17 Jun 2015

Saudi desert farm a 'sham'

5:59 am on 17 June 2015

Having poured millions of dollars into a demonstration farm in the Saudi Arabian desert, the Government now says there are not many farmers in the area.

Sheep

Photo: 123rf

The farm is supposedly for showing off New Zealand agriculture.

But Associate Minister of Foreign Affairs Todd McClay told Parliament yesterday he did not know whether Saudi farmers had access to the New Zealand-funded demonstration farm.

"I'm not aware that there are a great number of farmers in that part of the desert," Mr McClay added.

The Labour Party said Mr McClay's acknowledgement is further proof that the Government's Saudi deal is a taxpayer funded sham.

Todd McClay.

Todd McClay. Photo: NATIONAL PARTY

Labour's trade spokesperson David Parker said the Government had bought off Saudi businessman Hamood Al-Ali Al-Khalaf, who owns the land where the demonstration farm is being built, and whose anger over the cancellation of live sheep exports was preventing a free trade deal with the Persian Gulf States.

"If this was meant to showcase New Zealand's agriculture as a model farm and we've now got the Minister saying there's not many other people farming in the desert, it really shows what a waste of money this has been."

The Government has spent more than $11 million kitting out Mr Al-Khalaf's farm, including flying sheep to the Saudi demonstration farm, and funding irrigation and the building of an abbatoir.

Mr Parker said $4 million of that money was a facilitation payment to Mr Al-Khalaf. He said facilitation payments are considered to be bribes in many countries.

David Parker

David Parker Photo: RNZ / Diego Opatowski

The Government has repeatedly claimed that it was the Labour Party that created the friction with the Saudi businessman when it was in power, and that Cabinet papers from that era will prove it.

For the last two weeks Government ministers have been saying those Cabinet documents will be released within days.

However in Parliament yesterday, the Government again blocked Labour from making the papers public.

Prime Minister John Key maintained his Government was only fixing what he called Labour's mess.

"My position has always been that the Government had to act to try and tidy up the situation, but it was a situation of Labour's making is my view," Mr Key said.

But Opposition parties don't buy that.

New Zealand First leader Winston Peters asked Mr Key in Parliament whether the Government's Saudi deal amounted to corruption.

"Is it not a fact that this Government has entered commercial arrangements involving bribery, corruption and jack-ups of the tender process?" Mr Peters asked.

Mr Key responded that in his experience when you start calling people names you are losing the argument.