Website: www.democrats.org.nz

Media Release

Wednesday 29 June 2011

Take asset sales off the agenda

“There is no plausible reason for the proposed partial privatisation of our publicly-owned strategic energy assets” stated Stephnie de Ruyter, Democrats for Social Credit Party leader.

“Many of us recall with dismay the asset sales of the previous century, an orgy of fire sales that gutted our railroad system, turned our publicly owned postal and telephone service into a lolly scramble monopoly for the benefit of wealthy overseas shareholders, and threw a spanner of confusion into our once reliable and cost-effective electricity supply. The earlier attempt to privatise ACC attracted both an insurance company feeding frenzy and a public outcry that the Government of the day could not ignore.

“No doubt the current Government intends making smaller moves towards flogging off our assets, to give us all time to get used to increasing economic colonisation. We hear grim warnings of Government debt, and happy references to ‘Mum and Dad' investors owning shares, but the truths are these:

“The stated intention that individual New Zealand investors will be the target of the sales push neatly overlooks the inevitability that shares bought by these ‘mum and dad’ investors will invariably be on-sold to corporate buyers when their too-good-to-refuse offers come rolling in. There will not be any certainty about who will ultimately own 49% of our four state-owned energy companies. For the government to insinuate otherwise is misleading at best.

“'Publicly owned assets' means we, the people, already own them. So why should Mum and Dad be coaxed into buying shares in state assets which they already own?

“Selling even part of an income-earning utility company means less income for the Government.

“Government debt may be slightly reduced by selling assets, but private and corporate debt, already unsustainably high, will increase.

“As yet, the Reserve Bank of New Zealand is still in public hands. As it shored up the commercial banks during the 2008 credit crunch, the RBNZ has the capability to issue credit lines and even debt-free funding for significant events such as the emergency in Christchurch. In fact, the RBNZ creates and issues money already, in the form of notes and coins. An electronic version of this money creation could be issued, not to on-sell to commercial banks, but to the Treasury.

“The RBNZ is our bank and should be used for our benefit. Government borrowing programmes could be ditched, new public assets such as schools and hospitals could be built, transport infrastructure could be well maintained, and asset sales could be taken off the agenda, for good” said Ms de Ruyter.

ENDS

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