Companies in which National sold off shares have all recently reported their financial performance for the past 12 months and the amount of the final dividend they are paying. I thought that I would have a back of the envelope stab at the amount of money that New Zealand Inc is missing out on to highlight the stupidity of the sell off of these shares. I am presuming that all dividend payments were made under the new ownership regime, that is to private owners. Campaign pressures prevent me from digging into the figures too far and working out if some of the dividends were nevertheless paid to the Crown. I believe this approach is valid because it gives us an idea of what sort of yearly dividend stream the policy has diverted from public to private interests.
It is interesting to see the change in directors in the power companies. Meridian’s directors are all the same. MRP has two new appointments out of eight. Genesis has two new out of nine. The directors are predominately those appointed by the Government. The suggestion that private ownership would bring increased fiscal discipline is a fallacy unless of course private shareholders were scrutinising the companies’ performance more than Bill English and the Treasury were. A failure on the part of English and Treasury should never justify the sale of profitable Crown assets however.
As to the companies’ performances:
So all up in lost dividend alone in the past 12 months we may have missed out on $360.7 million. Sure we have saved some money in interest savings but given the increase in the values of the companies and their performances it is clear that New Zealand inc has done very poorly.
All the companies have given a return which is greater than the government’s cost of borrowing. And these figures do not include any allowance for bonus schemes or the cost of actually selling the shares.
If we had retained ownership we could have done such things as increased spending on health and education or reduced taxes. These could have been the real justifiable here are the figures type tax cuts, not the hypothetical hypocritical cuts we are being promised by National.
New Zealand you have been had.