Greens: Kiwibank sale Govt's fault

Greens: Kiwibank sale Govt's fault

The Green Party has said New Zealand Post is taking a step toward privatisation of Kiwibank, with today's announcement it will sell 45 percent of its shares, and the decision was forced by the National Government's failure to invest.

Green Party co-leader James Shaw said if National had invested capital into Kiwibank, it would have allowed it to expand like it should have years ago.

"The fact is the Government forced Kiwibank's hand and today's announcement will make it easier than it was before to move Kiwibank into private ownership," Mr Shaw said.

He said the deal will make it harder for the Government to use Kiwibank to drive competition in the banking sector because it can't direct Super and ACC funds the way it could have directed Kiwibank.

But New Zealand Post Group chairman Sir Michael Cullen insists the company has no intention to move into private ownership.

"[The offer] has been priced on a commercial basis, and reflects the Government's absolute position that Kiwibank must remain in public ownership," NZ Post said in a statement.

Labour is supporting the "clever scheme" which would see the bank remain in public ownership.

"There are some good conditions around it. The important thing is that the Government guarantees that if either the Cullen Fund or ACC wants to sell its shareholding that they take up the first right of refusal and buy back those shares -- that's the commitment Labour would make," leader Andrew Little says.

"Our bottom line is Kiwibank being in public ownership and having the opportunity to expand so it acts as a good competitor to overseas-owned trading banks." 

Sir Michael said Kiwibank is not in need of the cash injections the Green Party speak of and if this sale doesn't go through, Kiwibank would not be in dire straits.

"Kiwibank is not in distress at all; it will be much more constrained about its capacity to grow."

He says the Greens are incorrect in their assertion the Government could direct Kiwibank.

"Kiwibank is a 100 percent owned subsidiary of New Zealand Post, but in terms of the Companies Act and Reserve Bank requirements it must act independently in terms of its activities.

"The Government cannot direct New Zealand Post, nor through New Zealand Post can it direct Kiwibank." 

ACT Party leader David Seymour believes the Government should sell the bank.

"The Government should not own commercial enterprises. This is a National government which campaigns from the right, governs from the left and is afraid to take on issues of that magnitude.

"If the answer to anti-competitive behaviour is for the Government to go into business in every single sector then we've got very big problems."