Following yesterday’s release of the NSW Auditor-General’s report “Oversight of Electricity Industry Restructuring”, the Iemma government has recalled the parliament early, for Thursday August 28, to try to ram through the privatisation.
The Auditor-General did not help MPs make a decision because, he claimed, “he was not asked to form a view on whether or not the electricity restructuring should occur”.
The Auditor-General’s effort was severely criticised by Prof Bob Walker and Betty Con Walker, who are experts on privatisations in NSW and on state government finances.
Basically, the Auditor-General did not come up with his own estimates of the prices likely to be received from sale, compared with the value of keeping the electricity system in public ownership.
However, he did report that the publicly-owned assets now earn about 25% on their current value to the taxpayer, and that the generators provide 30% of the National Electricity Market, and that the retailers provide 33% of the retail part of the NEM. In other words, these are very valuable and important public assets.
The Auditor-General did confirm the fear that Premier Iemma and Treasurer Costa intend to have a ‘fire-sale’ because he revealed that no work had been done by the government to establish a ‘reserve price’. Of course, he also failed to estimate a ‘reserve price’ at which it would be better to keep the electricity system in public ownership.
The Auditor-General also confirmed that the proposed National Emissions Trading Scheme would have a big impact on the price that Costa might get for the electricity assets. However, it is unlikely that the Rudd government will get legislation on this through the federal parliament until well into 2009. A NSW Treasury strategy document advised that any sale of the generators be delayed until the Emissions Trading Scheme is clear.
The overall picture is one of a fire-sale, like the disastrous sale of the State Bank of NSW where there was a real loss of about $2.5 billion, in the 1990s! No ‘reserve price’, no clear idea how to calculate a ‘reserve price’!
The politics
Premier Iemma is trying to tell the Coalition Leader, Barry O’Farrell, that he must now vote for the privatisation because there is an Auditor-General’s report that says it is okay. O’Farrell needs to be told loud and clear that the report does not make it ‘okay’.
For now, O’Farrell recognises this and is holding firm.
Premier Iemma is going after Coalition votes because he doesn’t have enough Labor votes to pass the privatisation. This is his major problem – his own party is strongly against the privatisation, and so are 85% of the entire voting population of NSW.
What you can do
- In this next six days, contact your local Member of Parliament and Upper House members who live near you. You can find all their contact details at the NSW parliament website, and the link is here to the Lower House.
- Write a short letter to the editor saying that the Auditor-General’s report indicates a fire sale is underway without adequate information about the ‘reserve price’ and about the greenhouse gas impacts:
- Log on to the union website that opposes the privatisation, and send an email to every MP – www.stoptheselloff.org.au
All of us can make a difference!
No comments:
Post a Comment