Parliament to keep eye on Air NZ

By CHRIS DANIELS aviation writer

Air NZ is to come under increased political scrutiny, with the Government's 82 per cent shareholding now meaning that its top management will soon have to appear before a parliamentary select committee.

Finance Minister Michael Cullen said yesterday that the change had come about after a recommendation from the Auditor General that Air NZ be subject to greater scrutiny.

The airline would now be described as a "public organisation" in Parliament's standing orders.

Such a definition is important, says Cullen, because the airline is a publicly listed company, so should not be described as a "Crown entity".

A Cullen spokeswoman said this process had been in train for some time and was not related to this week's announcement of job losses at Air NZ.

Although largely owned by the Crown, there were other shareholders and the airline was subject to all the disclosure rules and disciplines of listed companies.

He served notice to the select committee it should not expect Air NZ's managers to give it information that it had not already told the market about.

"This will impose limits on what Air NZ can tell the select committee, because it would be at risk of breaching securities law and listing rules were it to disclose information that had not already been disclosed to the market."

Cullen told Parliament's finance and expenditure select committee in June that the relationship of Air New Zealand to the Crown was problematic.

"Clearly Air New Zealand would not want any suggestion the committee would interfere with the management of the operation."

Air NZ spokesman Glen Sowry said the company was already accountable to its shareholders- which included the Government.

Its annual report would now be tabled in Parliament, but he not expect this would be before other shareholders got it.

There would be limitations placed on the company when appearing before the select committee, because it would be unable to answer questions that it was precluded from under Stock Exchange Listing Rules.