PM defends Tiwai payout

John Key
John Key
Prime Minister John Key has defended his Government's $30 million payout to the owners of the Tiwai Point aluminium smelter after the Greens and Labour said parent company Rio Tinto's US$3.7 billion profit showed the payment was unjustified.

As well as reporting the US$3.7 billion net profit, the global mining giant announced a 15 per cent increase in dividends to shareholders.

In August last year, the New Zealand Government made a made a one-off payment of $NZ30 million to Rio Tinto - which threatened to close the Tiwai Point aluminium smelter if it didn't get a lower power price from Meridian Energy.

Given Rio Tinto's increased profit, "John Key should be asking for our money back," Green Party Co-leader Dr Russel Norman said.

Labour's state owned enterprises spokesman Clayton Cosgrove said the subsidy paid to Rio Tinto "has been shown up to be corporate welfare at its worst".

"Rio Tinto must be laughing all the way to the bank. It can pack up and leave Tiwai in 2016, minus any obligations and having pocketed millions in taxpayer cash."

Mr Key this morning defended the payment as "a modest step to ensure there was a smoother transition where we didn't either have a glut of electricity we couldn't use or the thousands and thousands of Southland jobs were put at risk.

"If Tiwai Point had closed straight away then hundreds and hundreds and hundreds of jobs would have disappeared and the Greens would have said the Government doesn't care about those workers and is turning their back on them so they really can't have it both ways."

By Adam Bennett of the New Zealand Herald

Idea

Helping all Kiwis - now there's an innovative suggestion. Too clever for our PM.

Tiwai

So what is Mr Key doing to offset the closure of Tiwai, Southland's biggest employer in 2017?

Maybe he will just give Rio Tinto the power to keep Tiwai open if that hasn't happened already?

Why not put the money into connecting Manapori to the national grid and drop the price of power to all New Zealanders.

It's sickening.

Arrogant Kiwirail

speedfreak43: Regarding building wagons and locomotives at Hillside (NOT "trains"), despite several requests via the Ombudsman, Kiwirail refused to divulge the exact quote developed by Hillside against alien bid competition at the time when wagon replacement bids were called. Many foreign countries insist on a percentage of mandatory local manufacturing input into international bids. This Government via Kiwirail was just too dumb and uncaring to follow suit. Additionally, I very much doubt whether Hillside management were ever asked to actually make a bid. We will never know because of this Government's arrogant dictatorship.  

Quite right

macquack: That 30mil wouldn't have lasted long on welfare payments necessitated by the hundreds out of work. Call it job creation. And yes, those trains should have been built here regardless of if the cost was a bit more.

Corporate welfare

Just another example of corporate welfare payed out by the current National government with little to no bottle.

Putting company profit before people.

When are they going to stop selling us out?

A necessary $30m

The alternative, potentially, was for the loss of one of Southland's major (if not the major) employers, and many well-paid jobs. I am happy for Treasury $$ to support such employment; they should have acted similarly in respect of Hillside.

Time to go, John

So Australian Mining Corporations can blackmail our governement successfully? What a weak man our PM is. It must be getting around 'cause they are all doing it now from Warner Bros to Rio Tinto. Time to go, John before we decide your actions are a contravention to the obligations of office and impeach you.

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