Bolger on track to lose more than KiwiRail

Former National Government Prime Minister Jim Bolger has been dumped as chairman of KiwiRail and appears likely to lose his position as chairman of New Zealand Post and Kiwibank when his current term ends this year.

Wellington company director John Spencer will replace Mr Bolger at KiwiRail as part of a series of boardroom changes at state-owned enterprises (SOEs) announced yesterday by SOE Minister Simon Power.

The reshuffle includes the replacement of controversial Commerce Commission member Donal Curtin as chairman of the Public Trust with investment banker Trevor Janes, who himself served on the board of failed finance company Capital+Merchant.

Mr Bolger's removal as KiwiRail chairman is no surprise given the antipathy towards him the Herald understands still exists within the National Party caucus.

That stemmed from his appointment in 2001 as chairman of Kiwibank - the brainchild of Mr Bolger's former political opponent and Alliance party leader Jim Anderton.

The Herald understands antipathy was aggravated when Mr Bolger was appointed chairman of KiwiRail after the company was bought back by the Labour Government a few months before the 2008 election.

Yesterday, Mr Bolger said the decision not to reappoint him at KiwiRail was entirely up to Mr Power and the Government "and I totally accept their decision".

While he remains chairman of both Kiwibank and NZ Post, the Herald understands Mr Bolger is likely to be replaced in those roles when his current terms run out at the end of October. Former Labour Government Deputy Prime Minister Michael Cullen has been tipped as Mr Bolger's successor at NZ Post.

Meanwhile, Mr Power said he was delighted Mr Janes had accepted the role of Public Trust chairman.

Mr Janes resigned as a director of Capital+Merchant in October 2006, having three months earlier signed off on its prospectus, a document which is now the subject of Securities Commission charges of misleading investors.

The commission has laid charges against four Capital+Merchant Finance directors but not Mr Janes.

Capital+Merchant collapsed in November 2007 owing about $167 million to some 7000 investors.

A spokesman for Mr Power, who is also Minister of Commerce, said having received advice from officials about Mr Janes' involvement with Capital+Merchant, Mr Power was comfortable with his appointment to the Public Trust.

Capital+Merchant was one of a string of finance companies recommended by Vestar's investment committee, which was in turn headed by Mr Curtin.

Virtually all of the finance companies Vestar poured millions of dollars of client funds into have failed.