Govt tables privatisation bill; mulls Air NZ options   5 Mar 2012

Draft legislation to allow the partial privatisation of four state-owned energy companies has been tabled today, with its First Reading in Parliament due on Thursday.

As expected, the Bill will transfer existing clauses in the State-Owned Enterprises Act relating to Crown obligations to Maori under the Treaty of Waitangi and to “memorialised” land for settlement of Treaty claims.

However, the companies will no longer be subject to corporate responsibility obligations or to the Official Information Act. Only ministerial decisions relating to the government’s investment in the four companies will be subject to requests for public disclosure, whereas the businesses’ commercial decisions will be shielded from the OIA.

It will also include clauses requiring that the government remain the majority shareholder of the companies, defined as a 51 percent or greater shareholder, and that no other shareholder be allowed to own more than a 10 percent stake in the companies.

SOE Minister Tony Ryall confirmed the first SOE up for partial privatisation will be MightyRiverPower, owner of the Mercury retail electricity brand, “around the third quarter” of this year.

The other energy companies slated for partial sale are electricity generator-retailers Meridian Energy and Genesis Energy, and coal company Solid Energy. Further shares in Air New Zealand, which is already partially privatised, are also to be offered but it is not dealt with under the new legislation.

The government was taking separate legal advice on a further selldown of Air NZ shares, with some 27 percent of the NZX-listed company in public hands “because of the greater complexity around Air NZ’s existing shareholding," Ryall said.

The inclusion of the contentious Section 9 of the SOE Act in the new bill follows consultation with Maori interests following an outcry at suggestions that reference to the Crown’s Treaty obligations be left out of the bill for fear it would deter private investors.

Instead, the bill will include the clause, while making explicit that it applies only to those shares owned by the government.

Also to be replicated will be Section 27A-D to protect Maori interests in memorialised land owned by the partially privatised companies.

SOE Act requirements relating to social and environmental responsibilities will not carry over into the new bill.

“Like most large commercial entities, the mixed ownership companies will continue to build stakeholder trust and public support for their activities in a number of ways, including through their corporate social responsibility polices,” Ryall said.

Continuous disclosure requirements that come with stock exchange listing would require commercial transparency from the partially privatised companies.

“The rationale for selling minority stakes in the SOEs was that New Zealand “must not get into the kind of debt trap the UK and Europe are in," Ryall said.

"The $5 billion to $7 billion we expect to free up by these partial share floats will go into the Future Investment Fund to build priority assets like schools, hospitals and infrastructure.”

The assets for sale comprised less than 3 per cent of the government's total assets.

(BusinessDesk)

Add a comment

Bookmark and Share

News

Appointment of New Director of Rangi Ruru Boarding

25 Jan 2015 News
Treena Ruwhiu is already well known to many Rangi girls and families as she has been a senior and much respected member of the... more

Dramatic photos: Fox Glacier's retreat causes valley to rise by a metre

26 Jan 2015 Environment
A series of photographs taken over 10 years has revealed the dramatic changes to one of New Zealand's most famous glaciers. The Massey... more

Business

MARKET CLOSE: NZX 50 charts new record high, led by Spark

26 Jan 2015 Business News
By Paul McBeth Jan. 26 (BusinessDesk) - New Zealand shares rose to a new record close as holidays in Auckland and Australia kept... more

NZ services sector activity ends 2014 on up note

26 Jan 2015 Business News
By Paul McBeth Jan. 26 (BusinessDesk) - New Zealand's services sector activity picked up in December, led by wholesale trade and... more

Living

Could That Wetland Photo Win You An Overseas Trip?

26 Jan 2015 Arts
Local entries into an international photo competition for young people to mark World Wetland Day are encouraged by Hawke’s Bay... more

Wellington SPCA Open Day

26 Jan 2015 Lifestyle
Wellington SPCA will be holding its second annual Open Day on Waitangi Day, February 6th, at its Newtown Animal Care, Education and... more

Property

Housing warning: It's an Ireland repeat

23 Jan 2015 Property
NZ expert sees factors behind Irish house crash happening here. Precisely the same factors that plunged Ireland into its housing... more

A building block for your future

21 Jan 2015 Property
A rare big block of Bay of Plenty development land in Ohauti, about 10 minutes' drive south of the Tauranga CBD, is to be auctioned... more

Migration

Free new Kiwi workshops return for fresh season

23 Jan 2015 Migration
Newcomer settlement support agency Auckland Regional Migrant Services (ARMS) is kick-starting the New Year with the return of its ... more

Overstayer numbers at record low

22 Dec 2014 Migration
Immigration Minister Michael Woodhouse welcomes new figures showing New Zealand overstayer numbers are at the lowest since 2000. A... more

Travel

Fifteen New Zealand spots to visit in 2015

23 Jan 2015 NZ Tourism
Need some inspiration for the year ahead? Here are some brilliant things to do around the country. 1. Crankworx The world's... more

Holiday parks making most of sunshine

22 Jan 2015 NZ Tourism
Holiday parks are reaping the benefits of the great holiday weather, starting the new year with record-equalling confidence... more

Sport

Equine industry joins GIA biosecurity agreement

26 Jan 2015 Equestrian
Primary Industries Minister Nathan Guy has welcomed a fourth primary industry to the GIA partnership today. The New Zealand Equine... more

Christy Prior Claims X Games Bronze Medal

26 Jan 2015 Sport
Aspen, USA, 25 January 2015 – Cardrona NZ snowboarder Christy Prior has this morning claimed New Zealand’s second medal... more

Columns

Gordon Campbell on Saudi Arabia and Islamic State

23 Jan 2015 Column
So the US has been holding talks in London this week with its 21 coalition allies, on how best to co-ordinate the military response... more

Gordon Campbell on the Greek election, and EU turmoil

22 Jan 2015 Column
Column - Gordon Campbell   Gordon Campbell on the election in Greece, and EU turmoil The election in Greece on Sunday –... more

Kiwi Success

New Zealand scientist receives top award in China

16 Jan 2015 People
Science and Innovation Minister Steven Joyce has welcomed the news that Kiwi scientist Dr Phil Rolston has been awarded the Chinese ... more

Graham Shaw, Peter Huljich join Pushpay board

13 Jan 2015 Appointments
By Suze Metherell Jan. 13 (BusinessDesk) - Graham Shaw and Peter Huljich have joined Pushpay Holdings' board as part of the... more

Recruitment

Tainui's Mike Pohio resigns

23 Jan 2015 Recruitment
By Fiona Rotherham Jan. 23 (BusinessDesk) - Mike Pohio, chief executive of Tainui Group Holdings, has resigned after eight years at... more

Manufacturing activity rises to decade high in December

22 Jan 2015 Recruitment
By Suze Metherell Jan. 22 (BusinessDesk) - Activity in New Zealand's manufacturing sector rose last month to its highest level in a... more