Rotorua Grey Power is warning Prime Minister John Key to "ignore us at your peril" over the asset sales referendum.

The citizens-initiated referendum is now underway, amid controversy and protest about the Government's "mixed-ownership policy".

Mr Key has said the Government will ignore an unfavourable response and proceed with its plans to partially privatise Genesis Energy.

The Electoral Office estimates 61,970 people are eligible to vote in Rotorua, with 56,445 currently enrolled to vote - 91 per cent of eligible voters.


Rotorua had close to a 60 per cent turnout in the 2009 smacking referendum.

Rotorua Grey Power president Rosemary MacKenzie said most Grey Power members were "very anxious" to make their voices heard. "It's part of our policy since the founding of Grey Power that we're totally opposed to the sale of state assets by any government."

Grey Power co-led the Keep our Assets petition that sparked the referendum, and was now encouraging members to vote "No", Mrs MacKenzie said.

"[Mr Key] has said he's going to ignore the referendum and do it himself.

"The majority do not feel that one parliamentary seat gives him a mandate.

"Ignore us at your peril Mr Key. If you're not going to take any notice of what over 300,000 people think, then there's an election next year and our memories are long."

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Voting papers for the current citizens-initiated referendum started arriving in letterboxes on November 22, with the question: "Do you support the Government selling up to 49 per cent of Meridian Energy, Mighty River Power, Genesis Power, Solid Energy and Air New Zealand?'

As of Wednesday, 73,255 voting papers had been returned - representing 2.4 per cent of the country's 3,030,707 enrolled voters.

Mr Key said last week the referendum would almost certainly show the partial asset sales policy was unpopular with the public.

However, the Government plans to ignore the results and continue with the programme, under which Genesis, the final state-owned enterprise to be partially privatised, will be floated in the first half of next year.

Calls from Labour and the Greens to halt the sale in the event of an unfavourable referendum result have been labelled hypocritical by Mr Key, who says neither party supported repealing the "anti-smacking" legislation in line with the 2009 referendum. Just over 87 per cent of those who voted said "a smack as part of good parental correction" shouldn't be a criminal offence, but Parliament passed the bill with an overwhelming majority anyway.

Under New Zealand law, citizens-initiated referenda are non-binding on the Government.

So far, they haven't attracted a high voter turnout unless taking place at the same time as a general election.

This one on asset sales is the fifth referendum since the first in 1995 - over the number of professional firefighters - which attracted just 27 per cent of eligible voters.

Voting papers for the current referendum must be returned by December 13.