Business NZ welcomes debate on state assets

Wednesday 8th December 2010

Business New Zealand is keen on a public debate about the options for state-owned assets after Treasury said it has prepared advice on state-owned enterprise ownership.

"There are a number of ways in which the current return on investment could be boosted, and a number of ways that mum and dad investors could benefit from investing in those assets," Business NZ chief executive Phil O'Reilly said.

Treasury's general manager of Crown ownership and state sector performance, John Crawford, said work was now completed on background papers on the issue of state-owned assets.

"We're ready to provide advice as and when asked," Mr Crawford said.

The work covered the arguments for and against state ownership, the pros and cons of full or partial privatisation, and the pros and cons of different ways of selling assets.

The first Annual Portfolio Report report by the Crown Ownership Monitoring Unit (Comu), released this week, said that the 37 state-owned companies and investment funds have survived the recession in reasonable shape.

The state-owned commercially focused companies valued at $55 billion, and $40 billion in investment funds, had turnover accounting for about 8% of gross domestic product.

The Government has promised only to promote asset sales after campaigning on the issue before an election. A general election is due within the next 11 months.

Business NZ welcomed Treasury's intention to provide advice on options for reviewing the form of state assets.

Mr O'Reilly said the economy would benefit from greater use of the value held in Crown-held companies.

"Getting public debate on the options, based on the best information available from Treasury, is healthy.

"The business community would welcome contributing to the discussion."

In a speech to Victoria University's Institute of Policy Studies, Labour's finance spokesman David Cunliffe spoke of the potential for the Government to leverage its capital investment in growth-enhancing projects through partnerships with business, iwi, local government and the New Zealand Superannuation Fund.

NZPA

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