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Funding infrastructure within AAA
Thursday, 24 June 2010

 

Mr MIKE BAIRD (Manly) [3.44 p.m.]: I feel bad because the member for Lakemba seems like a good bloke. It must have been disappointing for such a decent bloke to be sent into the Chamber to read a speech written by someone in the spin team. Today I stand in this Chamber to talk with pleasure about an alternative vision for this State. Government members hate the budget reply. They hate the fact that, within the triple-A credit rating, we have articulated a vision to fund desperately needed infrastructure. We have looked at diversifying sources of funding and, at the same time, we have kept our triple-A credit rating intact—something that this Government has been trying to do for some time.

I am of the belief that this is what happened: Treasurer Eric Roozendaal was glued to his television set, listening to every word of the budget reply and beads of sweat started to pour down his forehead. He then ran around the room and said, "Why didn't someone tell me about that?" As each gem of an idea and each policy vision rolled out, he realised that the Leader of the Opposition, in his budget reply, had articulated exactly what he had meant to do—notwithstanding the fact that he had 12 months to put his budget together—but no-one had told him about it. He hated it with a passion. He was furious. He was kicking chairs and throwing staff members out of the office. He wanted to place responsibility for it onto someone else.

The Leader of the Opposition trumped the Treasurer. He delivered a vision to take this State forward and to tackle those issues that members of the community are seeking solutions for. People in communities across this State are asking for infrastructure. When the Treasurer presented his budget he cut infrastructure. That was his idea of a solution to the problem. The Treasurer is devoid of ideas and he is out of touch with reality. His budget was a big flop. Opposition members have spoken about the budget forecasts and they have also spoken about the mining tax. Today's incredible events led to the appointment of a new Prime Minister. Will the new Prime Minister get rid of that impost on industry in this State?

It is unbelievably disappointing that the Treasurer and the Premier of this State, who put the Labor Party first, sold out the interests of the people of New South Wales. The Premier and the Treasurer were told not to say anything about the mining tax, not to cause any ripples, to keep it low and to keep it off the agenda. They did not stand up for the people of New South Wales. To her credit Anna Bligh stood up for the people of Queensland, but our Premier and Treasurer remained quiet. I move an amendment to this motion that goes to the heart of this matter—the Government's attempt to attack the Opposition in relation to this issue. Let me give the Treasurer a lesson in accounting. I move:

      That the motion be amended by leaving out all words after "That" with a view to inserting instead:
      "this House congratulates the Opposition on its budget reply demonstrating how critical infrastructure can be funded within a "AAA" credit rating.
Mr Joseph Tripodi: What a joke!

Mr MIKE BAIRD: I hope that Government members are listening to and enjoying my contribution to debate on this motion. Opposition members said that they would establish an infrastructure fund. I am surprised the member for Fairfield did not think about this, because he has a brain. I would have thought he would have made a contribution to this debate. Opposition members examined the assets on the balance sheet, which any prudent financial manager would do, and then said, "In which areas can we release capital? Where can capital be released that is sitting idle and that can be put to use for the benefit of the people of New South Wales?" We identified that the desalination plant was an asset that would sit on the balance sheet for 25 years and we tried to establish whether there was some way of releasing that capital.

Mr Joseph Tripodi: What is the net asset value?

Mr MIKE BAIRD: Let us go through that. I assume that the Government is saying that it will increase the financial liabilities of the State.

Mr Joseph Tripodi: That is right.

Mr MIKE BAIRD: The Government intends to increase the financial liabilities of the State. If it receives $1.5 billion for the desalination plant—which is what will occur—it will pay back the associated debt and borrow back the debt up to that level. The net proceeds would be $1.5 billion, with no increase in the debt to this State. That is what the Treasurer has done: that $1.5 billion in cash has been released and there is no increase in debt levels to the State. What is the nonsense that the Treasurer is going on with? We are talking about $1.5 billion, but where will the rest of the money come from? This Government is very good at wasting money. As the Government has received unbudgeted windfall taxation receipts it has put up expenses and then disappeared.

That will not happen if the Liberal-Nationals Coalition is elected to office in March 2011. Over the past 10 years $850 million of unbudgeted windfall taxation receipts—that is about the average each year—have gone. Every dollar of that amount of $850 million will go into this fund. If we match the average over the past 10 years, about $3.4 million or $3.5 million will go straight into this fund, which is something that this Government hates. An amount of $5 billion cash will go into the fund with no change whatsoever to the total liabilities of this State. The rating agencies love it. If we then started to introduce things such as Waratah bonds—

Mr Joseph Tripodi: Waratah bonds mean debt.

Mr MIKE BAIRD: No.

Mr Joseph Tripodi: It is debt.

Mr MIKE BAIRD: No, you do not understand it.

Mr Joseph Tripodi: It is debt by another name. Why don't you call it kangaroo bonds? What's the difference?

Mr MIKE BAIRD: No, we say that if you use Waratah bonds as part of an overall funding strategy to pay back the debt on the desalination plant—the member for Fairfield should follow this closely—then you replace that debt with Waratah bonds. The total financial liabilities to the State do not change because you introduce a new funding source. Self-managed super funds enable the people in this State participate in the building of infrastructure. The Treasurer hates that, as does the member for Fairfield, because they know that Treasury is working on that product right now. The net debt of this State will not increase, but up to $5 billion in cash will be in a fund to be used to build the infrastructure we desperately need. We look forward to articulating a plan and to announcing the projects that fund will support. That is how we will turn this State around. The Jobs Action Plan targets 100,000 jobs to take this State forward. Members opposite hate that. The member for Fairfield and the Treasurer are embarrassed because the Opposition has trumped the Government on its own budget.

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