Why asset sales isn't debatable

There must be something in the water up there in Hampden. They're a steely mob; determined. Not likely to take no for an answer.

Some time back - in 2006 to be precise - a few of the locals who like to spend a bit of time chewing the fat decided they should do something more than just talk.

Particularly concerned about issues relating to "global energy constraint and climate change and their potential impact on communities", they formed Hampden Community Energy Inc, a voluntary charitable organisation. "A more secure, self-reliant and vibrant community, better prepared to sustain the effects of a decline in fossil fuel availability and meet the essential needs of future generations" is how the group describes its vision.

Among the activities the group charges itself with organising is an annual celebrity debate aimed at facilitating "public interest in important political issues". This year's topic is: "The sale of all, or significant proportions of, New Zealand state assets will create more problems than it solves."

At this stage it promises to be a walkover for the affirmative. Why?

Because this small, voluntary charitable organisation in North Otago cannot seem to persuade a calibre team, indeed any team at all, from the National Party - whose controversial policy the debate inscribes - to oppose the motion.

The debate is timed for Saturday, September 17, in the local community hall. Invited in May, Prime Minister John Key's office said first it was policy not to confirm events further than three months out; when it later responded, the reply was that the PM's busy schedule did not allow him to be present - he wished the event organisers well.

National's Waitaki MP Jacqui Dean, likewise, had an event clash and cannot attend, and thus far entreaties to the PM's office to rouse up a team to participate - and defend what is likely to be one of the party's edgier policies going into the November election - have fallen on deaf ears.

Not that they are unduly surprised in Hampden - although they were rather hoping it might be a case of third time lucky. "

We appreciate this time leading up to the election is a busy time for all candidates. However, on the two previous occasions we have invited the National Party to defend one of its policies, it has declined," secretary of the society Elizabeth Norton has written in a follow-up letter to National Party caucus members inviting participation.

What will ensue, will ensue. Does the National Party have a commitment to local democracy in action - even in an area where it perceives it has little need for the extra votes?

Or does it, in its heart of hearts, believe the less said about asset sales the better in the hope the issue will sail under the election radar and into formal policy with the next National-led government?

Certainly the team aligned to affirm the motion - Pete Hodgson (Labour Party), Chris Trotter (political commentator) and Kennedy Graham (Green Party) - would give any opposition a lively work out; and past events by all accounts have been good-natured, fair and entertaining.

There could only be one winner on the night: participatory democracy.

There are faint echoes of all this in the Labour Party's big idea launched last week: the capital gains tax, and associated measures - at least that is how some commentators have chosen to interpret an email circulated by Trevor Mallard suggesting MPs don't sweat the small stuff when responding to questions about the package.

It's the principle that counts, that has the emotional pulling power. And he's right: drill too deeply down into the complexities in so far as they have thus been articulated and eyes begin to glaze over.

But can the OECD, the IMF, our own Tax Working Group, and most economists - who along with the Government and the Reserve Bank Governor have been chiding us for our unproductive love affair with property for some time now - all be wrong? In principle?

Probably not. Which is possibly more than you can say about asset sales; in fact you can't say much about asset sales at all without running into one or two inconvenient truths: you can only sell state-owned power companies for a one-off windfall; thereafter you forgo all the future dividends that such companies might have contributed to debt alleviation. And, second, there is no mechanism by which windfall shares snapped up by mum and dad investors can be retained in New Zealand ownership. Eventually most will be owned by offshore institutions.

We seem to have been down that road before - as the affirmative team would undoubtedly tell you in Hampden.

 - Simon Cunliffe is deputy editor (news) at the Otago Daily Times.

 

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