Sunday 3 Feb 2002

NZ Post is relying on PR spin to hide KiwiBank's failure to open as promised, ACT Finance Spokesman MP Rodney Hide said today.

"The roll out is not on target. Kiwibank is in trouble. The business case relies on over-the-counter transactions costing just 53 cents. Experienced banking sources think the cost will be closer to five dollars. No wonder franchisees are up in arms - NZ Post's business case relies on ripping them off.

"Just four months ago, Kiwibank CEO Sam Knowles detailed extensive roll-out plans in his Bank Update:

"[The opening] next year will be managed as a three wave roll out programme. The first wave, commencing February 2002 will involve around 30 shops. Wave two will be starting in March to give us broad geographic coverage. Wave three, starting in April, will be `filling in the gaps'. The enormous logistics involved with training and opening have led to the three-wave approach, which is expected to be completed by mid-May."

"By January, Mr Knowles had changed his tune completely. The Bank Update now declares:

"The roll out of Kiwibank consists of two waves. The first wave starts in February involving shops in the Hawkes Bay and Manawatu regions. The second wave roll out is throughout the rest of the country, from late March through April and May. Specific details around opening dates will be communicated to each shop when finalised.

"NZ Post now says that only seven `pilot' banks will open this month - down from the 30 promised - and not one of the banks will be a franchisee. That these banks are `pilots' is just spin. The pilot was run in December.

"NZ Post promised Parliament and the public of New Zealand that they would have 300 branches up and running by May this year. They can deliver on this promise if - and only if - they sign up almost every single franchisee. They have yet to convince one.

"NZ Post Chief Executive Elmar Toime has consistently maintained that just a `few individuals' are disgruntled. We now know that concern is widespread. NZ Post spin-doctor Bruce Thompson has been `adamant' the venture is on track. Yet the internal memos I have clearly show that the roll out is way off-track.

"It's time NZ Post started acting like bankers and behaved with integrity instead of spin and hype. They should front up and explain why the promised roll out has fallen through, and when they expect to have franchisees all signed up with a contract to provide the much-promised and over-hyped banking services," Mr Hide said.

Ends

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