Dear Crikey, I don’t really know why I’m bothering to reply to
your dishonest drivel. As you probably know, I discontinued my free trial of
Crikey after only a couple of days. However, I have been prevailed upon by a
friend who emailed me, saying: ” You’ve got to demolish this child Mayne… He
poses as a financial analyst and knows nothing about State

You took me to task for claiming that “the state’s
actual general government net debt is now zero”. Well, it turns out you’re right
and I’m wrong. It’s actually less than zero. In fact, it’s minus $3.38

You go on to claim that “for net debt to be zero,
the NSW budget sector has to have $13.68 billion in cash or cash equivalents
sloshing around somewhere…”. If you weren’t so lazy, you could easily have
discovered where these financial assets are “sloshing” around. It’s all laid out
in Budget Paper Number Two, pp 9-16 and 9-17.

As Tony Harris, a former NSW Auditor-General, wrote in
The AFR on 7 June: ” Eleven years ago, the NSW
government had net debt of about $15 billion. But thanks — if that is the right
word — to the Carr government’s fiscal attitude, the government will have no
net debt at the end of this month. Indeed, using the Australian Bureau of
Statistics methodology, NSW will have about $3.4 billion in net cash and

No matter what the provocation, this is absolutely
the last time I will ever respond to Crikey cr*p.

Stephen Mayne writes:

You can see the page Mr Egan is referring to here.
The assets list for 30 June 2006 includes $1.1 billion in cash, $1.28
billion in advances paid and $14.68 billion in investments, loans and
placements. However, this is unclear as to exactly what these funds are
and only $1.1 billion is actually cash – the asset that is usually
netted off against gross debt.

Advances, loans and placements are not cash and the point remains – why
on earth would a government retain $13.68 billion in debt if it had all
these liquid assets? Let’s hope Egan isn’t being so silly as to net off
investments that are set aside for superannuation liabilities against
the government’s debt.

It is also interesting that Egan has not challenged the criticism that
he loaded up public trading enterprises with debt to the tune of an
extra $7 billion over the past six years.

Peter Fray

A lot can happen in 3 months.

3 months is a long time in 2020. Join us to make sense of it all.

Get you first 12 weeks of Crikey for just $12. Cancel anytime.

Peter Fray
Editor-in-chief of Crikey

12 weeks for $12