New South Wales Election Renews Debates on Privatisation of Public Assets

Treasurer, Matt Kean speaks during a press conference in Randwick in Sydney, Australia, on Oct. 18, 2021. (Brendon Thorne/Getty Images)

The New South Wales (NSW) state election is heating up, with politicians from the incumbent government and the opposition party butting heads over the privatisation of state-owned assets.

On March 9, NSW Treasurer Matt Kean rebutted Labor’s allegations that the state’s residents had to bear higher energy costs due to the privatisation of electricity distribution company Ausgrid and Endeavour Energy, which is responsible for operating the NSW electricity network.

Citing data from the Australian Energy Regulator, the minister said residential network charges fell from $973 in 2014-2015 to $722 in 2022-2023.

“Network charges have fallen by 26 percent for the average household and 49 percent for the average small business since the long-term lease of Ausgrid and Endeavour,” he said.

“(Labor leader) Chris Minns has been lying to the people of NSW, and now his grubby scare campaign that asset recycling raises customer bills is taking on water when you look at the cold hard facts.”

The NSW Coalition party had proposed privatising the state’s energy network during the 2015 election to fund new roads, public transport and education infrastructure.

After coming to power, the Coalition government carried out the plan and leased out 50.4 percent of Ausgrid in 2016 and 50.4 percent of Endeavour Energy in 2017 for 99 years each.

The proceeds from the privatisations were $16.2 billion (US$10.7 billion) and $7.6 billion, respectively.

Opposition’s Response

Opposition Energy Spokesman Jihad Dib said the figures did not represent the real picture and that the treasurer ignored rising energy prices as well as further forecast increases in 2024.

“Matt Kean must live in a parallel universe if he’s trying to convince people that energy prices have gone down,” Dib said.

“He can use whatever spin he likes, but the fact of the matter is, people are paying more since privatisation.”

In addition, Dib alleged that the Coalition government was preparing to privatise Essential Energy, a state-owned energy infrastructure company.

Meanwhile, Minns raised concerns that the NSW government might sell off the under-construction Western Harbour Tunnel to deal with the budget deficit, which is expected to reach $7.1 billion in 2023-2024.

However, Metropolitan Roads Minister Natalie Ward dismissed the idea of selling the tunnel, saying it was a “scare campaign” promoted by Labor.

NSW Premier Says No to Further Privatisation

The debates come after NSW Premier Dominic Perrottet announced in late February that his government would stop privatising public assets if it were re-elected.

“I’ve said we’re not privatising assets. I can’t be clearer,” he said, reported the Australian Broadcasting Corporation.

“What I have said is we have an economic plan. We have a sustainable and manageable debt position here in New South Wales because of our management over our time in office.”

NSW Premier Dominic Perrottet addresses media at Smalls Road Public School in Sydney, Australia, on June 22, 2022. (AAP Image/Dan Himbrechts)

The announcement was a reverse of the premier’s previous standing on the issue several weeks earlier, where he did not rule out privatisation as a solution to funding major infrastructure projects in the state.

For instance, at the beginning of the state election, the premier left the door open to the plan to sell Sydney Water, a state-owned corporation responsible for providing potable drinking water, wastewater and some stormwater services, to get extra funding.

“Progress wasn’t made by taking things off the table,” he said during a debate with Opposition leader Chris Minns in February.

“Money doesn’t grow on trees. You’ve got to make the tough decisions.”

Later, the Coalition clarified that it had no plan to sell Sydney Water following a television ads campaign by Labor that criticised the government for its privatisation of state-owned assets.