14 November 2000 PR126/2000

FEDERATED FARMERS SIGNAL IMPORTANCE OF SUPER FUND DEBATE

Federated Farmers Vice President Tom Lambie gave the keynote address to the federation's 2000 National Council.

In his speech, Mr Lambie said that the Government's pre-funding of superannuation through the Super Fund would be significant for small and medium sized businesses. There is potential for investment funding to be diverted towards large publicly traded companies, and offshore stockmarkets.

"The Super Fund will take a huge amount of money under its control. While it's there, that money may be directed into large secure investments such as major companies, or offshore, because that is the financially prudent policy."

"These funds would not then be available for smaller investments into small businesses, because they are high-risk, hard to manage investments. While the total level of investment may or may not grow through the Super Fund's existence, where the investments could be skewed away from small and medium sized businesses.

"Pre-funding means that the Government is doing New Zealand's saving, albeit for a particular reason. Farmers need to ask the Government will funds be diverted towards the small businesses that are the engines of economic growth," Mr Lambie concluded.

Federated Farmers will participate in the Select Committee process to make sure any compulsory superannuation funds are available for small businesses' investment needs.

ENDS For further comment: Tom Lambie 026-113-161 Catherine Petrey 025-429-965 or 04-473-7269

© Scoop Media