Cunliffe vows no Lochinver sale despite legal risks

FOR SALE: Lochinver Station near Taupo.
FOR SALE: Lochinver Station near Taupo.

The sale of Lochinver Station to foreign buyers would have to be proven to create "significant" extra benefit for New Zealand to be approved by a Labour-led government, leader David Cunliffe says.

Cunliffe is promising to block the sale of the 13,800-hectare Lochinver Station, valued at more than $70 million, to foreign buyers, despite possibly opening the Government to legal risks.

It was revealed this week the sale of Lochinver Station in the central North Island, to Shanghai Pengxin – the company that bought the Crafar farms in 2011 - was awaiting Overseas Investment Office approval. 

"We're not opposed to them selling it, we're just saying that so far no case has been made why significant extra [benefit] accrues to New Zealand by selling it to a foreign buyer rather than a New Zealand one," Cunliffe said this afternoon.

"That will be the test under a Labour-led government."

All sales would be assessed by certain rules under a lawful manner, he said.

He denied the policy could be subject to legal challenges or questions over compensation.

"It is not a liability on the crown to pay compensation if a sale is declined," he said.

The policy was "colour blind", Cunliffe said, and it would apply equally to bidders from China, the United States or the United Kingdom.

He said the Overseas Investment Office had become a "rubber stamp".


Lochinver Station was put up for tender last December by the Stevenson Group, which has owned the property for more than 50 years. Stevenson Group has said it would be able to use the funds to expand its other interests, that would potentially create 8000 jobs.

Cunliffe said that could still be achieved with a New Zealand buyer.

"Let's assume that Stevenson Group's analysis is rigorous and that there could be 8000 jobs," he told Morning Report.

"Those 8000 jobs could also apply equally if a New Zealand interest purchased the land."

Just because Shanghai Pengxin's bid was the highest, did not mean it was the best for New Zealand, he said, and Stevenson Group could function without the sale going ahead.

"I've said based on the information that I've seen so far, there is nothing that would convince me that there is any advantage to the sale, and on that basis it would not proceed," Cunliffe said this morning.

He denied his stand prevented the relevant ministers in his government, making an objective and fair decision on the sale.

"They would need to take into account the fact that an imminent policy change was awaited and they would need to weigh that up in good faith alongside other factors," he said.

Cunliffe said Labour's policy was country-neutral, but did not know if it applied to Australia.

Prime Minister John Key said Cunliffe was playing a dangerous game.

"He's jumping in front of a process, and the Overseas Investment Office hasn't made a decision yet about whether the sale should progress," he said.

"It has to be convinced that sustainable and identifiable benefits are met. So he's effectively in a dangerous position here, prejudging a decision.

"That could be reviewed by the courts, it's really not a sensible thing to say."