There’s something about Telecom that brings out the macho beast in some politicians.
A couple of months back we had Labour’s Graham Kelly saying the company “would feel the cold wind up their kilts” which, for this voter, brought back memories of Corporal Jones in the old TV comedy Dad’s Army (“They don’t like it up ‘em ...”).
More recently Alliance leader Jim Anderton took a phrase from science fiction to warn Telecom: “Be afraid. Be very afraid.” And of course New Zealand First leader Winston Peters’ spats with Telecom heads have been the stuff of the front pages for some time now.
How much of all this is bluster and how much is backed up by substantial policy?
The Alliance seems to have gone into the most depth in terms of policy specifically targeted at Telecom. While Labour has produced a fairly weighty policy document, it’s couched mostly in terms of the entire market--although obviously drafted with Telecom very much at the forefront of policy makers’ calculations.
By and large, Labour seems to have taken a leaf from its counterparts in the United Kingdom--leave utilities in private hands, but regulate them strongly.
Alliance leader Jim Anderton has targeted Telecom specifically, damning the company’s profits as excessive. In the event of an Alliance government, Telecom will be given a deadline to reduce line rentals by at least 30%. If it doesn’t, the government will legislate.
Both Labour and the Alliance have a policy to set up an industry regulator, saying that no other country in the world does without such a telecomms watchdog, and that the absence is allowing Telecom to get away with, in Anderton’s words, “gerrymandering the system”. New Zealand First hasn’t stated yea or nay on a regulator, but its general approach suggests it would be comfortable with such a body.
New Zealand First is an interesting case. For all the criticism directed from its leadership at Telecom--especially at the fact that it is almost entirely foreign-owned--it doesn’t have a particular telecommunications policy.
Telecom is, however, very much in its sights on the issue of foreign ownership. The party’s policy on this is that no foreigners can own more than 24.9% of any “strategic asset”.
They don’t come much more strategic than Telecom--although precise definition of strategic asset is elusive, and no one knows at what point Clear, for example, might also fit into this category.
However, there’s no deadline for Telecom reverting to three-quarters New Zealand ownership. The New Zealand First policy is that if and when any shares in Telecom are sold by foreign owners, they must be sold to New Zealanders.
Which New Zealanders will have that sort of money? This is where the party’s compulsory savings policy comes in. This money, whether held by a government savings fund or by private superannuation funds, will be used to buy Telecom back.
Of course, many private funds are run by companies partly or wholly foreign-owned, and there’s no guarantee they would want to buy Telecom shares anyway. So that probably leaves the government-run fund.
Telecom is currently valued at about $13 billion, which is going to tax (pun intended) the resources of such a fund. It’s going to be intriguing to see whether, when push comes to shove, the New Zealand First policy has any real meaning here.
As for the parties of the right, National is obviously happy with the status quo, despite the odd backbench rumble. United has made similar vaguely disgruntled noises on wanting more progress on competition, but specifics are lacking at this stage. ACT gives every appearance of being even happier than National. And the Christian Coalition doesn’t have a specific policy, although it seems broadly happy with the present free market mix.
So the likely result is a leftish reining-in, or a rightish little-or-no-change.