Friday, June 14, 2024

The looting is the point

Last time National was in power, they looted the state, privatising public assets and signing hugely wasteful public-private partnership (PPP) contracts which saw foreign consortiums provide substandard infrastructure while gouging us for profits. You only have to look at the ongoing fiasco of Transmission Gully to see how it was a complete disaster. So of course National are going to do it all again:

The infrastructure minister wants more private sector financing, such as public-private partnerships (PPPs), to pay for major projects.

In a speech to Local government New Zealand on Thursday night, Chris Bishop said he wanted government grant funding to become a last resort for councils.

"My speech talks about some of the things we've been talking about as a government for six months, and we've actually campaigned on - so making greater use of tolls, public private partnerships, things like value capture as well," he told Morning Report on Friday.

So, basically National's promised new motorways are going to be for the rich and for businesses, not for actual people, in order to guarantee a privatisable revenue-stream. And they'll be paying foreigners inflated prices to build those roads, to keep debt off the government's books and so meet a completely artificial and self-imposed debt-target.

This is inherently less efficient than simply borrowing to build, because the private providers will be paying higher interest rates while demanding a huge, government-guaranteed profit. That's the clear lesson from the UK's disastrous Private Finance Initiative. The fact that National is persisting with this leads to the obvious conclusion that the purpose of the policy is in fact the looting, not the infrastructure. Like everything else they're doing, its about paying off donors and cronies with public money - corruption on a grand scale.