Small Parties holding the Majors to account.

The following is an excerpt from UnitedFuture’s Supply and Confidence Agreement with National, December 2011:

• There will be no sale of any part of Kiwibank or Radio New Zealand
• Introduce statutory limits on the sale of public assets to no more than 49% of shareholding to private interests including limits on the extent of single entity ownership

In the 2011election, both National and UnitedFuture campaigned on partial asset sales. United Future’s wording is quite clear. The rest of the Supply and Confidence is here:
That document; not the media or the mob rule sentiment of the day is what mainly governs party interactions after an election.

Despite the sentiment on asset sales in your part of New Zealand, or, if you are gone-burgers to a different part of the world like moi, UnitedFuture has kept to it’s word with asset sales:
Essentially UnitedFuture originally saw no problem in flogging off the aging asserts up to a 49% shareholding for a shot of capital and presumably some experience on the energy company boards.  

 In the interim, Tony Ryall and his advisers came up with the funky idea of allowing second class or shares with non-voting rights and this was seen as a breach of Supply and Confidence by United Future:

http://www.stuff.co.nz/business/industries/7138920/Government-U-turn-on-SOE-sale-cap

UnitedFuture was absolutely, technically correct.  51% retention of ownership is 51% regardless of whether the shares are A class, B class, pink, purple or issued on flypaper.

Kudos to UnitedFuture for spotting this.
  I have volunteered for UF and they are a very pragmatic bunch so this doesn’t surprise me.
Kudos also for holding the bigger party to account.
It is very easy for a smaller party to roll over to the bigger if nothing else than to get extra air in Question Time in Parliament.
In this case UF played it’s hand well. Peter effectively had the casting vote on asset sales. Given the level of discontent over asset sales in the general populace, there was room for UF to move. Not all the room in the world given the lack of affection in New Zealand for smaller political parties but enough for a game of poker.

It would seem Tony Ryall had no choice but to issue an amendment eliminating the future issue of non voting shares;  the respective press secretaries will have eyeballed each other over a couple of afternoons, and the share ownership will remain undiluted for the benefit of New Zealanders.

Why the idea of non-voting shares was proffered in the first place is interesting.
Interest rates will remain low for a decade. You don’t dilute your shares or dividends by issuing a new round if you can borrow from banks at  a good rate.

Ergo, there must be a need for a new capital injection projected 5-10 years into the future. Capital that might be supplied by the issuance of second class shares. This begs the question: what new project is planned by National. A new coal burner, and/or a change to the RMA and a reversal on project Hayes and Mokihinui perhaps?