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

 


No case for taxpayer bailout of Chorus

No case for taxpayer bailout of Chorus

Labour Leader David Cunliffe says there is no case for a taxpayer bailout of Chorus based on the Ernst & Young report made public yesterday.

The EY report accepts Chorus’ revenue reduction forecast of $1billion over five years, but highlights measures that could reduce it to $200 - $250 million without any government intervention.

“EY indicates that almost half of the gap can be filled with offsetting operating and capital cost reduction and other revenue measures ($400 - $500m), halving the dividend rate to $90 million and increasing debt headroom ($130m).

“That leaves a revenue gap from the initial forecast of only $40 - $50million per year,” David Cunliffe said.

“Crucially Chorus’ dividend pay-out rate could be further reduced. Even at half its current rate it would still be above the average of benchmark New Zealand infrastructure companies.

“Taxpayers should not be asked to subsidise Chorus’ shareholders,” David Cunliffe said.

“Labour rejects a taxpayer subsidy; we reject the Government purchasing Chorus shares; we reject throttling back copper broadband speeds; and we reject renegotiating Chorus’ broadband contract.

“Labour considers further work is needed by EY to independently test Chorus’ revenue forecasts. EY should test further dividend reduction, capital raising and increased debt headroom to meet the remaining shortfall.

“Minister Amy Adams should also investigate the impact of the timing difference between the interim and final pricing policy decisions across both bitstream and access prices.

“What the Ernst & Young report makes plain is that Chorus’ revenue gap can be closed by normal commercial means. No case exists for the taxpayer to subsidise Chorus’ shareholders,” David Cunliffe said.

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Auckland Relocation Grants: 12 Grants Paid So Far

Since the policy took effect one month ago, 12 applicants have received the non-recoverable grant, supporting 32 people. $54,508 has been paid out, covering things like moving costs, bond, rent in advance and letting fees. More>>

ALSO:

Vaccine Funding Change: HPV Vaccines For All Children

PHARMAC has today announced changes to funded vaccines, which will benefit an extra 100,000 people... The human papillomavirus (HPV) vaccine will be available for all children and adults up to the age of 26 years, and boys will now be included in the HPV school vaccination programme. More>>

ALSO:

Gordon Campbell: On Why The Opinion Polls For Key And Trump Defy Gravity

What is going on? Donald Trump got confirmed as the Republican presidential candidate at a bizarrely chaotic political convention… and promptly received an upwards bump in the polls to where he’s now rating ahead of Hillary Clinton, for only the second time this year. More>>

Sugar: Auckland Leisure Centres Axe Unhealthy Drinks

Auckland Council is to stop selling drinks that are sweetened by sugar from vending machines at its leisure centres in a bid to try to reduce obesity and type 2 diabetes... More>>

ALSO:

Gordon Campbell: On Todd McClay’s Faulty Memory

Time and again, whenever an issue arises the initial response by government is to deny or diminish the problem – nothing to worry about here, everything’s OK, move on. Then, hang on. In line with the usual pattern, as embarrassing details emerged into daylight, the story changed. More>>

ALSO:

Labour's 'Future Of Work': Major Reform Of Careers And Apprenticeships

The next Labour Government will transform careers advice in high schools to ensure every student has a personalised career plan, Leader of the Opposition Andrew Little says. More>>

ALSO:

State Investments Management: Treasury Likes IRD, Not Education Or Corrections

The Inland Revenue Department has scored an 'A' in the first tranche of the Treasury's investor confidence rating for state agencies that manage significant Crown investments and assets, gaining greater autonomy as a result, while the Corrections and Education ministries gained a 'C' rating. More>>

ALSO:

Govt Goal: NZ To Be "Predator Free" By 2050

Prime Minister John Key has today announced the Government has adopted the goal of New Zealand becoming Predator Free by 2050... “That’s why we have adopted this goal. Our ambition is that by 2050 every single part of New Zealand will be completely free of rats, stoats and possums." More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news