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Media statement on resignation from SOE boards

21 October 2002


Media statement

Today I have tendered my resignation as Chair of both Television New Zealand Limited and Industrial Research Limited and these resignations have been accepted by the shareholding Ministers.

I accept that my positions are no longer tenable and that the honourable course of action is to resign. However, I regret and reject the way in which reports of my efforts to develop the Public Private Partnerships (PPP) issue have been interpreted as an attempt to deliberately mislead the government,

A word about the subject of PPP. Public private partnerships enable the public and private sectors to work together in developing major projects that may otherwise not be affordable. A precondition of these partnerships is the requirement that ownership remains in Government hands.

My intention was to work with a team to develop a set of discussion papers on PPP with input from the private sector and overview from the public sector.

I saw this as an opportunity to contribute to New Zealand's growth because our standard of living and our future depends on our ability to grow the economy. To achieve such growth, services and infrastructure must perform efficiently. Roads are a vital part of our infrastructure and when Auckland is moving, New Zealand is moving. Conversely, when Auckland comes to a standstill New Zealand's growth and productivity is compromised.

There was absolutely no intention that any participating company would have an unfair advantage. In fact no advantage beyond the obvious benefit by their participation in a better understanding of policy issues such as the private public sector risk, the public sector comparator, approval processes and other contractual issues, was intended. The issues of probity would have been a central part of one of the discussion papers. Following the completion of the papers it was intended that Government would consider and implement a consultation process with both business and the wider public.

The reason I sought to pursue this idea and involve the private sector in an area traditionally the preserve of the public sector was because it seemed to encapsulate the very spirit of the words "public private partnership". Here was a policy area where a number of New Zealand companies through their off shore connections had an excellent working knowledge of PPP. Our closeness to Australia mean that we had an opportunity of understanding the workings of PPP in the states of New South Wales, Victoria and Queensland. This meant we wouldn't have to reinvent the "policy" wheel.

While the paper was prepared by the Pacific Roads Company, I take responsibility for it. Unfortunately, the preparation and approval process took place in a short time frame and I overlooked some critical phrases in the draft. There was never any intention that there be favouritism to any participating company and I do regret the embarrassment caused to the Government.

I am proud, privileged and honoured to have been given the opportunity by successive Governments to lead New Zealand Post, establish Kiwi Bank, prepare for the implementation of TVNZ's charter, and add to scientific innovation through my work with Industrial Research Limited.

Ross Armstrong

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