Don’t flirt with MOM

LETTER

Quite correctly you state in your editorial of September 5 that the Mixed-Ownership Model (MOM) for SOEs was implemented by the National-led government during the years 2011 to 2014. But, had Labour won the 2008 general election it is certain that MOM would have been wined and dined just as enthusiastically.

Why? Because it was Labour Commerce Minister Lianne Dalziel who was persuaded to set up a taskforce mid-2008 charged with finding ways to “deepen” the capital markets. In a media release (July 21, 2008) she said how “delighted” she was to appoint investment broker Rob Cameron to chair this new panel — the same man who had helped Labour sell off Telecom during Roger Douglas’s term of office. The taskforce also included Business Round Table members along with Gareth Morgan and Adrian Orr.

Two very significant proposals appeared in the report duly presented the following year. One was for Treasury’s Debt Management Office to set up a quasi-bank for selling local government securities — to be called the Local Government Borrowing Agency. The other was the so-called “principle” of the mixed model for SOEs so that “mums ’n’ dads” could own shares traded on the Stock Exchange. If this had really been aimed at mums ’n’ dads, why did certain overseas-owned banks establish special in-house units to facilitate the selling of such shares to the big buyers?

The claim that SOEs are performing better since MOM took up residence is misleading. Had our electricity grid and power boards remained in public ownership, with the infrastructure funded from our sovereign Reserve Bank, MOM would never have been welcomed.

If our local council invites her in, then ratepayers and power consumers beware!

Heather Marion Smith

Quite correctly you state in your editorial of September 5 that the Mixed-Ownership Model (MOM) for SOEs was implemented by the National-led government during the years 2011 to 2014. But, had Labour won the 2008 general election it is certain that MOM would have been wined and dined just as enthusiastically.

Why? Because it was Labour Commerce Minister Lianne Dalziel who was persuaded to set up a taskforce mid-2008 charged with finding ways to “deepen” the capital markets. In a media release (July 21, 2008) she said how “delighted” she was to appoint investment broker Rob Cameron to chair this new panel — the same man who had helped Labour sell off Telecom during Roger Douglas’s term of office. The taskforce also included Business Round Table members along with Gareth Morgan and Adrian Orr.

Two very significant proposals appeared in the report duly presented the following year. One was for Treasury’s Debt Management Office to set up a quasi-bank for selling local government securities — to be called the Local Government Borrowing Agency. The other was the so-called “principle” of the mixed model for SOEs so that “mums ’n’ dads” could own shares traded on the Stock Exchange. If this had really been aimed at mums ’n’ dads, why did certain overseas-owned banks establish special in-house units to facilitate the selling of such shares to the big buyers?

The claim that SOEs are performing better since MOM took up residence is misleading. Had our electricity grid and power boards remained in public ownership, with the infrastructure funded from our sovereign Reserve Bank, MOM would never have been welcomed.

If our local council invites her in, then ratepayers and power consumers beware!

Heather Marion Smith

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