The public sector cannot carry the load and funds will need to come from the public sector and private sector.
The Cook Islands also has significant investment; we need to be smart about how investment happens. We need to maximise overall investment, from both sectors. The Government is focussed to ensure that public sector investment goes into areas that maximise the public good. The Government should not be investing in areas where the private sector demonstrates clearly it is willing to do so. This sort of action leads to a reduction in opportunities for the private sector to invest in areas where there is a financial return.
As Finance Minister I recognise the needs of the country are great, no one can argue of the need to invest in water, sanitation, roads, schools, airports, ports and hospitals. Some of these do not bring immediate financial returns to the owner, in this case the tax payer, but they bring significant economic and social grounds returns. I have not had people queuing up with their own money to invest in these areas. Ultimately it will be the government that will have to do so; our budget capital book outlines the investments we are committed to making across the country in a lot of these areas.
The proposed sale of 60 per cent of Telecom Cook Islands by Telecom New Zealand to Digicel has seen many people propose that Government takes the unusual action of taking up the pre-emptive rights to purchase those shares for the agreed price of $23 million. Proponents of nationalising Telecom Cook Islands are essentially promoting the Government borrow $23 million towards a venture which the private sector is willing to undertake. If we did this, then there would be less capacity in the future to invest in schools, roads, water, ports, airports, sanitation and hospitals.
Additionally, telecommunications is a complex and ever-increasing global industry. Many countries have or are trying to divest themselves of these assets which require on-going investments to keep up pace, and public budgets cannot keep up – we would be no different.
Those that are concerned about future service delivery by Digicel need to understand that the Government can influence this area through its role as a regulator of the sector as well as through a shareholder agreement.
The Government has decided not to take up its pre-emptive rights. The opposition was provided with a briefing from Crown Law and MFEM on the issue and they would also have the same base of information that we are working from.
However, the opposition have provided no clarity on the issue. James Beer promotes re-nationalisation of TCI but I believe both Norman George and Wilkie Rasmussen have both been on the public record outlining they do not believe government should own TCI. I will leave the opposition to clarify to the public where they stand on this matter.
Minister of Finance