The Queensland Government is right to have begun advertising for advisers on asset sales, to ensure that assets such as CS Energy and Stanwell are sold in a timely fashion after the next election (Government advertises for asset sales advisors). The Government needs to get these assets ready for sale, and will no doubt benefit from advice from professional services firms and investment banks.
The Government, however, seems to have missed the important step of undertaking comprehensive cost-benefit studies of the sale proposals. I’ve written before on the failure of the Strong Choices campaign to provide useful information to the public regarding the impacts of asset sales on the economy and community. I was disappointed the Government spent $6 million on the campaign which could have been better spent undertaking comprehensive studies of privatisation proposals and marshalling the evidence that could help convince the public these proposals are in the public interest (see my post Failure of Strong Choices now obvious – missed chance to persuade on asset sales).
As a supporter of asset sales, I’ve disagreed with a number of my fellow economists around town on the merits of assets sales, but one thing I think we can all agree on is the need to do the rigorous analysis of the costs and benefits to the community of proposed sales. This does not appear to have been done so far, and the Government is now highly exposed because it is basically signalling that it will sell assets after the election, but it may not have the evidence and arguments it needs to justify its actions.
For more on the issue of asset sales, please consider attending a panel discussion tomorrow night at Griffith, Southbank, at which I’m speaking:
Queensland Economy Watch 