Ministers grilled on future of Air NZ amid bleak economic forecast, Winston Peters berates ‘stupid neoliberal thinking’

Government ministers have been grilled on the potential sale of Air New Zealand shares amid a bleak economic forecast for the airline, with one saying any potential sell-off would be “over my dead body”.

NZ First leader Winston Peters has completely ruled out the possibility of selling the Government’s 51% stake, while Minister for State Owned Enterprises Simeon Brown said the Government is focused on making state-owned assets perform, not purchasable.

The questioning comes as Air New Zealand suspended its previous earnings guidance yesterday.

The airline warned fares would change, and its network may be adjusted in response to “unprecedented volatility” in global jet fuel markets due to the war in Iran.

Last month, it posted a bottom-line loss of $40 million in the six months ended December, prompting Deputy Prime Minister David Seymour to review his call for the sale of the Government’s stake.

Speaking on Ryan Bridge TODAY, Brown acknowledged the market volatility will be putting pressure on Air New Zealand, yet ruled out initiating asset sales or providing the airline with a cash injection to soften the impact.

“I think the reality is Air New Zealand has to weather the storm and work through this,” Brown said.

“We’re not in the business of selling assets the Government owns. What we are focused on is making sure they perform.”

Brown said the expectation was that the airline puts its focus on doing the basics well, “running their business on time, and delivering a service that New Zealanders actually want to have and can be proud of”.

Brown left the door open to repackaging asset sales in a potential election policy, referencing opportunities around asset recycling that Prime Minister Christopher Luxon had previously alluded to.

Also speaking on Ryan Bridge TODAY this morning, Peters said he would make sure the Government’s shares are never sold.

The Foreign Affairs Minister said the airline was a “critical utility for a country called New Zealand”.

“It’s our face abroad.”

Asked by Bridge if the Government stake would have to be sold over his dead body, Peters responded: “Not about over my dead body. We’re going to make sure it never happens because we’re just sick and tired of this stupid neoliberal thinking that has been, for the last 40 years, a disaster.

“We’re going to get rid of this neoliberal stupidity, start doing some practical, plain, obvious, sensible, logical things like Singapore, like great countries like that, and make our country great again.”

Peters and Green co-leader Chlöe Swarbrick both pointed out on the show that the Government has sold and then repurchased its stake in the airline previously.

The airline was privatised in 1989 but bailed out in 2001.

Seymour reiterated his point that Air New Zealand was “pursuing all sorts of quasi-political causes” rather than the core aspects of the business.

Seymour said selling the Government stake is not a bottom line for him.

Aviation Industry Association chief executive Simon Wallace said the Government can offset rising air fares by addressing Civil Aviation Authority (CAA) levies and airways charges.

“If just to put this into context, a $200 fare, Wellington Auckland for example, $15 of that is CAA levies...

“We’ve got $40 out of that $200 ticket going towards airport charges in Wellington and Auckland, and Auckland Airport has some of the highest landing charges in the world.”

The charges could be paused to provide short-term relief to the industry, he said.