Govt $2bn short in power sale: union

THE state government’s sale of its electricity generators could raise as little as $1billion for infrastructure spending, once liabilities and costs are deducted from the proceeds, the Electrical Trade Union said.

The government said it would raise up to $3billion on the sale of generators including Hunter power stations and power station development sites.

But the union argued the generators’ current debts totalled about $1.5billion, and the sale could incur a further $500million in transaction and legal costs.

Premier Barry O’Farrell said the government won’t sell the generators for less than their value, and is acting on the recommendation of the Tamberlin inquiry into the former Labor government’s partial privatisation.

‘‘We’re not intending to sell for less than good public value, there’s always a floor price on these things,’’ he said.

‘‘But the commission of inquiry was clear, the recommendation was that the generators be sold.’’

Greens MP John Kaye said the sale would be a ‘‘double whammy’’ for the Hunter, leading to job losses for power station workers in the region and higher  bills for residents.

The Australian Manufacturing Workers Union said there would also be flow-on effects for maintenance contractors.

Treasurer Mike Baird said the government had ‘‘engaged the unions to develop appropriate employee protections for this transaction’’, including a four-year job guarantee for permanent workers.

‘‘We also expect any new owners of the generating assets will be keen to retain their expertise and experience,’’ Mr Baird said.

He said scoping studies the government  commissioned  supported the $3billion valuation, and transaction costs would be lower than for Labor’s partial sale.

‘‘At the same time, the state will also save around $1billion in avoided ongoing operations and refurbishment costs, and potentially save a further $6billion to meet future generation capacity needs,’’ Mr Baird said.  with AAP

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