3. JOHN KEY (National—Helensville) Link to this
to the Minister of Communications
Does he stand by his statement that Telecom shareholders “need to accept that in the short run there may be somewhat lower dividend flows or lower returns”; if not, why not?
Hon DAVID CUNLIFFE (Minister of Communications) Link to this
As I said in the article referred to, and have clarified since, Telecom’s dividends policy is a matter for the Telecom board. The issue has been referred to the Securities Commission, and it is therefore not appropriate for me to comment further at this time.
Does he acknowledge that as Minister of Communications he is the Minister with the most inside information about the future of Telecom, including whether it will be forced by the Government to be physically separated at some stage in the future; if so, does he consider comments about its future dividends policy to be the actions of a responsible Minister?
Hon DAVID CUNLIFFE Link to this
As I have said, the matter has been referred to the Securities Commission, and should the commission ask it, I will cooperate fully with it on this matter.
Is he aware that his comments being posted on the Bloomberg News wire at 12.30 yesterday immediately led to 75 million trades in Telecom stock yesterday afternoon, which was a massive increase in the volume of trade normally experienced with this stock; if so, does he consider that all participants in the New Zealand sharemarket have been fairly and equally treated by the dissemination of this information?
Hon DAVID CUNLIFFE Link to this
I refer the member to my clarifying statement issued this morning, and I repeat that the matter has been referred to the Securities Commission, and if asked I will cooperate fully with it.
Hon Trevor Mallard Link to this
I raise a point of order, Madam Speaker. I think it was Dr Smith who just indicated that you had goofed. He has been around for a few years now, and he knows that he should not address that sort of comment to you.
Hon Dr Nick Smith Link to this
Madam Speaker, may I make it absolutely plain to the House that the goofing remark referred to David Cunliffe and not you as Speaker.
Madam SPEAKERIf the comment was directed not at the Speaker but at another member, and if it was not made when a question was being asked, it was perfectly in order. However, I would just warn members that implications about the Chair are to be taken very seriously in the future, as I have now counted up the number of statements that have been made as asides.
Is he aware that Bloomberg News is a wholesale news service, and is not accessed by retail investors, and that he was making his comments to a wholesale news service and not to the entire market; that the bulk of the $200 million lost by investors yesterday afternoon was borne by retail investors—namely, Kiwi mums and dads—and does he consider it fair that Kiwi mums and dads lost $200 million yesterday on the back of his statements?
Hon DAVID CUNLIFFE Link to this
As I have previously answered, the matter has been referred to the Securities Commission, and I will cooperate fully with it.
What impact does he think it has on the professional image of the New Zealand Exchange and on the confidence that investors have in our stock market when a Minister with not only a vested interest but also inside information makes, at best, a grossly irresponsible and inappropriate comment that sees one group of shareholders—namely, Kiwi mums and dads—savaged by another group?
Hon DAVID CUNLIFFE Link to this
The member’s question contained a number of presuppositions that are by no means established. The matter has been referred to the Securities Commission, and I will cooperate fully with it.
What was the purpose of his comments about Telecom’s dividend policy if it was not to send a signal to the company, when the Cabinet papers specifically state that the future separation of the company rests on the Government’s assessment of “Telecom’s cooperation in meeting the Government’s broadband objectives”?
Hon DAVID CUNLIFFE Link to this
Telecom’s dividend policy is, as I have said, a matter for the Telecom board to decide. The matter has been referred to the Securities Commission.
Is he aware that the New Zealand Exchange has formally passed the matter to the Securities Commission for investigation, and if, as a result of that investigation, he is found to have breached the law, will he follow the lead of his bench mate, David Parker, and resign his warrants; if not, why not?
Hon DAVID CUNLIFFE Link to this
I think it can be taken from my previous answers that I was aware of that referral.
Rodney HideThank you, Madam Speaker—they are excited to see me. What sort of signal does it send to investors, both here and around the world, when the Government pinches private property from Telecom, the Prime Minister hints that the company will be broken in two, and the Minister of Communications directs that the company’s dividend be reduced?
Hon DAVID CUNLIFFE Link to this
However gratifying it is to have the member back in the House, I suggest that he checks his facts first.
Hon DAVID CUNLIFFE Link to this
The assumptions in the member’s question may be the subject of possible action by the Securities Commission, with which I will cooperate fully.
Hon DAVID CUNLIFFE Link to this
As I have said, the matter may be the subject of discussion with the Securities Commission, and I will cooperate fully with it.