Too flippant for his own good

Parliament was entitled to better answers when Prime Minister John Key was questioned about his Government's asset sales programme. So was the public.

Asked if he was confident the asset sales schedule was on track, Mr Key said yes, the Government's share offer programme "is completely on track". Between March and June next year it intends to offer shares in Mighty River Power while still holding at least 51 per cent of the company. It always expected the Maori Council's legal challenge and "it is better that this is happening sooner rather than later".

But Mr Key seems unfamiliar with the state of the market for state assets, an important influence on the likely revenue. This emerged when he was asked if he had received advice showing sale processes had stalled in Portugal, Ireland, Greece, and Spain because the anticipated revenue was not raised.

Mr Key (ignoring the other countries) said he could not talk much about the economics in Greece, "other than to say that I am pretty convinced that Labour, the Greens, and NZ First would probably turn us into Greece". Instructed by the Speaker to address the question, he said: "Well, the answer now is maybe, because Clayton Cosgrove is holding something up. I think it was his application to become leader."

With better advice, he might have pointed out that the lack of progress on Greek asset sales stems from the reluctance of Greek governments to sell as well as a lack of investor interest.

Less positively, he might have cited a recent Irish Independent report that foreign investors are struggling to believe the Irish Government's privatisation plans will raise the €3 billion (NZ$4.7b) required under the 2010 bailout terms. Among the snags, "governments everywhere are busy selling assets, leading to a glut of energy company sales".

If that be so, our Government is on track to add to the glut. Whether it is on track to get a good return is another matter.

- © Fairfax NZ News

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