Privatisation proceeds should be spent wisely

I have an opinion piece in today’s Courier-Mail on asset sales/privatisation:

Corporatisation has brought efficiency gains but there is still room for more gains through privatisation

It’s based largely on my speech from a few weeks ago: Productivity and privatisation.

Next month, the Government is due to announce where it intends to spend the $9 billion of privatisation proceeds it isn’t using to pay down debt. While the Government has already provided an indicative, high-level carve up (see below), it still needs to identify specific projects. There is obviously a risk that proceeds could be used to fund popular projects with dubious economic merit in marginal seats. Hence there is a need for Queensland Treasury and the Premier’s Department to ensure a rigorous cost-benefit analysis has been done of all projects.

The proposed Townsville super-stadium certainly warrants close attention from bean counters on George St. It’s unclear why the Government should contribute millions of dollars to provide a venue for the NRL to improve its profitability (see NRL plan for 25,000 seat super-stadium). There doesn’t appear to be a strong public good case for public investment in the stadium, given Townsville already has 1300SMILES Stadium and the Sports Reserve, which can hold important public events as required.


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4 Responses to Privatisation proceeds should be spent wisely

  1. KT says:

    Agree Gene. I love sport but Stadiums are very expensive for marginal return. May be an upgrade for the existing stadium. I like the current breakdown in the provided pie chart.
    However, I think the government needs to provide better / clearer direction on private investment on projects such as Surat Basin Rail – may be offer a top up if the private consortium doesn’t make any cash in the first few years

  2. NSSfT says:

    I think the Townsville SS might be heading to lame duck status. The public can see through the facade and see its a seriously stupid way to spend any one off community investment from the lease/sale of the Port of Townsville. Many/All of us could sit down and assemble a list of lower cost projects that actually might grow the regional economy in the medium/long term, not enrich the NRL at the communities expense …

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