Bolger under fire over sale of NZ national bank


By David Robie

AUCKLAND — Prime minister Jim Bolger's government calls for an investigation into allegations of extortion from homeless Pacific islanders desperate for living quarters by staff of the state-owned Housing New Zealand corporation.

Social welfare minister Jenny Shipley launches a bitter attack on the nation's television diet of violence and "rampant welfarism", blaming them for social trends marked by the two recent mass murders of families.

Maori protesters angry over land rights and the closure of rural public amenities threaten to barricade a postal bank office in the small seaside resort of Raglan in a bid to keep it open.

While the New Zealand government claims to see signs that the country's radical free market economic upheaval of the past few years is beginning to pay off, critics point to unemployment, health and education crises and a worsening social malaise.

In the same week that the government announced the sale of the country's largest bank to Australian interests — the latest move in its asset-stripping strategy — the number of unemployed New Zealanders officially rose to yet another record of almost 245,000.

Unofficially, the figure is believed to be close to 13% unemployment.

The historic sale of the Bank of New Zealand — the largest NZ-owned bank since 1861 — will recoup the government $850 million to pay off part of the country's $20.8 billion foreign debt. The bank will become wholly owned by the National Australia Bank by November, now that the bank's minority shareholders have agreed under pressure.

Opponents on the left have condemned Bolger for the agreement. When the former Labour government tried to sell the bank to the same buyer in 1968, Bolger branded the attempt "the act of a Judas".

Opinion polls affirm renegade MP Winston Peters — a politician who has fiercely contested the bank sale — as the country's most popular politician. He remains in Bolger's ruling National Party in spite of attempts to expel him.

Peters recently implied on Australian television that the Business Roundtable, NZ's highly influential business "club", had tried to bribe him to change his economic views into supporting privatisation.

Since then Peters has continued to attack his government's rescue of the Bank of NZ in 1990 and the role of the Fay, Richwhite merchant bank in government affairs. The opposition Alliance and e joined his demand for an inquiry into the bail-out of the bank for $800 million and now its impending sale.

Although the National Party has recovered from its slump in opinion polls to edge into a slight lead over the opposition Labour Party in opinion polls, the fast-rising third party coalition, the Alliance, has also made a strong showing in the three-way race.

With a general election due next year, National now has 35% support compared to both Labour and the Alliance on 32%. The current state of the parties in the 97-seat parliament is National 65 seats, Labour 29 and Alliance 3.

While National and Labour are opposed to a change in New Zealand's traditional first-past-the-post electoral system, the Alliance has campaigned strongly for a mixed member proportional system when New Zealanders vote on the issue in the vital referendum on September 19.

The ballot is probably the most crucial postwar vote in New Zealand, yet television ads in the $3 million promotion campaign have been attacked in parliament as costly and confusing.

Michael Laws, a government backbencher and strong advocate of proportional representation, criticised the first ad of a series as showing a "clearly manically depressed young man" with moronic conversation skills who couldn't be bothered about the referendum.

The Alliance — a coalition of the NewLabour Party, Greens, Liberals, Democrats and Mana Motuhake (a Maori sovereignty party) — is strongly opposed to the Bolger government's privatisation policies.

It played a key role in the blocking of the sale of Auckland Port with a high profile public campaign.

Secondary teachers have staged rolling strikes and have accused the State Services Commission of being "hell bent" on destroying cooperative working relationships in schools, insulting attitudes and treating teachers with contempt over wages negotiations.

A government plan to put a substantial number of senior staff on individual "management" contracts instead of on the traditional collective agreement has angered teachers, who have threatened to shelve a new curriculum.

University students have also protested against the government's user pays policies. Student leaders have branded the policies as penalising the poor in favour of people from more affluent backgrounds.

Ironically, social welfare minister Jenny Shipley has blamed New Zealand's ills on the "legacy of rampant welfarism" which "produces young illiterates, juvenile delinquents, alcoholics, substance abusers, drug addicts and rejected people at an accelerating speed".

She pledged to introduce new censorship laws later this year to clamp videos, books and publications.

Prime Minister Bolger dismissed the nation's problems and said the wealthy should be treated as heroes, not parasites.

"What we need in New Zealand today is nothing less than a new breed of hero", he said, suggesting citizens should hero-worship successful winemakers, fish resource developers, farmers, forestry investors, apple growers, tourism operators and manufacturers.

Bolger believes the "drama" surrounding the government's reforms will fade and New Zealand can look forward to a period of "quiet prosperity". He also stresses the need for further privatisation and deregulation.

Bolger's prescription has been challenged by a leading journalist, David McLoughlin, who has written a new book pointing the finger at complacency and political bungling in New Zealand for the past two decades.

The Undeveloping Nation: New Zealand's 20-Year Fall Towards the Third World gives a disturbing account of the economic and political decay that has left the country with crippling debts, shocking levels of unemployment, nil growth, fewer state-owned assets and deteriorating social services — particularly health, education and local services.

According to McLoughlin, New Zealand's standard of living — if measured by statistics such as the quality of health care, housing, sophistication of household goods and so on — is being rapidly overtaken by Asian countries such as Hong Kong, Singapore and Thailand.