Last year’s parliamentary year finished pretty much where the previous one had; with confident looking Labour-led Government firmly in the driving seat, and struggling National opposition languishing in the polls and the party faithful wondering if they had the kind of leader who could ever resurrect their former fortunes. It was as if the Orewa speech that rocketed National up the charts earlier in the year and fleetingly made Don Brash the darling of the right, had never happened.
Now in born-again mode, re-invigorated Government shows no sign of easing off on new legislation, as has traditionally been the case with administrations approaching the end of their second term, fearful of giving offence in election year, and keen to husband their energies for the hustings.
All the indications are that the 2005 legislative programme will proceed under full canvas and the select committee work load, at least in the first half of the year, will be as heavy as ever it was.
As the committees settle down to their task, there are three Bills in particular that the commercial world will scrutinise. They are the Securities Legislation Bill, the Taxation (Base Maintenance and Miscellaneous Provisions) Bill, and the Overseas Investment Bill, all of which have the potential to significantly impact the bottom line.
The Securities Legislation Bill aims to strengthen insider trading laws and toughen up on other financial market misconduct. In introducing the legislation the then Minister, Margaret Wilson – soon to take her place as the new, and first ever woman, Speaker of the New Zealand House – said that the Securities Markets Act 1988 did not provide effective insider trading laws.
“Current laws are complex, difficult to enforce and its trading prohibition clauses are relatively easy to avoid. No one has been found liable for insider trading since the Act came into effect. When coupled with research showing an enforceable insider-trading regime can increase market liquidity, the need to beef up our insider trading legislation becomes very apparent,” according to Wilson.
The Bill also broadens the definition of insiders prohibited from trading and introduces criminal remedies as well as increasing civil penalties.
The Taxation (Base Maintenance and Miscellaneous Provisions) Bill introduces number of significant changes to current taxation law. Amendments to the Income Tax Act 1994 and the Income Tax Act 2004 will limit the deductions of registered bank in relation to interest incurred on loans that finance the operations of the bank and of companies in the same group as the bank.
Other amendments introduce temporary exemption for six years, of income earned by foreign companies from offshore seismic surveys of possible petroleum fields and from offshore drilling of wells for petroleum. Amendments also allow deductions for expenditure incurred by business in avoiding or remedying the detrimental effects to the environment from the discharge of contaminants
The Overseas Investment Bill aims to subject overseas people wanting to buy sites of special heritage or environmental value to tougher regime. Among the changes: Overseas applicants wanting to buy land but not intending to reside in New Zealand will have to include, in the asset management plan attached to their application, how they will manage any historic, heritage, conservation or public access factors relevant to the property as well as any planned economic development.
With the Government showing no signs of running out of puff, the scrutiny of those whose job it is to closely examine bills will be every bit as important this year as it is in any non-election year. Watch this space.
Julie Collier is editor and publisher of Select Committee News.
