Oct 12, 2012

Keane: time to sell at least part of Medibank Private

The government is obtaining a valuation of Medibank Private. It should put it to good use and sell off at least part of the company, because the Coalition's policy is right.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

For a government hell-bent on a surplus and running out of ways to secure it, it could do worse than sell a partial stake in its most successful company, Medibank Private.


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11 thoughts on “Keane: time to sell at least part of Medibank Private

  1. SBH

    so the smart thing would be to sell it and then neck the private health insurance subsidy and funnel the money back into actual health care rather than rent seekers

  2. Hunt Ian

    I find Bernard’s article confusing. The only consistent thread in it is that Liberal Party policy on Medibank private is correct. It is not clear to me why this is so. As Bernard points out, the government earns $800 a year from Medibank Private dividends. It’s sale price would have to deliver that guaranteed stream. After all, as Bernard points out, the private insurers are propped up artificially to provide “contestability” for corporatisation of Medibank. The whole artificially supported industry would then supply cream to private investors at the expense of the public. In these circumstances, the future earnings stream of Medibank Private is unlikely to be capitalised in its sale price. Let’s face it. The public is right to oppose privatisation, which has so often been an offer of a bottle to private investors to support the massive shift from wages to profits over the last twenty years up to the GFC.

  3. ianjohnno1

    Sell a good profitable concern?
    Privatise the profits and socialise the losses!
    When did you turn into a rabid capitalist, BK?

  4. fredex

    Bernard just go and join the Liberal Party or get on Murdoch’s staff at Ltd News because this charade that you are part of a team pushing “independent media independent minds’ is past tiresome.

  5. paddy

    I’m beginning to wonder what they’re putting in your drinks these days Bernard. You say
    ‘Voters, as we’ve seen again and again, can’t stand privatisation.’
    Which sort of suggests, that a Govt struggling in the polls 12 mths out from an election, might be wise not to cheese off the voters even more.

  6. John Bennetts

    How is a valuation of 3.5 to 5 billion dollars adequate compensation for the loss of an $800M per year cash flow? After 4 or 5 years and for ever thereafter, it would be a negative result.

    At the Government’s current cost of borrowings at just above 3%, that $800M compares with returns from $20+B.

    Chalk and cheese, Bernard.

  7. fredex

    Bernard has doubled up on his dubious claims.

    It seems the Press Gallery [all hail the Press Gang]is confident that the economy can be seen as a negative for the government and a postive for the COALition. They are of course partly right – it can be seen thus. Particularly if you ignore the economic realities and only see and hear the Press Gang and related cronies version and what they pass off as anal -ysis.

    So a new article is up on Crikey.

    “RBA now contols the next election [something like that].”

    No, it doesn’t.

  8. beachcomber

    Selling the banks, the airlines, the power companies, the water, etc has seen prices escalate, reliability and service fall. Why make the same mistake again?

  9. floorer

    Propaganda fed to me as a child/youth, Australia, the land of the fair go (more like be on your toes). Privatisation (amongst other things) flattened that little fairy tale.

  10. luc Anthony

    You must be high Bernard! To trade a short term gain for the loss of a never-ending and quite high income stream, that also has the benefit of creating a counter weight to potential price gouging by private providers is stupidity, and very poor government policy. (And we all know the gouging WILL happen: you need only look to the unit/housing insurance market in QLD).

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