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

Gordon Campbell: On The Mt Albert Aftermath

Personality politics – Jacinda is great! Jacinda is not so great! – have dominated the coverage of the Labour Party’s fortunes this week...

Still, this is a relatively new and welcome problem for the centre-left. Labour has seemed so bereft of crossover talent for so long that it seems almost embarrassed by this latest development. More>>

 

Conservation: Central Govt Takes Over 1080 Regulation

“This new approach standardises the rules for using such poisons rather than the current system of different rules in different regions. This change will reduce costs and delays for operators, ensure consistent conditions throughout the country, reduce mistakes from misunderstanding rule differences and allow best practice approaches to be used." More>>

ALSO:

Election Entertainments: ACT Has Prison Plan, Greens Have Water Bill

Green Party launches Member’s Bill to protect our freshwater The Green Party has today launched a member’s bill that will keep water from underground sources, called aquifers, safe from pollution and contamination. More>>

ALSO:

2040 Target And Lower Standards: “Swimmable” Rivers Five Times More Likely To Make You Sick

Forest & Bird has condemned the government’s new water quality standards, warning New Zealanders that they lock in current levels of water pollution and allow for a 5-fold increase in the chance of getting sick from swimming in a river. More>>

ALSO:

Immigration: Clampdown On Rogue Employers Good First Step

The Human Trafficking Research Coalition is pleased at the new clampdown on rouge employers who exploit migrants announced by Minister Woodhouse this morning, and believes this is a step in the right direction. More>>

ALSO:

Mayor: 750 New Social And Affordable Homes For Wellington (Over A Decade)

The next stage of Wellington’s Housing Upgrade Programme will see at least 750 new units of social and affordable housing built over the next decade, Mayor Justin Lester has announced. More>>

ALSO:

22/2: Christchurch Quake Memorial Unveiled

A city, a region, a nation and an international community impacted by the Canterbury Earthquakes will come together to mark the sixth anniversary of the deadly quake and dedicate Oi Manawa Canterbury Earthquake National Memorial. More>>

ALSO:


November Quakes:

Gordon Campbell: On The Mana-Maori Party Deal

If the self-interest involved wasn’t so blatant, the electorate deal between the Maori Party and Hone Harawira would be kind of poignant. It’s a bit like seeing the remaining members of Guns’n’Roses or the Eagles back on the road touring the nostalgia circuit… playing all the old hits of Maori unity and kaupapa Maori politics. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news