TECT proposal could have negatives

Trustpower has raised concerns over the proposal by TECT to stop issuing cheques to customers from 2023. File photo.

The 58,000 households in the Tauranga and Western Bay of Plenty that receive the annual TECT cheque, are facing a historic decision about future payments that will have profound impacts on some customers, according to Trustpower.

Research shows 85 per cent of these households say the TECT cheque is important to them.

Trustpower chief executive Vince Hawksworth says the Tauranga Energy Consumer Trust proposal to cease TECT payments in 2023 could have unintended negative consequences for some customers.

“In particular, we're concerned about the impacts on superannuitants and low-income families who rely on this annual payment for budgeting purposes,” says Vince. 

He also says the rationale for change put forward by the trust makes no sense.

“We're not sure why the trustees are proposing such a dramatic, irreversible change. The electricity industry has been changing for 25 years, and Trustpower has proved to be a disruptive force in that. Changes in technology have been an opportunity for us; so much so we are now New Zealand's fourth largest telecommunications company.

“At the moment trustees are proposing a single option for radical change, which is strongly incentivised, whereas we think our local electricity customers deserve to better understand why the change is needed, and to choose from a wider range of options.”

Other options could include shifting a greater proportion of funds toward charitable distribution, he says.

“We believe there will be a range of community views. Some of our customers will be implacably opposed and will want to protect the cheque, others will see merit in rebalancing the distribution between customers and community.

“This is very important because customers are being asked to sign away their rights to annual TECT cheques for the next 55 years, which represents tens of thousands of dollars and is a very big decision to make.”

He says Trustpower has decided to actively participate in the consultation process, including undertaking research with its customers to better understand their perspectives.

“We're very keen to hear people's views on the issue and what they think should happen to the TECT cheque, and how Trustpower can best support them in ensuring their voices are heard.

“It is vitally important any final decision made by the trustees, following the proposed vote by beneficiaries of the Trust, is informed with a full understanding of the facts and the concerns people have with the option the Trustees are proposing.”

Trustpower was formed by the old Tauranga Electric Power Board and the Tauranga Energy Consumer Trust was established to hold Trustpower shares on trust for the benefit of Trustpower's customers in Tauranga and Western Bay of Plenty.

TECT ensures that Trustpower's local electricity customers own part of the business, and the TECT cheque ensures Trustpower's success is shared with its local electricity customers.



45 Comments

Trustpower oppose this for a good reason

Posted on 18-02-2018 21:06 | By NotNat

AND for once it is THE CONSUMER! Trustpower made a contract with tect for 50+ years of ongoing rebates for the shareholders of Trust power (power consumers are shareholders) in this area. TECT have only been loyal to this for 10 or so years, leaving another 40 years of TECT cheques/ rebates to the consumer aka the shareholder,And they are only offering you $2500 - some people have been loyal to TECT charity by purchasing their power rates with Trustpower for much longer than $ worth, in fact - If all of Trustpower and their consumers oppose the new proposal - you will be entitled, by contract between Trustpower and TECT to be payed out for an additional 40 odd years @ $300 min rebate per year - you do the math..Trustpower gifted TECT shares in the exchange for TECT staying loyal to the shareholder, YOU. Vote no change

Here’s a tip

Posted on 17-02-2018 19:45 | By Tgaboy

Leave Trustpower. They over charge their users way too much. Its laughable. We were with them. Then we switched to an alternative provider - rhymes with hercury. Our bills are way cheaper for same power used. Our savings are over and above the tect cheque we used to receive. Im sharing those because I hate the thought of this company making a profit and ripping off Taurangas people.

Trust the Trustees - Yeah Right

Posted on 10-02-2018 10:25 | By Yeah right

TECTs assets are held on behalf of Trustpower consumers - always have been it never was a community asset. Natalie and Amanda stood at the last election to protect the cheque, now they support its removal. Ron Scott is on record as wanting more of the distribution going to consumers and yet he is now supporting a proposal that sees only $200M given out to consumers and $600M put aside for Trustees pet projects. Bill when originally elected stood to protect the cheque, now not so much. Has anyone noticed that while these Trustees talk about the generous consumer distribution they don't talk about the $600 million they are keeping for pet projects when much more of that could be given out to those that helped build the asset.

@ ROCCO

Posted on 01-02-2018 17:06 | By MISS ADVENTURE

There is an obvious obstacle to the best plan for the community stake holders. Thise running it, name tagging it, getting the bronze name tag on whatever wont willing let go such free publicity and such mana as false created for the use of others monies for self gratification of ones own ego. So much could be better, so much wont be because of self interest

JUST DO IT -WIND THIS MISFIT UP

Posted on 31-01-2018 20:39 | By ROCCO

@astex you have basically nailed it as the shares have fallen over $2 IN PAST 2YEARS. Cash the lot in now pay all proceeds to the TECT consumers and the payment out would be closer to $15000 to each consumer.Conservatively invested that could be $600 interest per annum and you still always have control of the capital.............It is a no brainer

@ astex

Posted on 31-01-2018 14:32 | By MISS ADVENTURE

Agreed, a wise investor would not have got involved for the long term here. Especially that the TECT held shares have become a marketing tool for Trustpower about without any benefit to consumers for the money making curcuit that occurs. Where exactly is the benefit to Trustpower customers as even allowing for the TECT cheque, the power rates are huge so the net cost to consumers is more than others overall. What benefit to the wider community is there by returning 80% of the dividends received only to Trustpower customers? Isnt this meant to be a "Community" asset and so the whole community can benefit?

@ Willekers

Posted on 31-01-2018 00:44 | By MISS ADVENTURE

That would seem a little short sighted, the share price dropped 10% or so or some $40m. The payment of an extra one off payment of just $2,000 above usual is just $116m, The TECT assets are some $600m+ It seems to me that Trustpower customers will miss out on a huge win fall that should be some $10-12,000 each. Of course, most on what is in TECT, the vast majority will simply disappear into an obscure world of handouts to various schemes plans and creations that have caused way to much havoc for Tauranga Rateayers alone. This scheme will add some four times the amount of funds in the hands of mischief and nonesense makers who will decide all behind closed doors. One glaring issue also arises, who will be the trustees and how/when will they get voted in?

The problem

Posted on 30-01-2018 18:40 | By astex

The main fear should be that the government, at the stroke of a pen, could take back control of the power supply. That will leave all TECT shares with no value and therefore no more payments of any kind. With the pressure on government to act on power prices this is a real possibility. Best to cash in the whole lot and pay out to shareholders now.

A win for consumers and a lose for Trustpower

Posted on 30-01-2018 15:36 | By G. Willekers

The great unmentioned benefit of this is that Trustpower will have to reduce its prices to be competitive with other power companies here. At the moment Trustpower relies on TECT producing cheques so that Trustpower can charge hundreds of dollars more to Tauranga consumers. It might be difficult for some to understand but the big shareholders use Tect's cheque and gifting to their advantage and it doesn't cost them anything. Tect is the payer, not Trustpower or shareholders like Infratil. Mercury's price for a 3 to 4 person house quoted on switchme is $165 a month compared to Trustpower's $218. Taken over a year that's $636 more for Trustpower which more than covers your average Tect cheque. Trustpower can only charge more here because of the Tect cheque, that's why Trustpower will hate this proposal I think?

Better accountability needed from TECT

Posted on 29-01-2018 16:46 | By MISS ADVENTURE

Money should be returned to teh community as a whole, not just to Trustpower customers. Any money paid out as grants and so on should only be made to approved charities.

TECT setup strange?

Posted on 29-01-2018 16:45 | By MISS ADVENTURE

Where else in the world would a shareholder (TECT) give its investment returns back to and only to the customers of its Investment. This is a very strange setup.

Waiting for the story behind the announcement

Posted on 26-01-2018 16:50 | By Dollie

It's not only about being able to give more to community organisations. There's something else and it's probably financial.

Be afraid be very afraid of this bunch.

Posted on 26-01-2018 16:40 | By kellbell

@Condor @paul @Penny p @Rocco.Yep I too have grave fears here - just hope the Decoy Demon ain't thinking of ruling the roost again when gets DCM soon because we then will all know where the dosh will end up and I suspect the other turkeys have similar based intentions.

Absolutely correct.

Posted on 26-01-2018 16:26 | By ROCCO

Well said@paul you are on to it - this is not what it seems they are trying to blindside consumers with a cunning plan and will need no approval from anyone for their little ploys.^ Jackasses voting for their pets.

TECT cheque proposed theft

Posted on 26-01-2018 13:19 | By paul

I strongly oppose this proposed change driven by the elite trustees. If this is the direction they wish to pursue I recommend that TECT Charitable Trust be wound up and all shareholding in Trustpower be returned to the 58000 customers. We can then decide how best we utilise our interests, be it for personal or charitable disposal. I for one don't need an overpaid trustee trough feeder telling me what's best for me or my community. Wind it up and return the shares to the 58000 customers.

I know.........

Posted on 26-01-2018 10:15 | By groutby

..........we are overcharged for power compared to other suppliers, and for me the reason I stay is that I am rewarded in part with a "TECT" cheque, but it also removes my moral 'obligation' as a citizen of helping out organisations each year with 'TECT" to feel the need to donate throughout the year as I am already doing so via the Trust. I can swing either way at the moment but be assured if the proposal does go ahead, there will be a time when I log on to 'switchme.co.nz' or similar to get the best power price, which won't be Trustpower will it?

Hands off

Posted on 26-01-2018 09:44 | By Told you

If it arent broke leave alone, keep what we have now.

DO YOUR RESEARCH

Posted on 26-01-2018 09:29 | By PennyP

Why have TECT only given one option - do consumers know that if TECT wrapped up now and allocated each consumer a one-off payment that each consumer would be entitled to a payment of around $13,000 - $15,000 !!!!! This is very much different to the $2500 + $1800 worth of cheques over 5 years !!! TECT are not telling people the full story nor are they giving consumers any other options. TECT have very cleverly 'left out' that option. While $2500 sounds mighty attractive to those that are in need - wouldn't $15,000 be even more attractive - that's life changing for some people - SHAME ON YOU TECT!

STOP BLEATING-Good Riddance,

Posted on 26-01-2018 08:25 | By ROCCO

Trustpower motivated only by own self interest - dearest electricity provider around and TECT cheque is only small compensation.Anyway Consumers its your own shares that are paying it out and has nothing to do with Trustpower.Why not drag them kicking and screaming into the 21st Century and get them to stand on own 2 feet for a change without being propped up by the TECT dividend.Yes they will lose many customers because are greedy and overpriced.So be it.

The only winners

Posted on 26-01-2018 08:00 | By Christine1965

if the cheques are stopped are non Trustpower customers using community resources. Whats fair about that??

Keep the cheque

Posted on 26-01-2018 06:21 | By Angel74

if it goes i might consider changing power companies!!!!!!!!!!!!!! its a nice bonus at the end of the year and part of it goes towards my xmas shopping.

Who wins?

Posted on 26-01-2018 06:02 | By SheldonNesdale

With this change, community organisations get 3 times the money every year starting 2019 (think of all the people in need that will benefit from that), plus as a TrustPower account holder we get $2500 in our hands this year and contine to get $350 every year for 5 years. Plus the fund is future proofed from changes the Government might make to the electricity industry (imagine the fund being dismantled because of a govt decision instead of helping our community for the next 105 years!)

Who is it for

Posted on 26-01-2018 05:31 | By johnmcd03

The TECT Trust was put in place so we - the customers - own part of the business and should at least have a say on the future of the cheques. For a the board to announce this unilaterally is not acceptable. Maybe, an option of getting the cheque or not should be put to the customers to decide.

TECT

Posted on 25-01-2018 20:27 | By Kimberlee

If the Trustpower CEO is so concerned about the elderly and low income families then whydoes he not do something about it like lowering his charges in line with other power providers. The TECT proposal is fair, $2,500 lump sum and you still get a cheque for 5 years. Just think on what they can do to help our community with more funding. No doubt we all will be using one of these organisations sometime in our lives. GO TECT I am 100% for this proposal

A kick in the Teeth ....

Posted on 25-01-2018 19:54 | By Maryfaith

for Trustpower customers. "Trustpower was formed by the old Tauranga Electric Power Board and the Tauranga Energy Consumer Trust was established to hold Trustpower shares on trust for the benefit of Trustpower's customers in Tauranga and Western Bay of Plenty." Can the trustees legally carry out this move and go against the intention of the original Trust deed ? I think not!!

Wrong Move!

Posted on 25-01-2018 19:46 | By Maryfaith

People - especially the elderly rely on this cheque for budgeting purposes. A lump sum payment is not the same and will not cover living expenses in the long run. TECT will lose customers as people will shift their loyalty to another provider. TECT is owned by the citizens of Tauranga - it is not to be tampered with!!

Greedy

Posted on 25-01-2018 19:30 | By Capt_Kaveman

over paid leaches , antitrustpower are the most expensive even with the rebate

an interesting short term bribe

Posted on 25-01-2018 18:05 | By ow

Tect know better how to spend our annual cheque better than we do!

Tect Cheques.

Posted on 25-01-2018 18:00 | By rayjonalen

The old men who run Tect have already sold off many of the Tect shares. I wondered today why the massive drop in the price of my Trustpower shares. Now I know.

Watch

Posted on 25-01-2018 17:55 | By nerak

them leave in droves now, a country mile away from cheaper providers. Customer churn will be interesting. TECT cheque is no more than a reimbursement for what customers had overpaid annually being with TPW. But TPW continue to use it as a carrot.

Trustpower goodbye

Posted on 25-01-2018 17:48 | By waiknot

It will be time to shop for the cheaper power companies

If this proposal goes ahead

Posted on 25-01-2018 17:17 | By Astoreth

You can bet that there will be a LOT of Trustpower customers take their payout and promptly switch companies to one that is cheaper. That will spell the end of both TrustPower and TECT. The proposed change looks like a suicide bid to me.

i noticed

Posted on 25-01-2018 16:17 | By old trucker

them at a meeting this morning at a cafe,(maybe breakfast) gosh how they like to look important.my two pennies worth for what its worth,Sunlive is the BEST NEWS and WON BEST NEWS how AWESOME you are the BEST. keep up the stories when you can, Thankyou, 10-4 out. phew.

Charitable distribution

Posted on 25-01-2018 16:15 | By HMG

As a trust power consumer and superannuitant we should be at least somewhere very near the top of charitable distribution.

Business shakeup

Posted on 25-01-2018 14:20 | By papakiwi

If TECT is disbanded then Trustpower will be forced to reduce their power charges by a large amount as we all know that they overcharge on the basis that people will get the TECT cheque, and people will abandon Trustpower by the thousands as Power will be cheaper by other players.

Disingenuous

Posted on 25-01-2018 13:56 | By maildrop

He's only concerned for the future of Trustpower and his own job.

I like my annual cheque

Posted on 25-01-2018 13:54 | By backofthequeue

We've been Trustpower customers for nearly 20 years. The TECT cheque is a major factor in Trustpower retaining our business and I see no compelling rationale for change.

Don't be silly

Posted on 25-01-2018 13:52 | By Dazed and Confused

The maths is simple...Unless you believe in free money.There's guys are giving you back about 1/3 of what they over charge you during the year.Wow what a great deal

Protecting vested interests

Posted on 25-01-2018 13:11 | By bigal

Trustpower are only concerned about losing customers who stay with them for the TECT cheque

May be

Posted on 25-01-2018 12:43 | By Abobsworth

May be self interest by Trustpower here as they think they may lose customers.

May be

Posted on 25-01-2018 12:43 | By Abobsworth

May be self interest by Trustpower here as they think they may lose customers.

I vote the same - keep it as is!!

Posted on 25-01-2018 12:35 | By SML

The biggest concern is that "Tauranga Energy Consumer Trust was established to hold Trustpower shares on trust for the benefit of Trustpower's customers in Tauranga and Western Bay of Plenty." yet it is proposing a " rebalancing the distribution between customers and community".Well, excuse me, but much of the donations from TECT already go to the community, and a "rebalance" between "customers and community" would only take away from loyal CUSTOMERS and give to all the rest, who are using some other power/telecommunications organisation/s.How is this fair to the customer/shareholders' rights (which I've from from start) "Trustpower shares on trust for the benefit of Trustpower's customers in Tauranga/Western Bay of Plenty"??Who but the low income earner is going to turn down the immediate prospect of a $2,500 cheque, without being educated on the longer-term implications of giving up this Trust? DODGY!

Panic mode at TrustPower

Posted on 25-01-2018 12:01 | By MISS ADVENTURE

Obviously this happening, if approved (hard to see that it will be) would have a huge impact on Trustpowers customers, they will leave in droves.

There is more

Posted on 25-01-2018 11:23 | By The Caveman

to this proposal than is being disclosed !!

I vote..

Posted on 25-01-2018 10:59 | By Peaches

Carry on with the Tect Chq as it has always been.

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