Scott Ludlam (WA, Australian Greens) Share this | Hansard source

I rise to make some comments on behalf of the Australian Greens on the Asset Recycling Fund Bill 2014 and related bill. I agreed with much of what Senator Conroy said. In fact, when we come to the committee stage, the Australian Greens will be moving an amendment. We think the bill is not particularly accurately named and we will be moving to change the name of the bill to the 'Encouraging Privatisation Bill'—which it quite clearly is.

The only significant difference that I have with Senator Conroy is where he points out that this was the best that could be done by the Senate today—and I strongly disagree. The best that could be done by the Senate today would be to block this bill and send it back to the drafters in the Prime Minister's office or from whence it came to have a good hard think about exactly what it is that they are proposing to do. This bill should not proceed, for reasons that are so self-evident as to be barely worth documenting.

The myth of the pre-eminence of private sector efficiency for running essential services—and, in particular, for running natural monopoly infrastructure—should be set aside today, before this bill is committed to the vote, for the shallow and self-serving ideological dead-end that it is. Bribing financially stretched state governments to sell assets in return for funding catastrophically expensive urban freeways and tunnels graphically illustrates the coalition's poverty of vision when it comes to infrastructure funding.

The Australian Greens strongly oppose this measure. We will continue to promote deliberative planning processes to establish infrastructure plans that actually serve communities rather than divide them. This bill—to put it as plainly as I can—is about bribing state and territory governments to sell off public assets in order to obtain Commonwealth funding. We will be urging Labor to join with the Greens and vote down this bill which would, among other things, create a slush fund for toll roads at the expense of investment in public transport.

I think I understand why Prime Minister Tony Abbott is such a hardliner on climate change. I think part of it is ideological and I think part of it is that he is generally too terrified to acknowledge what is happening to the global climate and part of it is that the Liberal and National parties are bought and paid for by the coal, oil and gas industries. That is reasonably easy to understand. But I find it harder to understand why the Prime Minister has such a hatred of public transport. Is it just that he does not ever use it himself? Is it that basic, or is there more at play? Why would you come into power and crash public transport projects that had already been funded and that were already in the advanced design stage? I am speaking of course of the Perth light rail project.

That was a proposition put forward initially by the Greens. I acknowledge the work of the state Labor government—the Gallop and later Carpenter governments—and particularly former WA minister Alannah MacTiernan in doing early study work on light rail for Perth. It is never the coalition, either at a state or federal level, that brings these projects forward. The Greens launched the proposal at the 2007 federal election. After a couple of years of campaigning and hard work, the Barnett government—deeply unpopular, traumatised, moribund and in a bit of a mess—took up the idea, proposed it and committed a little more than $4 million to design and pre-feasibility work.

So that was a Green initiated project, designed by Liberal and National parties in Perth and Western Australia—and we got $500 million from a federal Labor minister in the Commonwealth budget for implementation and development. So it was very much a cross-party initiative. At about this time last year we were thinking that we had actually managed to pull politics out of the proposal and that the Liberals, Nationals, Greens and Labor were going to be able to get a light rail network built in Western Australia—for the first time since 1958.

What happened? Prime Minister Tony Abbott comes to office and says, 'There will be no public transport under a government I lead,' pulls $5 million off the table and instead we get this obscene $925 million contribution—which effectively gets the project over the line and makes it bankable—for a private freight highway through a wetland. That is one of the reasons why we are opposing a bill such as this. The federal government have effectively put on the table $9½ billion worth of funding around the country for projects that have effectively circumvented Infrastructure Australia's arms-length assessment procedure, and now they are just dropping freeways on people's heads. It is a little similar to the east-west tunnel catastrophe that Senator Conroy was outlining, although I understand that the Labor Party has a rather morally ambiguous position towards whether that gets built or not.

In Western Australia, the situation is much clearer. The state and federal Labor Party oppose this freeway. The state and federal Australian Greens oppose this freeway. The community oppose the freeway. Most of the local government authorities in the area oppose the freeway. People who care about urban bushland oppose it. The local Aboriginal mob oppose four lanes of tarmac smashing through sacred sites on the shores of Bibra Lake, or Walliabup. So it is fairly easy to see that this project should never have seen the light of day. But there was $920 million committed to it before you had even seen the design. The Commonwealth bureaucrats who are writing the cheques out did not even know whether it would be an elevated freeway or not. Nobody knows what is going to happen to all the traffic—the masses of container traffic that you are going to be dumping onto Tydeman Road through four sets of traffic lights. Nobody knows. The thing has not been designed. Nobody has released the cost-benefit analysis—based, undoubtedly, on hallucinations of time savings that amount to $4 billion or $5 billion, just imaginary numbers.

The government believe that anything that is not nailed down should be privatised. They never saw an urban freeway that they did not like, and they have this strange loathing of public transport. Maybe you spend your entire time being carted around in Comcars and chauffeur driven limousines and do not feel the need for public transport. It should be user-pays, shouldn't it? That loathing for public transport such that you would abolish projects already afoot is stranger to me than understanding how the coal industry could have just bought and written your climate policy for you. It is simpler to join those particular dots. So I hope that Labor will rethink their support for this bill.

We will go into this in detail in committee, but I foreshadow that we will be supporting most of the amendments that the Labor Party are putting forward around cost-benefit analysis. They are entirely consistent with amendments that we passed a fortnight ago when we were debating the Infrastructure Australia Amendment Bill. They are sensible. If this thing is going to be passed back to the House of Representatives, it does make sense to ensure that those checks and balances are in there. But I do find it strange to see the Australian Labor Party aiding and abetting Prime Minister Tony Abbott's privatised urban freeways agenda. It is strange, particularly when you have been so strong at home in the instance of the Roe Highway. I find that a bit peculiar.

We believe that public assets should remain in public hands unless there is a very compelling case for them to be sold off. A couple of weeks ago, at the ACOSS national conference in Brisbane, I caught up with Professor Charles Sampford. He has very interesting views on these things. He has spent many years studying what actually happens in the process of state asset sales. Professor Sampford is Foundation Dean, Professor of Law and Research Professor in Ethics at Griffith University. He is not a hardline pro- or anti-privatisation person per se. In fact he has got some quite strong comments for anybody residing at the opposite poles of the debate, telling them to take a look at what the actual costs are and arguments that can be made for where the state should not own a particular thing. I will give one example that is close to my heart. With the National Broadband Network, we supported the wholesale arm of that company being brought back into public hands from Telstra. But, at the retail level, there is no sense having a state owned retailer necessarily. It makes entirely good sense for the private sector to be competing to provide a decent service to people. But, for heaven's sake, you do not privatise the wholesale essential service end of the network, which is a natural monopoly. So there is a spectrum of views.

Professor Sampford's take on it is very interesting, because he looks into what happens during the process of state asset sales and looks at all the hidden costs that exist, which I mention for the benefit of the boosters, those right up the far end of the pro-privatisation spectrum, who just want to sell everything off because they do not really believe in the existence of democratic states, which is kind of bizarre. Here is what he says:

Transfers of ownership are not without cost. Transaction costs include the costs of legislation, legal advice, due diligence, brokerage and underwriting fees. The fees can easily reach 2-3 per cent of the value of the enterprise and are not irrelevant to the excitement privatisation generates among the legal and stockbroking industries—and the uncritical support they offer for it.

That is kind of interesting when you see that the range of voices in the public debate demanding that things be sold off tend to come from the very same people—the hordes of parasites who swirl around try to take a cut out of these things—who are the direct financial beneficiaries of asset sales. Professor Sampford goes on:

To this must be added the tendency to underprice the asset to ensure that the privatisation is a 'success'. Politicians pushing privatisation are less concerned that the price be maximised than that the sale go through. In this they will be aided and abetted by the underwriters who want to minimise their own risk.

So there you have it. There is a certain kind of moral hazard. The private sector see a fat asset that they can potentially strip, fire a whole heap of people, break up and do with as they wish—an asset built up over years or decades by taxpayers' money that can be sold cheaply to them to suck a profit out of. So they are all for it. Then there are the analysts, the lawyers, the underwriters, the brokers and this whole cloud of people who materialise out of the woodwork to assist the government in flogging off something that people built. They are all for it. They are busily writing op-eds in the newspapers saying that this will be a fantastic thing, and the public interest gets wiped off the table.

We can see, from the clauses and the way in which this bill has been presented to the parliament, that the Abbott government is right up the far end of the pro-privatisation spectrum. That is why, if the bill is to pass the Senate, the Greens will be supporting the Labor amendments around some checks and balances, and we will be introducing some amendments of our own. It is not appropriate to be bribing state governments who are starved of cash—and we know that; the Commonwealth has got most of the taxing power; it has got 75 per cent of the taxing power. The states sit upon a perilously narrow taxation base. To be telling them, 'If you want new transport infrastructure you need to sell hospitals, you need to sell ports, you need to sell what is left of your electricity grids or power stations,' as much as they remain in public hands, 'and you need to basically throw them to the whims of the market, otherwise you will not see a dollar in Commonwealth funding,' is a disgrace. I will have a great deal more to say when we come to the committee stage of the bill and start going through amendments in details, but it is the strong view of the Australian Greens that this bill not proceed past the second reading stage.