[5.51 p.m.]

Mr GAFFNEY (Mersey) - The expansive, radical and somewhat provocative privatisation agenda regarding the sale of government business enterprises and state-owned companies that was recently floated by the Tasmanian Liberal government could have major implications for Tasmanians.

 

The agenda may not necessarily be positive for the long-term interests of Tasmanians, nor does it come with a political mandate. I thank the honourable member for Hobart for this notice of motion and I could draw - and I could understand where she was coming from implying that, if the stadium build or Macquarie Point is going to be $1.86 billion over the next 10 years, how do we pay for that? Maybe we need to get rid of some of our GBEs and SOCs.

 

So, there is a correlation between that conundrum and I think that is something that needs to be fairly put out there to the community and I think you have done that very well.

 

In short, privatisation for me, in my mind, is a risk equation and one that is particularly risky for Tasmanians. In its privatisation agenda, the Tasmanian Liberal Party could leave behind vulnerable rural and regional Tasmanians as well as damaging Tasmania's economic and social long-term interests. I cannot imagine the amount of debt on interest that we would have to pay every year to be able to cover such a spend.

 

I am speaking today to highlight the needs of Tasmanians who could stand to lose the most from major changes to public services. Moreover, I would like to speak to the role of privatisation itself in Tasmania, the risks that come with that pathway and the potential benefits it might bring.

 

Each of these factors informs the risk equation and business case that the government must undertake when proposing to privatise government-owned enterprises and businesses. I also contend that thorough or even adequate business cases are not a strong point of this government.

 

Finally, I put to you that the current government does not have a political mandate to undertake such sweeping and radical economic long-term reform.

 

I would first like to speak to the needs of Tasmanians as they relate to privatisation. Tasmania is economically vulnerable and dependent on an effective and available public service. Commercialising the public service risks reducing quality and availability of service whilst also minimising the voices and needs of Tasmanians identified as having lower socioeconomic status, as well as those who live in rural and regional Tasmania.

 

Corporations have little reason to listen to those who do not provide commercial value, while public ownership underpinned by political representation allows Tasmanian voices to be heard.

 

Consequently, privatisation of GBEs and SOCs risks leaving behind Tasmanians who are most in need of those services currently under public ownership.  

           

​​​​​The economic vulnerability of Tasmania is a principal factor to consider when any dramatic changes to the public service are being considered. Well-known and highly regarded economist Saul Eslake, whom the Premier announced as advising on the sale of state-owned enterprises, found in his independent review of the Tasmanian economy that Tasmania by 2035 is heading for the worst level of debt in Australian states and territories and that is before the Mac Point paper was completed last night by the Planning Commission.

 

It is obvious that budgetary measures will need to be implemented to improve our state debt. However, this statistic cannot be viewed in isolation, as has been, to inform and support the privatisation agenda.

 

According to the 2021 Census, Tasmanian household income is nearly 20 per cent below the national income. Tasmania also has the highest proportion of people living in disadvantaged areas in Australia and has higher than average socioeconomic disadvantage, according to the State Growth Tasmania Socio Economic Index for areas.

 

These statistics highlight the vulnerable areas across Tasmania. Lower SES Tasmanians, and those living in rural and regional Tasmania, along with older Tasmanians and those struggling with disabilities, all rely on the public service to provide them with what they need at a reasonable cost and quality. By extension, services currently under public ownership, such as energy provision and the Metro transport system, provide essential benefits to those Tasmanians.

 

Public services offer an economic equaliser to these Tasmanians. They offer a means for people to access energy without risk of disconnection, provide readily available transport at low cost, promote lower costs of living, and the services are specifically targeted to those who need and use them - and we are thinking of selling them.

 

Removing these services from public ownership risks removing the political representation that vulnerable Tasmanians rely on to ensure they continue to receive these benefits.

 

In short, corporations concerned with efficiency will have less incentive to engage with consumers and provide services across the uniquely rural Tasmanian landscape as well as to lower SES Tasmanians.

 

Publicly owned services also support and supplement effective delivery of policy goals. For instance, environmental aims, city and state planning, and industrial development in Tasmania are each supplemented by public ownership of the public transport industry, industrial energy, water and rail companies.

 

The long-term goals of the government can be effectively delivered through state-owned companies and government enterprises if they are managed and supported appropriately. Many individuals and groups suggest that improvements are needed in the public service and the Budget. However, primarily, the needs of disadvantaged Tasmanians must be a priority.

 

This is not to say that we should throw out privatisation suggestions entirely, but they should be considered with great care and with authentic consultation to ensure the needs of the Tasmanian people, especially those who rely on these services, are not negatively impacted.

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This takes me to my next key concern. Privatisation itself comes with a risk. That is not to say that privatisation does not have its place in benefiting Tasmanians. However, considering the vulnerability of Tasmanians, if there is a failure in services, wholesale privatisation is a risky and substantial shift in the Tasmanian economic landscape.

 

By extension, without a well thought out and strongly researched business case for each privatisation suggestion, the government is gambling with the welfare of Tasmanians. It has been suggested that the government is cherry-picking the privatisation agenda.

 

The rationale for privatisation that it promotes efficient provision of services and can promote more efficient and effective delivery of current services does have an appeal to some people. However, privatisation may directly benefit the Budget and improve the bottom line for a fleeting period of time while also directly improving Tasmanian services by perhaps making them more efficient, more dependable and more available.

 

Additionally though, Tasmania stands well positioned to implement effective privatisation using lessons learned in other jurisdictions. However, any changes and their impact should be well thought out and certain services controlled by the government are unlikely to be improved by private ownership, particularly privatisation risks degrading services, removing oversight and reducing the ability of government to steer and guide industry to the benefit of Tasmanians. Selling items, such as Metro Tasmania, to private enterprise risks allowing monopolies and unfair practice in circumstances where government ownership is the only means to avoid that monopoly. In practice, certain services need a public service obligation to provide a suitable level of quality, price and availability. For example, Metro Tasmania, the Tasmanian city bus lines, inherently rely on a natural monopoly to provide a cohesive service. Carelessly removing oversight and control of industry practice risks reducing the quality of bus services. While there are remedies and ways to avoid such issues, the cost of poorly implementing private bus services, especially in low socioeconomic and rural areas, could be disastrous.

 

We can be selective on those businesses when we choose to privatise. While we can learn lessons from other jurisdictions, we have already done so. Ineffectively, in selecting implementing privatisation, the government stands to benefit to both Tasmania's and the budget bottom line. That is what the government is saying. Finally, having discussed the needs of Tasmanian's in relation to public sector as well as risk benefit equation, that is privatisation, I would now like to address the two issues raised by the member in her notice of motion.

 

For a number of years, we have heard, in this Chamber, second reading speeches which often maintain the government had a mandate to do this and this and this. However, the Liberal minority government does not have a political mandate for the substantial and risky proposed changes in privatising GBEs and state-owned companies and that these businesses and enterprises are operated by and for Tasmanians and should stay in the hands of Tasmanians.

 

I would like to recognise that, as the member states, these government business enterprise and state-owned corporations have been built by generations of Tasmanians and are owned by the people. Importantly, this informs the role which government-owned enterprises and businesses play in Tasmania. Commercialising government owned enterprises and businesses removes their Tasmanian character. People come to and stay in Tasmania for a less commercial, more community-oriented environment. Inviting corporatisation and commercial enterprise for the sake of economic efficiency and bettering the budget bottom line is not in the interest of keeping Tasmania a place for Tasmanians.

 

The purpose of governmentally owned industrial and utility organisations, such as Aurora Energy, TasNetworks and Tasmania forestry are to provide low cost and effective services and goods to and for Tasmanians. Privatising elements of these organisations risk diluting them, removing the Tasmanian element and straying from providing the benefits which many Tasmanians expect and rely on. Moreover, losing control over elements of public services risks reducing governmental input to address legitimate issues in the services.

 

I would finally like to turn to the most pertinent issue of all. While, we have ascertained that the Liberal minority government of the day does not have a political mandate for this privatisation agenda. However, given the scale of changes proposed to the Tasmanian economy as well as the possible undermining of fundamental expectations in Tasmanian life, this privatisation agenda should have been an election issue. Privatisation was not mentioned during the election period, nor does it feature in the government 2030 economic strategy. Frankly, the minority Liberal government does not have the political prerogative, nor the political capital to implement risky and controversial economic plans.

 

In recent times, we have witnessed very poor decision-making and lack of thoroughness in its management and coordination of major projects. The TT-Line fiasco and the divisive stadium build at Macquarie Point, two which spring to mind. In short, the minority Liberal government does not have a majority government and did not win the state election based on confidence in privatisation and substantial economic reform. It has been suggested to me, that is a kneejerk response to some disastrous financial realities. To some, it appears to be an afterthought to thwart media attention away from the very uncomfortable and untenable situation between TasPorts and the TT-Line.

 

Suggestions which will fundamentally change the frontline delivery of public services, should be subject to public input. Any suggestion otherwise strays from the principles of responsible and representative government. Given, the risk inherent to privatisation and the inherent vulnerability of Tasmanians, I would suggest a bulletproof business case first be made for each organisation that is suggested. Good governance, in my mind, means that whoever is in charge needs to leave the organisation in a better shape than when they inherited it. I am not certain how the current government is travelling with this belief.

 

In conclusion, the government of the day has suggested sweeping and radical economic reform for parts of the public service which many Tasmanians rely on. This comes with risks and pose a special risk to vulnerable rural and regional Tasmanians. As such, Mr President, the government should first come with the political mandate as well as a strong business case for each individual case of proposed privatisation. Sweeping agendas risk leaving Tasmanians behind and do not reflect democratic principles, nor will they necessarily benefit the long-term interests of Tasmania. If the government had raised this issue before the last election they would not have been voted in. They know that and that is why it has been brought in, sneakily, after the event. I thank the member for bringing on this notice of motion and I hope that other members in this place can spread the word that this is not in the best interest of Tasmanians.

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