BUDGET 2014: Power company sell-off proceeds reach Kiwirail, irrigation schemes

The government has sprinkled the proceeds of its $4.7 billion assets sales programme across projects ranging from housing developments to irrigation schemes and an increased bailout for state-owned Kiwirail.

Some $1 billion of the money, held by the Future Investment Fund, has been allocated in the 2014 budget, including $67 million for a new Grey Base Hospital on the West Coast and $172 million earmarked for upgrading and building schools.

Unprofitable Kiwirail is the single biggest recipient, getting $198 million for its turnaround plan while $75 million is set aside as a Christchurch housing contingency. The government is also allocating $40 million to Crown Irrigation to invest in irrigation schemes and Housing New Zealand's Hobsonville Land Company, which has a residential development north of Auckland, gets $31 million.

Gross proceeds from the sale of shares in MightyRiverPower, Meridian Energy, Air New Zealand and Genesis Energy came in below the original estimate of $5 billion to $7 billion, partly reflecting the decision not to sell the financially troubled coal miner Solid Energy.

The allocation announced today brings the total to about $3 billion over three budgets and leaves $1.68 billion in the fund.

(BusinessDesk)

What do you think? What do you think of the government's increased bailout of Kiwirail?  Click here to vote in our subscriber-only business pulse poll.


Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

NZ Market Snapshot

Forex

Sym Price Change
USD 0.6977 0.0000 0.00%
AUD 0.9169 0.0000 0.00%
EUR 0.6094 0.0000 0.00%
GBP 0.4775 0.0000 0.00%
HKD 5.4121 0.0000 0.00%
JPY 74.1560 0.0000 0.00%

Commods

Commodity Price Change Time
Gold Index 1292.7 26.930 2016-04-29T00:
Oil Brent 47.4 -0.400 2016-04-29T00:
Oil Nymex 45.9 -0.110 2016-04-29T00:
Silver Index 17.8 0.240 2016-04-29T00:

Indices

Symbol Open High Last %
NZX 50 6790.0 6822.1 6790.0 0.45%
NASDAQ 4805.8 4807.9 4805.3 -0.62%
DAX 10235.5 10252.1 10321.1 -2.73%
DJI 17813.1 17814.8 17830.8 -0.32%
FTSE 6322.4 6322.4 6322.4 -1.27%
HKSE 21215.2 21235.4 21388.0 -1.50%
NI225 17439.0 17572.3 17290.5 -3.61%