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Is Joyce too big to fail?

Written By: - Date published: 9:00 am, April 11th, 2011 - 18 comments
Categories: corruption - Tags: ,

In 2009, Bill ‘Double Dipton’ English survived a corruption scandal that would have sunk a less important minister. Key couldn’t afford to lose him. Now, evidence continues to emerge of how Steven Joyce gave his old company a sweetheart loan against the official advice. Do you think John Key will act or is Joyce too big to fail?

Joyce is widely tipped as Key’s successor when he leaves politics – either after losing later this year or in 2013. Where English is the rural workhorse of the National party, Joyce is the big-city wide boy who runs Key’s political strategy.

More and more of the story of how Joyce came to give his former company, Media Works, a $43.3 million loan at below market rates for a distressed company is coming out.

The Nats say they were just offering broadcasters the chance to spread their new fee payments over several years but, in reality, the $43.3 million soft loan to Mediaworks was over 99% of the money lent. In total, $43.6 million of payments were spread out. That means most other companies had to pay up front. Only Mediaworks got significant special treatment.

Over at No Right Turn, I/S has the OIA papers and is assembling the chronology of what went down. It looks decidedly dodgy. Official advice repeatedly told Joyce that a special deal for media companies was not needed. He then asked for options about spreading the payments before Mediaworks CEO Brent Impey approached Key at a function to ask for a favour (Key previously denied any such meeting took place).

Joyce then took a paper to Cabinet saying that Mediaworks would collapse, although the official advise was still that if Mediaworks ran short of cash it was the fault of the foreign owners for taking too much in dividends. (btw, yes, this is the same Steven Joyce who refused to let Kiwirail build its new traincars here, which would have saved manufacturing jobs and kept more money in the economy). Cabinet got scared and approved Mediaworks paying the fee over several years with an interest rate set by the government’s depreciation rate for telecommunications capital.

A little while later, MED realised that when the government lets someone pay a fee over time and charges interest on it, that’s a loan and requires the Minister of Finance’s approval under the Public Finance Act. So, English must have signed off on it, which makes his comments on Q+A yesterday interesting:

GUYON Another bailout in the news this week and for some weeks – MediaWorks. Why did you loan MediaWorks $43 million?

BILL Well, I think as it’s been explained there, that’s not a loan.

GUYON But it is a loan, because you signed a document saying it was a loan under the Public Finance Act. Otherwise it would have been unlawful. Do you remember that?

BILL I do remember being— I do remember the Cabinet discussion about it, of course.

GUYON So it is a loan.

English will be pissed off that he is being drawn into Joyce’s dirty little deal.

If, and I admit it’s a big if, Key demands real standards of ethical behaviour from his ministers, I don’t see how Joyce can stay. But, then, Joyce is Key’s mate and strong man.

18 comments on “Is Joyce too big to fail? ”

  1. marsman 1

    Hollow Men protect one another.

  2. todd 2

    Somebody without morals does not require them of others.

  3. Samuel Hill 3

    Umm.. why would Key consider asking Joyce to resign over this, hasn’t Key already been implicated in this too via his conversation with Impey??? Asking Joyce to resign would just put Key in the firing line too. I don’t think Key is that dumb. This is obviously not the dealings of one man, there are many players involved in this within the National Party (Key, Joyce, English already with attachments to the deal) and they have a shared interest in Mediaworks dominating the media market.

  4. Ron 4

    Why aren’t we seeing front page news about this? If it had been the last Labour Govt.. we wouldn’t have heard the end of it. I think the “corruption” extends to the news sevices who simply refuse to adequately cover these stories.

  5. randal 5

    no joyce is not to big to fail. he has been handing out free lunches to his mates like they were going out of style.
    he will get his bum kicked in november with the rest of the leeches who see govertnment as a way of looting state assets.
    they are worse than parasites.

  6. Irascible 6

    When will we see the international assessments of corruption in governments show the slide to third world status that Key & English are driving NZ to.
    Key sells the legislature to Warner Bros and a Wingnut and throws in a $60mill sweetener as well.
    Key & English bail out SCF, a company whose principal declared that his friend John Key would help his company out.
    Key, Joyce & English bail out a company that Joyce once held a major shareholding in to the tune of $43 million.
    The international realisation that NZ is a basket case under this government of opportunist speculators will not be too long in coming.

  7. Irascible 7

    <p>When will we see the international assessments of corruption in governments show the slide to third world status that Key & English are driving NZ to.</p>
    <p>Key sells the legislature to Warner Bros and a Wingnut and throws in a $60mill sweetener as well.</p>
    <p>Key & English bail out SCF, a company whose principal declared that his friend John Key would help his company out.</p>
    <p>Key, Joyce & English bail out a company that Joyce once held a major shareholding in to the tune of $43 million.</p>
    <p>The international realisation that NZ is a basket case under this government of opportunist speculators will not be too long in coming.</p>

  8. Joyce then took a paper to Cabinet saying that Mediaworks would collapse… Cabinet got scared and approved…

    Indeed it seems they did. But they’re not scared of many other businesses failing, as they are every day across NZ.

    So why Mediaworks, alone amongst them all (aside from fiance and insurance companies, about whom they at least have some plausible excuses to advance)?

    I come back to the question I asked a day or so ago: What quid pro quo has Impey offered and that Cabinet finds so valuable that it would sign off on this deal?

    And a secondary (but no less important, from the perspective of someone who’s experienced it) question: What pressure will be brought to bear on Mediaworks staff to not only deliver on this quid pro quo, but to keep schtum about it?

    • ak 8.1

      And a secondary (but no less important, from the perspective of someone who’s experienced it) question: What pressure will be brought to bear on Mediaworks staff to not only deliver on this quid pro quo, but to keep schtum about it?

      So here we have it:  alleged multi-million dollar corruption and deception by a minister.

      All the dog-work laid out on a plate in typically thorough detail and actual documentation from I/S.

      And now a well-known personality, courageously using his own name – onya Rex – alleging experience of similar practice and pressure on media staff by the very same actors.

      Newsworthy?

      Every continuing second of msm silence confirms – and screams – their own and Joyce’s guilt.

  9. Jum 9

    Lovely, just lovely.
    Transport Minister ignores the needs of skilled New Zealand workers to build rail coaches in New Zealand, but rushes to cabinet to get money to bail our his own failed ex-media company.
    What’s more important to a Transport Minister, eh – the New Zealand transport system going to New Zealand economy or a group of failed talking heads?
    I hated him before he entered parliament; I now understand why; he’s just as corrupt as all the others.

  10. Jum 10

    What does a media works do well – it spins, and it will no doubt try to spin this corrupt government into office.  Every advertisement, every comment from anyone related to this corrupt organisation needs to be examined and a complaint made to the Complaints Broadcasting Authority.  Make it formal.  The ads in the 2008 campaign were just as cunning and the cost would not have come out of NAct’s campaign funding allowance.
    This corrupt government has no ethical base from the top down.

  11. Draco T Bastard 11

    This post should have been in this thread.

  12. No National right whingers here to stick up for this dirty behaviour then?

  13. John Key will not demand standards from his Ministers, especially Stephen Joyce.

    John Keys whole working life has been in a sector where to be successful you must leave your morals at home, money traders can be as moral as they like in their private lives but when it time to work there is no room for morals, he knows no other way of working and that is why he was shoulder tapped by a National Government so they could introduce their Pinochet  style reforms starting with beefing up the employment contracts act, now it’s keeping wages down by saying it’s good for NZ. Too bad about the people of NZ just think of the money the favoured few will make.

  14. Irascible 14

    The influence of Murdoch in pressuring the MPs to back off from a corrupt practice to protect his commercial interests sounds like similar influence peddling is going on in New Zealand.
    http://www.guardian.co.uk/uk/2011/apr/09/phone-hacking-rupert-murdoch-gordon-brown
     
    Do we link Impey, Key and Joyce in the same way as the dots are drawn with this Murdoch story???
    Makes sense of the sort of reporting we’re “blessed” with doesn’t it??

  15. windy.city.struggler 15

    NO ONE is ‘too big to fail’. It depends how you define ‘failure’. Political failure implies loss of credibility and support. Find out who – what interests – are behind Joyce.

  16. Miracle Worker 16

    @todd: somebody without morals requires more of others than a wise man would take.

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