What Do We Think?

4 Dec

At least it is not another wind farm but I am concerned about the money being spent by our Council Controlled Organisations and their many subsidiaries.  I don’t know all the in’s and out’s of business arrangements but I do know what ‘uncalled capital’ is.  Given our CCO’s have a significant $ figure hanging over the ratepayers head, I would prefer a more cautious approach.  The dividends better be good ’cause it’s not like this investment is employing Southlanders.

Here is a link to EIL’s annual reports given they lent the money to this venture.

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One Response to “What Do We Think?”

  1. Phil T December 5, 2015 at 8:55 am #

    Its and interesting debate. I don’t see why anyone should be allowed to use my money or property to underwrite anything and the whole argument that councils should own companies to offset rates is wrong. Not one person has ever put up a spreadsheet on a wall showing any clear benefit to anyone apart from the directors. In fact far to often councils have used the COC to do nothing apart from generate directors fees as is the case in Invercargills property company.
    There is not one good reason why there was ever a need to form such a company and all the management is being done inhouse anyway. The same could be said for the airport company which has just become a top heavy structure strangling the airports cash flow.
    Councils around NZ are coming under pressure to pull their heads in and get back to their core role rather than use their positions to create huge debts buying things most commercial operators steer well clear of.
    However as long as you have people making as much as some are out of these companies little will change as its all just to easy for them. And a shrewd council manager will allocate directorships in just the right places to make sure the boat doesn’t get rocked too violently.
    The other thing that is far to easy is the fact all these directors avoid and transparent scrutiny of their or their companies performance as would normally happen in the commercial sector where they have to front the shareholders at an AGM

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