Electricity consumers ‘will lose assets’

Press, 31 May 1986, Page 32

Electricity consumers ‘will lose assets’

PA Wellington Consumers will be stripped of their assets by the Government’s planned changes to the Electricity Division, says the Electrical Supply Authorities’ Association. The association’s vicepresident, Mr Eric Johnston, said the electricity generating and transmission facilities of the division belonged to the consumers who had paid for them, and not to the taxpayers.

Capital costs involved in establishing the facilities had been met by loans raised by the division and paid for by the consumers through their supply authorities.

“This is not an argument in semantics, it is a

fact which the Government has conveniently decided to overlook in its corporatisation plans,” he said.

The association was also concerned about the Government’s decision to tax surpluses or profits made by supply authorities.

"On the one hand we have the Government telling us to be more efficient and on the other we are being told that the Government will take a percentage as a result of our increased efficiency,” said Mr Johnston.

“Again we have the taxpayers reaping the benefits which by rights belong to the electricity consumer. Efficiency is obviously affected when profits are not channelled

back into the area from which they came.” The general manager of the Dunedin City Council electricity department, Mr Geoff McDermid, said that local authorities would be unfairly treated by the Government’s proposed tax on their energy trading profits. The arrangement would seem to discriminate unfairly against local authorities in that they had a number of trading activities other than in the energy field, some of which required substantial support, Mr McDermid said.

He called on the Government to look at its own departments and accept that they should pay the full share of local body rates.