Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


Mighty River Sale Leaves $2.3m a Week Hole In Govt Books

Mighty River Sale Leaves $2.3m a Week Hole In Government’s Books

Mighty River Power’s financial results show that National has increased the Government’s net deficit by $2.3 million a week by selling a profitable public asset, even after accounting for the reduced cost of Government debt, Green Party Co-leader Dr Russel Norman said today.

Today’s financial results show that Mighty River Power recorded a shareholder equity gain of $167.7 million and issued dividends of $168 million in the 2012/13 financial year. Total Shareholder Return is the change in shareholder equity plus dividends, which equates to a 11.1% return for MRP. Yet the average Government 5-year bond borrowing rate was only 2.9% for the same year. Thus, the net position of the Government, accounting for reduced Crown borrowing costs, as a result of selling 49% of Mighty River is $2.3 million a week worse, or $121.7 million for the full financial year.

“So much for the supposed business acumen of the National Party; they sold an asset that’s returning four times the Crown’s cost of borrowing,” said Dr Norman.

“Today’s result show that Treasury was right: asset sales increase the Government’s fiscal deficit. The Government is losing over $2.3 million each week on foregone net profits due to the Mighty River sale. That’s on top of the $66 million that the sale process itself cost the taxpayer.

“The cruel irony is that those New Zealanders who listened to National’s expensive ad campaign and invested in Mighty River have also lost money as the share price has fallen.

“The only people who seem to be profiting from National’s asset sales are the stock-brokers, the lawyers, and the ad-men who are clipping the ticket, and the big institutional investors.

“Asset sales just don’t add up. That’s why the overwhelming majority of New Zealanders are so strongly against them.

“National could save whatever remains of its tattered economic credibility by listening to New Zealanders and cancelling the remaining asset sales,” said Dr Norman.

Additional information:

Mighty River Power return$m
Shareholder equity, 30 June 2012$       3,014.0
Shareholder equity, 30 June 2013$       3,181.7
Equity return$          167.7
Equity return %5.6%
Dividends$          168.0
Dividend return %5.6%
Total Shareholder Return$          335.7
Total Shareholder Return %11.1%
Average 5-yr bond rate 2012/13 (source: Treasury)2.9%
Net TSR %8.2%
Net TSR$        248.29
Net TSR on 49%$        121.66
Net TSR on 49% per week$            2.33

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

International Rankings: Student Results 'Show More Resourcing Needed'

NZEI: "For the second time in a week, international assessments show we have a problem... We need to put more resources into schools in high poverty communities to ensure all kids get the support they need."

New Zealand had only held relatively steady in international rankings in some areas because the average achievement for several other OECD countries had lowered the OECD average -- not because our student achievement has improved. More>>

 

Salvation Army Report: Beyond The Prison Gate Report

A new Salvation Army report says changes must be made to how prisoners re-enter society for New Zealanders to feel safe and secure in their homes and communities. More>>

ALSO:

Surprise Exit: Gordon Campbell On The Key Resignation

The resignation of John Key is one thing. The way that Key and his deputy Bill English have screwed the scrum on the leadership succession vote (due on December 12) is something else again. It remains to be seen whether the party caucus – ie, the ambitious likes of Steven Joyce, Judith Collins, Paula Bennett, and Amy Adams – will simply roll over... More>>

ALSO:

Q+A: Labour's Michael Wood Wins Mt Roskill

Labour’s Michael Wood, who last night won a 6,000 vote majority in the Mt Roskill by-election, says the reason for the win was simple, clear messaging... More>>

ALSO:

Gordon Campbell: On Anne Tolley’s Callous Folly

Last week’s conflict between Social Development Minister Anne Tolley and District Court judge Carolyn Henwood illustrated quite a few of the flaws in the system. More>>

ALSO:

Members’ Bills: Greens' Domestic Violence And Loans Bills Pulled From Ballot

Jan Logie’s Domestic Violence-Victims' Protection Bill introduces workplace protections for victims of domestic violence, including allowing victims to request paid domestic violence leave for up to 10 days... Gareth Hughes’ Bill allows Kiwis with student loans to defer their student loan repayments into a first home savings scheme. More>>

ALSO:

IPCA: Police Did Not 'Deliberately' Use Pepper Spray On 10-Year-Old

"When spraying the man, the officer did not properly consider the necessity of using pepper spray in a confined space, the likelihood that it would affect the other innocent passengers or the fact that he was using a more powerful spray." More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news