Govt accused of Budget leak to businessmen

Press, 13 June 1979, Page 1

Govt accused of Budget leak to businessmen

PA

Wellington

Budget material relating to export tax incentives had been leaked by the Government to businessmen who could profit from the information, two Opposition members of Parliament alleged yesterday.

Mr R. O. Douglas and Mr R. W. Prebble, in a series of notices of motion in Parliament, and at a press conference, revealed details of the scheme which they said had been given by Treasury and Trade and Industry officials to businessmen. Thev alleged a deliberate Budget leak which could benefit big business. The two also alleged that the leak was “totally wrong’- from a constitutional point of view. But the Acting Minister of Finance (Mr Templeton) has denied the allegations. Documents shown to the businessmen at a meeting in Auckland were for consultation based on Government policy announced in the. three previous Budgets, Mr Templeton said. The Government view was that consultations were necessary to make sure the proposals were clearly understood. It was pointed out to Mr Templeton by journalists that although the documents were not actual Budget papers, the material in them could be Budget material. “This is not Budget

material,” he replied. “There has been no leak.” Asked if he would resign if it turned out on Budget night that the information was Budget material, Mr Templeton replied “No comment.” He also denied any possibility of having infringed constitutional practice. Mr Douglas, the member for Manurewa, attempted to have a snap debate on the subject. This was not allowed by the Speaker (Mr Harrison), Mr Douglas and Mr Prebble gave details of what they alleged would be in the export tax incentive scheme. They said the papers discussed by the Auckland businessmen set out in detail Government proposals for export performance tax incentives; details of an export market development incentive scheme and export grant project scheme; and a general review of a new package which would meet both the needs of exporters and help fulfil the Government’s aims of improving the nation’s economic prosperity. Information was also given to Parliament of the

actual cents in the dollar which could be deducted for tax purposes under the export incentive scheme. Mr Douglas, at a press conference, said the information given to businessmen was either a deliberate Budget leak or else a “massive con job on the business community of New Zealand.” As a result of the leak, those “in the know” could buy shares which were likely to increase in value once the Budget was announced, Mr Douglas said. He asserted that a study of share registers over previous weeks showed increased trading in shares of large New Zealand companies which were big exporters. He cited U.E.B. and Feltex as examples. However, he did admit that their increased share turnover might be attributed to other factors. Mr Templeton maintained there had been no disclosures of what was in the Budget. Neither would anyone be able to gain from the information given at the discussions with businessmen “because they cannot be certain of the final elements in that Budget.”