NSW power privatisation dead: any life in Iemma?
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By the time you read this, the NSW Legislative Council will have killed Premier Morris Iemma and Treasurer Michael Costa’s legislation to privatise the State’s electricity industry by a wide margin. That’s provided upper house President Peter Primrose calls a division and doesn’t simply let it be decided on the voices — which would save the embarrassment of Labor MPs who support ALP policy being captured on film crossing the floor to oppose their own government. When this morning’s Coalition joint party room meeting voted unanimously to oppose the legislation on the grounds that it did not meet their “public interest” test, the planned sell-off was a dead duck. The utter failure of the power sale project can be sheeted home to two people — the Premier and his Treasurer. They had a golden opportunity to persuade the NSW ALP, Unions NSW, their backbenchers and the general public to support a plan to raise billions of dollars to help repair old infrastructure and start new projects. Instead, they behaved like old-style political bosses issuing orders, cracking the whip, shouting down opponents and threatening them. Even with the Sydney media in full throat backing the Thatcherite “solution” to the state’s energy needs, they failed to sell their message anywhere outside the city’s Central Business District. What gives today’s parliamentary defeat a seismic quality is that Morris Iemma and Michael Costa both placed their credibility on the line for privatization. They raised it to a matter of confidence in them. Iemma’s premiership is now in ruins: it is completely lacking in credibility, and it is difficult to know how long he can continue in the job. If Costa had any sense of the proprieties of public life and the Westminster system, he would be submitting his resignation later today. Costa came to parliament with the specific intention of becoming treasurer and succeeding Michael Egan. He wanted to achieve power privatization where Egan failed. In the next few days, Iemma will announce his much-postponed reshuffle. There is some evidence he take the opportunity to dump the widely unpopular and divisive Costa and replace him with Planning Minister Frank Sartor or Education Minister John Della Bosca who is coming back from suspension if, as expected, he is cleared of any offences arising from the Iguana’s restaurant fracas on June 6? But if he is removed from the Treasury portfolio, Costa doesn’t have the personality to accept demotion. He’d rather move to the backbench. He became a member of the upper house on November 21, 2001, and he is entitled to his taxpayer-funded parliamentary pension after he has served seven years — that’s in 11 weeks’ time. He’s likely to stay in parliament until he is entitled to draw down his fully indexed lifetime pension which is estimated to be around $130,000 a year, and then head to the investment banking world where his former political patron, ex-premier Bob Carr, is esconced at Macquarie Bank. Maybe Babcock & Brown could pick him up or the Fairfax board? The end game of this political drama is yet to be played out. Costa is a goner, but what will they do with Iemma? |
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11 Comments
So Barry O’Farrel finally grew a backbone and did the right thing. Good on him. Iemma should be gone by Christmas. Sad about Michael Costa-I expected so much yet he’s the biggest disappointment since that other phoney-Bob Carr.
Hillary?
Just for laughs, this saga has now been drawn out for another month! Delayed until September 23. That’s a long time to leave a lot of people sharpening knives.
Costa goes if electricity stays private. Where’s the downside?
NO WAY, NO HOW, NO SELLOFF!
Sack Iemma & Costa NOW!
Iemma and Costa were supporting a policy the believe in. The left of the ALP were similarly opposing this because they actually believe in what they were doing. The Nationals were opposing because they don’t want to give a wedge to Oakeshott before the Lyne by-election. O’Farrell and thr Libs are opposing a policy they support.
Goodnight NSW Cabinet
http://www.youtube.com/watch?v=2Ae4oCXsjXY
NO WAY, NO HOW, NO SELLOFF!
Sack Iemma & Costa NOW!
The news tonight that this pair is ‘powering’ on with the sale has gone beyond the extreme. Now that the public service has replaced merit appointees for party-sympathisers, is it any wonder we’re seeing flaws at every level of governance. Our political parties endorse the most average and questionable individuals such as Iemma and Costa … (Orkopolous, Rose, D’Arcy, Purcell, Buswell etc) who in turn select party-sympathisers to foster policies that run our economies and lives. These are people who’d struggle in mainstream employment, yet their allowed to drive our health, education, transport and general economic and social welfare via a party vehicle. I’m all for democracy, but tonight the manic Costa and dozy Iemma rang alarm bells. Parties have an obligation to filter and vet their members very closely particularly those running for office. How Iemma and Costa ever passed an IQ/EQ or general medical test I’ve no idea. But the electorate should.
Public, sorry. Private electricity is stupid. As are private roads, private hospitals and private education.
The thing I’ve never really understood about this sell off is Costa’s ranting about how irresponsible it would be to block the sale, that NSW needs the money for new infrastructure. The question for me is “why isn’t there any money?”. They’re running a business and should know that infrastructure needs to be replaced at some time, so why not put some money away or just borrow like every other business?
It shatters Costa’s credibility as a Treasurer. What was he going to do next year? Sell the Harbour Bridge? If he can’t manage the biggest economy in the country to include a revenue stream for infrastructure replacement he’s virtually incompetent. I won’t miss him. He looks funny too.
NSW desperately needs new infrastructure. That’s something that everyone agrees on. The problem is really something which Costa has inherited from previous governments, Labor and Liberal - failure to plan properly, and failure to budget appropriately for infrastructure augmentation. Questionable management of existing assets by the State-owned electricity generators probably has something to do with it too.
Given the amount of money required, borrowing holus bolus is not the answer. The State’s credit rating would nosedive, and the cost of loans would significantly increase. Increased borrowing as one prong in a multi-pronged solution may however assist.
With the failure of the privatisation of generation and retail assets, we have lost the opportunity make some very positive changes to NSW’s infrastructure deficit. It was the right thing to do, but Iemma and Costa were simply not strong enough to keep their own party in line to get this thing through. It will be interesting to see what strategies the ALP come up with to save their hides in NSW.