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Category: Electricity Energy and Utilities / States and Territories

Western Power debt could be sold to super funds

Friday, 7 Oct 2016 18:01:08 | Rebecca Turner

Western Power has about $8 billion in debt, the State Government says. (ABC News: Andrew O'Connor)

As the West Australian Government finalises its plans for Western Power, Premier Colin Barnett has revealed an option to sell its $8 billion debt to superannuation funds is on the table.

The Government is still considering an option to privatise Western Power in order to reduce the state's ballooning debt and fund new infrastructure.

Mr Barnett said it was not the only option under consideration to generate revenue from the corporation.

"It may well be that, whether it's Western Power or some other asset, allowing Australian superannuation funds to invest into those assets will relieve taxpayer money for other projects," he said.

"It's not a bad idea, is it? Instead of paying interest to banks on loans, we actually pay dividends to superannuants through their superannuation funds.

"And if you look at Western Power, Western Power has about $8 billion worth of debt.

The biggest component of state debt is the borrowings component of Western Power to do what is required."

Mr Barnett said he thought the idea of swapping borrowings from banks to investment by superannuation funds would appeal to West Australians.

His comments come amid concerns the privatisation of Western Power could prove electorally unpopular.

Mr Barnett expressed his concerns several months ago that the WA public was not supportive of selling Western Power's poles and wires.

While he confirmed that the Government's plans for the corporation would be finalised in the next few weeks, it is unclear whether this will include the sale of its distribution and transmission networks.

Treasurer Mike Nahan announced in May that the Government's plan to privatise Western Power would be taken to the March state election.

Opposition Leader Mark McGowan said on Thursday that "under no circumstances" would a WA Labor Government sell Western Power, Water Corporation or Fremantle Port.

AustraliaPlus


 

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