John Armstrong 's Opinion

John Armstrong is the Herald's chief political commentator

John Armstrong: Much now hangs on Genesis and Air NZ sale

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Much still hangs on how much is raked in from the two remaining companies in the asset sale basket - Genesis Energy and Air New Zealand.
Much still hangs on how much is raked in from the two remaining companies in the asset sale basket - Genesis Energy and Air New Zealand.

Blame it on Mighty River Power's plunging share price. Blame it on Labour's and the Greens' plans to intervene in the wholesale electricity market.

Those two factors have blown a hole in National's hopes of building a "shareholders' democracy" where citizens would lean more to the right politically because they would have a stake in privatised companies.

More than 420,000 New Zealanders expressed an interest in buying shares in Mighty River Power. Some 113,000 got around to opening their chequebooks to do so.

The number applying for shares in Meridian Energy, the second state-owned power generator to be put up for partial sale, is nearly half that at about 62,000. And only 16,000 of them are first-time investors.

Fortunately for National demand was such that a fewer number of investors sought bigger parcels of shares, thereby avoiding breaching self-imposed limits on foreign ownership.

However, the Government is now going to be really pushed in meeting its target of raising between $5 billion and $7 billion in proceeds from its partial privatisation programme. It may well struggle to be even within the bottom end of that range.

Final judgment on the success or otherwise of the policy thus cannot be made yet. Much still hangs on how much is raked in from the two remaining companies in the asset sale basket - Genesis Energy and Air New Zealand.

- NZ Herald

John Armstrong

John Armstrong is the Herald's chief political commentator

Herald political correspondent John Armstrong has been covering politics at a national level for nearly 30 years. Based in the Press Gallery at Parliament in Wellington, John has worked for the Herald since 1987. John was named Best Columnist at the 2013 Canon Media Awards and was a previous winner of Qantas media awards as best political columnist. Prior to joining the Herald, John worked at Parliament for the New Zealand Press Association. A graduate of Canterbury University's journalism school, John began his career in journalism in 1981 on the Christchurch Star. John has a Masters of Arts degree in political science from Canterbury.

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