Amidst growing realisation that the right wing “neo-liberal” economic agenda as a whole is fatally flawed, some of the previously ardent supporters of privatisation in NZ are admitting that the last round of sell-offs was a mistake. But the current National leadership haven’t got the memo. They’re ideologically opposed to state owned assets. They’re still developing an agenda of privatisation, including assets like ACC. They tried to push through the idea of flogging off KiwiBank. They cut back on contributions to the Cullen Fund, costing us an estimated $30 Million or more.
Unfortunately for the zealots, the Nats’ position makes no sense. This has become particularly obvious because of their dismal performance in lifting NZ out of recession. The occasional feeble flickers of life that we do see in our otherwise moribund economy are down to two factors, occasionally favourable commodity prices, and returns from state owned assets. For example, according to Treasury back in May:
Deficit Falls Further The Government’s deficit has decreased further, with the Crown’s operating balance for the nine months to March 31 coming in $2,006 million smaller than forecast at $1,327 million mainly due to gains on the Crown’s investment portfolios held by the NZS Fund, ACC and EQC.
Good news thanks to state owned Super Fund, ACC and EQC (so thank you Labour governments 2001, 1974, 1947). And now the same thing this month:
Oct. 14 (BusinessDesk) – The government’s deficit shrank as bigger returns from the ACC and New Zealand Superannuation Funds bolstered sagging revenue streams.
The government’s deficit narrowed to $4.5 billion in the year ended June 30, from a $6 billion deficit a year earlier, according to financial statements released today. That was underpinned by a $2.5 billion gain in the value of the so-called Cullen Fund and ACC investment portfolios…
These state owned assets are generating some rare bright spots in an otherwise dismal sea of poor economic news. So why would any rational government sell ACC (or other state owned assets)? Why would any rational government be cutting back on the Cullen Fund? In short, why are the Nats determined to kill the golden geese?