Greens Persuade FEC To Call For Greater Scrutiny Of Foreign Investment

The Green Party has called for the Auditor General to conduct a 'performance audit' of the Overseas Investment Commission in the Finance and Expenditure Committee's review of the OIC released today.

The financial review of the Commission, initiated by Green MP Rod Donald, contains a number of recommendations to the Government which, if adopted, would lead to a significant refocussing of the Commission's assessment of foreign investment proposals and greater scrutiny both by the Commission of applicants and of the Commission's approval and compliance procedures.

"I am pleased to have persuaded the Government members of the Committee to support a number of key recommendations to Government Ministers," said Green MP Rod Donald.

"While our goal remains to reduce the level of foreign dominance of the New Zealand economy the recommendations announced today will at least put the negative impact of foreign investment under the spotlight and should lead to higher standards of investment," he said.

Joint Government and Green recommendations include:
* Appointing an additional Commissioner to represent the wider community
* Extending the application of the "national interest" criteria to all proposals
* Re-examining the investment threshold that triggers scrutiny by the OIC (The Greens, the Alliance and NZ First all want the current $50M threshold reduced to the pre-election level of $10M.)
* Requiring the Commission to consider the impact on social well being, environmental sustainability and economic sovereignty when assessing whether an investment will benefit New Zealand.
* Introducing a code of Corporate responsibility which investors would need to agree to and against which the Commission would monitor compliance
* Expanding the "national interest" test to include the environmental impact of an investment, the impact on the social fabric of the local community and compatability with Treaty of Waitangi obligations.

"Until now the Commission has almost always rubber stamped applications and New Zealand has been the loser as a result. We want to put a stop to that and ensure that any new investment meets very high standards," Mr Donald said.

"It's simply not acceptable for the Commission to approve massive land purchases by the likes of the Japanese owned Southland Plantation Forestry Company, which have severely undermined the infrastructure and social fabric of the local community, and then be told by the OIC that all this upheaval yeilds a marginal net gain in jobs.

"And adding its insult to injury for those communities to be told by the Commission that it assessed the impact of such projects on the local community without saying exactly how it did let alone even visiting the effected regions before giving its approval.

"I believe the Commission's reported concessions on job creation highlights the uncritical promotion of foreign investment by Ministers such as Michael Cullen who had previously claimed in relation to the Southland plantations that 'it is widely recognised that forestry activities provide significantly more employment opporrtunities than farming'.

"The Greens want the Commission to provide for public submissions on investment proposals, especially where they involve land and fishing quota but none of the other parties supported us.

"If the local farming community in Southland had had the opportunity to have their say on the impact of thousands of hectares of productive family farms being turned into eucalyptus plantations they would have given the Commission a very clear message that this was socially and environmentally unacceptable.

"The refusal of this Government to face reality on foreign investment has lead me to add a minority report to the review which, among other things, calls on the Auditor General to conduct a performance audit of the commission given the considerable increase in overseas investment in recent years and the impact it has had on New Zealand's economy and society," he said.

Mr Donald's other recommendations include:
* requiring all 'national interest' criteria to be met before an application is approved
* requiring the Commission to report on each individual applicant's undertakings in relation to the 'national interest' criteria and its compatability with government policies and reporting periodically on whether they have met these undertakings.

Copy of the Finance and Expenditure Financial Review is available on request.

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