The Age’s Stephen Bartholomeusz has today come to the defence of the government over the T3 sale after this Crikey story on Tuesday pointing out that investors have made a quickfire $3 billion or 35% in just four weeks.

It was a typically considered argument from Bartho which concluded as follows:

Thus it is too simplistic to argue that the Government has gifted taxpayer value to private investors by selling more of its shares than originally planned – it is the interaction between the T3 process and structure, Telstra’s own performance and the macro influences that have emerged that are responsible for Telstra’s share price performance. Take any of those influences out of the equation and it is likely the Telstra price would be lower than it is today. The bottom line is that earlier this year the Government had a Telstra shareholding valued at just under $22.5 billion. Post-T3 it has $8.6 billion of cash, is owed $6.9 billion by T3 investors and has a Future Fund holding worth about $8.6 billion. Even with the time value of the second instalment and T3 costs included, it will be $1 billion in front of its starting point.

Yes, but how much more would the government be in front if they had stuck with the original plan and sold just 2.15 billion shares rather than doubling it to 4.3 billion? Bartho himself notes the internal debate this caused:

Even in the days leading up to the final decision on the number of shares to be sold and their pricing, there were fierce arguments among the Government’s various advisers about that price/volume mix and, until the final 48 hours, it looked like those arguing for a smaller sale would prevail.

The decision to double the sale was, in hindsight, a bad one. It also opens the door for a fascinating scenario going into the Federal election. What would happen if a shareholder activist gathered signatures from 100 Telstra shareholders and called an EGM proposing to remove the PM’s mate Geoffrey Cousins as a director?

The hand-picked Future Fund guardians would have to decide how to vote their 17% but it would probably not be enough to save Cousins if the Telstra board maintained its opposition given that the independent shareholders voted only 239 million shares in favour and whopping 1.73 billion against at last month’s AGM.