You may have heard, the 80’s are making a comeback. Lookout for denim on denim, bubble skirts, and asset sales. David Seymour is stepping up his campaign to sell state assets and privatise public services.
In his State of the Nation speech last week, the ACT leader said we should be continually asking ourselves do we own the right stuff? NZ First, Labour and the Greens have all pinned their respective colours to the mast and said they are dead against the sale of any state-owned assets under their watch. NZ First and Winston Peters, of course, famously, long-standing opponent of the sale of state-owned assets. Prime Minister Christopher Luxon has done what he does best and equivocated. Oh sure, I'm open to the idea, open to having a discussion, but if anything were to happen, not that I'm saying it will, but if anything were to happen, if the for sale signs were to go up, it wouldn't be until the 26th election. So, he hasn't committed either way, just waiting to see which way the wind blows.
The fourth Labour Government was the government that really sold off the silverware. New Zealand changed fundamentally as a society as a result of the economic reforms driven by Roger Douglas and his cabinet. David Lange, he might have been the Prime Minister, but it was Roger Douglas who was the driving force behind the economic reforms. One of those within the cabinet, Richard Prebble, argues it was the right thing to do in today's Herald. He says that they had huge debt, and they had to resolve that somehow. He says New Zealand's privatisation was extraordinarily successful. The investors provided much better services and lower prices. Only profitable businesses pay company taxes. The privatized businesses are paying every year in company taxes more than they ever did in dividends. In contrast, he says, the history of state-owned enterprises retained in government ownership is abysmal. Solid energy went from a valuation of $3.5 billion. To being worthless, that it's $390 million debt. He said his office valued TVNZ in 1990 at around $2 billion, $4.3 billion in today's money. The station now runs at a loss, he says.
Brian Gaynor argues that the asset sales were not a success, that the prime pieces of silverware were sold off and overseas investors made an absolute killing from them. There is a counter to what Richard Prebble claims. John Key brought back the prospect of state asset sales in 2010 with a deeply unpopular promise to privatise state-owned electricity companies such as Meridian. But he told Mike Hosking on the Mike Hosking Breakfast this morning there are better ways to improve the economy faster than by selling off what remains of New Zealand’s state-owned assets.
“In the scheme of things, we want the boat to go faster. There's a million things you can do, from cutting bureaucracy and taxes, and you know, making a more permissive society, better foreign investment, all those kinds of things. If you want my view, they'll make the boat go a lot faster than a few asset sales because, frankly, there ain't a hell of a lot to sell.”
And there isn't. What would we sell? We've got Quotable Value, which David Seymour quoted as being an example. It values property, it doesn't receive any taxpayer money. But it provides a dividend of between half a million and one million a year, which is the sort of chump change that Grant Robertson used to find down the back of the couch. So that's not going to save New Zealand. Anyone interested in buying a television station? Could chuck in a video store as well as a sweetener on the deal? Anyone? No? Because that's the thing, too, for a successful state asset sale, you have to find buyers. Anyone for a couple of clapped-out ferries? Anyone? No? There’s sort of plans for a kind of port infrastructure that's really expensive and hasn't been costed properly, that we could chuck in for free. No
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