Loyalty asset shares didn't work in Oz
Fri, 22 Jun 2012 6:09p.m.
By Political Editor Duncan Garner
Opponents of the Government's partial asset sales say the idea of loyalty or free shares hasn't worked in Australia so why consider it here?
One expert across the Tasman even called it a bribe.
The debate over whether to offer free shares to Kiwis has been fierce. Labour called it "a scam" and the Greens called it “a scheme for wealthy New Zealanders”.
So what happened across the Tasman? When Queensland Rail was sold two years ago locals were offered free shares if they held them for a certain period.
But thousands of investors didn't wait.
Green Party co-leader Russel Norman says it doesn’t work.
“If the price goes up then regardless of loyalty schemes people sell off.”
Dr Norman says that could happen here too.
“The Queensland taxpayer basically got ripped off because they sold the asset too cheaply so after the sale the price went high... people immediately sold."
Australia's high profile TV finance guru 'The Barefoot Investor', otherwise known as Scott Pape, agreed.
He called the loyalty shares a "short term bribe" and a "trick". Labour agrees.
The 9000 workers at Queensland Rail also got $1000 of free shares up front and they were assured their jobs were safe for three years.
But 1100 jobs have since been lost because "the cost base was too high".
But Dr Norman doesn't expect job losses here because the energy companies are already efficient.
“They’ll probably look at it but I’m not convinced there'll be big layoffs.”
The Government is yet to make a formal decision on a loyalty scheme but polls show this partial asset sales policy is unpopular.
And the noise will only get louder. The law will be passed next week - expect fireworks in Parliament and protests outside.
Post a Comment
Before commenting, please take the time to read our moderation guide
(Won't be published)
25/06/2012 10:02:26 a.m.
@ JOHN, and what better way for them to prove thats exactly why they are doing it then loyalty shares! If only we had adults running our country, we would have a brighter future! Although those assets will soon be obsolete and worth next to nothing. "dont tell the rich!"
23/06/2012 2:39:03 p.m.
'Didn't work in aus? Great lets do it here in good ol NZ!'Our PM (Prime Muppet) John Key.Were's the rest of the muppet show contesting this point? Must be reading up on their hero over there in Norway.
23/06/2012 10:30:09 a.m.
Of course Key will sell them. With the rise in electric vehicles and the decline of oil based cars it is is imperative "big oil" aquires as much fuel producing assets as possable before the general public catches on to the rort.
22/06/2012 10:18:17 p.m.
Can't believe that NZ ers are allowing there own power station and there profits to be sold off. These are essential services, and price rises will follow as sure as the sun rises.It is allready been proved that NZ will be at a net loss when the dividends are in foreign hands. This is an act of treason and I hope that the perpetuators are brought to justice... Barry ex Kiwi AUst
22/06/2012 7:29:14 p.m.
Everybody knows selling our assets will profit the rich and further stress the already financially struggling middle class, while at the same time flushing our grandchildrens chances at prosperity down the toilet. Too bad Key is a banker and doesnt care.
Prime Minister John Key has labelled the Labour-led Opposition the "devil beast"...
Shamed National MP Aaron Gilmore has given a teary final speech in Parliament....
Police had to physically push anti-poverty protestors back after they tried to b...
What began as a protest for more pay has morphed into a battle against cheap bur...
Embattled National MP Aaron Gilmore has resigned....
Copyright © 2013 MediaWorks TV. All Rights Reserved.