The State of David Seymour's Very, Very Cunning Plan

And this time, no twerking required! (Blessed relief.)

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Fresh from the maelstrom surrounding the Treaty Principles Bill, and before fury and dust from that toxic piece of rubbish has settled, Act Leader, David Seymour has launched a new narrative into the public and media discourse.

Like Dracula from a 1960s Hammer Horror movie, Seymour’s agenda for privatisation of state assets has risen from the graveyard of history.

In a “[Dire] State of the Nation” speech at Akarana Event Centre, Ōrākei, on 24 January, Seymour raised the spectre of his vision for a further round of asset sales:

“Then there’s the $570 billion, over half a trillion dollars of assets, the government owns. The one thing we know from state houses, hospital projects, and farms with high levels of animal death, is that the government is hopeless at owning things.

But did you know you own Quotable Value, a property valuation company chaired by a former race relations conciliator that contracts to the government of New South Wales?

What about 60,000 homes? The government doesn’t need to own a home to house someone. We know this because it also spends billions subsidising people to live in homes it doesn’t own. On the other hand, the taxpayer is paying $10 billion a year servicing debt, and the KiwiBuild and Kainga Ora debacles show the government should do as little in housing as possible.

There are greater needs for government capital. We haven’t built a harbour crossing for nearly seven decades. Four hundred people die every year on a substandard road network. Beaches around here get closed thanks to sewerage overflow, but we need more core infrastructure. Sections of this city are being red zoned from having more homes built because the council cannot afford the pipes and pumping stations.

We need to get past squeamishness about privatisation and ask a simple question: if we want to be a first world country, then are we making the best use of the government’s half a trillion dollars’ plus worth of assets? If something isn’t getting a return, the government should sell it so we can afford to buy something that does.”

There was just so much wrong with his superficial, rhetorical questioning of why the State should (and must!) own assets. For example, his sly attack on State housing:

“…What about 60,000 homes? The government doesn’t need to own a home to house someone. We know this because it also spends billions subsidising people to live in homes it doesn’t own…”

Why does the State own sixty thousand homes instead of selling off everything Kāinga Ora owns, and simply pay everyone in need an Accommodation Supplement/Benefit?

Two reasons.

Firstly. The moment those in need of housing assistance are paid a benefit/supplement, it falls into the purview of WINZ/MSD. And we all know how that agency treats welfare recipients (badly); the barriers it erects to make it hard to attain support (difficult); and the chronic under-payment of supplement/benefit payments.

If ever there was a ministry/agency that should be abolished, it is WINZ/MSD.

Secondly, this:

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That’s right: the State increased the students’ allowance by $50 per week. Landlords then increased students’ rent by… $50 a week.

The State merely shovelled taxpayers cash into the pockets of landlords, via students’ bank accounts. They might as well have not bothered.

Building state rental avoids this capricious, selfish profiteering by housing speculators, bleeding their tenants like the mythical Count mentioned above. (RIP Christopher Lee!)

David Seymour is either too dim-witted to understand this - or his voter-base comprises landlords, and he is pimping on their behalf. For the record, I do not believe Mr Seymour is dim-witted.

Mr Seymour also suggested;

“If something isn’t getting a return, the government should sell it so we can afford to buy something that does.”

Actually, we used to own State assets that “made a return”. Postbank was one such entity owned by the people of Aotearoa New Zealand. It made healthy, if modest profits:

Operating profit for Postbank Ltd, ANZ Banking Group 's recently acquired subsidiary, rose by a strong $NZ34 million to $NZ112.5 million ($A87 million)for the 11 months to February 1989, compared with $NZ78.6 million in the previous 12 months.

Though of course, not all state owned enterprises are intended to be run for profit - many having strong social and/or environmental mandates. Kāinga Ora, Kiwirail, healthcare, Department of Conservation being just a few examples.

(In fact, Kiwirail was privatised once, in 1993. It was an abject failure, and the State had to re-nationalise it in 2008 when its Australian owners could not operate it for a profit.)

The whole subject of privatisation over the last forty years has been controversial and opposed by most of the public.

So why do it?

Why did he open another can of worms so soon after proposing and promoting the contentious Treaty Principles Bill?

Quite simply: headlines. Lots of them:

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Make no mistake, the election campaign for Act started on 15 October last year - the day after the the 2023 General Election.

Mr Seymour’s plan is simple:

1. Maximise media publicity. Stay in the public eye.

2. Initiate controversy. Remain relevant.

3. Emasculate NZ First. Make Act the only possible coalition partner for National.

The controversy surrounding the Treaty Principles Bill was no accident. Mr Seymour knew precisely that the blue touch paper he was lighting would explode into a bright glare of publicity.

Not waiting for his wretched Treaty-killing Bill to be thrown out, he has now embarked on another contentious issue: asset sales.

We can expect more grenades of controversy lobbed into the public arena by the Act Leader as he seeks to control the political agenda. He fully understands that the next election may be sooner than many realise. Should the mercurial Winston Peters pull the plug on this shabby Coalition, Mr Seymour wants to be 100% ready to seize the moment.

If he and his corporate-friendly party are “match fit” for a snap-election, and are successful, the next National-Act Coalition would be Rogernomics on steroids.

Our Landlord PM, Chris Luxon, has shown himself far too weak to stand up to Act and its libertarian/rightwing zealots. It would effectively be an Act government.

Mr Luxon has also made noises in the media about campaigning at the next election on this issue. After all, John Key campaigned on partial asset sales in 2011.

National won that election and partial-privatisation of Meridian, Genesis, Mighty River Power, and Air NZ went ahead. Though the policy was opposed by over two-thirds of New Zealanders, Key eventually went on to win the following 2014 General election. Such was his 'charisma’ at the time.

Mr Luxon has none of his predecessor’s charisma. He has all the charm of paint drying.

Meanwhile, the Right are already putting the “There-Is-No-Alternative” case to the public. Former National Party apparatchik, Janet Wilson, has regurgitated the old arguments for asset sales:

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“If the coalition Government was to deliver on its promises it would need to find another $1.6 billion across the budget forecast period to make the much-vaunted tax cuts fiscally neutral, Treasury advised.

The political reality of two of its solutions to this crisis – spending cuts and tax increases – together would be implausible for any government, but particularly a right-wing one.

However, there’s a case for another solution.

Treasury boffins euphemistically call it “active management of the balance sheet”.

Its real name is asset sales.”

Ms Wilson lays it bare; asset sales to fund the short-fall in revenue caused by Minister Nikki “Noboats” Willis’ irresponsible tax cuts/bribe.

One thing is for certain. The rightwing playbook to starve state assets of capital and run them down until they can barely operate, leading to inevitable charges of failure, then the ‘remedy’ - privatisation.

We’ve been down this road before.

In 2015, I wrote about how the Key/English government had used SOEs as “slush funds” to pay for the 2010 tax cuts:

In 2009, English instructed all SOEs to increase their debt. This Statement of Corporate Intent is clear in National’s expectations;

“I would like all SOEs to increase their gearing from current levels, to a level more consistent with a BBB flat credit rating. In this regard, I have been advised by officials that Solid Energy may have the capacity to sustain a 40% gearing ratio.

I urge the Solid Energy Board to give serious consideration to this proposal, and to release all surplus capital to the shareholder as special dividends. “

Not only was National instructing SOEs (including Solid Energy) to borrow more (and then pass the cash on to the Government’s Consolidated Fund), it was also openly raiding their bank accounts by demanding “all surplus capital to the shareholder as special dividends“.

By August 2015, the state owned company went into voluntary liquidation and its assets (mostly mines) were sold off.

In a series of blogposts, Ryan Ward sets out how rightwing governments de-fund or otherwise undermine state assets, and then exploit subsequent poor performance as a rationale to privatise. (See Other Blogs links below.)

The next election will be more crucial in this country’s history than we realise.

Just look at the United States.

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Acknowledgement

Special thanks to my beloved fiancée for her proofreading of my writing (and finding some horrendous mistakes!).

References

Wikipedia: Treaty Principles Bill

Scoop Media: David Seymour - The State Of The Nation In 2025 - Dire States

Otago Daily Times: MSD receives almost 5000 complaints in two years

RNZ: Callers face long waits to get through Work and Income helpline

RNZ: Sample reveals half of beneficiaries paid wrongly by MSD - 'What happens next?'

Stuff: Student allowance boost blamed for rent spikes

RNZ: Landlords hiking rents with allowance rise - students

TVNZ News: Complaints flood in about landlords exploiting student allowance increase by raising rents

Financial Review: Postbank profit up by $NZ34M

Wikipedia: Kiwirail

Treasury: Income from State Asset Sales as at May 2014

Stuff: David Seymour flags asset sales in State of the Nation speech

TVNZ News: Seymour pushes for privatisation: 'Govt hopeless at owning things'

RNZ: Public Service Association calls on Luxon to rule out privatisation: 'Not the New Zealand way'

RNZ: Privatising health care would hurt those on lower incomes - Advocate

NZ Herald: David Seymour expected to blow open controversial privatisation debate

Otago Daily Times: Seymour calls for asset sales, privatisation

Insurance Business: Seymour - Opt out of public healthcare for private insurance

Indian Newslink: Seymour calls for ‘honest debate’ on government ownership, spending

NewstalkZB: Is privatisation the answer to New Zealand's healthcare woes?

The Conversation: David Seymour says Kiwis are too squeamish about privatisation – history shows why they lost the appetite

Wikipedia: 2023 New Zealand general election

NZ Herald: Election 2011 - Key's popularity unaffected by asset sale plan

NZ Herald: Resounding vote against asset sales in referendum

Wikipedia: 2014 New Zealand general election

The Post: The increasingly compelling case for state asset sales

Wikipedia: Solid Energy - Voluntary administration and sale of assets

Additional

RNZ: Political Panel 27 January 2025

NZ Herald: How asset sales went wrong

Scoop Media: Hon David Seymour's Speech to the Holocaust Centre of New Zealand

Other Blogs

Nick's Kōrero: Seymour's Tipping Point

Ryan Ward: Privatisation explained

Ryan Ward: Austerity explained

Ryan Ward: Deregulation explained

Ryan Ward: Libertarianism is corporate propaganda and neoliberalism is its sociopolitical agenda

Ryan Ward: Neoliberalism in 100 words

Previous related blogposts

Solid Energy and LandCorp – debt and doom, courtesy of a “fiscally responsible” National Govt (December 2015)

The Desperate Cynicism of David Seymour

The State of David Seymour's Shamelessness

The State of David Seymour's Shameless Double Standards

The State of David Seymour's Shameless Condescension and Unbridled Arrogance

Submission on Regulatory Standards Bill

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Acknowledgement: Emma Cook

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