20 Feb 2009

Help for businesses a last resort - English

2:31 am on 20 February 2009

Finance Minister Bill English says statutory management by the government of significant companies on the verge of collapsing cannot be ruled out as the global recession deepens, but such a move would be a last resort.

Mr English was speaking after Prime Minister John Key said the Government would keep all options open to assist what he called iconic companies.

He says no companies have approached the Government for a bailout and if they did it would be costly to shareholders.

Mr English says the Government has taken advice from Treasury on the sorts of businesses that could qualify for assistance, but there is no list of qualifying companies and none is being prepared.

"There's been some policy advice over the kind of businesses and the circumstances in which Government help might be warranted, and I wouldn't push it any further than that.

"The message to businesses, from our point of view, is that they would need to strongly focus on commercial solutions".

Mr English says if the Government chose to bailout any businesses it would come at a high price, and that in extreme circumstances the Government could consider taking over the management of failing businesses.

He says Government could also consider stepping in to keep a business's operations going over the short term because of a shortage of credit. However, he reiterated that such measures would be a last resort.