NZ Government holds course on SOE sales – John Key

Prime Minister John Key today outlined the Government’s next steps to prepare Mighty River Power for its partial sale in the first half of 2013.

“I’m pleased to announce today Cabinet made three decisions regarding our shares sales programme,” said Key in a post-Cabinet press statement.

•  “First, the Government will not implement the Waitangi Tribunal’s ‘shares plus’ concept, or engage in further negotiations in relation to that concept, before the sale of shares in our energy companies.

•  “Second, the Government will proceed to remove Mighty River Power from the State Owned Enterprises Act. We will prepare an Order in Council for Cabinet and Executive Council to consider and approve on Tuesday 23 October.

•  “Finally, we will direct officials to continue to work towards a sale of up to 49 per cent of the shares in Mighty River Power between March and June 2013.

The Waitangi Tribunal recommended the Government consider a “shares plus” option to settle claims. Finance Minister Bill English undertook a round of consultation on ‘shares plus’ with Māori with direct interests in the water and geothermal resources used by Mighty River Power, and Meridian and Genesis.

Key said the key findings from the consultation on ‘shares plus’ – show:

• Financial redress and input into resource management decisions can be provided in other – and in some cases better – ways.
• Appointing directors and exercising shareholder voting rights can also be achieved in other ways with the Crown, which will remain the controlling shareholder.
• The Crown does not believe that providing iwi with special rights in making management decisions will work well and most submitters who considered the idea agreed.
• Shares plus’ would create a potential conflict of interest within and between different iwi groups. And it would potentially weaken existing relationships between iwi groups and the SOEs.

Key conceded the decisions might lead to legal action by the Maori Council.

“That’s entirely a matter for them,” said Key. “From the Government’s perspective it would not be unexpected.”