Sunday 22nd Aug 1999

Richard Prebble

Speech -- Governance & Constitution

Extract from speech to ACT South Island candidates conference

Cotswold Hotel Christchurch 10.30am Sunday 22nd August 1999

Hon Richard Prebble CBE

Leader ACT New Zealand

Winebox allegations not upheld

The 1999 election is shaping up to be the most open and exciting in the last 30 years. If the TV One poll was correct, then last Saturday the country would have elected an ACT/National majority.

Labour was just 2% ahead of National, ACT and the Alliance were both at 7% and New Zealand First was below the threshold. It would have been a comfortable centre-right victory because the supporters of the left parties never go out to vote in the same numbers as they get in public opinion polls. Conversely, ACT's vote goes up.

At this point, in the last election three months out, ACT was at 2%, yet we won eight seats. Yet of other polls are correct, then it's an Alliance/Labour government. The correct conclusion is that the election is wide open.

It now seems also possible that a relatively straight forward election between National and ACT on one side and Labour and the Alliance coalition will be complicated by the re-election of some New Zealand First MPs.

No party welcomes this development because Mr Peters and his fellow travellers have proved to be erratic and unstable. No one can work with Mr Peters - he is too unreliable.

It seems extraordinary that commentators are now saying that a legal ruling on an academic point of law, about a complex tax arrangement that happened 15 years ago, restores Mr Peters credibility.

Everything Mr Peters told Parliament about the Winebox has been proved wrong.

Mr Peters promised Parliament that an inquiry would recover hundreds of million of dollars of taxes that he said were being evaded. The Minister of Inland Revenue, Mr Birch has confirmed that the $12 million Winebox Inquiry did not discover a single dollar of tax that the IRD had not collected.

Mr Peters' allegation of corruption against the then Inland Revenue Commissioner Mr Henry and against the then Serious Fraud Office head Charles Sturt, have not been upheld.

Now a tearful Mr Peters tells us that all he ever wanted was this legal ruling. Why did he not save us all the time and money and go himself five years ago to the High Court for a legal ruling?

For the record it's worth saying what the Winebox Inquiry really found and the High Court has not altered.

Some 15 years ago a few companies entered into a complex arrangement, involving the Cook Islands, to reduce tax. The Palmer Labour Government closed the loophole. The IRD, before the Winebox Inquiry, had disallowed the tax deductions and had collected the tax plus penalties. The Inquiry pointed out that in two years Mr Peters could not point out a single dollar of tax outstanding. It was a complete waste of time and Mr Peters should return the $600,000 he has received in legal aid.

If that's Mr Peters idea of a win, well I would hate to be around when he has a loss. But, of course, we were. The whole country suffered when Mr Peters was Treasurer. This week is the anniversary of the dissolving of the New Zealand First/National coalition, when half of his MPs left him.

Mr Peters is now reinterpreting his time as Treasurer just as he is reinterpreting his failure to find any lost tax revenue. Mr Peters is claiming to have reduced interest rates, the exchange rate and unemployment. A year ago the ANZ mortgage rate was 9.5% - today it's 6.5%. When Mr Peters became Treasurer unemployment was below 6% and falling. When he left office the unemployment rate was 7.5% and rising. The Reserve Bank, because Mr Peters was so erratic and government expenditure was out of control, kept interest rates and the exchange rate up. Even Mr Peters does not mention that when he took office there were record surpluses which he converted into a deficit.

In just under two years Mr Peters converted a growing economy, with falling unemployment, into a recession with rising unemployment. No other Finance Minister, in less than two years, has done more damage. It took Sir Robert Muldoon eight years to do what Mr Peters did in less than two.

The greatest damage is what Mr Peters has done to our national spirit. He has divided the country. He has managed to persuade large numbers of people that New Zealand business is somehow corrupt. He created an anti-business climate that still exists.

I believe parties have a duty to set out clearly where they stand. Let me set out ACT's position. ACT will not allow Mr Peters to hold the nation to ransom again. ACT won't enter into a coalition with Mr Peters. ACT will not support a coalition which New Zealand First is part of.

If Mr Peters wants to be on the Treasury benches again he can only do so with Labour and the Alliance. ACT will veto any New Zealand First participation in a possible centre right government. In ACT we say what we mean and mean what we say, we want no part of any New Zealand First government.

Of course it's still most likely that New Zealand First will win no seats. Three months out from the last election New Zealand First was at 27% in the polls, by election day their support had halved. Today the party is at 4.5% in some polls and just 2% in others. In the latest poll in Tauranga over 70% of Tauranga voters said they did not want him. ACT will do what we have to do to ensure that the wishes of over 70% of Tauranga voters are carried out.

This election a list vote for ACT is your insurance that Mr Peters does not hold the National Party to ransom. If the Alliance were to make a similar statement, then the popularist threat from Mr Peters would be over.

It's interesting note when Labour and the Alliance attack New Zealand First, they refuse to issue strong statements like ACT has, ruling out using New Zealand First to achieve power. Helen and Jim - you are welcome to Winston. He is a big spender, big taxer like you - and you belong together.

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