Minister denies speculation

Press, 12 June 1987, Page 1

Minister denies speculation

By

BRENDON BURNS

;<< in Wellington , Two of* the partners* 'th a property company with the Minister of Finance, Mr' Douglas, have defended his involvement against charges of speculation. In Parliament yesterday Mr Winston Peters, the member for Tauranga, asserted that Mr Douglas had broken his position of trust and privilege.

He said the Minister had a 25 per cent shareholding in a company which had two years ago negotiated a Hamilton commercial property purchase, priced at almost $170,000.

But a two year delay in settlement to April this year had seen the property rise in value to at least $280,000, said Mr Peters. “He was speculating on the failure of his own policies. He was speculating on the continuation of inflation and was taking, because of his unique position, no risk or gamble whatsoever. He could not lose,” said Mr Peters. 7 He released documents showing that Mr Douglas, the Development Finance Corporation chief executive, Mr Murray Smith, a retired Hamilton man Mr S. A. Russell, and Mr John Irwin were shareholders of Rostrevor Buildings, Ltd. They had collectively paid a $5OOO deposit on a Hamilton building with a delayed option for purchase.

Mr Irwin, a former Labour '. Party candidate, last rejected" any suggestion s 'of pro-' perty speculation. He said that five years ago he had bought a printing business housed in the building, with the option to buy the premises two years ago. As the time approached, the purchase price proved too much for him to meet personally. He approached a long-time friend, Mr Murray Smith, himself a former Labour member of Parliament, who in turn approached Mr Douglas. With Mr Russell, a company was formed to buy the premises and lease them to Mr Irwin’s printing firm. Mr Irwin said the vendors then asked for a two-year delay in the option to purchase, with a fixed price. This was agreed to and gave rise to the substantial rise in the property’s value, he said. Mr Irwin said Mr Douglas had not set out to achieve the paper capital gain now attained by the company. In a statement issued after Mr Peters’ claims in Parliament, Mr Douglas said they were disgraceful.

“I have done nothing wrong. There is no conflict of interest” He said he made a. small investment of $1250 to assist a friend.

“I have had ho money from

this investment at all. There is . nothing to hide.” ■ 'Mr,“Douglas' was further defended by Mr Smith, now with the D.F.C., but former Labour member' of Parliament for Whangarel in 1972-75. “There is no substance whatsoever to any suggestion of improper dealings or behaviour,” he said.

“What Roger Douglas has released is the truth.” Mr Smith said the relationship between him, Mr Douglas and Mr Irwin was one of friendship based on past association. “The proposition was developed and presented by Mr Irwin to myself and it was I who approached Roger Dougas to see. if he would be interested.” When Mr Peters, made his allegations in Parliament there were worried looks on the face, of the Prime Minister, Mr Lange, who conferred briefly with Mr Douglas.

An Associate Finance Minister, Mr Prebble, said the claims were “absolute rubbish” and done on the basis that if enough muck was thrown, some would stick, “What do the National Party do when they are in trouble? They throw muck.” After Mr Peters’ claims, made early in the Imprest Supply debate which allows wide-ranging discussion, no other National member pursued the allegations against Mr Douglas.