Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

I rise in the House today in the grievance debate with frustration and despair at the intention of the Commonwealth government, the New South Wales government and the Victorian government to sell off Snowy Hydro. I note that the Parliamentary Secretary to the Prime Minister is sitting at the dispatch box, and I hope that he will listen not only to my plea but also to the pleas of many Australians that the Commonwealth not be involved in the sale of Snowy Hydro.

We held a meeting at the Yoogali Club in Griffith on Wednesday, 26 April. It was after a motion was put in this House on this issue, a motion about which I did not have prior notice. I managed to come into the House to speak off-the-cuff about my concern at the sale of Snowy Hydro. At the time the motion was put to the House and a vote called for by the Independents, I had my say and then determined to leave the House. I did that so as to abstain from the vote—to not vote against the sale or be involved with a vote that could see the sale go through. However, I must say in this House now that, if I knew then the additional detail I know now, I would not have abstained. I should have crossed the floor and committed my vote wholly and solely against any proposal to sell any holding in Snowy Hydro.

At that meeting at the Yoogali Club in Griffith, I heard experts speak on this issue. Among those experts was Mr Vin Goode, a former commissioner for Snowy Hydro, who has extensive knowledge. Mr Max Talbot also spoke and provided information; he also has extensive knowledge about Snowy Hydro.

A view was put that the documentation drafted for the Snowy Hydro corporatisation put in place arrangements for the privatisation of Snowy Hydro. A view espoused to me in this place was that the time for discussing any future sale of Snowy Hydro was when it was corporatised. From further information now in my possession, I do not believe that is the case. The corporatisation documentation was drafted with corporatisation and not privatisation in mind. That documentation includes a 75-year water licence that grants Snowy Hydro Ltd rights over the collection, storage and release of the scheme’s water resource and not over the ownership of the entire kit and caboodle.

Snowy Hydro Ltd is being privatised, as we know—and it is being privatised with undue haste. It took us nine years to corporatise it, but it will take us only seven to nine months to privatise it. With only a few mutterings in this House, it is being privatised without consultation, without parliamentary debate of any form occurring in the Victorian chamber or the New South Wales chamber—the governments who are selling off the entire system—and without a due diligence exercise being undertaken on the adequacy or otherwise of the agreements and how they will operate in the hands of private enterprise.

Looking at the sale of Telstra, I must give the Commonwealth government due reward and credit. I did not vote for the sale of Telstra; in fact, I crossed the floor and cast my vote against it. But, on the impact of the privatisation and sale of Telstra, to the government’s credit, a number of inquiries were held over a period of five to six years and an enormous amount of consultation occurred, particularly with Minister Coonan. But nothing like that has been done in relation to the privatisation of Snowy Hydro.

Any transparency and oversight of Snowy Hydro Ltd’s activities are inadequate. The corporatisation agreements do not provide a basis for effective regulation of Snowy Hydro Ltd. Snowy Hydro Ltd can assign its interest in the water licence, subject to ministerial and corporation approval, and the deeds and the agreements say that it shall not be unreasonably withheld. Once privatised, Snowy Hydro Ltd will push the boundaries of that licence, believe you me. In addition, it will pursue growth and increased profitability for its shareholders, because that is what privatisation is all about. That a 75-year licence giving control over our nation’s water is to be in the hands of private enterprise is inappropriate, especially given our future climate uncertainties.

Putting water and heritage issues aside, I say that Snowy Hydro Ltd occupies a unique and monopolistic position in the national electricity market. It is a position which cannot be emulated easily by others and which gives it the ability to control market outcomes at critical times. This is not the intention of the NCP or privatisation. Connected with this privatisation, there is no contestable competition of the kind outlined to me during the discussion and debate had on the privatisation of Telstra. The argument used for the sale of Telstra simply does not apply to the sale of Snowy Hydro, and I cannot understand why this push, this rush, to sell Snowy Hydro is being accepted by people across Australia, by our governments and particularly by the Labor Party. One member of this House, Peter Garrett, the member for Kingsford Smith, in the Sydney Morning Herald on 15 February 2006, said:

It would be premature for governments to be rushing into privatisation. The recent track record of privatisation is mixed. The level of public and political insight into what is going on needs to be much greater.

That was well said and I agree entirely with the member for Kingsford Smith. But where was he and where is he now vocally, when he needs to influence his state Labor colleagues, when his views need to be taken into consideration? Where was he and where is he in this House, when there is a need to try to stop the selling off of Snowy Hydro?

We have an issue with the national electricity market in that its rules and market regulation are still evolving. As we have been advised by Mr Goode and Mr Talbot, market complexities make it difficult to effectively regulate the activities of market participants in the interests of consumers.

Snowy Hydro has an income of around $450 million per annum, with a net profit before tax of about $200 million. Over the last two financial years, it has paid cash dividends of $140 million and $110 million, with retained earnings of $188 million. There is a definite need to understand how this system works. We see where Snowy Hydro Ltd has invested additionally in excess of $500 million into gas turbine plant and a retail business in Victoria and around $80 million into modifying the Jindabyne Dam to provide for environmental flows. There is an ongoing capital expenditure to refurbish, enhance and modernise Snowy Hydro’s assets, which amounts to about $20 million to $25 million per annum. That is well within its ability to self-finance and it is well short of the ‘in excess of $1 billion’ that is being quoted by many who are in favour of this sale.

I would like to see us being able to look at all the opportunities. I have received a call today asking that I seek to have a national heritage order placed, as a matter of urgency, on the Snowy Mountains scheme so that this sale can be precluded or prevented. That call came from the Cooma-Monaro Shire Council and the Snowy River Shire Council, both of whom certainly do not support, under any circumstances, the ownership of this important infrastructure being put in private hands.

There is a need for us to rise up against this sale. There is a need for the people across Australia to do all that they can to prevent this sale. I am only sorry that I did not have further information at the time the motion was put before the House so that I could have exercised a true and conscientious vote—a vote of conscience for me and a vote for the Australian people—against any efforts to sell off any component of the Snowy Hydro. (Time expired)