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 0.7247 -0.0012 -0.17%
AUD 0.9572 -0.0005 -0.05%
EUR 0.6485 0.0000 0.00%
GBP 0.5537 0.0000 0.00%
HKD 5.6210 -0.0076 -0.14%
JPY 73.9830 0.0290 0.04%

Commods

Commodity Price Change Time
Gold Index 1323.7 2.760 2016-08-29T00:
Oil Brent 49.5 0.090 2016-08-29T00:
Oil Nymex 47.0 -0.660 2016-08-29T00:
Silver Index 18.8 0.120 2016-08-29T00:

Indices

Symbol Open High Last %
NZX 50 7367.3 7394.4 7367.3 0.25%
NASDAQ 5223.8 5245.1 5218.9 0.26%
DAX 10503.9 10566.7 10587.8 -0.41%
DJI 18421.3 18523.1 18395.4 0.58%
FTSE 6816.9 6857.3 6816.9 0.31%
HKSE 22945.1 23016.0 22821.3 0.82%
NI225 16691.0 16752.2 16737.5 -0.04%
ASX 5469.2 5504.0 5469.2 0.25%