PGF now providing banking services to struggling firms

The Provincial Growth Fund’s move to hand out loans to struggling New Zealand firms should scare the daylights out of taxpayers, says ACT Leader David Seymour.

Loans through the Provincial Growth Fund were announced today for the Ruatapu Garnet Project, Westland Milk Products, and the Punakaiki Rest Wellness Centre.

“If banks aren’t willing to lend to these companies, they have judged them to be too risky a proposition. Why on earth should taxpayers be on the hook?

“By not purchasing their products and services, New Zealanders have said they don’t wish to support these firms. But the Government has taken taxpayer money and doled out corporate welfare anyway.

“Banks have every incentive to get their investment decisions right because otherwise they go bust. Shane Jones doesn’t face the same constraints. He won’t be in politics to see the results of his decisions.

“This is a political fund, making political decisions. There is no compelling investment rationale underlying any of Jones’ decisions.”

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