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"Very complex web" of issues for partial state asset sales to be revealed Monday afternoon, PM Key says; 'And other actions to flow from that'

"Very complex web" of issues for partial state asset sales to be revealed Monday afternoon, PM Key says; 'And other actions to flow from that'

By Alex Tarrant

Prime Minister says there is a "very complex web" of issues to be spelt out this afternoon regarding the government's decision on whether or not to forge ahead with the partial sale of Mighty River Power later this year.

"And there are other actions that flow from that," Key said on TV One's Breakfast programme on Monday morning.

Cabinet will today decide on whether to delay the sale while the issue of Maori rights in the natural assets used by Mighty River and two other state-owned power companies, Genesis and Meridian Energy, is addressed.

The decision follows a recommendation from the Waitangi Tribunal on August 24 that the sales be delayed.

The government has been hoping to sell up to 49% of Mighty River by early December. It wants to raise NZ$5-7 billion over the next five years by selling up to 49% of Mighty River, Meridian, Genesis, and coal miner Solid Energy, as well as selling down its three-quarter stake in Air New Zealand.

This morning the NZ Herald reports the Maori Council, which took the issue to the Waitangi Tribunal earlier this year, saying it was geared up for court action to block the sale if Key announced the Mighty River float would go ahead this year.

It also reports an investment-banking source involved with the Mighty River float saying, "my pick is it goes ahead."

Fairfax reports government insiders not ruling out a "short to medium" delay for the Mighty River float, which it says could still allow for a float by the end of the year, or mean a delay into early next year.

Key has previously said the next window for a float of one of the power companies would be in March/April. Key has said the government would only look to float one company in any of the two windows it has each year (with the other being October/November), and that it would be prepared to float two companies in any one year.

Water rights, ownership

Key said the government was dealing with two issues in its response to the Waitangi Tribunal, to be released around 4pm on Monday.

One regarded the rights and interests of Maori in water, while the second was whether selling a minority stake in an SOE in anyway affected the ability of Maori to register those rights and interests. On the latter, Key said the government's view was the partial sales did not affect that ability.

The government also held the view that no one owned water.

“Our government for four years has recognised some of those rights and interests, and previous governments have done that as well – things like co-management of the Waikato River, general health of the river," Key said.

“There will be some who believe that Maori rights and interests are much more significant than that. People are free to have that view, [but] that doesn’t mean that any government, mine or any others, has to recognise those rights or interests, unless they’re proven I guess," he said.

Key said the decision to be announced on Monday afternoon was a complex one.

“It’s important to understand, if somebody wanted to take legal action against the government, we can’t stop that. It’s for the courts to decide whether they want to hear an application to them," he said.

“We’d hope we’d win, if that’s the situation."

'Mixed ownership will work better'

Key would not be drawn on whether problems facing the companies might reduce their values. See more here in Brian Gaynor's Weekend Herald column.

“The government’s view has been that these companies will operate better if they have a combination of government owners and private sector owners," Key said.

“We’ve seen as part of [the due diligence process for the sales], for instance, that Solid Energy’s pricing of coal had been quite high," he said.

See Friday's article, Outlook for coal market worse than at the bottom of the GFC, Solid Energy says; 'Reason why full Crown ownership is not suitable.'

“It’s one of those examples where we say, rightfully I think, that when the government is the sole owner of an asset, it’s not necessarily always the best owner. Sometimes it’s better when you have external analysis, external private shareholders also having input into that," Key said.

“That’s why we think the mixed-ownership model works," he said.

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15 Comments

Am I right in thinking that once the sale goes through that the power companies will be privatised because they cannot 'partially' privatised. Onve they are sold the government will own shares in a company a public company and therefore ithe hydro dams t will not longer be owned by the public -the government will simply own some shares with special rights (maybe) in a public compnay. To me partial privatisations sounds like someone being partially pregnant- just not possible. There are only two states that the hydro dams can be in either in public ownership or privatised.
Interesting that National spin continues to use partially privatised as if it means something and that media are happy to go along with it.
The arguement for using the term partial privatisation falls down if you imagine for a moment the government buying a single share in Contact Energy- one would not describe the company as partially privatised just because the government owns a single share.

No they can simply sell a minority % of shares. Beyond that if you look at National's present claim that they have a mandate in the face of the flak its pretty clear that while yes they do, its on dodgy ground IMHO.  Lots of ppl are unhappy with the asset sales, they have seen how badly they went in the past.  So sure National could try and force the sales of the remaining %s, given thier small majority I cant see JK and BE being so "irresponsible".  Now ocme 2014 theycould put forward that they sell teh remaining as part of their policy for the election....I think they'd need their bumps felt if they did.
maybe we should hope they do?
;]
regards
 

 Yes and No ctnz his current strategy is to use the" Maori pandering" backlash to turn anti soa's into pro soa's and bolster support at the same time.
You will note the timming of the papers released on Auckland Councils obligations to "work through " a current extensive list of demands from their indigineous component......no accident , no accident at all....

My reading over the last week has unearthed that in law Maori do have a right to these assets. The privy council determined this more than 100 hears ago and more recently the local court of appeal. There is also international case law confirming native land rights. It is only the imbalance here between the judicial and the legilative arms that has allowed the legislative to undermine the rights of Maori.
 
The question that you should be asking is if you are willing to give away the rule of law, which one do you want to give up next?

With respect Mist, it's just a matter of interpretation, to give away what you took in the first instance......?
 These are the ambiguations that arise when defining Conquered peoples to Treaty peoples  who are then assimilated to dilute the intention of a document in good faith.

OOOPs! there mist .....I'll just go mop up a bit , seem to have gotten my scrambled eggs a tad wide of the mouth there , pardon me ,and I shall excuse myself at this point.

Count you and Mist will see a fine point I have uncovered. The idea of the rule of law appealed to Maori, they were not stupid and could see the benefits the British were bringing. They signed on to that part willingly as the treaty guarantees their rights as British subjects. Right from the outset they engaged the courts to deal with grievances over land (there is some strong documentation about in their support because of this), however the court constantly refused to deal with the matter stating that the issue was between Maori and the Crown, and that the court had no jurisdiction. Do you see the anomaly there? 
This is still going on, even within the last few years.
 
As I have posted in response to Soreloser on the other thread, this is deeper than just the Maori issue. We have a legislative and executive branch out of control with the power to pretty much do as they please.
 

Isnt it all about property rights and the lawfull position surrounding ownership, like any other asset? Unfortunately too many commentators and individuals whilst professing to know what they are talking about, find it hard to differentiate between fact and emotion. Maori are exercising the same rights as any other New Zealander and that is to contest legally what they believe is being taken from them  - nothing more nothing less. There are a hell of alot of ignorant people out there that profess to know what the issues are, and hell of alot more willing to offer an opinion, when really all it shows is their ignorance and racist beliefs. In simple terms there is a contract between the Crown and Maori, and that is the Treaty of Waitangi, and whether or not you I or the man around the corner likes it or not, it exists. Yes it can be contested, changed, or used for toilet paper, but it comes at a cost and to think otherwise is dellusional. Maori are not at fault here. The finger should be pointed at the Government, as they knew this would be a hot potato. There is current case law on water ownership rights already, and to me it reinforces how arrogant the Governmet were, to think they could get sell something which isnt theirs. For Key it is all now about damage control and how best to come out of this diabolical situation, that should never have eventuated with some respectability - Regardless Key will not want to endure the wrath of the masses and will hold firm to his decision to float Mighty River, albeit in an abridged form. Place the blame at Maori - they are always the scapegoat when it comes to issues like this?

Well said there boofta......and yes it is the tactic of employ on the part of Key here to shift the emphasis of the issue away from SOA and squarely onto a pet fear many voters have of indigenous persons recieving  (what the percieve as) preferential consideration rather than consultation as the joint Treaty Partner. 

mist42nz - This reinforces again what  I have said all along about ignorance, and for that matter arogance. Yes they go hand in hand. Allow maori their day in court, and dont try to legislate their rights away like the Foreshore and Seabed Act. All I can offer you, is for you to not only read the two versions, but understand legally the position of these documents in the context of International Law. If you understood this you would not have commented the way you have. My mother and Father, told me to not open my mouth if you dont know the facts, because it will come back at you and bite you in the bum. What did your parents teach you?

And what about when the two treaty copies are different in their languages?
Then it would appear, mist, the Crown Treaty negotiators of the day underestimated or paid no cudos to the Noble Savages ability  to record their ....intent.
Regardless of the complexities in interpretation , I do not believe the intent of what a joint treaty partnership escaped the Crowns representatives.
As I said above.......
 These are the ambiguations that arise when defining Conquered peoples from Treaty peoples  who are then assimilated to dilute the intention of a document in good faith.........
And in that ,I think the Crowns intent has been historically evident.... 

Was a partnership in sharing ..not the intent...mist...? if not then the Crown had no business to propose such a Document, instead  a case of Veni Vidi , Vici and to the Victor the spoils.....but , that was not the case was it mist....

mist42nz - Youre a racist ignorant blonker who professes to know something, when in fact you know nothing. . Why then has the Government chosen to delay the sale of Mighty river?. Get your hand off it - your parents should have smacked this out of you when you were a kid

The issue of water rights was also contested with respect to the building of the Clyde dam.  Affected landowners won their argument in the High Court - so, the then Muldoon government legislated that problem away.
 
There was also debate about whether the dam was needed. National's support for a controversial aluminium smelter at Aramoana, another of Prime Minister Sir Robert Muldoon's Think Big projects of the late 1970s and early 1980s, was one justification propounded for the dam. An initial grant of water rights for the dam was overturned by the High Court following an appeal by landowners. National overturned this decision, after bargaining for the support of Social Credit (who had initially opposed a high dam), in the Clutha Development (Clyde Dam) Empowering Act 1982. The Act was later repealed by the following National government on 1 October 1991, when it was superseded by the Resource Management Act 1991.
http://en.wikipedia.org/wiki/Clyde_Dam
My point being, if these landowners had a right to their day in court - so do Maori.
 

mist42nz - Again it shows your ignorant racist beliefs. Go away little boy