Westland Milk's $10 million Government loan under fire

A loan from the Provincial Growth Fund to Westland Milk is under fire from those who say the Government shouldn't be playing the role of a bank.

The $9.9 million loan was announced as part of a wider founding package for the West Coast.

The loan will be used for a milk segregation development to produce develop high-end products.

Regional Economic Development Minister Shane Jones said the interest-bearing repayable loan will enable Westland Milk to collect and process different types of milk products and milk, such as A2 milk and colostrum.

However the National Party's economic and regional development spokesperson Paul Goldsmith is unhappy about the move, saying the soft loan must be at a rate no bank was willing to offer.

"The Government and taxpayers shouldn't be taking on the role of a bank, especially one that is directly controlled by ministers," he said.

Shane Jones, Jacinda Ardern and Damien O'Connor visited the West Coast.
Shane Jones, Jacinda Ardern and Damien O'Connor visited the West Coast. Photo credit: Newshub

It's a view also held by ACT leader David Seymour, who said taxpayers should be worried.

"If banks aren't willing to lend to these companies, they have judged them to be too risky a proposition. Why on earth should taxpayers be on the hook?" he asked.

"Banks have every incentive to get their investment decisions right because otherwise they go bust, while Shane Jones doesn't face the same constraints."

Newshub.

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