Posted by & filed under Advanced Accounting, Canadian governments.

Description: Asset Recycling is a fancy phrase  Canadian  governments are now using for what we used to call privatization – another invented word that grated on many when it entered the vocabulary. Asset recycling means that governments will sell off older ‘legacy’ capital assets – like in Ontario’s partial sale of Ontario Hydro – in order to obtain cash for other infrastructure projects. Part of the demand is driven by pension funds searching for returns given today’s low interest rates. Ottawa appears to be next in line for this recycling program, despite the warnings that the federal government may lack the expertise to negotiate good deals when selling off assets citizens have already paid for.

Date: October 7, 2016

Source: theglobeandmail.com

Link:

http://www.theglobeandmail.com/report-on-business/rob-commentary/executive-insight/government-asset-recycling-must-prioritize-public-good/article32300588/

Discussion Points:

1) What do you think about this strategy to sell off assets to provide for new ones?

2) How would a government have to account for ‘asset recycling’ in its financial statements?

3)  What sort of skill sets will the government negotiating teams require in order to protect citizens’ interests?

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