Snowy Hydro Scheme to go public

Sunday, May 21, 2006

The New South Wales (NSW) government says small investors will have the first opportunity to buy shares in one of Australia's most unique public assets - the Snowy Hydro Scheme, the sale of which begins officially on Monday, May 22. NSW Finance Minister John Della Bosca denied the sale was incongruent with Labor's stance on privatisation, or that it was a pre-election strategy.

The New South Wales, Victorian and federal government jointly owns the hydroelectric scheme and have decided to sell their shares by floating the company on the Australian Stock Exchange.

NSW taxpayers hold 58 per cent of the shares in the scheme and the State government stands to make between $1.5 billion and $2 billion from the sale. Selling the Snowy Hydro scheme could raise up to $3 billion for the Victorian, NSW and federal governments.

Mr Della Bosca told the ABC: "We've looked at all sorts of arrangements to raise more capital." He said the sale would secure the future of Snowy Hydro. "Snowy is at a point where it's not responsible for it to go further into debt and the best thing for it, to be able to do, is raise capital on the stock exchange." The Minister denied the privatisation was a "grab for cash".

Liberal Senator Bill Heffernan is demanding a constitutional referendum to hand control of all rivers to the Commonwealth. He claims the Snowy Hydro sale would damage regional Australia and is being forced by state governments, to prop up their budgets. "I've expressed my extreme distress and disappointment both to the federal and state governments in no uncertain manner," he said. "I think it's a national disgrace and I think we will live to regret it in the future.

Senator Heffernan says he has had trouble trying to raise the issue with his colleague, the Finance Minister Nick Minchin. "There's been no discussions," he said.

NSW irrigators have withdrawn support for the sale after the NSW, Victorian and federal governments agreed to a 10 per cent limit on the number of shares an individual can buy.

Greens MP Slyvia Hale says she believes the Government will attempt to limit the release of documents relating to the sale when Parliament resumes next week. "As with everything connected with the sale things have been kept very quiet and the Government will continue, I believe, to try and ensure that critical information is withheld from the public," she said.

She says the sale should be suspended while an inquiry takes place.