Latest / Early Edition with Ryan Bridge / Nick Leggett: Infrastructure NZ Chief Executive on asset sales

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Nick Leggett: Infrastructure NZ Chief Executive on asset sales · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: Privatization is the hot word of the day and Prime
• 0:02
  Speaker 1: Minister Christopher Luxon has floated taking asset sales and privatization
• 0:06
  Speaker 1: and asset recycling to next year's election to get a mandate.
• 0:10
  Speaker 1: He said this just days after athleader David Seymour suggested
• 0:13
  Speaker 1: the idea during the State of the Nation speech. We're
• 0:16
  Speaker 1: all talking privatization. Treasury has pointed to some government agencies
• 0:21
  Speaker 1: that aren't performing as well as they should. We're looking
• 0:23
  Speaker 1: at UQV and this they could potentially be the first
• 0:27
  Speaker 1: to be sold off. So Infrastructure New Zealand chief executive
• 0:30
  Speaker 1: Nick Leggand joins me now on the program. Hella, Nick, hello,
• 0:34
  Speaker 1: in your opinion, how would the economy benefit from asset sales?
• 0:38
  Speaker 2: Well, how was the country benefit? And I think what
• 0:40
  Speaker 2: we've got to do is take this discussion back at
• 0:43
  Speaker 2: that because it's not just about hawking off assets and
• 0:48
  Speaker 2: running away with the money. It's about what can you
• 0:51
  Speaker 2: sensibly build if you release funds in a different way,
• 0:55
  Speaker 2: and so that whole I think the idea of Asset
• 0:58
  Speaker 2: Partnership's asset recite, where the government takes a look at
• 1:01
  Speaker 2: it all the asset assets it owns and says right,
• 1:04
  Speaker 2: we can release the money here, we could perhaps have
• 1:06
  Speaker 2: a joint ownership with the private sector, and we're going
• 1:10
  Speaker 2: to build a school, a hospital, a light rail or
• 1:14
  Speaker 2: a road. And this is how New Zealander's lives are
• 1:18
  Speaker 2: going to be improved and how the economy is going
• 1:20
  Speaker 2: to be improved for the long term. New South Wales
• 1:23
  Speaker 2: did this. It was taken to the state election I
• 1:26
  Speaker 2: think about twelve years ago and it was sold to
• 1:29
  Speaker 2: the electorate and surprise, surprise, there was actually I don't
• 1:35
  Speaker 2: say that in any sarcastic way, but actually the government,
• 1:37
  Speaker 2: the state government delivered and you're still seeing the benefit
• 1:41
  Speaker 2: of that and the regeneration of Sydney, of regional New
• 1:44
  Speaker 2: South Wales. If you think about the light rail and
• 1:46
  Speaker 2: those really exciting public spaces in central Sydney, associated uplisted
• 1:53
  Speaker 2: housing and other economic improvements. All that happened because the
• 1:58
  Speaker 2: state said, how can we be use our balance sheet
• 2:01
  Speaker 2: for the benefit of social and economic progress. And that's
• 2:05
  Speaker 2: the discussion this country has to have. It's not about
• 2:08
  Speaker 2: this binary yes we should sell or no we shouldn't
• 2:12
  Speaker 2: sell an asset. It's what that improves for people and
• 2:16
  Speaker 2: jobs and growth over the long term and that's the
• 2:20
  Speaker 2: question New Zealand needs to ask itself. We are slipping
• 2:22
  Speaker 2: behind internationally. The amount of money that we earn from
• 2:27
  Speaker 2: exports is pales in comparison to some countries of similar
• 2:31
  Speaker 2: size in the OECD. We know we've got to kick
• 2:34
  Speaker 2: start our education and health systems if we want to
• 2:38
  Speaker 2: retain the kind of country that I think probably people
• 2:42
  Speaker 2: have come to expect. And it's about doing things differently.
• 2:45
  Speaker 1: Okay, and of course everyone goes well overseas capital. But
• 2:48
  Speaker 1: of course there is a possibility of Kiwi Save It
• 2:50
  Speaker 1: or the New Zealand Superfund or any New Zealand EWE groups.
• 2:55
  Speaker 2: Look, this doesn't have to be This is not about
• 2:57
  Speaker 2: a foreign grab. The other point of about it is
• 3:00
  Speaker 2: we have a pitiful reputation and record of managing the
• 3:06
  Speaker 2: assets we actually build and own. Look at roads, look
• 3:10
  Speaker 2: at schools, look at hospitals. When you get some private
• 3:13
  Speaker 2: sector discipline into these assets, you actually improve that long
• 3:18
  Speaker 2: term life because you can build maintenance and renewal into
• 3:23
  Speaker 2: the contracts.
• 3:24
  Speaker 1: The problem, I say, the problem though, Nick, is of
• 3:26
  Speaker 1: course everyone looks at Kiwi Rail where we sold it
• 3:28
  Speaker 1: and then they stripped it and then and then we
• 3:30
  Speaker 1: had to buy it back and they think, well, that's so.
• 3:32
  Speaker 1: Sometimes it's not that private is always perfect. But you know, hey,
• 3:36
  Speaker 1: but he's going with.
• 3:38
  Speaker 2: Your eyes wide open, Andrew, you can build those sort
• 3:40
  Speaker 2: of things and protect the asset and build long term
• 3:44
  Speaker 2: maintenance and prevent assets stripping in the contracts that you're right,
• 3:48
  Speaker 2: these things are you can overcome them. And I just
• 3:51
  Speaker 2: think we need to really ask ourselves the kind of
• 3:54
  Speaker 2: country that we want to build and become. What do
• 3:56
  Speaker 2: we build into wards and then we can decide how
• 3:59
  Speaker 2: we deliver that. Because we can't keep writing checks that
• 4:02
  Speaker 2: the public can't cash. We have to think of different
• 4:05
  Speaker 2: ways of funding things. And it's not about selling everything
• 4:08
  Speaker 2: and building in this way. It's about can we do
• 4:11
  Speaker 2: things better in some areas. And I think a more
• 4:14
  Speaker 2: balanced approach one that where people understand what we're going
• 4:17
  Speaker 2: to actually get, recognizing that when you sell something you've
• 4:20
  Speaker 2: actually still got to service the costs, so it's not
• 4:22
  Speaker 2: this perfect, wonderful world. We have to ask ourselves these questions.
• 4:26
  Speaker 1: Nick, I thank you so much for your time today.
• 4:28
  Speaker 1: Neck is the Infrastructure New Zealand CEO. Remember the government
• 4:32
  Speaker 1: apparently we'll be seeking a mandate in twenty twenty seven,
• 4:34
  Speaker 1: So this is not something that's happening tomorrow. For more
• 4:38
  Speaker 1: from Early Edition with Ryan Bridge, listen live to news
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