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PM Press Conference – Fonterra | Meridian Energy - 12 August 2013

PM Press Conference – Fonterra | Meridian Energy - 12 August 2013

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By Alastair Reith

A bill providing greater powers to Governmental Inquiries will allow the government to get to the bottom of the Fonterra milk scandal, says Prime Minister John Key.


A bill providing greater powers to Governmental Inquiries will allow the government to get to the bottom of the Fonterra milk scandal, says Prime Minister John Key.

Mr Key today told a press conference the legislation will allow a new kind of inquiry - less than a formal Commission of Inquiry but more than a Ministerial Inquiry- to subpoena witnesses and information from Fonterra, as well as seek testimony from relevant parties in the public and private sector.

Currently this could only be done through a Commission of Inquiry which the Prime Minister said could take over a year to complete.

“We need to get to the bottom of what took place. We can't wait for a year or more,” he says.

The Ministry of Primary Industries is conducting a separate "regulatorty" investigation, with the power to impose penalties of up to $500,000 or twelve months in prison.

The Prime Minister will travel to China once inquiries into Fonterra are complete. He says this announcement has been met with a positive response in Chinese media.

“It's important we get this right,” says Mr Key. “We live in a world where there is always the risk something will go wrong. I want to be able to say we have total confidence in the systems we have in place.”

Foreign Minister Murray McCully is travelling to China next week, where he will meet with government and trade officials. He has also indicated he will extend his trip to Sri Lanka, where Fonterra products have recently had to be recalled.

The inquiry bill to which the PM is referring appears to have been sitting at the select committee stage for four years. Now is the best time to move it forward, then Prime Minister says, and the Government might do so under urgency if necessary.

He says he has not yet consulted with the opposition about this and would not confirm which parties had pledged their support. He says is confident of majority support.

Other topics discussed at today's regular Post-Cabinet press conference included the $30 million taxpayer subsidy which is to be paid to to Rio Tinto, majority owner of the Tiwai Point aluminium smelter to ensure that the smelter remains open till 2017.

The company has abandoned plans to sell the plant, but Labour is accusing the government of propping up a multi-national company while power prices continue to rise for Kiwi households.

The PM says that the Government twice said no to unreasonable demands from Rio Tinto. He says the government is not prepared to subsidise the smelter for a further 18 years.

The government is preparing to announce new measures it says will protect vulnerable children, with Paula Bennett set to announce details this week.

“We make no apologies for these changes, which will be controversial to some,” says the Prime Minister.


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