MEDIA RELEASE
23 November 1999
FOR IMMEDIATE RELEASE

LABOUR TWISTING CONTACT STORY TO CREATE POLITICAL MISCHIEF

Not a cent of taxpayer's money has been paid to Contact CEO Paul Anthony under the termination provision in the contract he signed when the company was an SOE, Minister formerly Responsible for Contact Energy Limited Lockwood Smith said today.
"Labour is grossly dishonest in implying that Government was involved in an alleged payment between Contact Energy and Mr Anthony, or that Ministers attempted to persuade Contact Energy to delay the release of its Annual Report," Dr Smith said.
"It is my understanding that Mr Anthony has waived any rights he had under his original contract, and that his private sector employers have negotiated a new contract more favourable than he had previously with Contact as an SOE.
Dr Smith said last March, when the SOE was offered for sale, the company prospectus said upfront and in public that Mr Anthony's contract had a provision worth $2.6 million to him if he decided to quit following any change of ownership.
"The New Zealand Herald reported on 4 June that Mr Anthony was not leaving Contact Energy-despite the change of ownership, he intended to stay.
"The new owners have obviously assessed that Mr Anthony is making a valuable contribution to the company's efficiency, its value to shareholders, and its ability to deliver competitive prices to energy users.
"By contrast, Labour now seems to be running a concerted campaign to discredit some of the country's best business managers, damage their reputations, reduce their pay, and drive them offshore.
"The transformation of Contact Energy into a strong and profitable company, which the Government sold for $2.3 billion, delivering a profit of $1.4 billion to the taxpayer, could only have been achieved by attracting and retaining a Chief Executive of Mr Anthony's calibre.
"Labour's approach will not help transform New Zealand into a dynamic knowledge-based economy. Their attempts to politicise honest transactions within the private sector will damage New Zealand's international reputation as an attractive place to do business.

"It's a cheap shot that Labour should be ashamed of," Dr Smith concluded.

ENDS

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