PERROTTET’S TREASURY REQUESTED SYDNEY WATER PRIVATISATION ADVICE
Dominic Perrottet’s Treasury NSW directly commissioned a study into the privatisation of a major new Sydney Water asset, contradicting previous denials.
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Perrottet has repeatedly claimed he has no plans to sell Sydney Water.
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Documents however, show that it was his department that sought advice on Sydney Water’s privatisation.
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The privatisation plans have parallels to his sale of WestConnex.
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Perrottet has reserved the right to change his mind on further privatisation.
Perrottet claims on Sydney Water privatisation
On Wednesday, Perrottet claimed at a Leaders Debate:
“We’ve never directed the public service in relation to Sydney Water.”
In a trainwreck Sky News interview on Friday, Perrottet doubled down again, saying:
“I don’t know anybody in the history of our government that has ever spoken about [privatising] Sydney Water…
“It has never been, never been something that has ever been considered by our Government, or ever would be.”
He went on to claim that privatisation is “a good thing.”
April 2021 – Perrottet’s Treasury requests privatisation study
New documents from Perrottet’s time as Treasurer show his claims to be false.
A privatisation scoping study relating to Sydney Water, marked ‘Sensitive – NSW Government’, notes that it was ‘prepared at the request of NSW Treasury.’
The document, from April 2021, was produced by private finance consultants at KPMG and titled ‘Majority Interest Asset Financing Model.’
A majority interest asset financing model is a type of privatisation in which an investor or lender provides funding to a business in exchange for ownership interest in the assets being financed.
The April 2021 document, directly commissioned by Perrottet’s Treasury, sets out how Sydney Water and NSW Treasury could sell a 49 per cent stake in the $1.5bn new South Creek Water Factory in Kemps Creek:
Parallels to WestConnex sale
A KPMG document dated 6 January 2020 stated that the organisation was ‘in close consultation with NSW Treasury’ regarding ‘fitting a new PPP [Public Private Partnership] into Sydney’s water market.’
This 51 per cent public/49 per cent private split is exactly the same privatisation model used with WestConnex.
Perrottet believed this gave him licence to break his election promise not to sell the remainder of WestConnex, telling Sky News on Friday:
“We’d already sold the first half of WestConnex. It was always the view that that was the approach that we’re taking with that with that road. Now. We didn’t have a plan at that point in time to settle down the residual interest.”
The KPMG advice to NSW Treasury went on to explicitly advocate for a ‘post-completion sale’ of the new facility in Kemps Creek – that is, selling off the remaining 51 per cent after construction was complete.
The push from Perrottet and Liberal Ministers went beyond KPMG, into Sydney Water itself.
A Sydney Water board paper from February 2021, titled ‘Future Funding Strategy’ highlights ‘Stakeholder Preferences’ – referring to Perrottet himself and other shareholding Ministers. The board paper states:
There have been a number of direct and indirect communications received on increasing the level of returns to Government… Government has a publicly stated preference for asset recycling.
Perrottet leaves open possibility of further privatisation
Perrottet doubled down on his defence of privatisation, telling Sky News on Friday:
“It’s a good thing when it’s necessary.”
Perrottet also reserved the right to break his promise on no further privatisation, when asked about WestConnex in the same interview:
“We didn’t have a plan at that point in time to settle down the residual interest. But it became very clear that that was the right approach to take in those economic times.”
Quotes attributable to Daniel Mookhey, NSW Shadow Treasurer:
“This is the evidence that proves Dominic Perrottet and his Liberal Party have been misleading the people of NSW for years over Sydney Water.
“In public he says one thing, in private he does the opposite. How can voters trust any promise he makes in this election?
“After 12 years, it’s time for a Government that acts with integrity, honesty and respect for our state’s assets.”
Quotes attributable to Rose Jackson, NSW Shadow Minister for Water:
“Under the Liberals, Sydney Water privatisation isn’t a risk in the future. It has already begun today.
“In every other country which has tried water privatisation, it has ended in disaster. This isn’t just about price, it’s about the safety of our water supply too.
“The fate of water in NSW is at stake in this election. We cannot risk four more years of Liberal sell-offs.”
