Will the NSW government privatise the Port as Bligh has done in Queensland?

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Report from Daniel Hurst, Brisbane Times 11.11.10

The Bligh Government faces a “day of reckoning” at the next election when voters give their final verdict on asset sales, Treasurer Andrew Fraser says.

Mr Fraser made the comments after signing a $2.3 billion deal to lease out the Port of Brisbane for the next 99 years, the second transaction in the government’s controversial suite of asset sales.

The state opposition yesterday questioned the value of the deal in restoring the state’s finances, saying the proceeds would be eroded by a $1 billion drop in expected GST revenue over the next four years.

The winning consortium, Q Port Holdings, has agreed to pay $2.1 billion for the 99-year lease and will also shoulder the $200 million cost of upgrading part of the Port of Brisbane Motorway.

The state government is currently in the process of floating rail freight operator QR National on the stock exchange and earlier this year sold Forestry Plantations Queensland for $603 million.

Mr Fraser said a long-term lease of Abbott Point Coal Terminal would be negotiated in the first half of next year and the Queensland Motorways tolling business transaction would be completed by early 2012.

The Treasurer would not say yesterday whether he believed public opposition to asset sales would change as the transactions were completed, but said voters would ultimately decide at the election due in 16 months.

“What I do know though is that people would be opposed to us stopping the building program, and throwing 100,000 people on the scrapheap; people would be opposed to us cutting subsidies to pensioners and other vulnerable members of society; people would be opposed to us putting wage freezes on police and ambulance officers and nurses; people would be opposed to us slashing public services,” he said.

“In the end, there’s no pretty choices here. What we did as a government was take choices that were the right choices and we’ve had to courage to stick by those.

“We are building a recovery but we’re not out of the woods yet as [the GST revenue write-down] showed, and that’s why it’s vitally important for us to stick to our plan, and there’ll be a day of reckoning in March 2012.”

The government continues to battle public opinion over its asset sales program, from which it hopes to raise up to $15 billion – a figure the opposition doubts.

Opposition Leader John-Paul Langbroek said public anger would not subside after the assets were sold.

“I think it just solidifies the anger from the people of Queensland, wherever I go, about a government that is clearly not listening and is continuing with the path they’ve set,” he said.

Mr Langbroek said his party continued to oppose the assets “fire sale” but would not try to reverse any completed transactions if it won government.

The government last year tentatively estimated the value of Port of Brisbane at $3.5 billion, although land and bundled motorway upgrades were later excluded from the process. The expected sale price was revised to a range of $2 billion to $2.5 billion.

Mr Fraser said the total $2.3 billion deal signed yesterday provided “value for money” for taxpayers, noting it included a motorway upgrade that would otherwise have been funded by the government.

It would also save the government an additional $1 billion in future infrastructure expansions.

The winning consortium is made up of Global Infrastructure Partners, Industry Funds Management, Queensland Investment Corporation and the Abu Dhabi Investment Authority’s Tawreed Investments. IFM and QIC are also shareholders in the Brisbane Airport Corporation.

The government will retain ownership of the Port of Brisbane land, wharves and multimodal terminal, but the responsibility and expenses of operating the port would be transferred.

Mr Langbroek said voters did not support the asset sales and the government needed to stop spending more than it earned.

“And the worst thing [is] that half of the proceeds of this sale have already been zapped, gone, because of the cut to the GST [revenue] that was announced today by the Premier and the Treasurer,” he said.

Mr Langbroek has accused the government of sending mixed messages over asset sales, by linking privatisation to the continuation of the infrastructure building program.

However, Premier Anna Bligh last week told brisbanetimes.com.au all of the privatisation proceeds would go into retiring debt, which would in turn “free up” the budget for other purposes.

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