Clayton
COSGROVE
SOE Spokesperson
14 March 2013 MEDIA STATEMENT
Only perfect storm in Tony Ryall’s head

Tony Ryall claims Solid Energy faced a perfect storm but the only perfect storm is in his head, says Labour’s SOEs spokesperson Clayton Cosgrove.

“Tony Ryall claims that Solid Energy was facing a perfect storm. But he refuses to accept that demanding that a company facing falling revenue and coal prices should ramp up debt and increase dividends was a key factor in Solid Energy’s downfall.

“John Key himself says the increased gearing was one of three reasons Solid Energy collapsed. But it was his Government that demanded that Solid Energy increase its debt.

“John Palmer also confirmed that John Key has misled the people of New Zealand. John Key claimed that Solid Energy had asked the Government for a $1 billion capital injection. John Palmer said this never happened.

“The $1 billion capital injection is a pipedream of John Key as he desperately attempts to pass the buck. New Zealanders will see through it. The buck stops with the Prime Minister.

“National has constantly claimed there was nothing they could do to stop the collapse of Solid Energy. But John Palmer has confirmed that National minsters were fully informed of the state of the company but he received no direction or instructions to change tack.

“National ministers stood by while hundreds of jobs were cut across the country.

“Ministers had the powers to direct the company to change its investments, to reduce debt, to stop paying dividends or sack the board. In fact they asked the Board to expand coal projects, increase debt and pay out more dividends. Yet they now deny responsibility for their recklessness.

“National has pointed the finger at everyone else but it’s crystal clear that the blame lies at the heart of the Beehive,” says Clayton Cosgrove.

ENDS

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