenth time – and what is it that these businesses have over both National and Labour for them to act so contrary to the public interest?
ENDS

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