UnitedFuture on Asset Sales
February 02 3:23 PM
AUTHOR:
I see some are suggesting that UnitedFuture has abruptly changed its position on asset sales since the election, having previously been opposed to all such sales.
This is simply not true, so let me outline UnitedFuture’s long-held position, clearly and simply. While wholesale asset sales are not UnitedFuture policy, we had as long ago as the 2005 general election promoted selling shares in selected state assets to promote their expansion. This was similar to the mixed ownership model National was to promote at last year’s election.
In fact, I had discussed the arguments in detail in a blog over a year ago. I had written that,
“…. the nub of the issue is what is the best way to expand the capital base of certain government owned trading and commercial organisations so that they can compete effectively in today’s business environment. Should that investment be directly from the government (and if so, how should it be financed – higher charges, higher taxes, more borrowing)? Are we as taxpayers prepared to accept any or all of the above solutions as the price of retaining New Zealand ownership (“sovereignty” to some) of our assets? And, for a start, do we even agree with the proposition that they need to expand and grow, or are we quite happy to leave things as they are? If we accept the capital expansion argument, but do not like the idea of more government money going into them, what alternatives are there? The most obvious one is simply to sell the whole lot, lock, stock and barrel to the highest bidder. Apart from the ACT Party no-one is seriously suggesting that. So, what are we left with? Share floats of minority holdings, aimed at local investors, and with some controls about limits on overseas ownership come to mind here. That seems to be what John Key is talking about. In this regard, it is worth noting that groups as diverse as New Zealand First (up to a maximum stake of 24.9%) and Labour’s finance spokesperson (for subsidiary investments of state companies) have floated similar concepts in the recent past.”
Our stance on National’s plans, made public before the 2011 General Election, was that, as a government support partner, UnitedFuture’s responsibility is not just to contribute its own policies, but to help keep a government to a reasonable, centrist path. Our pledge then and since was to respect that the public had returned a National-led government with this policy, but to moderate any asset sales in a way that would make them more acceptable to most New Zealanders. (See our campaign launch video at unitedfuture.org.nz/four-key-election-issues-animated-video-1/)
As a party we had therefore ruled out ever supporting any sales – partial or whole – of Kiwibank, Radio New Zealand or our water supplies.
We further said (on 1 November 2011) that in the case of the four energy companies and Air New Zealand, which National was proposing to sell a portion of, that we believed the Government should retain a minimum of 51% control, and that there should be limits on the holdings able to be purchased by individuals or entities, and that New Zealand household investors be given preferential purchase rights at time of issue. (See www.united.future.org.nz/asset-sales-1/).
UnitedFuture’s confidence and supply agreement, negotiated with National after the election, confirms all these points and is therefore consistent in every regard with our pre-election policy. That is why UnitedFuture will support the Government’s plans to introduce a mixed-ownership model for the four energy companies and Air New Zealand.