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Our money, their gamble, our loss

14 August, 2003

Our money, their gamble, our loss

The Greens are labelling as "crazy" the decision to risk more than half of the New Zealand Superannuation Fund on offshore stockmarkets.

The Guardians have announced that 78 per cent of the Cullen fund - which is projected to grow to $100 billion in the next 25 years - will be invested offshore, and two-thirds of that will be placed in overseas shares.

"Overseas sharemarkets have proved a graveyard for New Zealand investments," Green Co-Leader Rod Donald said today. "The ink is still wet on last month's Government Superannuation Fund (GSF) Authority's Statement of Intent, which shows the same investment strategy helped turn a forecast profit of $232.8 million into a $47.7 million loss.

"When the GSF was previously invested in Government Bonds it made a profit in every one of its 55 years as part of a Government Department.

"Wake up, Dr Cullen. Learn from the mistakes of the very recent past and don't let the so-called 'guardians' of the fund gamble our life savings at the global sharemarket casino.

"How quickly we forget that stocks such as Enron and Worldcom looked 'blue chip' just two years ago. When Enron began unravelling in October its shares were trading at US$37 each. It is naïve in the extreme to believe that some of our super funds won't end up being placed on similar bad bets.

"New Zealanders should not be forced to watch their hard-earned savings disappear down the drain.

"The Government admits that profit is its only consideration in which stocks to invest in. That means our money will end up bankrolling the Lockheed-Martins, Monsantos, McDonalds and Sky Cities of this world, regardless of the misery they might inflict on people and the environment.

"The vast amounts of money being gathered by this scheme should be invested in New Zealand, both in our people and in building a truly sustainable economy," said Rod Donald.

"Imagine what we could achieve if we started spending that money now on our kids' health and education, rather than helping expand the business base of ethically suspect multinationals. That is the only certain investment for a better future for us all."

ENDS

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