Parliament

Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 

Westland & Tatua Farmers In Line For Capital Bonus

ACT Commerce Spokesman Stephen Franks revealed today that the fine print in Fonterra's constitution, and gaps in the Minister's regulatory package, mean that Tatua and Westland farmers get a capital advantage of as much as $3 per kg equivalent from their decision to stay out of Fonterra.

He says that nothing in the 'regulatory package' Bill winding its way through Parliament requires Fonterra to pay an exiting farmer a fair value which is full value. Instead it is to be a carefully calculated notional value per share, which could be as low as 50% of the true enterprise fair value.

"Farmers and others concerned might think it was bound to stick with fair value - silly them. Only a lawyer could see there are no constraints in the 100 or more pages of the Bill on Fonterra lowering the price to exiting farmers.

"Whatever happens, Tatua and Westland will get the true enterprise fair value on withdrawing from the Dairy Board. That is, their full proportion of the normally calculated value of the Board, (including its brands and prospects).

"Theoretically at least the shrewd Westland and Tatua farmers could take the benefit of the true fair value payment then exercise their open entry rights to rejoin Fonterra at the low entry value produced by its deep discount share price formula. Once in of course they couldn't do it again. On the next exit they would get only what other Fonterra farmers would get.

"This seems to be a result of sly drafting in the Minister's deal. The deal allowed Globalco directors to push the line, at meetings all over the country, that the new Board would have the discipline of potential fair value exit. That would restrain Board recklessness with dairy farmers' money in overseas adventures.

"Meanwhile the cunning drafters of the Bill before Parliament weren't even using the term "fair value". The Minister too might claim that he never used those words. The Bill actually includes the fair value parts of the Constitution but it doesn't tie Fonterra to stick with them.

"The Government could easily fix the problem in the regulatory package to make the law mean what people thought it would say. Whether it will do so remains to be seen," Stephen Franks said.

Ends


© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Tax Working Group’s Road Map

Trying to analyse the interim report on the Tax Working Group (TWG) is like trying to review an entire All Blacks game, but at the half- time mark.

With so much still to be finalised, Sir Michael Cullen and his colleagues are going to need all the All Blacks’ fabled finishing skills to get a coherent, fiscally neutral package together by the February 2019 deadline. More>>

 

Meth Testing Report: Housing NZ "To Right Wrong"

Phil Twyford “Housing NZ acknowledges that around 800 tenants suffered by either losing their tenancies, losing their possessions, being suspended from the public housing waiting list, negative effects on their credit ratings or, in the worst cases, being made homeless.” More>>

ALSO:

No Reshuffle: Meka Whaitiri Removed As A Minister

Meka Whaitiri will be removed as a Minister with immediate effect... The decision was made after receiving a report into an incident that occurred on 27 August in Gisborne, involving Meka Whaitiri and one of her staff. More>>

ALSO:

Pay Equity Bill: Making History For Women’s Pay

The Equal Pay Amendment Bill, introduced to the House today, will make it easier for workers to make a pay equity claim , using a more simple and accessible process within New Zealand’s existing bargaining framework. More>>

ALSO:

Suffrage 125: NZ A Trailblazer For Women

“We acknowledge the work of Kate Sheppard, Meri Te Tai Mangakāhia, and all of the suffragists who tirelessly campaigned for the vote… Today we also need to ask each other: how we can continue to make our country a fairer and better place to continue the legacy of the suffragists.” More>>

ALSO:

Asylum: Refugee Quota Increasing To 1500

“The quota increase will take place from July 2020. In the meantime, we will work to increase the number and spread of refugee resettlement and support services. We need to make sure we’re prepared for this change in policy.” More>>

ALSO:

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels