How amusing to see repeated references to having not lost the money spent on recapitalising Air NZ as a reason why SOE's need not be partially privatised to be successful. First, Air NZ is listed. Its legal obligations to its minority private investors have been a defence against being forced by political masters to do stupid things, like maintain uneconomic services, or to give in to union bullying.

But more importantly:

a) private ownership saved us taxpayers from the inevitable after the Aussie government reneged on the open skies agreements, and sank Air NZ's Ansett strategy (which may well have been a dog even without Federal Minister Laurie Brereton's perfidy). Instead, those losses were borne by the private investors who held the "silver" at the time, including the Singaporeans who controlled Brierley Investments. These were not the only silver we saved. For example, Sir William Birch's hated sale of central North Island Forests gave taxpayers around $2bn. Most of  that was then lost by buyers Fletchers',  Brierley and a Chinese Government investment vehicle.

b)   claiming that government ownership is responsible for Air NZ's success characteristically ignores the real reason why some businesses soar and others crash, even in hard industries where more fail (or suck in capital for little return) than succeed. The real difference is leadership. We taxpayers may owe most of our Air NZ thanks to two outstanding Chief Execs, Ralph Norris and Rob Fyfe, and the Chairman John Palmer.

Leadership can of course emerge and flower in many kinds of organisation. SOEs, co-ops, armies, departments and partnerships can be brilliantly led. As in most things in life, the differences among the different structures are in likelihoods. The conflicting motives that bedevil political appointment processes and the frustrations of having political masters does not drive away all talent. Nor does private ownership guarantee prompt replacement of incompetents, or eliminate misuse of corporate assets.

The difference is just in the comparative likelihood of incentives being aligned with high performance, and with managerial scope to be bold, and with pathology being rooted out promptly.  Even a small difference in the likelihood can make a huge difference in the culture, and in outcomes, over time and over many cases.