Ministers 'stand apart’

Press, 8 April 1987, Page 2

Ministers 'stand apart’

PA Wellington The Minister of Finance, Mr Douglas, sought yesterday to distance the Government from the resignations of two Coal Corporation directors over an asset valuation dispute with the Treasury.

The Cabinet had instructed Ministers to stand apart from the negotiations between the Treasury and the corporations which were “highly technical and extremely complex,” he told Parliament.

A Wellington businessman, Mr lan Small, and an Auckland lawyer, Mr Steven Franks, quit the Coal Corporation board on April 1.

Mr Small said later he decided to quit after a late-night session with

Treasury negotiators trying to fix the value of State Coal’s assets.

The high price asked would force the corporation into taking short-term decisions not in the best interests of mine workers or the nation, he said.

Mr Franks said yesterday the Government’s corporatisation exercise would fail if it did not give the new corporations the authority to act on their own decisions.

He said he resigned because he was not going to “stay around to be frustrated” by the way the Crown’s negotiating team were handling the changeover of control. While Coalcorp’s establishment board, of which he was a member, was formulating what it saw as a plan of action which

would turn the Crown’s coal investments into a profitable business, he became increasingly convinced the Crown’s negotiating team had different proposals.

The differences concerned the value of the assets and how the resources involved could be best used.

The Opposition spokesman on State corporations, Mr lan Mac Lean, had asked Mr Douglas to make public in view of the resignations the new issues raised by the Treasury in last-minute negotiations with the Coal Corporation. Mr Douglas refused, saying the negotiations did not involve Ministers and for reasons of commercial viability were not normally made public.