Energy shares sell-off delayed

Officials will now spend more time consulting indigenous Maori, who had threatened legal action to halt the sales.

Mr Key insisted that the delay would be only for a few months and he didn't expect any substantive changes to the plan to sell minority stakes in four state-owned energy companies and Air New Zealand.

The government hoped to raise up to $7 billion NZ (£3.5bn).

An initial public offering of shares in electricity company Mighty River Power, which was to take place later this year, will now wait until March 2013.

The sell-off was part of the ruling National Party's recent re-election campaign, although many New Zealanders opposed it, labelling it selling the family silver.

A Maori tribunal recommended last month that the government should delay the sales until claims over water rights could be resolved.

Maori are guaranteed water rights under the country's founding Treaty of Waitangi.

But energy companies rely on water because New Zealand's power is mainly generated by hydroelectric dams.

The Maori Council welcomed the decision, calling it a "great result," but others disagreed.

"National has botched this process from the beginning," said opposition Labour Party leader David Shearer.

"It had no choice but to delay the sale of Mighty River Power.

"There is now so much uncertainty that no investor is going to want to touch it.

"Selling our best performing assets at rock-bottom prices is economic lunacy."

foreigneditor@peoples-press.com