Electricity privatisation in Queensland

I’ve just released a report I prepared on electricity privatisation in Queensland[1] This was a bit difficult given that the Costello Commission’s proposals have been announced with great fanfare, but the supporting analysis is so secret that even Campbell Newman claims not to have seen a copy. This Courier-Mail story by Paul Syvret gives the basic points

The report is online here.

fn1. It’s partly a followup from my previous response to Costello’s Interim Report. As in that case, I’m not getting paid for this, and it’s entirely my own work. So, it’s not as polished as the Costello report will doubtless be when it comes out, but I can confidently say it’s better value for money for the Queensland public.

55 thoughts on “Electricity privatisation in Queensland

  1. Ikonoclast :
    @malthusista
    Privatisation of natural monopoly infrastructure and strategic infrastructure (these being overlapping sets, not identical sets) leads to all of the following problems;
    (a) loss of social income, equity and wealth in common;
    (b) concentration of wealth in few hands (corollary of point a);
    (c) loss of accountability;
    (d) loss of transparency;
    (e) loss of regulative control;
    (f) increased risks to the public (corollary of c, d and e)
    (g) creeping loss of strategic control of all aspects of national governence; and
    (h) in a democracy point g is equivalent to a creeping loss of democratic control and its replacement by corporate and oligarchic control.

    a) Increase in revenue from sale, with the sale price equalling net present value of expected dividends, efficiency gains and any monopoly rents
    (b) Concentration of wealth in many hands because the majority of share market is owned by superannuation funds and other vehicles of pension fund socialism
    (c) Increased accountability through threat of bankruptcy and takeover
    (d) Increase in transparency because of the daily share price encapsulates the fortunes of the company
    (e) Increased regulative control because of not conflict between government as owners and dividend recipient and government as regulator
    (f) Reduced risks to the public because enterprise is run on the basis of private profits AND private losses and no more bailouts
    (g) Increased strategic control of all aspects of national governance because of less conflict between commercial ownership interests and public interest
    (h) In a democracy point g is equivalent to greater democratic control replacing bureaucratic control with public accountability

    • Do you dispute that the annual rate of return on the portfolio of New Zealand’s state owned enterprises was zero in 1984?
    • Do you dispute that the NZ government is bailing-out the state owned mining company
    • Do you dispute that the book value of Kiwi rail was written down from about $600, the purchase price, to $1.

    If the annual rate of return on the portfolio of New Zealand’s state owned enterprises was zero in 1984, and is still below the long-term government bond rate, the revenues from any privatisations were windfalls.

  2. Ikonoclast :
    Privatisation of natural monopoly infrastructure and strategic infrastructure (these being overlapping sets, not identical sets) leads to all of the following problems;
    (a) loss of social income, equity and wealth in common;
    (b) concentration of wealth in few hands (corollary of point a);
    (c) loss of accountability;
    (d) loss of transparency;
    (e) loss of regulative control;
    (f) increased risks to the public (corollary of c, d and e)
    (g) creeping loss of strategic control of all aspects of national governence; and
    (h) in a democracy point g is equivalent to a creeping loss of democratic control and its replacement by corporate and oligarchic control.

    a) Increase in revenue from sale, with the sale price equalling net present value of expected dividends, efficiency gains and any monopoly rents
    (b) Concentration of wealth in many hands because the majority of share market is owned by superannuation funds and other vehicles of pension fund socialism
    (c) Increased accountability through threat of bankruptcy and takeover
    (d) Increase in transparency because of the daily share price encapsulates the fortunes of the company
    (e) Increased regulative control because of not conflict between government as owners and dividend recipient and government as regulator
    (f) Reduced risks to the public because enterprise is run on the basis of private profits AND private losses and no more bailouts
    (g) Increased strategic control of all aspects of national governance because of less conflict between commercial ownership interests and public interest
    (h) In a democracy point g is equivalent to greater democratic control replacing bureaucratic control with public accountability

    • Do you dispute that the annual rate of return on the portfolio of New Zealand’s state owned enterprises was zero in 1984?
    • Do you dispute that the NZ government is bailing-out the state owned mining company
    • Do you dispute that the book value of Kiwi rail was written down from about $600, the purchase price, to $1.

    If the annual rate of return on the portfolio of New Zealand’s state owned enterprises was zero in 1984, and is still below the long-term government bond rate, the revenues from any privatisations were windfalls.

    note: re-post of post in moderation because of hyperlinks

  3. Privatisation of Queensland Electricity Assets: A Preliminary Evaluation

    The report by past Federal Treasurer Peter Costello of his supposedly independent investigation into Queensland State finances on behalf of the Queensland Government Commission of Audit recommended the full privatisation of Queensland Government’s electricity generators. Only last year, the Queensland public, outraged at the asset fire sale embarked upon by former Premier Anna Bligh without any electoral mandate whatsoever from the 2009 state elections, savagely punished Labor at the ballot box leaving only 7 sitting Labor members in a house of 89.

    That, less than a year after, the new Government of Campbell Newman has contrived an excuse to continue with policies, that have been so resoundingly repudiated by Queenslanders, provoked outrage. An example of the outrage felt is a new opinion poll taken by news.com, which shows that Qld privatisation [is] opposed by 85%: poll.

    Professor John Quiggin of the University of Queensland responded on 6 March with a post on his web site. That post included a link to a pdf report which, by examining the disastrous history of privatisation across Australia in recent decades, comprehensively demolishes the case for any privatisation.

    In fact, much of the ground covered by Professor Quiggin has also been covered by candobetter.net and, before that, the site citizensagainstsellingtelstra.net. I realised that Professor Quiggin’s pdf document could be made so much more useful if it were reformatted from pdf into html so that it could be directly linked to other material on the Internet which is also against privatisation, particularly on candobetter.net. This document is the result of that work.

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