National Silent On Local Government Bond Bank

National Silent On Local Government Bond Bank

Labour Leader Phil Goff says Government action has stalled on the Capital Markets Development Taskforce recommendation to set up a local government bond bank.

In his speech to the Local Government New Zealand conference in Auckland today, Phil Goff said local authorities need access to affordable capital to meet the infrastructure demands of our growing communities.

“The concept of a local government bond bank originated with the Capital Markets Development Taskforce, which was set up by Labour in 2008 and reported back to the Government at the end of last year,” Phil Goff said.

“This concept is a win-win for local government and for Kiwis looking for new and safer ways to save.

“Mum and Dad investors know that their investment is good for the community. It will help Kiwis retain ownership and control of assets they have built up over decades. The use of bonds will avoid privatisation of assets that are often monopolies. “All over New Zealand local authorities have infrastructure needs they are struggling to fund. A local government bond bank will allow Kiwis to earn a return on their savings at the same time as helping to build our local infrastructure.”

Phil Goff said that while the Government said it supported the recommendation, all it had done so far, in the seven months since the taskforce report was delivered, was to set aside $5 million in an establishment fund.

“Prime Minister John Key and Local Government Minister Rodney Hide failed to talk to the conference about setting up the bank, and I can only suspect the reason the Government is not moving faster is because it has a different agenda.

“That agenda is based around privatisation, corporatisation and PPPs. Labour prefers the concept of a local government bond bank to PPPs,” Phil Goff said.

Phil Goff said central government had an obligation to work with local government --- and with Kiwis --- to get the bond bank in place as soon as possible.

“The proposed bond bank will give communities a real stake in local government again. Perhaps that is why the Government is so lethargic in implementing the recommendation. John Key and Rodney Hide seem set on a path that will actually distance communities from local government rather than involve them.”

ENDS