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Winston Peters recycles pledge to “buy back state assets” – where have we heard that before?

31 March 2014 5 comments

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Over the last two years (give or take), NZ First leader, Winston Peters, has stated on numerous occassions that buying back shares in the three energy SOEs (Meridian, Genesis, and Mighty River Power) will be a “bottom line” in any post-election coalition deal.

On 20 June 2012, NZ First posted this statement on their website,

New Zealand First will use its influence on the next coalition Government to buy back our state-owned power companies which are being flogged off by National.

Rt Hon Winston Peters says New Zealand First is committed to buying back the shares at no greater price than paid by the first purchaser.

“State-owned assets rightfully belong to all New Zealanders but National is intent on handing them over to rich foreign investors.

“It is simply lining the pockets of the wealthy by selling off well-performing assets that already provide the Government with extremely healthy dividends.”

Mr Peters says it is only fair to alert potential investors that New Zealand First’s intention to buy back the shares will be part of any coalition negotiations.

“As things stand now, the assets will end up in foreign ownership which is an outright attack on our sovereignty. We are committed to repelling that attack.”

The pledge was repeated on 29 November 2013;

New Zealand First is the only political party that has said since the beginning that if the Government did go ahead with this idiotic decision, then when we are in a position to influence the next Government, we would buy back the shares at a price no more than that initially paid for them.

On ‘The Nation‘, on 15/16 March, interviewed by Patrick Gower, Peters repeated NZ First policy that a share buy-back, at a cost no greater than the original purchase-price, was a bottom line policy for his Party;

Gower: So that means buying Genesis back?

Peters: That’s right. At no greater price than they paid for it.

Gower: And does that mean buying back the other power companies as well?

Peters: It means exactly that. That’s what our position has been for some time.

Gower: So that’s a priority for you in any negotiations?

Peters: It is a priority, and it also has the blessings in terms of economic calculations from Treasury.

Taken at face value, Peters’ committment to buy back shares in the powercos seems more comprehensive and radical than either the Greens or Labour. Neither have committed to buying back shares in Meridian, Genesis, and Mighty River Power until the government books allow it.

But, can Peters’ pledge be taken at face value?

Can he be trusted to make good on his word to (a) make a share buy-back a bottom-line in any coalition deal and (b) actually follow through?

His track record on such matters is not good.

On 27 September 1996,  the then-Bolger-led National government sold the Forestry Corporation of New Zealand Ltd cutting rights to a private  consortium (Fletcher Challenge Forests, 37.5%, Brierley Investments Ltd, 25%, and Chinese state-owned company,  Citifor Inc, 37.5%)

This became a major election issue in  the lead-up to the first MMP election in  1996, with the Alliance organising a CIR petition to halt the sale.

NZ First leader, Winston Peters, pledged to buy back the cutting rights, stating on several occasions that any government he was part of would “hand back the cheque“;

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The game plan - what we're all playing for - NZ First buy back forest corp

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During the election campaign, Peters stated unequivocally his intentions that the privatisation of Forestry Corp would not stand under any government he was part of;

“I want to tell the Chinese buyers and I want to tell Brierleys that they had better not make any long-range plans because the day after the election is over we will be sending them an emissary to them them exactly what is going to happen, that is, that we are going to keep out promise, they can give back the asset and we will give the money back.” – Winston Peters,  Otago Daily Times, 1 Feb 1997 (on pre-election statement/promise)

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On 11 December 1996, Peters announced that he would be entering into a formal coalition arrangement with the National Party, to form the first MMP coalition government.

Subsequently, Peters’ pledge to “hand back the cheque” and buy back the forestry cutting rights, was ‘quietly’ dropped;

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NZ First ignored chance to implement own policy

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“… NZ First did not make any attempt to include  in the [Coalition] agreement its policy of placing a 24.9% limit on foreign ownership of strategic assets.

Neither did they raise the NZ First promise to buy-back Forestry Corp, which was sold earlier this year to a consortium including Fletcher Challenge.” – Otago Daily Times, 16 Dec 1996

As Treasurer and Deputy Prime Minister in the National-NZ First government, Peters had ample opportunity to implement his Party’s buy-back policy. It was a promise he could have kept. And should have kept.

Instead, NZ First opted to implement National’s policy of tax cuts on 1 July 1998. With even more tax cuts promised by then-Finance Minister, Bill Birch.

This was money that Peters could have allocated and spent of re-nationalising our forests – but was instead wasted on cutting taxes, thereby reducing the ability of the coalition government to implement a buy-back, as Winston Peters had promised.

If Peters holds the balance of power after 20 September, and if he forms a coalition with either bloc, he may well carry out his promise to buy back shares in our energy utilities.

Or then again, he might not.

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References

NZ First: NZ First Committed To Buying Back State-Owned Assets

NZ First: Our asset sales buyback promise – Radio Live Column

TV3: Winston Peters: Asset buy-back ‘a priority’

FAO.org:  Devolving Forest Ownership in New Zealand: Processes, Issues and Outcomes

Treasury: Income from State Asset Sales as at 30 September 1999

Wikipedia: CITIC Group [Citifor]

Wikipedia: Referendums in New Zealand

Otago Daily Times: Alliance quits quest for forestry petition

Otago Daily Times: NZ First ignored chance to implement own policy

Otago Daily Times: NZ First opts for National

Otago Daily Times: Further tax cuts unlikely before next century

NZPA: Birch pledges more tax cuts

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Be careful what you wish for - Key and Peters

Above image acknowledgment: Francis Owen

This blogpost was first published on The Daily Blog on 16 March 2014.

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Radio NZ: Politics with Matthew Hooton and Mike Williams – 9 December 2013

10 December 2013 Leave a comment

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– Politics on Nine To Noon –

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– Monday 9 December 2013 –

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– Kathryn Ryan, with Matthew Hooton & Mike Williams –

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Today on Politics on Nine To Noon,

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Click to Listen: Politics with Matthew Hooton and Mike Williams ( 25′ 53″  )

This week:

  • The political ramifications of Nelson Mandela’s death and the NZ delegation travelling to South Africa,
  • the Green Party’s new policy for the Meridian share float,
  • and leadership changes within New Zealand’s smaller political parties.

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Corporate Welfare under National

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In case there are still one or two New Zealanders remaining who haven’t yet cottoned on to one very simple truism about National in office, let me spell it out; they are rank hypocites of the highest order.

And in case you, the reader, happen to be a true-blue National supporter, let me explain why.

In the last four years, National has been beavering away,

  • slashing budgets
  • sacking nearly 3,000 state sector workers
  • closing schools
  • attempting to close special-needs services such as Nelson’s Salisbury school
  • cutting state services such as DoC, Housing NZ, Police, etc
  • freezing wages for state sector workers (whilst politician’s salaries continue to rise)
  • cutting back on funding to various community services (eg; Rape Crisis ands Women’s Refuge)
  • and all manner of other cuts to  state services – mostly done quietly and with minimum public/media attention.

In return, the Nats successfuly bribed us with our own money, giving us tax-cuts in 2009 and 2010. (Tax cuts which, later, were revealed not to be as affordable as what Dear Leader Key and Little Leader English made out – see:  Key: $30b deficit won’t stop Nats tax cuts, see: Government’s 2010 tax cuts costing $2 billion and counting)

One such denial of funding for public services is an on-going dispute between PHARMAC and the New Zealand Organisation for Rare Disorders (NZORD) which is struggling  desperately to obtain funding for rare disorders such as Pompe’s Disease,

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Acknowledgement: Fairfax Media – Mum not prepared to wait and die

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NZORD and it’s members have been lobbying National for the last four years to gain funding for much-needed medication. They are in a dire situation – this is a matter of life or death for them.

This blogger has blogged previously about their plight,

Previous related blogposts

This blogger has also  written directly  to the Prime Minister and to Health Minister, Tony Ryall.

One response from Minister Ryall is presented here, for the reader’s attention,

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So there we have it, folks. If you’re a New Zealander dying from a rare disease, and PHARMAC won’t fund life-saving medication – don’t expect an assistance from this rotten government. Their response will be, and I quote,

While I share your concern [snort!!!]  for people with Pompe disease, as I advised you in my letter of 22 November 2012, in the current fiscal environment, unfortunately funding is not available for all treatments.”

So “in the current fiscal environment, unfortunately funding is not available for all treatments“?!

But funding is available for;

$1 Rugby – $200 million to subsidise the Rugby World Cup (see:  Blowouts push public Rugby World Cup spending well over $200m)

$2 Movies – $67 million paid to Warner Bros to keep “The Hobbit” in New Zealand (see:  The Hobbit: should we have paid?) and $300 million in subsidies for “The Lord of the Rings” (see:  Hobbit ‘better deal than Lord of the Rings’ – Key)

$3 Consultants – After sacking almost 3,000 state sector workers (see:  555 jobs gone from public sector) – and with more to come at DoC – National seems unphased at clocking up a mind-boggling $1 billion paid to “consultants”.  (see:  Govt depts clock up $1bn in consultant fees)

And on top of that, we are now faced with the prospect of a trans-national corporate – Rio Tinto – with their hands firmly around Meridian Energy’s neck, attempting to extract a greater subsidy from the SOE powerco. The story began in August last year,

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Rio Tinto seeks power deal revision

Acknowledgement: NZ Herald – Rio Tinto seeks power deal revision

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We know why. Despite implausible assertions to the contrary by National Ministers, Genesis Energy, and Rio Tinto executives – the partial sale of SOE powercos (Meridian, Genesis, and Mighty River Power) have made them vulnerable to the demands of Big Businesses.

Rio Tinto  knows that the share price of each SOE will be predicated on marketplace demand for shares.

They know that if there is less demand for electricity, then the price of power may (note: may) drop; those SOE’s profits will drop; and the price of shares will drop.

That leaves shareholders out of pocket and National with egg on it’s face. And a whole bunch of  Very Pissed Off Voters/Shareholders.

Think: Warner Bros. Think: corporate blackmail to shift ‘The Hobbit’ overseas. Think: National not wanting to risk the wrath of Peter Jackson and a thoroughly manipulated Public Opinion. Think: National looking at the 2011 election. Think: panic amongst National ministers and back-room Party strategists.

National capitulated.

This is precisely what is happening with Rio Tinto, Meridian, and National.

In the space of six and a half hours yesterday (28 March 2013),  events came to a dramatic head. The following happened in one day:

9.15am:

Via a Press Release from Merdian Energy;

Thursday, 28 March 2013, 9:15 am
Press Release: Meridian Energy

New Zealand Aluminium Smelter’s electricity contract

For immediate release: Thursday, 28 March 2013

Meridian was approached by Pacific Aluminium, a business unit of global mining giant Rio Tinto Ltd, the majority shareholder of New Zealand Aluminium Smelters Ltd (NZAS), in July 2012, to discuss potential changes to its existing electricity contract.

Since talks began, various options have been discussed and Meridian has offered a number of changes and concessions to the existing contract.

Chief Executive of Meridian Energy, Mark Binns, says that Meridian has advised Pacific Aluminium of its ‘bottom line’ position.

“Despite significant effort by both parties there remains a major gap between us on a number of issues, such that we believe that it is unlikely a new agreement can be reached with Pacific Aluminium,” says Mr Binns.

In the event no agreement can be reached, Meridian will seek to engage with Rio Tinto and Sumitomo Chemical Company Ltd, the shareholders of NZAS, who will ultimately decide on the future of the smelter.

Meridian signed a new contract with NZAS in 2007, after three years of negotiations. This current contract commenced on 1 January 2013 and remains unaltered and binding on the parties.” – Source

To which Rio Tinto replied,

10.15am:

In a NZ Herald story,

CEO  of Pacific Aluminium (the New Zealand subsidiary of Rio Tinto), Sandeep Biswas responded with,

“We believe a commercial agreement that is in the best interests of NZAS, Meridian, the New Zealand Government, and the people of Southland can be reached. We look forward to continuing productive negotiations with a view to achieving a positive outcome for all parties.” – Source

De-coding: “This ain’t over till the Fat Chick sings, and she’s nowhere to be seen. You guys better start hearing what we’re saying or this is going to turn to sh*t real fast; we’ll close our operations at Bluff; 3,200 people employed by us directly or  indirectly will be told ‘Don’t Come Monday’;  your Southland economy will collapse like a Cyprus bank, and National can kiss goodbye to it’s re-election in 2014. Ya got that, sunshine?”

11.15am:

That got the attention of National’s ministers Real Quick,

The Government has opened discussions with Tiwai Point aluminium smelter’s ultimate owners Rio Tinto in a bid to broker a deal after talks between the smelter and Meridian Energy reportedly broke down.

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“With this in mind, the Government has been in contact with Pacific Aluminium’s international parent company Rio Tinto this week to discuss helping to bridge the gap in their positions over the short to medium term, if this could be of assistance in concluding an agreement.

“In the meantime, we understand Meridian’s existing contract with Pacific Aluminium remains in place at least until 1 January 2016 with significant financial and other obligations beyond that.” – Source

Barely two hours had passed since Meridian had lobbed a live grenade into National’s state asset sale programme, and it’s fair to say that the Ninth Floor of the Beehive was in a state of panic. It was ‘battle stations’. Red Alert. National ministers were, shall we say, slightly flustered,

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12.00pm:

By noon, the markets were reacting. Though share-market analysts were attempting to down-play the so-called  ‘Phoney War’ between Meridian and Rio Tinto, Devon Funds Management analyst, Phillip Anderson, remarked that,

“…the announcement had hit Contact’s share price – the company was down 3 per cent in early trading but is now down only 1.2 per cent.” Source

If Contact’s (a fully privatised ex-SOE) share price had dropped 3% on the strength of these media stories, it is little wonder that share-market analysts were down-playing the brinkmanship being played out by Meridian and Rio Tinto. If the share-market was spooked enough, Contact’s share price would plummet, as would that of Mighty River Power – estimated to be in the $2.36 and $2.75 price-range. (see:  Mighty River share tips $2.36 to $2.75).

In which case, National would be floating shares worth only a fraction of what ministers were seeking. In effect, if Rio Tinto closed down operations, Key could kiss goodbye to the partial sale of energy SOEs. They would be worthless to investors.

3.43pm:

By 3.43pm, and six and a half hours since Meridian’s press release, National had negotiated some kind secret deal with Rio Tinto.  We don’t know the terms of the deal because though it is our money, National ministers don’t think we have a right to the information,

The Government is negotiating a new taxpayer-funded subsidy with Tiwai Point aluminium smelter’s owners and has all but acknowledged its assets sales programme is being used by them to get a better deal on power prices.

State Owned Enterprises Minster Tony Ryall this morning said the Government has opened discussions with the smelter’s ultimate owners global mining giant Rio Tinto in a bid to broker a deal over a variation to the existing electricity contract.

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“With this in mind, the Government has been in contact with Pacific Aluminium’s international parent company Rio Tinto this week to discuss helping to bridge the gap in their positions over the short to medium term, if this could be of assistance in concluding an agreement.”

Mr Ryall indicated the Government had offered Rio Tinto “a modest amount of money to try and help bridge that gap in the short to medium term but there’s still a very big gap in the long term… We’re not interested in subsidising this business in the long term”. – Source

Ryall added,

“…they’re pretty tough negotiators and I’m sure they look at what else is happening in the economy when they make their various decisions…

…”they certainly haven’t got the Government over a barrel.”

Three questions stand out from Ryall’s statement,

  1. If  State subsidies for electricity supply to Rio Tinto’s smelter are “short to medium term” – then what will happen when (if?) those subsidies are lifted? Will shareholders “take a bath” as share prices collapse in value?
  2. Does Ryall think we are fools when he states that Rio Tinto did not have the government “over a barrel” ?! Is that how National views the public – as morons?
  3. How much is the “a modest amount of money” that Ryall is referring to?

Perhaps the most asinine comment from Ryall was this, as reported by TVNZ,

“The electricity market is capable of dealing with all the issues relating to the smelter,” said Ryall.

Acknowledgement: TVNZ News – Talks break down over Tiwai smelter contract

Really?! In what way is “the electricity market … capable of dealing with all the issues relating to the smelter” when the government has to step in with what could be millions of dollars worth of subsidies? Is that how “the market” works?!

This blogger has two further questions to put to Minister Ryall. Both of which have been emailed to him,

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Date: Thu, 29 March 2013, 6.43pm
From: Frank Macskasy <fmacskasy@yahoo.com>
Subject: Re: Your correspondence to Hon Tony Ryall
To:  Tony Ryall  <Tony.Ryall@parliament.govt.nz>

Kia ora,  Mr Ryall,

I am in receipt  of your emailed letter to me, dated 5 December 2012, regarding the non-funding of certain medications for sufferers of Pompe Disease. Firstly, thank you for taking the time to respond to this issue in a thorough and timely way. Several of your other ministerial colleagues seem to lack that simple etiquette.

I note that, as Minister of SOEs, you have been in direct negotiations with Rio Rinto, and have offered the company subsidised electricity for the  “short to medium term”.

This will no doubt cost the taxpayer several millions (hundreds of millions?) of dollars.

If  National is able to provide such largesse to a multi-national corporation, please advise me as to the following;

1. Why is the same subsidy for cheaper electricity not offered to ALL New Zealanders? Or even those on low-fixed incomes? Why provide a multi-million dollar subsidy just to a billion-dollar corporation when New Zealanders could do with a similar cut in their power bills?

2. In your letter to me, dated 5 December 2012, you point out that,

“While I share your concern  for people with Pompe disease, as I advised you in my letter of 22 November 2012, in the current fiscal environment, unfortunately funding is not available for all treatments.”

If National has millions of dollars available to subsidise multi-national corporations, them obviously your statement on 5 December 2012 that “in the current fiscal environment, unfortunately funding is not available for all treatments” – is simply not credible.

It is obvious that your government can find money when it wants to. This applies to Rugby World Cup funding, consultants, movie-making subsidies, etc.

As such, I hope you are able to find the necessary funding for medication for people suffering rare disorders.

You are, after all, Minister for Health as well as Minister for State Owned Enterprises.

Regards,

-Frank Macskasy
Blogger

PS: Please note that this issue will be canvassed further on the blogsite, The Daily Blog.

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Minister of Health. Minister for SOEs. Minister for corporate welfare.

Which ‘hat’ will Tony Ryall be wearing today?

And will he find the necessary funding to save the lives of sick New Zealanders?

This blogpost was first published on The Daily Blog on 31 March 2013.

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References

NZ Herald: Rio Tinto seeks power deal revision (10 Aug 2012)

Scoop.co.nz:  New Zealand Aluminium Smelter’s electricity contract Press Release (9.15am, 28 March 2013)

NZ Herald:  Smelter counters Meridian – power deal still possible (10.15am, 28 March 2013)

NZ Herald:  Govt steps in to sort out stalled Tiwai power deal (11.15am, 28 March 2013)

NZ Herald:  Tiwai stoush may affect Mighty River price  (12.00pm, 28 March 2013)

NZ Herald:  Govt offser Tiwai subsidy (3.43pm, 28 March 2013)

Related references

NZ Herald:  Mighty River share tips $2.36 to $2.75 (20 March 2013)

Related to previous blogposts

Pharmac: The politics of playing god (16 June 2011)

$500,000 a year to keep toddler alive (5 Feb 2013)

Rare disease sufferers want pricey treatments (1 March 2013)

Rare disease takes awful toll on boy (1 March 2013)

Call for an Orphan drugs access policy to overcome Pharmac’s systems failure (28 Feb 2013)

Bill English – do you remember Colin Morrison? (4 Feb 2013)

Related Opinion

NZ Herald – Fran O’Sullivan – Govt intervention doesn’t cut mustard (30 March 2013)

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392,000 New Zealanders send a clear message to John Key – Part Rua

12 March 2013 4 comments

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Continued from: 392,000 New Zealanders send a clear message to John Key – Part Tahi

NZ, Wellington, 12 March 2013 – Ms Maniapoto Jackson introduced the first speaker, Greypower’s President, Roy Reid,

“So please welcome up the man who initiated this historical moment for us – the biggest citizens initiated referendum in [New Zealand’s] history!”

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Roy Reid

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“As President of Greypower, I wish to inform you  that Greypower has been opposed to the  sale of state owned assets  for a number of years. And this was reconfirmed at our annual general meeting two years ago. We advised all the political parties in this  House that we were opposed to them selling any of our assets.

Our generation worked hard. We paid the taxes, to build our existing assets. They’re not for sale. They belong to  all New Zealanders.

I sincerely thank all those who worked from one end of New Zealand to the other, to collect those 394,000 signatures just behind us.  It’s the biggest petition  ever presented to this House.
I pay tribute to our co-supporters, the New Zealand students association. For being involved with us, because it shows the country that we are united from the elderly to the younger generations…

…I’m sure that we’ve got enough valid signatures in those boxes to force the referendum. And [despite] no respect for what this government today says, the people of New Zealand will have their say.”

It as perhaps fitting that Mr Reid was given first opportunity to address the crowd.  It was indeed his generation, and others before him, who sacrificed so much to build what we have in New Zealand today. And which a few greedy, short-sighted number of our fellow New Zealanders seem unable to comprehend that these assets do, indeed, belong to us all.

Not just to those with the cash to buy shares.

Our elected representatives certainly did not hesitate to show their agreement with Mr Reid’s comments,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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Ms Maniapoto Jackson then invited the next speaker; ex-Vice President of the Auckland Students Association and  Ngai Tahu; Arena Williams,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Arena Williams

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Ms Williams greeted the crowd in Te Reo and her following message was short, blunt, and to the point,

“There’s one message that the government needs to take home from such an over-whelming support of this petition, and that’s Stop the asset sales and give New Zealanders a chance to have a say on this really important issue!”

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The next invited guest-speaker was  economist, Peter Conway, from the Council of Trade Unions,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Peter Conway

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Mr Conway said,

“The Union movement is really proud to be here today  at this amazing event and I just want to say, fantastic effort. Well done everybody! It’s awesome.

Now it might have been a little bit easier if for me to have the backing of a one million dollar advertising campaign, and maybe if we we’d been able to do it all on line. But I actually think that the fact that we went out there into communities where people work, live, and play and debated the issues; talked to people about it and got such a fantastic response, is really a testament to our democracy…

… So this is part of our democracy. And what we’re saying to the government; respect democracy… Let’s get this referendum up,  and the Council of Trade Unions, on behalf of the union movement, is calling on the government to halt all asset sales and listen to the people.

Kia kaha, and thanks very much.”

Ms Maniapoto Jackson then welcomed the Leader of the Labour Party and MP for Mt Albert, David Shearer,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

David Shearer

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 After expressing his welcome,  Mr Shearer gave a brief thanks to the people, followed by a similarly brief message,

Look, I just wanted to start by saying ‘thank you’, ‘thank you’ for all of those people who went out day after day, weekend after weekend, who stood on cold corners in the middle of winter and got people to sign this petition. Thank you to the hundreds of thousands of New Zealanders who care about this country so much that they put their signature to this petition.

This is about the transfer of an asset that we all own into the hands of a very few. That’s what it’s about, it’s about fairness. It [asset sales]  is not fair.

This referendum will make the government listen to New Zealanders.

The fight will go on. It’s not finishing today. It will go on and we in the Labour Party will continue to fight this until 2014.

I wanted to say, as the boxes were being put up there, I was thinking that “Another Brick in the Wall” tune came into my mind, and I was thinking “We Don’t Want your Asset Sales Programme John Key”…

… Once again thank you for your effort, thank you for being here today. Kia Kaha,  let’s take  it to the government.”

Before Ms Maniapoto Jackson introduced the next speaker, Green Party co-leader Russell Norman, she briefly pointed out  that the Parties behind her were unified, “with only the odd absence, which was duly noted“.

Mr Norman then addressed the people,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Russell Norman

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Mr Norman then addressed the people,

“Today we stand here here on behalf  of the millions of New Zealanders who are opposed to the sale of their assets. Today we stand here on behalf of the hundreds of thousands von New Zealanders who have signed this petition, behind us. Today we stand here on behalf of future generations who are relying on us to stand up for our country.

And that is why we have done this massive piece of  work that you see behind us.

It has been incredibly hard work on behalf of thousands and thousands of people to go out and collect these signatures. It is despicable that the Prime Minister  then says that the people who signed this petition were children and tourists! Prime Minister you do not know New Zealanders!

If the Prime Minister of New Zealand thinks that the people who signed this petition, the 400,000 people who signed this petitition, are not real New Zealanders, then he is in the wrong country…

… Real New Zealanders are the ones who worked and laboured to build those assets up so that we could inherit them. Real New Zealanders are the ones who will look after them so that we can pass them on to those who come after us…

… We have a mandate to keep our assets. The Prime Minister has no mandate to sell them.”

Ms Maniapoto Jackson then introduced Mr Peters, saying  “if there’s anyone who can talk about justice and fairness, it’s Winston Peters“,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Winston Peters

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“…Mr Key does does not have a mandate to make these sales. We all know the last election result and he relies upon the vote of Peter Dunne, who you know, with your money, at the last election had TV adverts saying that he would not do that.  So there is no mandate.

We come now to the referendum, which  is a chance for Mr Key to see whether he’s got the public backing and he doesn’t have even have the backing of one third of the National Party vote by every survey that you and I have seen.

Ladies and gentlemen, it’s going to be difficult over the next few months on this issue, but I want to make something very, very,  clear. Unless we make it clear to everyone who’s buying, that after the next election, whenever they fly the white flag, we intend to take back those shares at no greater price than they bought it for, then we will not be making the message very clear for Mr Key who governs for the few and very few.

Now your problem is,  you don’t own a casino. Otherwise he’d be listening to you.

And you’re you’re not a Hobbit or some wide-boy from Hollywood, otherwise, he’d be listening to you.

No wonder he fell upon the defence of tourists, because that’s what Mr Key is; a CV Prime Minister, who will soon go, on issues like that…

… this is just the beginning. It is not the end.”

Next up, Ms Maniapoto Jackson introduced “the wonderful leader of the Mana Party, and MP for  Te Tai Tokerau, Hone Harawira“,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

Hone Harawira

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Mr Harawira injected a note of humour into the afternoon, and the crowd enjoyed his off-beat way of giving a speech,

“Look I’m going to do most of my korero in Maori, so the best way for you to support it is, every time I stop to take a breath,  clap like crazy!”

The crowd obliged with enthusiasm, clapping and cheering each time he paused  during his korero.

Ending his speech in  Te Reo, he  added,

“Now just for a short chant, a short chant, eh? Because Moana get’s all the the recording rights for this little gig, so mine is going to be a short little chant. So just follow after me. You ready?

“Aotearoa is not for sale!”

The crowd responded, “Aotearoa is not for sale“.

“C’mon, c’mon, now you can do better than that,” he ‘admonished the crowd with a smile.He repeated, “Aotearoa is not for sale!”

The responded boomed back, AOTEAROA IS NOT FOR SALE!”

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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“Tell John Key to Go to hell!”

“TELL JOHN KEY TO GO TO HELL!”

And with that, Hone  Harawira finished with a cheerful “Kia ora tatou!”.

As far as political speeches went, it was one of the shortest and more entertaining that this blogger has heard for a while. He certainly injects a bit of fun into a political event.

As an intriguing aside, this blogger managed to capture this picture of two Davids and a Damian. Their body language seemed to belie any suggestion of tension or ‘struggle between Messrs Cunliffe and Shearer.

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

(L-R) David Shearer, David Cunliffe, Damien O’Connor

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Hmmmm… One has to wonder…

On a closing note, Ms Maniapoto Jackson ‘encouraged’ (dragged!)  Hone Harawira back to the microphone to sing a duet – an old song from their protest days together,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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And final posed-pics from Ms Maniapoto Jackson and  Hone Harawira, after their singing-duet finale,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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It’s interesting to compare the persona of Hone Harawira in the media, especially in his early days in Parliament – with the man who presents to the people, at public gatherings.  There is a warmth and sincerity to the man that is almost wholly lacking in his MSM appearances – but a warmth and humour that is obvious when seeing him in person.

And from the Green Party caucus, this lovely snapshot. They deserve thepride they were feeling in being part of a movement to collect nearly 400,000 signatures,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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In conclusion…

John Key’s casual dismissal of the petition, and the nearly 400,000 New Zealanders who signed it,  was not a “good look”. It spoke volumes of Key’s persona; his arrogance; and his pettiness.

He could just as easily have accepted the petition as part of the democratic process and congratulated New Zealanders for   participating. It would have made him look statesmanlike; stand above petty politics; and increased his mana.

Being derisive; suggesting that the signatures were from “children and tourists”;  was offensive.

It was unnecessary and uncalled for.

It was childish.

It publicly revealed John Key’s innermost insecurities – as he knows that the people are not with him on this issue. It must be a debilitating, depressing feeling, knowing that three million New Zealanders are angrily opposed to what Key and his cronies are up to.

“Where is the love”, he may well ask?

“Where is the respect”, we ask him.

An open message to John Key…

The Prime Minister insists he has a “mandate” to part-privatise our state assets.

I disagree. More people voted for Parties opposing state asset sales than voted for Parties endorsing said sales.

John Key has a one seat “majority”, due in part to manipulations during the 2011 election, and MMP rules that prevented some Parties from gaining representation in the House.  For example, the Conservative Party won twice as many votes as ACT – but gained no seats. (see: Mandates & Majorities)

That’s not a mandate, Mr Prime Minister – that’s an accident of circumstances.

Mr Key – if you truly insist that you have a mandate, then put it to the test. Hold off on the sharefloat for Mighty River Power. Let the people have their say in a referendum.

I, for one, will accept the verdict of a referendum, whatever the outcome. If the majority – even the slimmest margin over 50% – support your asset sale programme, you’ll not hear one more word from me on this issue ever again.

Are you willing to  put your “mandate” to the test, Mr Prime Minister?

Are you willing to listen to, and abide by, the will of the People?

I am.

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Additional

Radio NZ: Petitioners confident of asset sale referendum

Dominion Post: Government to ignore asset sales referendum

NZ Herald: Asset sales petition arrives at Parliament

TV3: PHOTOS: Asset sales petition presented

TVNZ: Petition against SOE sales delivered to Parliament

Newstalk ZB: Opposition MPs greet anti-asset sales petition

Copyright (c)  Notice

All images are freely available to be used, with following provisos,

  • Use must be for non-commercial purposes.
  • At all times, images must be used only in context, and not to denigrate individuals.
  • Acknowledgement of source is requested.

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= fs =

392,000 New Zealanders send a clear message to John Key – Part Tahi

12 March 2013 3 comments

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NZ, Wellington, 12 March 2013 – Another beautiful sunny day with blue skies  (apologies to farmers) was a perfect setting this afternoon in Wellington, when a couple of hundred marchers arrived on Parliament’s grounds, bearing 68 boxes, containing 392,000 signatures.

The referendum requires 304,000 valid signatures to precipitate a nationwide referendum. The 392,000 signatures gives a 22% ‘buffer’ against invalid signatures; people not on the electoral roll; duplicate signatures; and malicious attempts to undermine the petition.

There was a small number of people on Parliament’s grounds  awaiting the march, amongst them tino rangatiratanga activists, Brenda and Fran,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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At about 1pm, marchers arrived, bearing the boxes that contained a priceless treasure – signatures of 392,000 New Zealanders. Media flocked around them. This was an historical event,

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12-march-2013-presentation-of-anti-asset-sales-petition-parliament-referendum

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They walked onto Parliament’s grounds to cheers and applause of those waiting,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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On the steps to Parliament, more media and elected representatives from Opposition Parties were waiting. (Curiously, none from National, ACT, or United Future were in attendance. Their ‘invites’ must’ve been lost in the post?)

Politicians clapped as the marchers approached. Men, women, young, old, Maori, Pakeha, these were New Zealanders who believed that the People’s Assets were not to be stripped and flogged off by a handful of politicians,

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12-march-2013-presentation-of-anti-asset-sales-petition-parliament-referendum

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Sixty eight marchers proudly carried a prized box each,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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The boxes were carefully passed over a security barricade, to be stacked on the Parliamentary forecourt,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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Meanwwhile, the crowd watched, as the stacking of boxes progressed,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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The leadership of the Green and Labour Parties,  with Brendan Horan (far left, standing beside Metiria Turei); former AUSA President, Arena Williams (standing beside David Shearer); Grey Power National President, Mr Roy Reid; Annette King; and (far right – no slur intended, Mr Conway) CTU Economist and Director of Policy, Peter Conway .

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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Mana Party leader, Hone Harawira, joined the Party leaders shortly afterward (NZ First lreader, Winston Peters was standing off-camera, to the left),

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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NZ First leader, Winston Peters, being interviewed by a MSM journalist,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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A panoramic view of part of the assembled crowd,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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Green MP, Jan Logie; NZ First leader, Winston Peters, and NZ First MP, Andrew Williams, at the stacked petition boxes. At this point, the  invited guest-speakers were preparing themselves – and  their notes – to address the crowd and media,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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With a  unique style and flair she has become reknowned for, Moana Maniapoto Jackson welcomed people to today’s presentation of the petition,

“We are celebrating people power…”

Coaching the crowd, to chime in with “Ohhhh yeahhhh” as the chorus, Ms Maniapoto Jackson launched into a short protest-style song. Her powerful voice belted out the words, making her microphone and speakers practically redundant, as she filled Parliament with her lyrical sounds,

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Frank Macskasy   Frankly Speaking  blog  fmacskasy.wordpress.com  12 March 2013 - presentation of anti-asset sales petition - parliament - referendum

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“Hey, hey Mr John Key,

You say you’ve the mandate
We’re here to help,
it’s not too late,
People here are standing strong
a hundred thousand – can’t be wrong
We’re here to help you get back on track,
Let’s stop the sales,
Let’s pull it back.

Crowd’s chorus, Ohhhhh Yeahhhhh!

All together now!

OHHHHH YEAHHHH!”

Ms Maniapoto Jackson then welcomed the first of “a long line of luminaries, that are positively glowing with energy and excitement as we deliver to the government a very strong call from New Zealanders.”

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To be continued at: 392,000 New Zealanders send a clear message to John Key – Part Rua

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Additional

Radio NZ: Petitioners confident of asset sale referendum

Dominion Post: Government to ignore asset sales referendum

NZ Herald: Asset sales petition arrives at Parliament

TV3: PHOTOS: Asset sales petition presented

TVNZ: Petition against SOE sales delivered to Parliament

Newstalk ZB: Opposition MPs greet anti-asset sales petition

Copyright (c)  Notice

All images are freely available to be used, with following provisos,

  • Use must be for non-commercial purposes.
  • At all times, images must be used only in context, and not to denigrate individuals.
  • Acknowledgement of source is requested.

.

.

= fs =

Labour, Greens, NZ First, & Mana – A Bright Idea with electricity!

10 March 2013 15 comments

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What?

A part of me is mightily pissed off at Labour.

Like, really ticked off.

From 2000 to 2008, they had ample opportunity to safeguard state assets and remove them from any prospect of privatisation by ideologically-driven,  rightwing elements in our political system.

But perhaps, I suspect that most folk – including the Left –  had believed that privatisation had been abandoned by National as an  ideological dead-end experiment, leading nowhere except eventual foreign ownership and profits remitted to offshore investors. Which, as a consequence, worsened our already shabby Balance of Payments deficit.

More importantly, we had every right to expect that National believed that asset sales would be a sure-fire way of losing an election.

However, someone – some bright, zealous, political strategist working in some back-room somewhere – must’ve come across a “cunning plan” to make asset sales palatable to at least half the voters.

That’s all the Nats needed; 50% of voters.

Why?

To pay for tax cuts in 2009 and 2010. Those tax cuts dug a $2 billion-plus hole in government revenue (see:  Govt’s 2010 tax cuts costing $2 billion and counting, see: Outlook slashes tax-take by $8b). The shortfall could only be made up by borrowing more – or selling something. National opted for the latter.

How?

Post 2011 Election,  has demonstrated that National has not changed it’s free-market stripes. Given an opportunity, they would hock off as much of the country as possible. For “the good of the nation”, you understand.

At the 2011 election, National were handed that opportunity, on a gold plate*,  by a voting public who seemed to be distracted by smoking magic mushrooms. Whilst voters expressed disdain at National’s privatisation – they voted National regardless.

(Call me old fashioned, but I tend not to vote for things I disagree with.)

Go figure.

Note that I said “they voted National” – they didn’t vote for National. It may seem as if I’m splitting hairs on a molecular level – but bear with me.

Consider the facts;

  • 1. In 2011, National won 1,058,638 votes – or 47.31% of votes cast. That gave them 59 seats.
  • 2. The 2011 election was the lowest voter turn-out (74.21%) since 1887.
  • 3. Whilst Labour’s vote dropped from 2008 to 2011, overall the anti-asset sale bloc gained more popular votes in 2011 than the pro-sale bloc,
National , ACT, United Future Party Votes Labour, Greens, NZ First, Maori Party, Mana, and Conservative Party votes

National – 1,058,636

Labour – 614,937

ACT – 23,889

Greens – 247,372

United Future – 13,443

NZ First – 147,544

Maori Party – 31,982

Mana – 24,168

Conservative Party* – 59,237

TOTAL – 1,095,968

Total – 1,125,240

* Whilst the Conservative gained no seats in Parliament (because of the 5% threshold), their numbers are included because they gained over double the electoral-support for ACT.

In effect, Key could claim an mythical “mandate” simply because the MMP rules in 2011 gave ACT a seat, but no representation for the Conservatives – even though support for the latter was double that of ACT.

  • 4. Voting patterns are reflected in polls which consistantly show public opinion opposed to asset sales. Generally, the figure is around two thirds opposed and less than a third supporting. (see: Most of us oppose selling NZ)

In fact, this blogger cannot find any reputable poll favouring National’s privatisation programme.

However, the harsh reality is that, for politicians, unless faced by a populist revolt and tens of thousands taking to the streets (see: Huge protest says no to mining on conservation land) , the only numbers that really count are bums-on-seats. Parliamentary seats.

Political machinations in Epsom and Ohariu gave Key the two seat Parliamentary majority he needed, and that’s what counts as a “mandate”. For the Nats, that’s the end-of-story.

Who?

As Dear Leader has oft been quoted,

 “On the mixed-ownership model debate, the Government has been very clear about its intentions since well before the 2011 election.” – John Key, 24 June 2012 (see: Most of us oppose selling NZ)

Thus far, 200,000 have pre-registered (see: Mighty River pre-registrations top 200,000) – which, whilst a sizeable number, is still only around five percent of those who voted for National in 2011. And I suspect many are pre-registering for a variety of reasons,

  • self interested naked greed
  • a desire to keep shares in local hands
  • and a few bogus pre-registrations to subvert the process (a surreptitiously organised covert resistance? You might say that, but  I couldn’t possibly comment)

The 200,000 pre-reguistrations is still dwarfed by signaturies to the petition, which is fast approaching 400,000 (see: Asset sales referendum likely)

So, did all 1,058,638 voters  who voted National in 2011 also endorse asset sales, either in whole or partial?

The answer is a clear no.  In a poll just over a year ago (see:  Poll shows asset sales unpopular), around 32% – about one third – of National supporters disapproved of asset sales.

That’s 338,764 voters who opposed asset sales who ticked the box for National in 2011, despite knowing full well that Key was promising partial floats on Meridian, Genesis, Mighty River Power, Solid Energy (now in doubt), and a further sell-down of Air New Zealand.

338,764 people who voted for something they didn’t want.

As Marcus Lush said on Radiolive on 28 February this year (2013),

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Why would anyone vote National and be opposed to asset sales -  28 February 2013 -  Radiolive - Marcus Lush

[click on image to access Radiolive link]

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Good question.

The answer, I think, can be distilled  down into two categories of voters.

  1. The first group simply either didn’t taken notice of  the asset sales campaign, or, more likely did not believe that Key would go ahead with the policy. They may even have thought that Key’s coalition ally(ies), United Future and/or the Maori Party, would stop the sales from proceeding. There was a kind of  “in denial” mentality going on here.
  2. The second group is perhaps more complex. Whilst they don’t support asset sales per se, they perhaps believed National Party rhetoric that shares would remain in New Zealand hands. Considering the consequences of Contact Energy’s privatisation – where the majority of shares are now in Australian hands – this would seem to be a forlorn hope.

Having spoken with National Party voters belonging to Group 1, I believe that asset sales will impact to varying degrees on National’s support at the next election. Having woken up to the fact that Key has no intention of backing away from  sales,  there are 300,000 National voters who may think twice before voting National again.

Expect National to drop in the next few polls following the sale of Mighty River Power.

However, unless something totally unanticipated happens between now and May, the partial sale of Mighty River Power will probably proceed. Followed by Genesis and Meridian. Followed by hefty power price increases if past history is anything to go by.

Where (to from here?)

NZ First’s Winston Peters has promised that any government he is part of will buy back state assets. (Which, by the way, if he’s not telling lies, means that any coalition deal with the Nats is off the table. I’m not holding my breath on this. The 1996 election is still fresh in my mind.)

On 4 March this year (2013), Peters announced,

“New Zealand First will use its influence on the next coalition Government to buy back our state-owned power companies which are being flogged off by National and we are committed to buying back the shares at no greater price than paid by the first purchaser.”

Source: One More Quisling Moment from Key

This is do-able. Especially if NZ Superannuation funds are used, which would not impact or have any bearing on a new Government’s books.

By announcing that the shares would be re-purchased  “at no greater price than paid by the first purchaser” – Peters is effectively putting all purchasers on notice: expect to incur a loss if you buy into National’s thieving (and let’s be clear – selling goods that don’t belong to you is theft) programme.

And a year earlier, in March 2012, Hone Harawira had promised the same in an open letter to investors,

“So today I think it only proper to send a warning to overseas investors – steer clear of any share offer in the above SOE’s. The purchase of these shares is likely to see you caught up in legal battles and direct action from citizens determined to protect their own interests, both of which will be lengthy and costly and have an adverse impact on the value of your investment.

As the leader of the MANA Movement and Member of the New Zealand House of Representatives, I wish to advise that MANA is opposed to the privatisation of state assets and will strongly argue for any shares sold to overseas investors to be returned to New Zealand hands.”

Source: Hone Harawira: Open letter to overseas investors

By contrast, in an attempt to appear “fiscally responsible” to Middle Class voters, Labour and the Greens were luke-warm, at best.

Green co-leader, Russel Norman said,

“We just can’t make the promise that Winston is making. We will do whatever we can, but it is two years away, the books are getting into a terrible mess because of National, and closer to the time we will make an announcement but at the moment we can’t.”

Source: Peters: Use super funds to buy back state assets

And Labour’s Clayton Cosgrove effectively went, ‘ditto’,

“… I can’t commit to an open-ended fiscal envelope. That would be fiscally irresponsible in my view.”

Source: IBID

Which is all pretty timid stuff.

This, my fellow New Zealanders, is why the Centre-Left lost the 2011 Election: no boldness in vision; no measurable difference to the Nats; and no unshakeable courage of  their/our convictions.

All that Labour and the Greens  said was “no” to asset sales.

And when Cunliffe suggested that a future Labour-led government would re-nationalise these SOEs – he was firmly slapped down by his Party.

On 4 December 2011,

I don’t stand for a paler shade of blue, and I want to look down the barrel and say this: if the Government is going to sell off precious state assets then we would not rule out re-nationalising some of them. And people need to be aware of that regulatory risk.”

When asked by host Guyon Espiner whether he would buy them back, Mr Cunliffe replied “we would look very hard [at buying them back].” Source

On 5 December 2011,

Labour leadership aspirant David Cunliffe has moved to clarify his position on the buyback of state assets.

He believed comments he made in a weekend interview, where he didn’t rule out buying back partially privatised SOE’s, had been misinterpreted.

Mr Cunliffe said it was not an explicit promise to buy back all shareholdings National may sell. Source

That’s not “manning the barricades” stuff – that’s an open retreat in the face of a remorseless enemy.

Which, in turn, emboldened National to openly mock and taunt the Labour Opposition, seven months later,

Hon BILL ENGLISH (Deputy Prime Minister) : I move, That the House take note of miscellaneous business. We are still waiting, this week, for the Labour Party to commit to buying back the shares of the 49 percent of the energy companies that the Government is planning to sell, mainly to New Zealanders. New Zealand First has made that undertaking. New Zealand First has shown that the Labour Party has persuaded New Zealand First that its arguments are so strong, New Zealand First should go and buy them back if it has a role in a future Government. But the Labour Party has not been able to persuade itself. Labour members have been in the Chamber arguing, hour after hour, day after day, week after week, that these proposed share offers are fiscally irresponsible, economic nonsense, and a sell-out to foreigners, but they are not so fiscally irresponsible that they are going to buy them back. They are not such a sell-out to foreigners that they are going to buy them back. They are not such an economic nonsense that they are going to buy them back.” – Source

At a time when Labour should be tearing strips of National and setting their own counter-agenda – we’re getting precious little of that. Instead, the agenda is being set by Key and his cronies with bugger-all opposition. The Greens and NZ First have scored more ‘hits’ against the Nats than Labour.

On top of that, the Greens have become the “go to” opposition Party, for criticism of National policies. If you doubt me, check out the next 6pm TV news bulletin. Which opposition party spokesperson is interviewed? Keep tabs over a few night. You’ll quickly see what I mean.

So, what options does Labour have?

It has two options;

  1. Carry on with a conservative course. There is a 50/50 chance it will lead the next government, with perhaps a one or two seat majority, consisting of Labour/Greens/Mana/NZ first.
  2. Strike out with a strategy of  aggressive and bold announcements of initiatives. Announce;
  • radical policies that are a departure from neo-liberalism and declare that the Great Neo-liberal Experiment is dead; “we come to bury the bastard, not praise him”.
  • focus on the message that the 30 year experiment in neo-liberalism has failed utterly, and is one reason we’re driving our young people to Australia
  • a policy that all state assets will be re-purchased at cost-price (as a coalition deal with NZ First)
  • a list of National policies that will be ruthlessly  reviewed and dumped (eg, the Hobbit Law)
  • a focus on job creation; attacking the root causes of child poverty; and a committment for decent housing for all New Zealanders
  • a full review of the tax system, with a plan to reduce (or eliminate gst) and replaced with a comprehensive Capital Gains Tax; Financial Transactions Tax; and other non-income related taxes
  • Comprehensive food-in-schools programmes
  • looking at how our Scandinavian and Nordic cuzzies are running their economies/societies
  • cheaper education for our kids
  • a conversation with New Zealanders as to what kind of society we want to live in – and are we willing to pay for it and set goals to achieve it?
  • etc, etc.

As part of Option 2, I have one further Bright Idea…

A Libertarian acquaintaince and I were chatting one evening at  ‘Backbenches’ (prior to it catching fire – and no, our conversation wasn’t that heated) . We were talking about the three state owned power companies.

He asked me; why should there be  three state owned companies; all producing the same service; at roughly the same costs and prices – have three sets of management; CEOs; offices; accounting systems; staff; etc? Wouldn’t  it make more sense to combine the three and pass the savings onto consumers?

Damn it, he was right. What is the point of having three state owned electricity companies?

One could do the same job – and cheaper.

Just as we had the old ECNZ, prior to Max Bradford’s so-called “reforms” in the late 1990s. At the time, Mr Bradford promised cheaper electricity through competition. Instead, power prices have doubled sinced the start of the century. (see: The 30-year power price hike , see: Power prices over decade)

“Ministry of Economic Development (MED) statistics show average power prices rose from 13.9 cents per kilowatt-hour on average in May 2001 to 26 cents in May 2011.” Source

The problem is not just to re-nationalise our electricity companies.

The next problem is what do we do with them?

How do we make them socially responsive to domestic consumers as well as  efficient?

Do we re-combine Mighty River Power, Genesis, and Meridian back into one single unit, a new ECNZ?

Do we ensure that there are Board members elected to a new ECNZ whose constituents are domestic users? Perhaps any such Board should have directly-elected  representation?

Do we entrench a new, state owned ECNZ in legislation so it’s future is protected from predatory governments seeking either maximum returns (ie, price gouging) or to privatise it?

Could a new ECNZ afford to offer each domestic household their first 300kwh per month, free,  as has been suggested by Victoria University researcher, Geoff Bertram? (see: Call for free power )

These are the issues which the Opposition should be focused on.

And thus far, we’ve not heard much from them.

If  Labour-Greens-NZ First are serious about being an alternative government, then by the gods, they should be serious about giving us that alternative.

Conclusion

When National started campaigning in the 2008 election, it began two years in advance with a series of  aggressive policies. It was acting like a Government-in-Waiting.

By contrast, Labour and the other parties are an Opposition-in-Waiting.   They are timidly watching and waiting for the public love affair with Key to wear off, and for National to f**k up.

Well, news flash guys.  That doesn’t seem to be working too well. The Nats have been excoriated with scandal after scandal last year and this year; unemployment rising; Mainzeal and Solid Energy collapsing – and the Nats are still high in the polls?!

My message to Labour, Greens, NZ first, and Mana;

If you want the voting public to take notice of you, you have to give them something that’ll make them notice you.

Be bold.

Be aggressive.

Offer alternatives.

Offer practical solutions.

Give the public a vision.

And at all times, work together.

If you don’t give the public an alternative, why should they look away from National?

Give the people of New Zealand an alternative, better way of living – and they will look at you.

But not until then.

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(* Plate will soon be auctioned on Trademe.)

Previous Blogposts

Politics through a crystal ball, palmistry, or chicken entrails?

History Lesson – Tahi – Electricity Sector “reforms”

Additional

Power prices over decade

The 30-year power price hike

Call for free power

Cunliffe: buy back any sold assets

Cunliffe not promising to buy back assets

Parliament: Hansards – Wednesday, 20 June 2012, Bill English on Asset Sales

More heat in power struggle as prices go up

Government in $112b barney over accounting

Electricity prices tipped to rise steeply

Heavy traffic hits Mighty River Power share site

One More Quisling Moment from Key

Other blogs

MANA threaten overseas investors not to buy assets – Bloomberg pick up on the story

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How to sabotage the asset sales…

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Something I blogged on 25 June 2012, and now more appropriate than ever…

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On last weekends’ (23/24 June 2012) “The Nation“,  the issue of asset sales was discussed with   NZ First leader, Winston Peters; Green Party MP, Gareth Hughes; and Labour MP, Clayton Cosgrove,

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Source

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Whilst all three parties are staunchly opposed to state asset sales, NZ First leader, Winston Peters went one step further,  promising that his Party would buy back the assets.

Gareth Hughes and Clayton Cosgrove were luke-warm on the idea, quite rightly stating that there were simply too many variables involved in committing to a buy-back two and a half years out from the next election. (And Peters never followed through on his election pledge in 1996 to buy back NZ Forestry – “to hand back the envelope”, as he put it –  after National had privatised it.) There was simply no way of knowing what state National would leave the economy.

Considering National’s tragically incompetant economic mismanagement thus far, the outlook for New Zealand is not good. We can look forward to more of the usual,

  • More migration to Australia
  • More low growth
  • More high unemployment
  • More deficits
  • More skewed taxation/investment policies
  • Still more deficits
  • More cuts to state services
  • And did I mention more deficits?

By 2014, National will have frittered away most (if not all) of the proceeds from the sale of Meridian, Genesis, Mighty River Power, Solid Energy, and Air New Zealand.

In such an environment, it is difficult to sound plausible when promising to buy back multi-billion dollar corporations.

Not to be thwarted, Peters replied to a question by Rachel Smalley, stating adamantly,

The market needs to know that Winston Peters and a future government is going to take back  those assets. By that I mean pay no greater price than their first offering price. This is, if they transfer to seven or eight people, it doesn’t matter, we’ll pay the first price or less.

Bold words.

It remains to be seen if Peters will carry out that threat – especially if a number of his shareholders are retired Kiwi superannuitants?

When further questioned by Rachel Smalley, Peters offered specific  ideas how a buy-back might be funded,

Why can’t we borrow from the super fund, for example? And pay that back over time?  And why can’t we borrow from Kiwisaver  for example, and pay that back over time…”

The answer is that governments are sovereign and can make whatever laws they deem fit. That includes buying back assets at market value; at original sale price; or simple expropriation without  compensation. (The latter would probably be unacceptable to 99% of New Zealanders and would play havoc with our economy.)

Peters is correct; funding per se is not an issue. In fact, money could be borrowed from any number of sources, including overseas lenders. The gains from all five SOEs – especially the power companies – would outweigh the cost of any borrowings.

Eg,

  1. Cost of borrowing from overseas: 2% interest
  2. Returns from SOEs: 17%
  3. Profit to NZ: 15%

We make on the deal.

The question is, can an incoming Labour-Green-NZ First-Mana government accomplish such a plan?

Should such a  radical policy be presented to the public at an election, the National Party would go into Warp Drive with a mass  panic-attack.

But it’s not National that would be panicked.

It would be National going hard-out to panic the public.

National’s scare-campaign would promise the voters economic collapse;  investors deserting the country; a crashed share-market; cows drying up; a plague of locusts; the Waikato River turning to blood; hordes of zombie-dead rising up…

And as we all know, most low-information voters are highly susceptible to such fear-campaigns. The result would be predictable:

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But let’s try that again…

A more plausible scenario would have the leadership of Labour, NZ First, the Greens, and Mana, meeting at a secluded retreat for a high-level,  cross-party strategy conference.

At the conclusion of said conference, the Leaders emerge, with an “understanding”, of recognising each others’ differing policies,

  1. Winston Peters presents a plan to the public, promoting NZF policy to buy-back  the five SOEs. As per his  original proposals, all shares will be repurchased at original offer-price.
  2. The  Mana Party  buy-in  to NZ First’s plan and pledge their support.
  3. Labour and the Greens release the joint-Party declaration stating that  whilst they do not pledge support to NZ First/Mana’s proposal – neither do they discount it. At this point, say Labour and the Greens, all options are on the table.

That scenario creates considerable  uncertainty and anxiety  in the minds of potential share-purchasers. Whilst they know that they will be recompensed in any buy-back scheme – they are effectively stymied in on-selling the shares for gain. Because no new investor  in their right mind would want to buy  shares that (a) probably no one else will want to buy and (b) once the buy-back begins, they would lose out.

Eg; Peter buys 1,000 shares at original offer price of $2 per share. Cost to Peter: $2,000.

Peter then on-sells shares to Paul at $2.50 per share.  Cost to Paul: $2,500. Profit to Peter: $500.

Paul then cannot on-sell his shares – no one else is buying. Once elected, a new centre-left government implements a buy back of shares at original offer-price @ $2 per share. Price paid to Paul: $2,000. Loss to Paul: $500.

Such a strategy is high-stakes politics at it’s riskiest.   Even if Labour and the Greens do not commit to a specific buy-back plan, and “left their options open” –  would the public wear it?

The certainty in any such grand strategy is that the asset sale would be effectively sabotaged. No individual or corporate buyer would want to become involved in this kind of uncertainty.

Of less certainty is how the public would perceive  a situation (even if Labour and the Greens remained staunchly adamant that they were not committed to any buy-back plan) of political Parties engaging in such a deliberate  scheme of de-stabilisation of a current government’s policies.

The asset sales programme would most likely fail, for sure.

But at what cost? Labour and the centre-left losing the next election?

We may well end up winning the war to save our SOEs – but end up a casualty of the battle.

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Related Blog posts

Peter Dunne says

Campaign: Flood the Beehive!

Additional

Asset sales remain unpopular for NZers

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