The Finance Minister says KiwiRail, New Zealand Post and the country's public broadcasters will remain in state ownership despite him questioning their future.

Photo: RNZ / Alexander Robertson

Bill English told a conference on competition and regulation this morning that it was not hard to imagine those organisations becoming relics of a bygone era.

But he later said that was not a signal that the Government had any intention of selling them. Mr English said he was simply expressing concern that these were difficult businesses to run.

"The people who are running those businesses, New Zealand Post, KiwiRail's... another pretty challenging one. They're working very hard and we're in, you know, constant interaction with them over how to get the best value and how to compete in a world where it's pretty tough," he said.

Speaking at the conference organised by the Commerce Commission, Mr English said the Government had no business being in business.

He highlighted several areas that he said could benefit from either more competition or better regulation of monopolies, including council water supplies and electricity lines companies.

Mr English said he was "sceptical" of claims that because a community owned its own water supply, it would be efficient. He said lack of regulation or competition meant that a number of council-run water systems did not have any data on the quality of their assets.

Community-owned electricity lines companies also faced significant commercial risk as the cost of distribution continued to fall, and their owners could end up holding worthless assets.

"The risk here is partly around economic efficiency, but it's also about the destruction of community wealth... The Government knows about this because we own a whole lot of assets whose value is being eroded by competition and technology.

"It's slightly unfortunate that we own a rail company, a postal company, free-to-air broadcasters. It's not hard to imagine that before too long they are going to be relics of a bygone age."

Mr English said the Government was making progress in breaking up the state housing monopoly, but the other monopoly - the regulation of residential housing - was a bigger challenge.

He said a new area for the Government was introducing competition in government services. He said social services had been dominated by "good intentions and spending lots of money" with not enough emphasis on outcomes and changing people's lives.

In response to questions, Mr English said it was unfortunate that taxpayers' money was sunk into assets that were losing value.

"Why do you want us to keep owning broadcast media - it was worth a billion, it's worth $300 million today, and soon it will be worth nothing. Same with post offices - was worth a billion, worth $300 million today, soon be worth nothing.

"You know, it's a bit painful sometimes when you're Minister of Finance, watching this stuff happen."