The
Airport sale continues to attract sporadic comments. After reviewing the deal,
there doesn’t appear to have been any gross breaches as has been alleged by
some. Just a series of events that were beyond the usual experiences of
most of the participants. The Govt did ok, by default rather than good
management although they’ve been terribly evasive. Lennon’s legacy. Some
of the proceeds may eventually return to RBF should the airport investment
disappoint and lead to an increase in the unfunded superannuation amount
required to be paid by the Government. Parliament provided little scrutiny, the
Libs dithered and the Greens went searching for the sensational headline. RBF
probably paid way too much and have been too defensive as if trying to hide
something. The paper shufflers did handsomely out of the deal.
What
is interesting is it provides a good example of how privatisation works and how
the Macquarie model operates. At a macro level Governments may receive a cash
boost, but from an overall social viewpoint, total debt simply increases. And
that is what has brought the world to its knees.
Super
funds’ investing in heavily geared entities is a recent phenomenon. Fortunately
the glory days for such behaviour appear to have come to an abrupt end.
Trustees were under pressure to emulate their peers whose performance was
boosted by forays into unlisted geared entities.
Trustees
although not bound by the continuous disclosure requirements of listed
Companies, nevertheless owe it to their Members to keep them informed. It is
not evident that RBF has done this with unlisted investments. By their nature
unlisted entities tend to be a little more secretive.
