Nats fail own asset sales tests

Written By: - Date published: 6:29 am, November 14th, 2011 - 67 comments
Categories: david cunliffe, election 2011, labour, national, privatisation - Tags:

Labour’s David Cunliffe put out a press release judging National’s proposed asset sales programme by the 5 tests that Key laid down in an effort to reassure us that sales would only go ahead if they made sense and were good for the country. Cunliffe’s analysis shows asset sales clearly fail the Nats’ own tests. The only reason to go ahead is blind ideology.

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Here’s Labour’s analysis –

John Key said in his State of the Nation speech that he would only proceed with asset sales if they passed five important tests.[1] This analysis shows John Key has failed the five tests.

1.    Widespread Kiwi Ownership: FAIL

Test: New Zealand investors would have to be at the front of the queue for shareholdings, and we would have to be confident of widespread and substantial New Zealand share ownership…

Treasury says “significant participation by foreign investors will be essential to achieve the Government’s overall objectives”.[2]   National has refused to give any guarantee against the subsequent purchase of shares from ‘mum and dad investors’ by foreign multinationals.[3]

National promised in 1999 that Contact Energy would stay in Kiwi ownership after it was sold, but at least 65% of Contact’s dividends now go overseas – in excess of $100 million last year and almost $1 billion in total since privatisation in 1999.[4]

2.    Presenting Good Investment Opportunities: FAIL

…the companies involved would have to present good opportunities for investors…

Official advice has cautioned National that the New Zealand stock exchange is “already heavy in energy stocks”, and that selling the publicly-owned companies could have “negative effects on current listed energy stocks as investors swap one for another (e.g. from Contact to Meridian)”.[5]  If John key thinks the companies are such good opportunities for investors, why doesn’t he keep these great assets in public ownership so that all New Zealanders own them?

3.    Protecting consumers: FAIL

…the Government would have to be satisfied that industry-specific regulations adequately protected New Zealand consumers…

The UK’s experience of energy privatisation suggests that Kiwi consumers might be facing higher prices should asset sales go ahead. An analysis of power prices in Britain shows that “privatisation has led to significant increases in the price of domestic electricity compared with those predicted for continued public ownership.”[6]

New Zealanders learned the hard way from the privatisation of Telecom that selling core infrastructure without a proper regulatory framework cost them dearly.  Telecom’s foreign buyers pushed up prices, bled the company, and then quit it rather than investing in its long-term future.[7]  It was left to Labour in 2006 to rectify the regulatory framework.[8]

4.    Retaining majority control: FAIL

…the Government would have to maintain a majority controlling stake by owning more than 50 per cent of the company.

Treasury says “minority shareholders will have significant influence”.[9]  The legal rights available to minority shareholders include access to company information, and in some cases, to board processes and appointments. Treasury says “a shareholder who feels that the action of the Government (as majority shareholder) has been prejudicial to the interests can apply to the court for an order requiring the company to purchase their shares or pay compensation.”[10]  Furthermore, conflicts of interest can arise on the boards of partially privatised companies, and Treasury points out that “the Government will be unable to vote in transactions where it is a related party”.[11]

Treasury believes that if the energy companies are partially privatised, there will be the perception of an ‘implicit government guarantee’.[12] This raises the spectre of more government bailouts, after National has already spent billions bailing out South Canterbury Finance, MediaWorks and AMI.

5.    Use Revenue to Buy Other Public Assets: FAIL

…the capital freed up would have to be used on behalf of taxpayers to fund new public assets and thereby reduce the pressure on the Government to borrow…

National hasn’t accounted for the loss of dividends which help fund government spending. As Key said about SOEs in 2009, “we expect them to receive a return and Government to receive a return over time, if we don’t how do we pay for our doctors and hospitals and the likes”.[13]  National claims asset sales will raise $5 to $7 billion, but within 15 years the Crown will have foregone $11 billion in dividends. This cost will continue to rise because half the dividend stream will be permanently lost.[14]

Further, it doesn’t make sense to sell these assets to avoid borrowing.  According to the Treasury, the average annual total shareholder return for SOEs over the past 5 years has been about 17.5%.[15]  This easily exceeds the government’s cost of borrowing – the 10-year bond rate is 6%.[16]

And it is doubtful whether National will actually receive the estimated $5 to $7 billion in revenue.  In its Pre-Election Economic and Fiscal Update (PREFU), National did not take into account this year’s sharp decline in equity markets.[17] It is not a good time to be selling shares on capital markets.

National has already banked the proceeds of the asset sales in the PREFU baselines.[18]  National’s so-called Future Investment Fund is a fiction. It is illogical.  Rather than investing asset sale returns in a genuine trust fund for future development, National is simply just recycling expenditure that would have happened anyway.[19]

[1] John Key’s State of the Nation speech, 26 January 2011: http://www.stuff.co.nz/national/politics/4584114/PM-John-Keys-State-of-the-Nation-speech

[2] The Treasury, “Extending the Mixed Ownership Model – Overview of Advice”, first A3 page, 4 March 2011, released 19 May 2011. http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[3] When Tony Ryall was asked in June whether the companies would end up in foreign ownership, he said “you can’t guarantee on those issues”: Finance & Expenditure Committee, 22 June 2011: http://www.nzherald.co.nz/nz-treasury/news/article.cfm?o_id=358&objectid=10733861:

[4] This figure is based on an analysis carried out by the Parliamentary Library and the Office of the Leader of the Opposition.

[5] The Treasury, “Extending the Mixed Ownership Model – Overview of Advice”, second A3 page, 4 March 2011, released 19 May 2011. http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[6] JR Branston, “A counterfactual price analysis of British electricity privatisation”, Utilities Policy, pp. 31-46 (2000).

[7] Rod Oram, “Govt’s last shot at useful policy”, Sunday Star-Times, 8 August 2010: http://www.stuff.co.nz/sunday-star-times/business/3999585/Govts-last-shot-at-useful-policy

[8] Telecommunications Amendment Act 2006

[9] The Treasury, “Extending the Mixed Ownership Model – Overview of Advice”, sixth A3 page, 4 March 2011, released 19 May 2011. http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[10] The Treasury, “Extending the Mixed Ownership Model – Overview of Advice”, sixth A3 page, 4 March 2011, released 19 May 2011. http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[11] The Treasury, “Extending the Mixed Ownership Model – Overview of Advice”, sixth A3 page, 4 March 2011, released 19 May 2011. http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[12] The Treasury, “Crown Ownership of Commercial Entities”, page 30: http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[13] John Key on TV3’s Sunrise, 17 March 2009.

[14] Labour’s fiscal strategy, page 8. http://www.ownourfuture.co.nz/fiscal-strategy

[15] 2010 Investment Statement of the Government of New Zealand, 14 December 2010, pp. 71-72

[17] PREFU B.16 p 82

[18] PREFU B.16 p82

[19] Asset slush fund an investment cop-out. NZ Herald, 9 November 2011 http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10764698

67 comments on “Nats fail own asset sales tests ”

  • Comments are now closed

  1. tc 1
    14 November 2011 at 7:23 am

    Good to see from Cunliffe, these clowns have been swanning around lying their butts off as they know the MSM will not pull them up.
    Love the way mr fay is positioning himself to be a white knight and with weldon departing his cowboy nzx…..no prizes for guessing that they’ll be busy with the great nz fire sale they’re all hoping for.

  2. tsmithfield 2
    14 November 2011 at 7:24 am

    “Unfortunately for him this contradicts Treasury’s advice that significant foreign investment would be essential to a successful sale share float.”

    Does that include the superannuation fund, kiwisaver accounts etc that are likely to be heavy buyers, effectively keeping the assets in kiwi hands?

    “The second and third tests stated National would ensure the companies involved presented good investment opportunities and protected New Zealand consumers. Key failed on both counts.”

    Ummm the complaint I have seen with monotonous regularity on this site is that the assets are being sold too cheap. If this is the case, then, by definition, they are excellent investment opportunities. Can’t have it both ways. I fail to see why consumers should be disadvantaged. The current model hasn’t worked too well in this respect given the huge power price increases over the last decade.

    “In addition, the UK’s experience of energy privatisation suggests that Kiwi consumers might be facing higher prices should asset sales go ahead.”

    What a stupid thing for Cunliffe to say, especially considering he was part of a government that oversaw massive price increases under the current structure that have absolutely rogered the consumer in every orifice possible. Under the new arrangement it will be possible for public/private entities to sell new shares to fund future developments rather than having to raise prices as is the case now. Assuming this is done on a 50/50 public/private basis, the cost to the tax payer will drop by 50% for future infrastructure.

    “But National’s projections haven’t accounted for the loss of dividends, which help fund Government spending once those assets are sold.”

    Conveniently ignoring Treasury advice that the loss of dividends and the offset in interest saved balance each other out. If the superannuation fund and kiwisaver funds invest heavily in the asset sales then a large proportion of the dividends will be returned to kiwi owned entities anyway helping to offset future superannuation costs. So the dividends aren’t necessarily lost.

    • mickysavage 2.1
      14 November 2011 at 8:17 am

      Ummm TS the Government owned companies increased prices at a lower rate than the private companies.  And like it or not prices are going to keep on increasing as energy becomes a more and more valued commodity.
       
      At least when we own the shares we get the profits.  If overseas get the shares all we do is send large amounts of money there.

    • Blighty 2.2
      14 November 2011 at 9:09 am

      ““Unfortunately for him this contradicts Treasury’s advice that significant foreign investment would be essential to a successful sale share float.”

      Does that include the superannuation fund, kiwisaver accounts etc that are likely to be heavy buyers, effectively keeping the assets in kiwi hands?”

      No, foreign investment does not include kiwisaver and the Cullen Fund, TS. Jesus. Get out of the wrong side of bed and whack your head on the wall this morning, did you?

    • Draco T Bastard 2.3
      14 November 2011 at 9:12 am

      The current model hasn’t worked too well…

      No it hasn’t but that’s what you get when you go round adding costs through faux competition.

      Under the new arrangement it will be possible for public/private entities to sell new shares to fund future developments rather than having to raise prices as is the case now.

      The costs still need to be met so they’ll just raise the prices later. Your method doesn’t save us anything. In fact, it’s most likely going to cost more as the privateers demand higher returns.

      Conveniently ignoring Treasury advice that the loss of dividends and the offset in interest saved balance each other out.

      Except that it doesn’t. Even Treasuries figures (17.5% return vs 6% interest) show that which means that Treasury and this government, if they’re saying that it makes no difference, are lying.

      If the superannuation fund and kiwisaver funds invest heavily in the asset sales then a large proportion of the dividends will be returned to kiwi owned entities…

      And if the government keeps them then the government gets to keep the dividends. What was the point of selling them again?

      Never mind the fact that there’s no guarantee that the Cullen Fund or Kiwisaver funds would get any shares.

    • mik e 2.4
      14 November 2011 at 10:53 pm

      Tsm Robbing taxpayer to buy votes

  3. Bored 3
    14 November 2011 at 7:36 am

    TS, in a world where economists were anything but chicken entrail readers suggesting that Treasury economists actually were credible experts would make sense. Unfortunately for us Treasury and economists in general have failed to deliver to us so singularly that their opinions should be avoided at all costs.

    I run companies, if I had listened to Treasury advice on business and followed it assiduously I would have gone bust years since. These guys are clowns, and worst than that idelogues in the pay of those who want “truth” delivered to the benefit of a very limited sector of society.

    • tsmithfield 3.1
      14 November 2011 at 7:39 am

      So, why has Labour relied on the PREFU for its own budget, then, if Treasury advice can’t be relied on? Seems to me that Labour is trying to play it both ways by putting forward a budget relying on Treasuries figures, and then ignoring Treasury when it is convenient for their arguments.

      • Blighty 3.1.1
        14 November 2011 at 8:00 am

        because the point of Labour’s fiscal strategy is to show what differences Labour’s policies make against the base case, which is the PREFU.

      • mik e 3.1.2
        14 November 2011 at 10:54 pm

        Tsm the prefu had to be updated because national have lost another couple of billion

  4. Psycho Milt 4
    14 November 2011 at 7:40 am

    Well yeah, it’s a totally illogical policy that would do more harm than good, but it’s election time and they have a base to appeal to. So it’s like a National equivalent of Labour promising to extend the In Work Tax Credit to people without work.

  5. Gosman 5
    14 November 2011 at 8:21 am

    This is not National failing their own tests on asset sales. This is just a rehash of the Labour party line on asset sales.

    • Blighty 5.1
      14 November 2011 at 8:32 am

      Well, there’s the tests and there’s evidence of failing those tests.

      What, specifically, do you dispute in regard to the tests being failed? Or are you just trolling?

      • Gosman 5.1.1
        14 November 2011 at 9:04 am

        Well let’s have a look at the ‘fails’ shall we just from the first point.

        – Widespread Kiwi ownership.

        “Treasury says “significant participation by foreign investors will be essential to achieve the Government’s overall objectives”.”

        – So? Widespread Kiwi ownership is not the same as no Foreign investment even at a ‘significant’ level. You can still have one and the other.

        “National has refused to give any guarantee against the subsequent purchase of shares from ‘mum and dad investors’ by foreign multinationals.”

        – Left wingers might enjoy imposing restrictions on markets. People on the right tend to favour individual freedom a tad more. If people wish to on sell their shares because they feel that it makes economic sense to them to do so why is that a bad thing?

        “National promised in 1999 that Contact Energy would stay in Kiwi ownership after it was sold, but at least 65% of Contact’s dividends now go overseas – in excess of $100 million last year and almost $1 billion in total since privatisation in 1999.”

        – Considering our country was built largely through the importation of Foreign capital for investment purposes to try and demonise it as bad is rather pathtic. It reminds me about NZers banging on about immigration when the country is populated by immigrants,

        All of the ‘fails’ above are opinions about the potential negatives of the Asset sales. They no more conclusive proof that Asset sales fail the tests than Labour’s view that it makes economic sense to borrow for speculation on Wall Street.

        • Draco T Bastard 5.1.1.1
          14 November 2011 at 9:21 am

          So? Widespread Kiwi ownership is not the same as no Foreign investment even at a ‘significant’ level. You can still have one and the other.

          No, actually, you can’t. Significant in this instance pretty much means the greater amount going to foreign owners.

          People on the right tend to favour individual freedom a tad more.

          To the point that it’s bad for society – yes, we know, as we’ve got the last 30 years of failure to see just how stupid right-wingers are.

          If people wish to on sell their shares because they feel that it makes economic sense to them to do so why is that a bad thing?

          Because it doesn’t make good economic sense if it leaves society worse off which it inevitably does.

          Considering our country was built largely through the importation of Foreign capital for investment purposes to try and demonise it as bad is rather pathtic.

          Financial capital that we didn’t actually need and left us working to make a few foreigners better off rather than making us better off.

          All of the ‘fails’ above are opinions about the potential negatives of the Asset sales.

          Um, no. The facts and figures show that selling assets off is bad for us.

          • Gosman 5.1.1.1.1
            14 November 2011 at 9:41 am

            No it is quite clear that Labour are misinterpreting the Asset sale tests for their own end. There is no harm in that. I wouldn’t expect any less expecially in an election campaign.

            National has never claimed that the test extend forever and a day. It would be foolish for a Right leaning political party to claim that it will allow asset sales to private individuals and then place additional restrictions to those that currently exist on who those private individuals can then on sell those assets to. The test is about the initial sale from Government to private hands.

            You may want it to be in place longer term but then you are advocating a different test.

            • Draco T Bastard 5.1.1.1.1.1
              14 November 2011 at 9:46 am

              They’re Nationals tests. Assets sales fail those tests at all time levels.

              Selling our assets off leaves us worse off. All the evidence proves that.

            • felix 5.1.1.1.1.2
              14 November 2011 at 9:51 am

              If there’s a time limit to National’s guarantee then they should say so and specify it.

              It’s a dinimic environment after all.

              • Gosman …
                14 November 2011 at 10:18 am

                Why should they say so?

                It is quite obvious to most that there would be a time limit on these guarrantees. National has no policy in place to impose additional restrictions on people selling their shares to whoever they want so long as existing regulations are met.

                If you had evidence that the Asset were going to be sold directly offshore at the initial offer stage then you are able to say that the test has not been met.

                • felix …
                  14 November 2011 at 10:40 am

                  Then they can’t guarantee widespread and substantial ownership, Gos.

                  You’re getting there slowly. Keep it up.

                • mik e …
                  14 November 2011 at 10:56 pm

                  How come Don Brash has chimed in and said he would with draw support for Asset sales if they didn,t meet the minimum price

        • felix 5.1.1.2
          14 November 2011 at 9:24 am

          I don’t think you’ve understood the post, Gos.

          It lists the tests that National says they’re using, not the tests applied by the standard authors or anyone else.

          So when you say things like “If people wish to on sell their shares because they feel that it makes economic sense to them to do so why is that a bad thing?“, you’re missing the point.

          It’s not whether you or I think that’s a bad thing, it’s that John Key says it’s a bad thing.

          He fails his own test if he can’t stop millionaire mums & dads selling their shares offshore.

        • bbfloyd 5.1.1.3
          14 November 2011 at 10:36 am

          ts.. you’re reading the bill english spin sheet and rewriting it verbatim by the look…. still total bullshit, but hey, that’s never stopped you before…enjoy pretending to be clever…. it’s the closest you will ever get to actually having an opinion worth the cost of ink to write it…

  6. Draco T Bastard 6
    14 November 2011 at 9:03 am

    Telecom’s foreign buyers pushed up prices, bled the company, and then quit it rather than investing in its long-term future. It was left to Labour in 2006 to rectify the regulatory framework.

    When what they should have done is renationalised it back in 2000. We knew then that privatisation had failed.

  7. Gosman 7
    14 November 2011 at 9:10 am

    Following left wing logic the Government should be nationalising more and more parts of the economy because it is a no brainer economically. It is a win-win for the country involved apparently.

    However looking around the world the opposite is in fact happening in places where economies have got themselves in to major difficulty. Take Greece for example. Noone is advocating the Greeks nationalise industries. In fact they are being forced to divest themselves from State Assets.

    Also why isn’t Labour advocating more nationalisation as part of it’s policy mix if State Assets are such a good thing?

    • felix 7.1
      14 November 2011 at 9:16 am

      Why isn’t National advocating selling ALL state assets if it’s such a no-brainer, Gos?

      • Gosman 7.1.1
        14 November 2011 at 9:33 am

        Because it isn’t a very popular policy with the electorate.

        So back to the original question. Why isn’t Labour advocating more nationalisation if it is such a no brainer? It used to be the bedrock of what the Labour party stood for.

        • felix 7.1.1.1
          14 November 2011 at 9:40 am

          Oh, you’re serious. Ok, the reason Labour isn’t advocating state ownership of everything is that it’s not a very good idea for the state to own everything.

          • Gosman 7.1.1.1.1
            14 November 2011 at 10:26 am

            I didn’t state everything though did I Felix. I asked why Labour is not proposing MORE nationalisation.

            If foreign ownership of Banks is such a bad thing as some here think then surely it is a no brainer to have a policy that the Government will nationalise them.

            If foreigners ownering farms is a bad thing economically then it is obviously a good idea to take over foreign owner farms.

            Why aren’t Labour and the Greens advocating these policies?

            • felix 7.1.1.1.1.1
              14 November 2011 at 10:36 am

              It’s the same argument and it’s an absurd reduction.

              You think if I agree to eat a pancake for breakfast I have to agree to eat ten? Why not? I obviously like pancakes, don’t I? What’s the problem?

              It’s a playpen argument Gos, and I’m not going to humour you with it.

    • Draco T Bastard 7.2
      14 November 2011 at 9:24 am

      In fact they are being forced to divest themselves from State Assets.

      The definitive word their is forced, ie, they’re not doing it voluntarily.

      Also why isn’t Labour advocating more nationalisation as part of it’s policy mix if State Assets are such a good thing?

      Because they’re stupid and still think capitalism works despite an entire three hundred years of failure.

      • Gosman 7.2.1
        14 November 2011 at 9:36 am

        Nice to see you acknowledge that Labour is stupid. We have some common ground after all 😉

        Greece has the right not to follow the policy advice it has been given. Of course it won’t then get any injection of capital to fund their large budget deficit and they will essentially go bankrupt unless they leave the Eurozone. But that is a small price to pay for sovereignty isn’t it?

        • Draco T Bastard 7.2.1.1
          14 November 2011 at 9:49 am

          But that is a small price to pay for sovereignty isn’t it?

          Yes, it is especially considering that it will leave them better off (just so long as they address the corruption in their society – but they need to do that either way).

    • bbfloyd 7.3
      14 November 2011 at 10:42 am

      gossyboy…. you really shouldn’t be quoting “left wing logic” to anyone until you can show a shred of understanding as to what that logic is…. apart from that,, your comment is an amusing little fantasy that seems to be making so much noise in your head it’s drowning out any attempts by your “logic” center to counter the emotional imbalance your attitudes to anything remotely realistic shows up…

  8. Gosman 8
    14 November 2011 at 9:15 am

    Just curious about how that darling of the left – Kiwibank will get the capital funding that it is likely to require in the next few years under a Labour led Government if they don’t get a capital injection such as National has promised from the Asset sales?

    • Draco T Bastard 8.1
      14 November 2011 at 9:23 am

      Well, I suspect that the best way for Kiwibank to get the capital would be for the government to put in a cash injection from taxes. It’s incredibly cheap (0% interest) and leaves us with all the assets that we currently own.

    • Bored 8.2
      14 November 2011 at 9:27 am

      Goss, this is where we get into the dark and murky world of fractional banking…..quite frankly all fractional banking should be done by strictly government owned and regulated banks…so to answer your question Kiwibank would only get capital from the state as fractional banker or as lender / guarantor of capital loans. We are talking renewing economic sovereignty and the demise of big bank finance, but that’s another story.

      • Gosman 8.2.1
        14 November 2011 at 9:30 am

        I must have missed that part of Labour party policy. Where did they state they were committed to the demise of big bank finance over the next few years?

        • Puddleglum 8.2.1.1
          14 November 2011 at 10:52 am

          “I must have missed that part of Labour party policy.”

          C’mon Gosman, don’t be so desparate with your rhetoric.

          Are you saying that Labour are beholden to adopt policies suggested by every commenter on The Standard? 

      • Draco T Bastard 8.2.2
        14 November 2011 at 9:52 am

        Fractional banking shouldn’t be done at all.

        Governments should print the money, banks should loan out the deposits in their banks and once loaned out the depositor shouldn’t be able to withdraw it until it’s been paid back (if it’s paid back).

        • Gosman 8.2.2.1
          14 November 2011 at 10:28 am

          Which country has ever had that sort of banking system?

          • Draco T Bastard 8.2.2.1.1
            14 November 2011 at 11:06 am

            What has that got to do with price of fish?

            • Gosman 8.2.2.1.1.1
              14 November 2011 at 1:14 pm

              Because much like the rest of hard left wing economic thinking it is a fantasy land idea that has no bearing on reality whatsoever.

              • Draco T Bastard …
                14 November 2011 at 1:35 pm

                No, it’s capitalism that is the fantasy. It’s the primary cause of the GFC, the Great Depression and the massive inequality that we have in society. The logic is inescapable – it cannot and does not work.

          • Zaphod Beeblebrox 8.2.2.1.2
            14 November 2011 at 1:21 pm

            Given what is happening in Europe that will be changing quite soon.

            • ropata 8.2.2.1.2.1
              14 November 2011 at 11:26 pm

              Agreed, fractional reserve banking has been taken to Madoff Ponzi scale extremes.
              We are seeing a long drawn out zombification of all banks and spreading social upheaval.

              Possibilities are hyperinflation, systemic failures, nationalisations, or the demise of the nation state.
              Weird shit these bankers are smoking.

    • Blighty 8.3
      14 November 2011 at 9:27 am

      selling meridian to get that capital injection would be foolish when the government has access to cheaper funds.

    • Lanthanide 8.4
      14 November 2011 at 10:02 am

      The reason they’re talking about Kiwibank getting a capital injection is so that it can start business lending.

      But Kiwibank was never set up to lend to businesses. It was set up as a retail bank for NZers to bring down bank fees. Whether you’re a customer of kiwibank or not, they’ve achieved that – I now have a bank account with ANZ in which I pay 0 fees.

      Kiwibank doesn’t “need” capital injection, it’s quite sustainable under it’s current business model.

      • Draco T Bastard 8.4.1
        14 November 2011 at 11:10 am

        But Kiwibank was never set up to lend to businesses.

        Wrong. It always said it was going to do business banking just not from the start. It does business banking now but it doesn’t have the size to do big business or government banking (and it really should be the bank that our government uses).

        • Gosman 8.4.1.1
          14 November 2011 at 1:16 pm

          Quite wrong. It isn’t it’s size which is stopping it from doing Corporate and Government banking but it’s systems. It would require a large capital injection to be able to develop these systems before it could move into these areas.

      • Gosman 8.4.2
        14 November 2011 at 1:19 pm

        Kiwibank never introduced zero fees first. That was the BNZ as far as I remember. Lower fees weren’t even a primary motivation for the business.

        • Draco T Bastard 8.4.2.1
          14 November 2011 at 1:39 pm

          Kiwibank never introduced zero fees first.

          Actually, it did. It was on that basis that I opened up my Kiwibank account. It was awhile before any other bank followed suit.

          • mik e 8.4.2.1.1
            14 November 2011 at 11:07 pm

            The big four banks were running a cartel gooseman putting up bank charges at will charging ridiculous margins on loans they are still gouging New Zealanders and are the main reason our balance of payments is so skewed.Incidently they are funding National party MPs social life .
            As well they have lobbying keys to enter parliament at will like other favourite lobbyists like the rod transport forum chaired continually by former National MPs jobs for the favours no wonder we get petrol head joyce borrowing to build holiday highway to john keys door

    • mik e 8.5
      14 November 2011 at 10:59 pm

      Why would you sell your best performing assets to prop up an under capitilzed bank while the assets are returning 20% cost of borrowing 6% it dumb gooseman.

  9. felix 9
    14 November 2011 at 9:42 am

    God how boring. Can someone wake me up when Gosman fucks off?

    • Ianupnorth 9.1
      14 November 2011 at 9:54 am

      I was practically comatose – he keeps rebating  his hook and they keep biting – please let him troll elsewhere.

  10. Bored 10
    14 November 2011 at 10:17 am

    My fault gents, I made the foolish mistake of being nice enough to reply, rebaiting the hook. My god I must have been bored.

  11. randal 11
    14 November 2011 at 10:32 am

    has ideology become the new codeword for THEFT.
    ther is no good reason to sel the states assets except to take a markup on the transaction and to stag the shares.
    National wanted their “TURN” but their turn is to steal the sates assets.
    throw them out before the do any more damage.

  12. randal 12
    14 November 2011 at 10:33 am

    gosman has had an anal trnaspalnt. he keeps talking sh*t out of his mouf.

  13. Dianne 13
    15 November 2011 at 2:00 pm

    I wouldn’t believe anything that the sly Cunliffe said. He simply has nothing going for him. I have watched and listened to him many many times, and he never can answer any questions. His common reply is I will have to check with the experts. He is absolutely hopeless. All he know’s is how to Tax and Spend money, and the results are the culture we have today.