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National criticised by party faithful on asset sales

Labour Leader
13 August 2011 MEDIA STATEMENT

National criticised by party faithful on asset sales

Bill English has been criticised by his own party faithful on National’s plan to sell off New Zealand’s productive state-owned assets, says Labour Leader Phil Goff.

“Rank and file members of the National Party queried the Finance Minister’s assurance that state-owned assets would remain in the hands of Kiwi investors during the National Party conference today. The truth is that the shares won’t remain owned by the so-called ‘Mum and Dad’ investors, but will end up corporate and foreign owned,” Phil Goff said.

“National’s plan to sell 49 per cent of shares in our remaining state-owned power companies, while keeping a majority of shares onshore is dubious, even for the party faithful. Treasury’s advice to National is that foreign owners would end up with a cornerstone shareholding.

“Bill English acknowledged today there was no way National could stop Kiwi investors selling shares to overseas buyers. Even with the positioning of a ‘loyalty scheme’ the fact remains—our productive state-owned assets will end up in the hands of foreign owners whose chief concern is profit, not the people of New Zealand.

“Most Kiwi Mums and Dads struggle to pay their power bills, let alone being able to afford to buy shares in the companies. Why should they have to buy shares in something they already own? Private shareholding and the pressure to maximise profits will push up power prices for Kiwi consumers. This happened when Contact Energy was privatised by Bill English in 1999.

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“National has learned nothing from its failures when last in Government. When Contact was sold, the number of shareholders fell by 34,845 in just six months. Shareholder numbers fell from 225,000 at sale to about 81,000 in 2010. Just over 75 per cent of those shares were held by 20 companies, with Australian-owned Origin Energy as the major shareholder.

“History shows us that within a very short space of time after sale, shares become concentrated in the hands of big corporates and most shares end up foreign-owned.
Selling off shares in our assets like the power companies, Air New Zealand and Kiwi Bank is not in our interests as New Zealanders. We will lose the dividends they provide, lose ownership of our future and pay more in power prices.

“Voters have a clear choice this election. Labour will not sell our productive assets and will ensure profits are kept in Kiwi pockets,” Phil Goff said.

Paid for by Vote Parliamentary Service and Authorised by Phil Goff, MP, Parliament Buildings, Wellington


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