Headline: The case for John Key’s asset sales takes another hit
John Key’s economic credibility has been shredded by his failed asset sales agenda. It’s time for the Government to listen to Kiwis and stop the sales
The National Government’s asset sales make even less economic sense now with the sale proceeds unlikely to reach the Government’s $5-$7 billion target and costs spiralling out of control, Green Party Co-leader Metiria Turei said today.
It has been reported today that Government ministers are revising the projected sales revenue from asset sales as its advisors warn that a sale of Meridian could net less than $2 billion for the Crown, making it unlikely that the total sales revenue would reach $5 billion.
This comes on the back of new figures showing that the Government has spent over $124 million on the asset sales so far and that expense is likely to at least double if the sales continue. Additionally, the Crown is losing $2.3 million in net profits per week from the sale of Mighty River over and above savings from avoided borrowing.
“John Key’s economic credibility has been shredded by his failed asset sales agenda. It’s time for the Government to listen to Kiwis and stop the sales,” said Mrs Turei.
“The economics of asset sales didn’t stack up even when Mr Key was promising that they would deliver up to $7 billion in proceeds. Now, that the companies have proven to be worth much less than thought and the costs of sales have spiralled out of control.
“The Mighty River sale cost twice as much as National said it would and the Crown is now losing $2.3 million a week in foregone profits from Mighty River. Asset sales just don’t add up.
“Kiwis have opposed National’s asset sales from the start. We don’t want public money wasted on selling valuable public assets to a wealthy few.
“The responsible thing for Mr Key to do now is suspend the asset sales, let Kiwis have their say in the coming referendum, and then cancel his costly privatisation programme,” said Mrs Turei.
Additional information:
Green Party asset sales cost tracker
Calculation of Crown’s net TSR on sale of Mighty River shares
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