web analytics
The Standard

Asset sale disaster

Written By: - Date published: 7:45 am, December 5th, 2013 - 30 comments
Categories: ACC, Privatisation - Tags:

So the government are predictably having to lower their estimates of what asset sales will raise them.

They’ve done a terribly incompetent job implementing a stupid policy.  And unfortunately that terrible job has made the stupid policy even worse.

When they promised us $10 billion for our assets back in early 2011 they were already receiving warnings that they were running Solid Energy into the ground.  But they fully expected to sell half of it for a great sum.

When they began a policy that was against 2/3 to 3/4 of the public’s wishes, as well as against all the opposition parties, leaving them to ram through major changes on a bare majority in parliament… it was somehow a shock that said opposition parties didn’t roll over and came up with alternate policy, as is indeed their job.

They then went screaming “nationalisation! nationalisation!” misrepresenting that opposition policy, and are now blaming Labour/Greens and “unsophisticated investors” (ie their mythical mum and dad voter-investors) for running scared of a threat of … nationalisation.

Their crown jewel Meridian’s problems with Rio Tinto were visible a mile off, but somehow still struck them by surprise, and they claim you surely can’t blame them…

Now I really don’t agree with selling our power companies off.  For multiple reasons – security of energy supply and selling a profit giving asset to pay off a lower rate interest than the power-companies’ dividends chief amongst them.

But if you’re going to put your ideological blinkers on and do it, at least do it right.

The Government didn’t do as badly with getting a reasonable amount of money with Mighty River Power, in the teeth of Labour/Greens new policy.  Not good, but nothing like the disaster that was Meridian.

It’s National’s fault for not anticipating Rio Tinto and especially their fault for trying to sell too much of the same too quick.

When you’ve just sold a major energy company, massively rebalancing the stockmarket and investors portfolios, the next thing they aren’t going to want is… another energy company.

So despite the interest-free loan sweetners etc they got about half the valuation of their biggest asset.  It went for a song.

Now next up is Genesis.  To sell this next year would be insane.  If investors didn’t want Meridian, they’re going to want Genesis even less.

Sell it, and they’ll get a pittance.

Currently they’re claiming they’ll raise maybe just over $4.5 billion from asset sales including Genesis.  Their borrowing (remember Labour’s surpluses?) is down from $260 million / week to $110 million / week currently.  That means they burn through our cash producing assets in less than 10 months.  This isn’t setting us up for future infrastructure, this is burning through your major assets for petty cash.

That’s before they fail to receive as much as they expect from Genesis.

How tied are they to their ideological blinkers to blind them from seeing their next failure?

I guess we’ll find out next year.

In the meantime, we need 1,000,000 no votes in the referendum to send a message to Key – so make sure you’ve voted – and your friends and family.

30 comments on “Asset sale disaster”

  1. lanthanide 1

    Meridian and MRP at record low prices yesterday. 92.5c for Meridian and $1.99 for MRP. Analysis is that their prices drop when Labour looks more like it will win the next election.

    Act’s destruction is judged bad for National by the market…

  2. phil 2

    Good time for the Government to buy them back, eh?
    Just posted my Referendum Voting paper. It’s a complete waste of $ 9 million. It could have gone on the next Americas Cup campaign! It is clear now, that dimocracy is way too expensive, unaffordable and not working. If it’s not working, change it.

    • One Anonymous Knucklehead 2.1

      Buy? Nope. Receivers of stolen property don’t get their money back.

      Now, I’m not saying this situation is entirely analogous with receiving, but there is a further consideration: what better way to Tory-proof New Zealand strategic assets than by punitive reacquisition policy?

      The SOE model has failed. Neo-liberalism has failed, but until it hurts them in their wallets, the National Party’s owners will not resile from these policies.

      • Judge Holden 2.1.1

        No, what happened was that the Nats bilked everyone, including the Mum and Dad investors it conned into buying over-priced shares. That they said the companies were worth even more than the inflated price they sold them for amply demonstrates English’s massive incompetence. The programme has been a disaster on every possible measure.

        • jcuknz 2.1.1.1

          Originally I considered it a donation to help the government with some possible return.
          But when it came to the crunch I had other uses for the money.

  3. appleboy 3

    Heard English saying the most stupid thing yesterday. He said Labour ‘couldn’t have it both ways’, by saying National should not have sold the assets , and then complaining about what price when sold.

    Duh. We don’t agree with the sale AND we think you got a lousy price when you did sell them.

    These two ideas are entirely compatible!

    Media and Labour need to call the lying dick out.

    What a tosser, I guess that was a soundbite for the greedy/unthinking out there.

    • Disraeli Gladstone 3.1

      I think there’s probably a more subtle point than what English were trying to make. Which is that if the government sold too highly, then Mum and Dad investors couldn’t buy into it and it would all go to speculators. Which is why they had to sell lower.

      But Mr Clark here is absolutely bang on with: “and especially their fault for trying to sell too much of the same too quick.

      When you’ve just sold a major energy company, massively rebalancing the stockmarket and investors portfolios, the next thing they aren’t going to want is… another energy company.”

      That was the stupidity of the whole policy.

      • Naturesong 3.1.1

        Treasury did warn them.
        $2B per year is what they estimated the market could absorb iirc.

  4. Ad 4

    +100 Mr Clark

  5. Tat Loo (CV) 5

    Institutional investors got our best assets for cheap? Sounds to me like success for Keys mates. No fail there.

  6. Tracey 6

    I agree with tat loo. Especially on mrp which spiked up day one. Alot of keys former colleagues bought big and sold quick and pocketted the profit. Selling many power companies back to back contradicts so much of what mr key learned as a trader to maximise price for seller.

  7. jcuknz 7

    But for the sabotage on the part of Labour/Greens …….That is what I will remember about the event.
    I suppose I should be greatful to them in view of the current share price for putting this DAD off getting some.

    • One Anonymous Knucklehead 7.1

      Diddums, the nasty opposition parties came up with some policies that don’t suit you. It’s the risk you take, and after all, there are far worse things in life than losing a little bit of your money, Daddy.

    • framu 7.2

      oh bullshit

      asset sales are unpopular and its a political issue first and foremost – if you thought it was ONLY a financial deal – your an idiot

      if you were thinking about buying shares in the asset sales – and you DIDNT recognise that its a highly polarising political issue and you DIDNT ask your self what might happen when the govt changed – your an idiot

      if your going to claim that the only thing that affected the share price and overall result was the opposition announcing their policy intention BEFORE the shares went on sale – your an idiot

      The nats are in govt – not the opposition – i didnt realise that the opposition had so much power over the govt – those nats must have been quaking in their boots when that nasty labour party put a gun to their head and said “sell”

    • ropata 7.3

      yes it is all Labour’s fault that National was *forced* to piss away half the country’s finest assets :rollseyes:

  8. Will@Welly 8

    Key was working as a money man when the privatisation process began, so he knows how much money the speculators can make. Bill English was working in Treasury at the same time, he knows what sort of money that they too can make. Key knew he only gets one chance to sell these assets, keeping his buddies happy. He’s not interested in New Zealand, only what he can get out of it.

  9. Richard Christie 9

    Quite right, it isn’t nationisation, it is restoration or reclamation.
    The Labour/Green paries should stop being terrified of the term nationalisation, call it what it truly is and proudly adopt the policy.

  10. Matthew 10

    Taxpayers should be delighted at the foresight of Key and English to sell 49% of these Assets while they still had some value.

    The taxpayer has made some very good coin on these while the supposedly rich investor has lost out.

    It’s the best scheme to fix inequality anyone has ever come up with!

    • Lanthanide 10.1

      No, because the crown is losing the dividend stream that is the golden goose from these companies.

      The Greens have already done the maths that shows the government is $1b worse off by 2017, even after the proceeds of the sale is taken into account.

      Better luck next spin.

  11. Draco T Bastard 11

    How tied are they to their ideological blinkers to blind them from seeing their next failure?

    But it won’t be a failure to them. They would have sold it to the “worthy” so that those worthy can have a parasitical income on the backs of the impoverished and they’ll see that as a success.

    This National government are acting exactly as the old aristocracy and the let them eat cake attitude to the poor.

  12. Roy 12

    Have you perused the comments on that Stuff article? So much whining from idiot Nat supporters that it is all the fault of Labour and the Greens for ‘sabotaging’ the process. The stupidity of those people makes my head hurt.

    • infused 12.1

      Good to see so many people can see through Labours bullshit.

      • Paul 12.1.1

        Zzzzzz

      • framu 12.1.2

        asset sales are unpopular and its a political issue first and foremost – if you thought it was ONLY a financial deal – your an idiot

        if you were thinking about buying shares in the asset sales – and you DIDNT recognise that its a highly polarising political issue and you DIDNT ask your self what might happen when the govt changed – your an idiot

        if your going to claim that the only thing that affected the share price and overall result was the opposition announcing their policy intention BEFORE the shares went on sale – your an idiot

        The nats are in govt – not the opposition – i didnt realise that the opposition had so much power over the govt – those nats must have been quaking in their boots when that nasty labour party put a gun to their head and said “sell”

        so whats this bullshit you complain off? – all i see is a bunch of whiners to stupid to notice that investing in a politically driven sale will have political results

  13. jcuknz 13

    Paul and Rodel say it briefly and well :)

Recent Comments

Recent Posts

  • NZ response must reflect scale of humanitarian crisis
    The Government’s response to the refugee crisis must reflect the scale of the massive humanitarian disaster unfolding in Europe, Opposition Leader Andrew Little says. UNHCR spokesperson Ariane Rummery this morning told The Nation that the New Zealand Government has agreed… ...
    15 hours ago
  • Dangerous environment supports Commissioner’s report
    An OIA revealing more than 600 dangerous incidents at a CYFs run youth justice facility in Christchurch, Te Puna Wai o Tuhinapo, is proof of last month’s damning report by the Children’s Commissioner, but also shows that Ministers have known… ...
    16 hours ago
  • Nathan, seize the opportunity and change direction
    Yesterday, I called for a complete ban on herbicide-tolerant (HT) swedes, which have been implicated in the deaths of hundreds of cows, and compensation for stressed out farmers who have lost stock. HT swedes have been developed using a… ...
    GreensBy Steffan Browning MP
    1 day ago
  • NZTA blows a year of roading funding on flyover
    On the day that NZTA has finally given up on the Basin Reserve flyover it has been revealed that they have wasted the same amount of money on it as NZTA spends on local roads in the Wellington region in… ...
    1 day ago
  • Emergency bill could save 750 refugees
    Labour will on Tuesday introduce an Emergency Humanitarian Response Bill to Parliament to bring an additional 750 refugees into New Zealand this year, Andrew Little says. “We cannot stand by and wait for a review. This is a crisis and… ...
    1 day ago
  • Cable failure on Great Track walk huge potential risk
    Tourism Minister John Key and Conservation Minister Maggie Barry must act urgently and decisively to assure trampers on all Great Walks that every bridge will be checked as soon as possible for safety, says Labour’s Conservation spokesperson Ruth Dyson. “It… ...
    2 days ago
  • Green Aoraki Newsletter September 2015
    Attachmentsseptember2015_web.pdf - 2.64 MB ...
    2 days ago
  • Rough-Shod Approach to Iwi Housing
      "The Governments rough-shod approach to social housing in Auckland has forced the Minister to clarify and uphold his Treaty Settlement obligations to Ngati Whatua and Waikato-Tainui," says Labours Maori Development Spokesperson Nanaia Mahuta.   “While it's a positive undertaking… ...
    2 days ago
  • More housing humiliation for Nick Smith
    Nick Smith has been completely humiliated once again – this time by Ngāti Whātua who have used his blunders to their full advantage to extract an excellent deal for Aucklanders that the minister would never have developed himself, Labour’s Housing… ...
    2 days ago
  • PM must stop making excuses for offensive MP
    John Key must stop dismissing the highly offensive behaviour of his Pakuranga MP Maurice Williamson and publically reprimand him, Labour’s spokesperson for Woman Sue Moroney says. “Maurice Williamson’s behaviour at an Eagle Technology dinner was completely unacceptable. ...
    2 days ago
  • Charter application skew assists rich American
    The Government has skewed the latest round of charter school applications to assist an American millionaire’s goal of ‘revolutionising” New Zealand’s education system, Labour’s Education spokesperson Chris Hipkins says. ACT Leader David Seymour and Ngāi Tahu’s Sir Mark Solomon in… ...
    3 days ago
  • Key’s refugee response at odds with Kiwi traditions
    John Key’s response to the current refugee crisis is out of step with New Zealand’s tradition of pulling its weight internationally, says Labour’s Foreign Affairs spokesperson David Shearer. “In 1999, under a National Government, New Zealand accepted more than 400… ...
    3 days ago
  • Coromandel rallies against the TPPA
    On Wednesday, John Key visited the southern Coromandel area with local National MP Scott Simpson and was challenged by citizens who spontaneously organised protests against the Government position on the Trans Pacific Partnership Agreement (TPPA). I went down to Waihi… ...
    GreensBy Catherine Delahunty MP
    3 days ago
  • John Key: where is your conscience?
    The Prime Minister’s refusal to raise the refugee quota in the face of an international humanitarian crisis shows a lack of empathy and moral leadership, Opposition Leader Andrew Little says. “There are times in politics when you are faced with… ...
    3 days ago
  • Report highlights National’s poor funding decisions
    The Government’s poor coordination between its transport strategy and the needs of the regions has been highlighted in a new report by Local Government New Zealand, Labour’s Transport spokesperson Phil Twyford says. “Local Government was forced to write its Mobilising… ...
    3 days ago
  • Government wakes up to Opotiki Harbour
    John Key is expected to finally announce Government support next week for the Opotiki Harbour development, says Labour Economic Development spokesperson David Clark. "While it is astonishing that it has taken seven years for the Government to commit to this… ...
    4 days ago
  • New figures show speculators rampant
    New figures released by the Reserve Bank show there’s been an explosion in mortgage lending with most of the growth going to property investors, Labour’s Housing spokesperson Phil Twyford says. Reserve Bank data shows mortgage lending was up 6 per… ...
    4 days ago
  • Spring is here – not pollen your leg
    It’s the first day of spring, and many people will be thinking about getting stuck into the weeds in the garden ready for planting. This year September is also Bee Aware Month. While there is a lack of movement from… ...
    GreensBy Steffan Browning MP
    5 days ago
  • Government must do more to help global refugee crisis
    John Key must urgently increase our refugee quota and let New Zealand play its part in helping address the tragic humanitarian crisis unfolding around the world, Opposition Leader Andrew Little says. “The refugee crisis in countries like Lebanon and Austria… ...
    5 days ago
  • The latest equal pay case – Go the Midwives
    ...
    GreensBy Jan Logie MP
    5 days ago
  • Key’s threat to veto premature
    John Key’s threat that he might use a financial veto against the Bill that will introduce 26 weeks Paid Parental Leave is premature and based on inflated costings, says the bill’s sponsor, Labour ‘s Sue Moroney.  “The Government keeps saying… ...
    5 days ago
  • Reflections on the plastic bag tour
    After a marathon public tour around New Zealand that took me to 29 different places around New Zealand from the far north of Kaitaia to the deep south of Invercargill to talk about phasing out plastic bag use, I wanted… ...
    GreensBy Denise Roche MP
    5 days ago
  • Labour celebrates Tongan language and diversity
    Tongan Language Week is a timely reminder of the importance and beauty of our Pacific culture, identity and language in New Zealand, says our first Tongan born, Tongan speaking MP Jenny Salesa.  The theme for Tongan Language Week in 2015… ...
    6 days ago
  • Privatising CYF about ideology not care
    John Key’s suggestions today that Child Youth and Family could be privatized will be a terrifying thought for New Zealanders already dealing with the mess created in private prisons and plans to sell our state houses to Australians, Opposition Leader… ...
    6 days ago
  • Govt must make most of Jetstar competition
    Government agencies should pledge to always buy “the best fare of the day” to maximise competition between Jetstar and Air New Zealand and ensure savings for taxpayers while boosting services to regional New Zealand, Labour’s Transport Spokesperson Phil Twyford says.… ...
    6 days ago
  • Time for inquiry into petrol margins
    It’s time for an inquiry into petrol companies as margins are once again at the high levels that prompted concerns late last year, says Labour's Energy Spokesperson Stuart Nash. "Over the December January holiday period, petrol importer margins jumped to… ...
    1 week ago
  • More talk as Auckland congestion worsens
    The main impact of the Government’s agreement with Auckland Council today will be simply to delay still further decisions needed to relieve the city’s traffic congestion, says Labour’s Auckland Issues Spokesperson, Phil Goff. “Government has been aware for more than… ...
    1 week ago
  • Serco inquiry extended
    A two month delay to the Government investigation into prison fight clubs shows the extent of problems within the Serco circus, says Labour’s Corrections spokesperson Kelvin Davis. “My office received a tsunami of complaints so I’m not surprised the terms… ...
    1 week ago
  • Truck Shops ignore consumer laws
    A damning Commerce Commission report out today highlights the failure of the Government to protect poor and vulnerable families from unscrupulous truck shops, says Labour’s Consumer Affairs Spokesperson David Shearer. “The report found that 31 out of 32 firms it… ...
    1 week ago
  • Taihoa at Ihumatao says Labour
    Labour’s housing spokesperson Phil Twyford has called on the Government to rethink its controversial Special Housing Area in Māngere. Auckland Council is today meeting to discuss the development which borders the Otuataua Stonefield Historic Reserve. This project is to get… ...
    1 week ago
  • Figures suggest National deliberately excluded farming
    Figures showing the dairy industry would be categorised as high risk if there were a further five severe injuries within a year, strongly suggests National designed its flawed system to deliberately exclude farming, Labour’s spokesperson for Labour Issues Iain Lees-Galloway… ...
    1 week ago
  • Bleak report on the state of our children
    A damning conclusion by the Children’s Commissioner today that ‘we don’t know if children are better off as a result of state intervention, but the indications are not good’ should make fixing CYFs a top priority for this Government, says… ...
    1 week ago
  • Dodgy data used to justify axing KiwiSaver kickstart
    National’s agenda to run down KiwiSaver has become even clearer from a scathing critique of the Government’s justification for axing the $1000 kickstart, says Labour’s Finance spokesperson Grant Robertson. “Since National came to power they have not only continually undermined… ...
    1 week ago
  • Unsecure website risks Ashley MoBIEson hack
    Experts have raised security concerns that vulnerabilities in MoBIE’s half million-dollar website could lead to a possible Ashley Maddison-style hack, says Labour’s Economic Development spokesperson David Clark. “The real issue here is not what data is immediately available, but what… ...
    1 week ago
  • Democracy still the loser in Canterbury
    The Government has demonstrated once again how arrogant and out of touch it is in denying Cantabrians the same democratic rights as the rest of the country, says Labour’s Environment spokesperson Megan Woods.  “The Environment Canterbury Bill which has been… ...
    1 week ago
  • Waiver cost still a mystery
    The Government still has no idea what it’s going to cost community and voluntary groups to get a waiver from the fees police will charge to carry out checks on their staff and volunteers, says Labour’s Community and Voluntary spokesperson… ...
    2 weeks ago
  • China exports fall 27 per cent in a year
    Exports to China have fallen by 27 per cent over the last 12 months - showing that the looming economic slowdown should have been expected by the Government, says Labour’s Economic Development Spokesperson David Clark. “The Chinese economic slowdown should… ...
    2 weeks ago
  • National should support all families for 26 weeks
    Families with multiple babies, and those born prematurely or with disabilities, are the winners from moves to extend paid parental leave to 26 weeks but the Government must give all babies the same head start in life, Labour’s spokesperson for… ...
    2 weeks ago
  • National’s health and safety shambles puts school camps at risk
    Reports that schools are considering scrapping student camps and tearing out playgrounds highlights just how badly National has managed its health and safety reforms, Labour’s Education spokesperson Chris Hipkins says. “Schools have been left completely in the dark about the… ...
    2 weeks ago
  • National’s asset stripping agenda hits schools
    National’s fire-sale of school houses and land is short-sighted, mean-spirited, and will have huge unintended consequences that we will pay for in years to come, Labour’s Education spokesperson Chris Hipkins says. Documents obtained by Labour show the Ministry of Education… ...
    2 weeks ago
  • Takahe massacre supposed to get all New Zealanders involved in conservation
    The Minister’s claim that a  botched cull of one of New Zealand’s rarest birds was a way of getting all New Zealanders involved in conservation is offensive and ludicrous, Labour’s conservation spokesperson Ruth Dyson says.  “An email from Minister Maggie… ...
    2 weeks ago
  • Serco circus rolls on with revelations of fight club practice
    Further revelations that a Serco prison guard was coaching inmates on fight club techniques confirms a fully independent inquiry needs to take place, says Labour’s Corrections spokesperson Kelvin Davis. “The Minister’s statement today that a guard was coaching sparring techniques… ...
    2 weeks ago
  • Government targets put ahead of students’ education
    The Government must urgently reassess the way it sets NCEA targets after a new report found they are forcing schools to “credit farm” and are undermining the qualification, Labour’s Education spokesperson Chris Hipkins says. “A PPTA report released today says… ...
    2 weeks ago
  • ER patients in corridors as health cuts bite
    Patients are being forced to wait for hours on beds in corridors as cash strapped hospitals struggle to keep up with budget cuts, says Labour’s Health spokesperson Annette King. “People coming to the emergency room and being forced to wait… ...
    2 weeks ago
  • Not too late to fix Health and Safety for New Zealand’s workers
    The Government and its minor party supporters are showing an arrogant disregard for workers’ lives by not agreeing to a cross-party solution to the botched Health and Safety bill, Opposition leader Andrew Little says. “Yesterday I wrote to the Prime… ...
    2 weeks ago
  • Speech to the New Zealand Council of Infrastructure Development
    Tēnā Kotou Katoa. Thank you so much for having me along to speak today. Can I begin by acknowledging John Rae, the President, and Stephen Selwood, the chief executive of the Council for Infrastructure Development. ...
    2 weeks ago
  • Reserve Bank points finger at Govt inaction
    In scathing criticism of the Government’s inaction, the Reserve Bank says Auckland housing supply is growing nowhere near fast enough to make a dent the housing shortage, Labour’s Housing spokesperson Phil Twyford says. Reserve Bank deputy governor Grant Spencer today… ...
    2 weeks ago
  • Chickens come home to roost on climate change
    The Government’s gutting of the Emissions Trading Scheme has caused foresters to leave and emissions to rise, says Labour’s Climate Change spokesperson Megan Woods. “The release of the Environmental Protection Agency’s Facts and Figures Report for 2014 on the ETS… ...
    2 weeks ago
  • Website adds to long list of big spends at MBIE
    The Ministry of Business, Innovation and Employment’s $560,000 outlay on its new website is further evidence of excessive spending by Steven Joyce on his pet project super ministry, Labour’s Economic Development spokesperson David Clark says.  “Hot on the heels of… ...
    2 weeks ago
  • Brownlee warned over EQC repairs but ignored them
    Gerry Brownlee was warned that EQC’s underfloor repairs weren’t being done properly by industry experts, the cross party working group and in public but he arrogantly ignored them all, says Labour’s Earthquake Commission spokesperson Clayton Cosgrove.  “Today’s apology and commitment… ...
    2 weeks ago

Public service advertisements by The Standard

Current CO2 level in the atmosphere

x
The incoming RSS feed is currently turned off. It caused commenting humans to be blocked from the site. Now unblocked. Press the X to turn this notice off.