TVNZ sport loss queers pitch for Act sale plan

By ANDREW LAXON

TVNZ's loss of top sports events could put pressure on Act's promise to cut taxes.

The party is relying on selling TVNZ next year for $1.2 billion above its book value, based on market estimates from early this year.

But Act leader Richard Prebble acknowledged yesterday that TVNZ's value had fallen since then, especially after it lost screening rights for rugby and cricket to TV3 in September.

"The loss of sport has clearly meant a substantial reduction. The most dramatic estimate I've heard is $500 million."

According to its own figures, Act could still afford to cut the top tax rate to 20c without reducing existing spending.

However, a $500 million drop in value for TVNZ would reduce the party's estimated surplus next year to just over $1 billion.

Launching Act's economic policy in Auckland, Mr Prebble said the party wanted to sell all state-owned businesses, including NZ Post and the remains of ECNZ, within three years.

The aim was to run the businesses better, rather than balance the books.

Mr Prebble said Act would cut red tape for business by commissioning a study of compliance costs and making all proposed laws pass a cost-benefit test.

Over the next five years, Act plans to cut $2.7 billion of potential spending that has been set aside for future initiatives.

It claims this is not a spending cut, but its opponents - including National ministers Bill English and Simon Upton - say it will mean cuts in social services.

Labour finance spokesman Michael Cullen said Act's claim that it could get an extra $1.2 billion for TVNZ was extraordinary.

He said the policy meant a $450-a-week tax cut for Prime Minister Jenny Shipley, while most low and middle-income families would pay more for health and education.