Govt slashes assets sales earnings estimate

Bill English
Bill English
The Government has cut its estimated earnings from partial asset sales from up to $7 billion to as low as $4.6 billion.

Finance Minister Bill English said the Government's half-year economic and fiscal update this month would revise the estimated range of proceeds from the sales to $4.6b to $5b.

That is lower than Treasury's estimate in 2011 that proceeds from the sales, including Solid Energy, would be $5b to $7b - with the $6b mid-point range assumed in Treasury forecasts.

Excluding Solid Energy from the sales, the estimated proceeds were between $4.4b and $6.1b.

"So we are on track to be within that range," Mr English said.

Mr English gave the revised estimates before Parliament's finance and expenditure select committee today.

"The revised assumption of share sale proceeds is based on Solid Energy clearly being in no position to be sold anytime soon, and it takes account of other developments and the results of share offers to date," he said.

"This is cash the Treasury expects taxpayers to receive, which can be invested in new priority public assets without the Government having to borrow from overseas lenders."

The partial sales of Mighty River Power, Meridian Energy and Air New Zealand raised almost $4b. The Government plans to sell shares in Genesis Energy in the first half of next year, subject to market conditions.

 

Tax and sales

The tax cuts for the top 10% = approximately $1 billion less in income tax a year. It's been 4.5 years , so that's about  $4.5 billion.

Sales income? $4.6 billion

Result

1/ the lose of nearly 1/2 our assets , the loss of the ongoing income from them
2/ the Loss of $1 billion a year tax revenue
3/ income from sale of said assets balances the books for the past 4.5 years, but the twin loses continue from here on
4/ Mom and Pop investors almost nil
5/ The percentage of spending of said income being spent on proposed projects is only a small part of the generated income
6/ Items still funded by debt because the sales only balance the loses caused by the tax cuts
7/ Govt debt has gone from $18 billion to $80 billion since National became the government - assets sales would barely cover a year's interest if they werent already covering the tax cuts

 

Asset sales

The National Government gave away tax cuts to the highest paid, which (by 2014) will have cost $4.5bn.

They now estimate the income from asset sales (not including the cost of the sales) will be $4.6bn.

Basically, they sold our assets and gave them to the rich.

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