SOE heads to be called in – told to raise their game

Simon Power. Photo / Mark Mitchell

The Government has summoned the heads of State-owned enterprises to an April 9 meeting, where they will be told to improve their performance.

"We are keen to talk to them to make sure they are contributing to the economy in an efficient way," State-Owned Enterprises Minister Simon Power told NZPA.

"In the six months to the end of December 2008 we have seen the net profit after tax across those portfolios reduce by 50 per cent.

"That is a matter that a shareholder of any commercial enterprise would be concerned to discuss."

Mr Power said SOEs made up a significant part of the Crown's balance sheet, representing a taxpayer investment of just under $24 billion.

Opposition parties today called on State-owned power companies to use their profits to help consumers with their winter power bills, citing results announced by Genesis and Meridian.

Asked whether the Government was prepared to accept lower dividends from the energy SOEs, Mr Power said the prices they charged was up to them.

"The net profit after tax across all four of the energy companies is actually a loss of $50 million in that six-month period compared with a $260 million net profit after tax in the six months to December 2007," he said.

Labour's energy spokesman, Charles Chauvel, said the minister's letter to SOE chairs calling them to a meeting on April 9 in Finance Minister Bill English's office stated that the purpose was to discuss measures to improve their financial performance.

"This is code for SOEs charging higher prices to the public," he said.

"There is fundamentally one way that energy SOEs can contribute higher dividends to the Government - by charging higher prices."

Progressive Party leader Jim Anderton said the power company profits should be returned to consumers.

"Mighty River Power recorded a profit of $235 million in the last six months of last year," he said.

"That on its own is enough for every household in New Zealand to get a cheque for nearly $200."

- NZPA