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Asset sale down to the power of one

Brian Robins and Alexandra Smith
August 22, 2008

THE Opposition Leader, Barry O'Farrell, is under growing pressure to show his hand on power privatisation after the Auditor-General backed Morris Iemma's plans to sell electricity assets.

The move prompted the Premier to call MPs back from their winter break to vote on the sale as early as next week.

While supporting the broad thrust of the power asset sale, the Auditor-General, Peter Achterstraat, said yesterday he wanted the Government to sell the electricity retailers and generators at the same time, and not sequentially, as planned. As well, he wants a "floor price" set for each asset to be sold.

The Opposition had demanded the Auditor-General review the planned sale and maintained it would support privatisation if it was given a clean bill of health.

But yesterday Mr O'Farrell refused to state his position on the report. "Morris Iemma is desperate to get an early decision because his political future hinges on it," Mr O'Farrell said.

Even with the report in hand the Opposition would not make its decision on the sale until immediately before Parliament next sat, Mr O'Farrell said.

"You only get one chance to sell a state asset," he said.

Mr Achterstraat also indicated in his report that the lack of clarity on the price of carbon will prevent potential bidders from coming forward until legislation for the Federal Government's emission trading system is disclosed this year.

"Apart from a few matters that we feel could be swiftly addressed, we found no major issue with the sale/lease arrangements proposed by the State Government's advisers," he said in his report.

The Premier was forced yesterday to concede that some of his rebel MPs still did not support the plan and were prepared to cross the floor of Parliament in any vote.

Mr Iemma stepped up pressure on the Opposition by moving to recall Parliament early. Parliament was not due to resume until September 23.

"No double-Dutch, plain speaking, tell the people what you stand for. It's time he [Mr O'Farrell] comes clean … have the courage to state a position," Mr Iemma said yesterday.

Business lobby groups yesterday also called on the Opposition to support the sale.

"There's no wriggle-room left for the doubters," Patricia Forsythe, the executive director of the Sydney Chamber of Commerce, said. "The Parliament of NSW has a clear responsibility to pass the legislation to ensure that the economy of NSW is on a firm footing for the future." The secretary of Unions NSW, John Robertson, said the Government should abandon privatisation. "Over 85 per cent of people are still opposed to the privatisation of electricity, and we now want the members of Parliament to start listening to the people of NSW. The Government has no mandate for this," he said.

The ALP backbencher Paul Pearce, who is opposed to privatisation, said that even with the Auditor-General's report, "nothing's changed" on the issue.

Another Labor opponent, the Menai MP Alison Megarrity, also refused to support the sale plans, saying she needed time to consider the report, and Left MPs such as Ian West and Sonia Hornery are also understood to be sticking to their decision to oppose the sale.

No Liberal or National Party MPs attended a briefing of MPs by the Auditor-General yesterday. Shadow cabinet members were in Camden for a previously scheduled meeting, but no others bothered to attend.

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