Mike's Minute: So many questions around the Govt's cement bailout

Nicola Willis told us she did not take the decision lightly, and well, she might have said that. 

She's lucky it's only cost $60 million. We still don’t know the terms, but we need to. 

This is Golden Bay Cement, and the Government has come to their rescue. 

Without this help, allegedly, they would have closed. 

There is only one supplier in the country – this in and of itself would seem to be an issue. They produce 60% of what we use. 

Is the other 40% cheaper? And what of the climate mitigation issues Fletchers speak of? Why do we worry about the 60% and not the other 40%? 

Why is climate so important in the cement business, and is climate worth worrying about if it means the closure of business and the loss of jobs? 

That is one of the questions of the age, especially given the Europeans over the weekend signalled their intentions to pull back on climate expectation for businesses for exactly the same reasons. 

Climate versus jobs? We quite like the work, thanks. 

Fletcher Building is the owner and a company with no shortage of drama around their reputation and activities, but not a business desperate, you wouldn't have thought, for $60 million. 

But, and here is the crunchy bit, they're a company that in straightened times is perfectly entitled to pull the pin on things that aren't working. 

So, a good business decision, or blackmail? 

Is the business run as they claim? In other words, it's not workable, or are they a bit useless? 

Britain is having the same conversation currently over a nationalised steelworks involving the Chinese and a water company that’s on its knees. 

The trouble is the specifics and the precedent. Every story is unique. 

Can a government write a cheque for one-offs? Maybe. 

Does it set a potential precedent? Yes. 

Should the Government be in cement? No. 

Should we be more resilient in the basics of things like building materials? Yes. We have just had that debate by cleaning out an old tank at Marsden. Resilience is important. 

So I don’t mind this as a one off. 

But is it a bad business or is it a business hampered by dumb rules around climate? And if it’s the latter, would a change of rules fix the problem better than a bailout cheque would? 

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Episode Transcript

Speaker 1 (00:00):
The Mike asking breakfast six and nine week days on
used talks you know there. Nikola Will has told us
she did not take the decision lightly and well she
might have said that, and she is lucky. It's only
sixty million dollars. We still don't know the full terms
and conditions, but we need to. This is golden cement.
Of course, the government has come to their rescue. Without
this help, allegedly, they would have closed the thing. There's

(00:22):
only one supplier in the country. This in and of
itself would seem to be an issue. They produced sixty
percent of what we use. Is the other forty percent cheaper?
And what of the climate mitigation issues? Fletcher's speak of
why do we worry about these sixty percent and not
the other forty percent? And why is climate so important
in the cement business? And is climate worth worrying about
if it means the closure of the business and of

(00:43):
course the loss of jobs. That is one of the
questions of the age, of course, especially given the Europeans
over the weekend signaled their intentions to pull back on
climate expectation for businesses there for exactly the same reasons
climate v. Jobs. We quite like the job thanks Fletcher
Building is the owner a company with no shortage or

(01:04):
drama around their reputation and activities, but not a business
desperate You wouldn't have thought for sixty million dollars. But
and here is the crunchy bit, one that has straightened times,
apparently perfectly entitled to pull the pin on things that
aren't working. In other words, are they entitled to close
their business that they don't want to run it anymore?
I guess yes? So what have we got here? A
good business decision? Or have we got some blackmail? Is

(01:28):
the business run as they claim in other words, it's
not workable? Or are they basically a bit useless? Britain
is having the same convo currently over a nationalized steel
works involving the Chinese are about to see them, and
a water company that's basically on its knees owing about
twenty billion pounds. The trouble is the specifics and the precedent.
Every story, of course, is unique. Can a government write

(01:51):
check for one offs? Well? Maybe? Does it set a precedent?
It most certainly does. Should the government be in cement? No?
Should we be more resilient in the basics of things
like building materials? Yes, we have just had that debate
by cleaning out an old tank at Marsden Point. Resilience,
it turns out, is important, so I think on balance,

(02:12):
I don't mind this as a one off. But is
it a bad business or is it a business hampered
by dumb rules around climate? And if it's the latter,
what a change of those rules fix the problem better
than a large check from the government. The my asking
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