Privatisation Essential For Growth

“ACT New Zealand SOE Spokesman David Seymour today welcomed National’s initiative on the partial privatisation of SOEs as a sound plan which will see government move back towards its core role of infrastructure provision. 

“If we want our economy to grow, we need to shift the government out of the commercial business sector.  Compared to public ownership, private ownership produces more wealth per dollar invested,” Mr Seymour said. 

“Privatisation is not only a way for the government to get cash but also to make the firms involved more productive.  Last year, the Crown Ownership Monitoring Unit reported that the top seven SOEs – including Air New Zealand - had a dividend yield of just two per cent in comparison to 4.5 per cent for the top eight private companies.  Even according to the Government’s own figures, government ownership is providing inferior returns.

“Privatisation has been practised in over 100 countries over the past thirty years.  In that time, over two trillion dollars of assets have been transferred from public to private ownership worldwide and it has overwhelmingly resulted in an improvement in economic performance. 

“Getting the best out of our Government resources is a key policy for ACT and this is an example of the choice ACT presents voters for the next Parliament.  The sale of assets to improve performance is recognised as a sensible and uncontroversial policy around the world.  It frees up cash for better uses and would make the New Zealand economy more productive. 

“ACT is the only coalition partner willing to work with National to turn this policy into a reality,” Mr Seymour said.