Friday, March 8, 2013

Truth on asset sales and Labour's indecision

Truth calls for the Labour Party to clearly state its position with regard to asset sales. The Truth website opines:

Labour and the Greens need to come clean on asset sales. We know that both parties oppose asset sales. We get that. They have spent a considerable amount of taxpayer cash recruiting staff and manipulating for political purposes the Citizens Initiated Referendum process to try to re-litigate the 2011 election.
The Maori Council tried to assist with their vexatious and costly litigation, only to fail int he Supreme Court with a unanimous decision that asset sales of the power companies can proceed.
The process for the government to sell down 49% of the assets, retaining control and 51% is now underway with an information sharing exercise and advertising campaign to accurately inform people of the benefits and risks of investing in shares.
We know what the government thinks. We can all read the prospectus when it comes out for Mighty River Power, but what investors don’t know is what Labour intends as its policy towards these sales.
We know they oppose them, but what is their policy moving forward?
Investors and voters need to know if Labour intends opposing the sales in actions and not just words.
Will Labour commit to forced buy-back of the shares, essentially a re-nationalisation of the asset? Before readers poo-pooh that suggestion remember Air New Zealand.
Helen Clark even flirted with securities laws by advising on national television for Mum and Dad investors to keep their shares in Air New Zealand…that everything would be alright. As we know everything wasn’t alright and some weeks later the government forcibly acquired as many shares as it could and left about 25% of shareholders mired without any sort of say in the company.
Would Labour do this again with the listed power companies? And if so how much would they pay for the shares? The listing price? The market price (unlikely)?
Labour and their hangers-on who oppose asset sales need to clarify before even a single share is sold what their intentions are.
I suspect that their policy will be as bankrupt as their position so far has been. Words not Deeds.

David Shearer has been dancing on the head of a pin so far with regard to Labour's position should it become the Government next year or at some future time. That is simply not good enough.

As much as we despise Winston Peters' brand of populism, he at least has been blunt. The cost of New Zealand First's support in a coalition deal will be a commitment to buy back shares in Mighty River Power and any other SOE's which are part-sold. Clearly on that basis, talk of NZF doing a deal with John Key after the 2014 election is just that; talk. If buying back the shares is an NZF absolute, a deal is not going to happen.

Over at Homepaddock, Ele has similar concerns:

Labour and the Green Party haven’t let us know their plans yet.
If they go ahead with the petition without making a commitment to buy the shares back they are adding yet more proof to the contention they’re after publicity for themselves not a change in policy.
If, however, they plan to buy back the shares they will sabotage any efforts they make to pretend they have any interest in the careful management of public finances and any concern for investors.

Thus far, the Political Party Initiated Referendum has all been a big political game. But with Mighty River Power shares about to go to the market, the game is over. 

David Shearer needs to state clearly and unequivocally whose side he is on, and what Labour will do to wind back a policy that it built an entire election campaign around - and lost.


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