Simon Watts: Climate Change Minister on the Government winding down Green Investment Finance

The Government has revealed the New Zealand Green Investment Finance will stop making new investments - and will wind down its' existing portfolio.

Climate Change Minister Simon Watts says it has invested almost $400 million into various projects, with 'limited' results.

Watts says there's no need for the Government to be involved in this particular market going forward.

LISTEN ABOVE

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
The government is winding down Green Investment Finance, saying it
invested almost four hundred million dollars but only had very
limited results. Green Investment Finance gave one hundred and forty
five million dollar loan to Solar zero. Remember that that
was put into liquidation last year. The Climate Change Minister
Simon Watts is with me now to talk about it.

Speaker 2 (00:19):
Good evening, minister, yea evening, Ryan, thanks for having me. Yeah. Good.

Speaker 1 (00:23):
So the four hundred million dollars, what was what return
did we get for that? What did we get?

Speaker 2 (00:29):
Well, look at it across of the four hundred only
two hundred million of that was invested across twenty different organizations,
one of which you were right to point out was
Soldar zero. The major portion was about there was one
hundred million totality. But look, you know there's quite a
mixture of returns across the board, but you know, not

(00:52):
large returns. You know, to twenty twenty three about one
point eight percent return on equity. Twenty twenty two and
twenty twenty one were negative for return uns in twenty
twenty four forecast was just under five percent, So you know,
not not at all significant returns in terms of taxpayer investment.

Speaker 1 (01:09):
Did you say twenty twenty four was five percent forecast.

Speaker 2 (01:12):
Five four point nine? Correct? Right?

Speaker 1 (01:16):
And did and that obviously did that happen.

Speaker 2 (01:20):
It is still finishing through, but it's it's that's an
estimate position.

Speaker 1 (01:25):
Right, right, So we don't actually know yet what the
result was. Is it premiature to cut it?

Speaker 2 (01:31):
No, I don't think it's premature to cut it. We've
been pretty clear that the government has decided that, you know,
this type of stuff isn't core government business. We need
to be selected around how we invest taxpayer money. We've
seen the impacts of the Solar zero decision, which went
positive for the taxpayer, and you know, the decision made

(01:52):
that this is no longer core business. I think it
also reflects that actually the market, the private market, has
evolved in many of these funding and financing services are
now provided by banks and other players in the market.
And you know, I don't think that there is a
need for government to be involved in this market going forward.

Speaker 1 (02:11):
How much because obviously so how much has actually been
paid out. Two hundred million dollars has been paid out,
so we won't it's correct what happens with that money.
They just continue, those contracts continue, those investments continu Well.

Speaker 2 (02:23):
Basically the organization is going to stop any new investments
and it's going to manage down that portfolio. Obviously, the
big chunk is sold a zero and that's for that's
an liquidation proceedings, So I sort of can't get into
too much detail. But the other investments, the other nineteen
will in effect be loans that they'll manage through to
maturity or any of the equity stakes that they have,

(02:45):
and they'll be looking for buyers for those in a
managed process.

Speaker 1 (02:49):
Right, So does that mean that there's two hundred million
dollars that otherwise would have been linked that's not been lenked.
I mean that's the upside to the Crown accounts is
two hundred million dollars.

Speaker 2 (02:58):
Yeah, that's right, it was sitting on term depozzle.

Speaker 1 (03:02):
Interesting. Is there anything else that Nicola is taking a
sledgehammer too that you've got purview.

Speaker 2 (03:08):
Over Look, I've only got purview as I'm a shielding
minister for this entity. But you know, at the end
of the day, we've had to we are making calls
across the board around what government's investing in and what
we're not and the reality is this is not an
area which we see as core government coment business. And

(03:28):
as a result of that, you know, we've made a
decision and we'll manage it down. That investment and that
money that is available go back into the center and
will be available for us to invest in other priorities
for the government. So I think that's a sensible decision, all.

Speaker 1 (03:43):
Right, appreciate your time, Simon Wat's Climate Change Minister. For
more from Heather Duplessy Alan Drive, listen live to news
Talks the'd be from four pm weekdays, or follow the
podcast on iHeartRadio.