Work forever to put things right

ING's final, final offer to investors in its distressed CDO funds on Thursday morning exempted me from considering THE BUDGET - the only day when the media gets excited about accountancy.

I've never been to a 'lock-up'... except that one time...

Helen Troup, ING NZ head,was probably more pleasant to listen to, anyway, than Bill English droning on about his "dubious distinction of being the first finance minister in 60 years to deliver a budget while the global economy is shrinking".

Troup denied there was any ING conspiracy to bury its quite interesting offer by timing the release for just before THE BUDGET. She sounded a little like that old standard-bearer of Kiwi whiteware retailing, Alan Martin, with her statement that ING was doing "all it could to make things right".

This is corporate damage control but it was done with a touch of sincerity. I believed Troup was concerned about the 8,000 out-of-pocket investors - how could you not be? But the revised deal is not a capitulation to critics who have demanded a 'product recall'. ING and ANZ have batted the ball back to investors asking them to select from three choices "in light of their own individual circumstances" with no collective decision-making now required from unitholders.

Investors who sign up will waive any right to future legal action against ING or ANZ. It's only fair.

Similarly in THE BUDGET, the government has also implicitly handed some fairly sophisticated investment decisions back to individuals.

There's some interesting stuff in THE BUDGET (choose your favourite government department and have a look ) but the decision to 'defer' automatic payments to the New Zealand Super Fund for a decade has rightfully grabbed the headlines.

Nevermind that you could make a good case for investing more now to shore up future pension payments. Perhaps the government shouldn't take on this investment risk but if it doesn't individuals are going to have to without necessarily having the skills to do so.

Without the long-term funding that the NZ Super Fund was set up to address the country's universal pension will come under pressure sooner rather than later.

But there are other solutions to the looming pension crisis. As Sydney Morning Herald columnist Ross Gittins details in this article, we can all just keep on working.

That might put things right.


David Chaplin

 

 

Pictured: ING's Helen Troup. Photo / Kenny Rodger