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National keeps on digging

19 March 2008 Media statement

National keeps on digging

The National Party is digging a hole so deep on this issue that they are likely soon to find themselves in China, Agriculture Minister and Progressive Party leader Jim Anderton said today.

Jim Anderton said Bill English was compounding his leader's errors on the $700 million New Zealand Fast Forward fund.

"Last week, John Key was saying the whole Government contribution of $700 million wouldn't be spent. Now, Bill English seems to accept that it will be, but not in the way they want it to be spent. He seems to think that the funds will go in tax and administration costs instead.

"There is no foundation to the claim that the Government has inflated the funding of New Zealand Fast Forward by excluding tax and administration costs.

"Whether the entity will be taxable and whether, if it is, the tax revenue will be returned to the fund, are questions that will go to Cabinet for further decisions following decisions about the formation of the entity.

"However, the figures the Government released last week show that even if the interest on investments was taxed and not returned to the fund the total level of Government funding would exceed $1 billion over 13 years."

Jim Anderton said the administrative costs of this fund will be kept to a minimum.

"The capital contribution is not intended to be a growth asset, it is for disbursement. Therefore, it will be invested conservatively incurring very little cost.

"Similarly, the Cabinet paper makes clear that existing funding vehicles, such as the Foundation for Research, Science, and Technology, NZ Trade and Enterprise, or the Tertiary Education Commission will be used wherever possible so as to minimise operational costs."
He said that last week's announcement made clear that the precise organisational form of the fund has yet to be determined.

"It has been necessary for the Government to announce the $700 million capital commitment to the fund, in advance of the detail being finalised, so that a dialogue can occur with industry, which as co-investors, have a major stake in the governance of the initiative."

Jim Anderton said that despite the desperate bluster of the National Party Finance spokesperson, Bill English, today, there was no dispute between officials about how the funds should be managed.

"I have a Treasury advice paper on my desk at present that provides a unanimous view from government officials on how the funds should be managed."

He said the opposition was desperate to oppose an initiative that was unanimously supported by the pastoral and food sectors.

"Really, when you're in a big hole, just stop digging."

Jim Anderton noted that John Key had yet to come up with a time to take up an offered briefing by officials on the New Zealand Fast Forward initiative.


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