Brian Easton, an economist known for left-of-centre views, is wary the scheme will block future policy options for the electricity sector but supports the benefits it can bring to the local investment scene.
“By increasing the opportunities for New Zealanders by offering shares in minority stakes in SOEs, you would partly moderate the stupidity that happened over the finance company sector,” he says. “That enrichment of the financial market, which incidentally, curiously, Rob Cameron and I agree on, is a very strong case.”
And Mark Weldon notes:
“What I really like about the policy is it’s not left wing, it’s not right wing … It’s based on the Air New Zealand model which has the great attribute of actually being shown to work.”
Air New Zealand, 75 per cent government-owned since its taxpayer rescue 10 years ago, has performed well and delivered better dividends than the power SOEs in recent years.
“If you talk to [CEO] Rob Fyfe or [chairman [John Palmer] they will tell you that the majority long-term ownership of the government has been a real positive,” says Mr Weldon, “because it means they can focus on long-term planning and not worry about being taken over, as they would if they were a fully free-float company.”
As I have pointed out on many occassions, allowing the private sector to invest or buy some shares in state owned companies is absolutely common practice aroundthe world amongst governments of the left and right.Tags: Brian Easton, Mark Weldon, privatisation