Scoop Election 08: edited by Gordon Campbell


Gordon Campbell's blog updates are now published at Werewolf.co.nz.

Gordon Campbell on asset sales contortions, the GCSB Bill and Jay Z

July 9th, 2013

Hope you’ve got it straight now. Treasury said $100 million from the Mighty River Power sales proceeds had been earmarked to prop up Solid Energy’s “recovery facilities” – although John Key said it hadn’t been, and that Labour’s Clayton Cosgrove was just making that up until on second thoughts, Key conceded that it could ‘technically” be used to do so in future – but trust us, it won’t – even though Finance Minister Bill English conceded it (i.e. the propping up) could still happen, but would probably be done differently than Treasury imagined, if it was needed, which it probably wouldn’t be. If you’re feeling a little dazed and confused by this dizzying change of message over the past 72 hours, join the club. The government has given every sign of not knowing what it was doing with this highly theoretical “now you see it, now you don’t” $100 million rescue fund either.

What we do know is that the original commitment was there in black and white in the Budget papers. There it rested until Cosgrove made a meal of the issue ever the weekend. Good political issue. Asset sales from one state energy company apparently being used to prop up another one earmarked for sale – and that’s even before you get to the Greens point that the proceeds from selling the state’s renewable energy companies would be being used to prop up the state’s failing fossil fuel company. As mentioned, Key initially accused Cosgrove of “making it up” before backing down and tossing in an “I can’t recall” brain fade to cover his tracks. In the Dom-Post’s account, it went down like this:

The Budget said it [the $100 million] could be used for a secured or unsecured loan to Solid Energy or to buy assets from the coal company.

But Key said: “If the Crown has to make a capital injection if that’s what it decides to do with Solid Energy to try and resuscitate it, then, yeah, it can go and do that. But it’s not going to come out of the mixed ownership money” However, Finance Minister Bill English confirmed the Government had set aside a “facility” made up of $50m of appropriated cash and another $50m contingency to help Solid Energy through its cashflow problems, though it was never used. Key later backed down, saying the allocation appeared to be “buried pretty deep” in the Budget documents. “I haven’t actually seen those myself, well I can’t recall them.”

Hmmm. Something to that effect was ‘buried pretty deep’ in the Budget papers. (Evidently, Key just isn’t a fine print sort of guy.) Sometime yesterday, English and Key did finally get their messages more or less aligned. Given the government’s position that it didn’t believe in borrowing to finance its capital spending, English explained, Treasury had taken “a conservative view” and concluded that the proceeds from asset sales programme might conceivably be used to bail out Solid Energy. The other option? “There was, and is, the possibility that the Government would put cash in other than as a secured loan.”

Key agreed that the Cabinet decision “technically” allowed the cash to be used to help Solid Energy. Yet contrary to English, Key insisted the government had only ever contemplated a secured loan, and that would not come from asset sales. At this point, the whole question remains somewhat moot: “We have made no payments to Solid Energy.” Yet watch this space. As English added, the discussions between the government and Solid Energy’s bankers over the future of the company were continuing. Hopefully, they will be more coherent – and better informed – than the government’s own communications on this issue over the weekend.

GCSB Update
As the GCSB Bill hurtles towards its (entirely unnecessary) rushed conclusion, Key made it clear at yesterday’s post-Cabinet press conference that Peter Dunne is his first priority in (a) securing a basic majority for the Bill and (b) then proceeding to build the wider consensus normally considered desirable for the passage of legislation to do with national security. The carrot for Dunne is a dog eared Winston Peters idea – of a two or three person panel to advise the Inspector-General. Something along the lines of the Reserve Bank board, and as Key put it – to give the IG someone to talk to, when he makes decisions. It’s lonely out there.

Talk about the blind leading the blind. What is needed to truly beef up the oversight role of the I-G is a proper budget, to equip the office with dedicated research and investigative staff who can provide some kind of informed technical, legal and evaluative counterweight to what the security services are proposing to do. Fat chance of that. Peters will claim this figleaf of a panel as a triumph.

Labour meanwhile is being very publicly tossed a bone as well – namely, a review after the legislation is passed to assess how it is functioning as a sop to Labour’s request for a wide ranging independent inquiry beforehand as to whether the new legislation is needed in the first place, and what form it should take. Key is not making a serious offer – apples and oranges stuff, given that what Key is offering by way of a review and what Labour leader David Shearer was proposing by way of an inquiry are so different. Yet the offer will serve the political purpose of putting a gloss of reasonableness on what is still a rushed, draconian and unnecessary violation of the privacy rights of every New Zealander.

Jay Z Is the Enemy
So it is not only the GCSB Bill, the NSA’s Prism programme and its French equivalent that we have to worry about. We also need to worry about Jay Z’s attempts to invade our privacy as well. Fans who wanted early access to the rap star’s new album Magna Carta Holy Grail could do so via a special Samsung app. But the app came a set of conditions of use demands that you can access here.

They include permission to “modify or delete contents of your USB storage,” plus the ability to prevent your phone from sleeping” in order to retrieve running apps, to access your “approximate network location” as well as your “precise GPS location,” and the ability to “read [your] phone status and identity” among other things. The politically conscious rapper Killer Mike has been at the forefront of those who read the conditions of Samsung/Jay Z’s joint promotion, and chose to pass on it.

Leave aside the irony of something with “Magna Carta” in its title being a tool to invade privacy. Interestingly, there has been no word as yet on Kim Dotcom’s Twitter feed about this issue. Which side, one wonders is Dotcom on – would he be down with a megastar such as Jay Z, or would he be siding with Killer Mike?

ENDS

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