By Denis Bright
Premier Berejiklian has confounded the final pre-election Newspoll to achieve an effective working majority in the NSW Legislative Assembly. Even in the less than likely absence of an absolute majority of 47 LNP members, Premier Berejiklian can seek endorsement from the conservative independents from the seats of Sydney and Lake Macquarie.
It will take more time to assess the political character of the Legislative Council where the quota for successful candidates is just 4.55 per cent under a state-wide proportional voting system.
Mark Latham (One Nation), David Leyonhjelm (Liberal Democrat) can form a voting bloc in the Legislative Council with members from the Shooters, Fishers and Farmers (SFF) and the Fred Nile Group of Christian Democrats, to move NSW politics in a centre-right direction. It is a long-time since a NSW Government had a cruisy relationship with the Legislative Council.
The results from previous elections show the ongoing appeal of minor parties in the Legislative Council (Tally Room 2019):
Five members of the cross-bench of the Legislative Council retain their seats until 2023 including two Greens and one each from Animal Justice, the Fred Nile Group and the Shooters, Fishers and Farmers (SFF).
The size of the cross-bench is also likely to increase in the Legislative Assemble with SFF members from Murray, Orange and possibly Barwon. There are conservative independents of varied hues from Wagga Wagga, Sydney, Lake Macquarie and possibly even Dubbo which is still one of the doubtful seats on election night.
This fracturing of the traditional two-party system is reinforced by the re-election of three Green members from Ballina, Balmain and Newtown plus uncertainty of the result in Lismore as supplied by ABC News Online during the election count at 21.00.
As the election night count continued, Labor looked like gaining the seat of Coogee, rather than the most state marginal seat of East Hills prior to election day.
The net loss of seats to the state-LNP has also been reinforced by voting trends in regional NSW.
Despite Labor’s failure to gain more winnable marginal seats across Metro Sydney, the NSW election result is hardly a ringing endorsement of Treasurer Dominic Perrottet’s strident brand of neoliberalism.
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Treasurer Dominic Perrottet has attempted to humanise and popularise the appeal of neoliberalism and the effects of recent privatisations in his press releases.
As a softener to the privatisation of NSW electricity generation, the NSW Government has established a Generations Fund which will manage some of the revenue generated to expand infrastructure and community development projects (Media Release from Treasurer Dominic Perrottet 19 June 2018):
“The NSW Generations Fund adds a whole new level of resilience to the sturdy financial foundations our Government has already built, to help withstand the budget pressures of an aging population in the coming decades.”
The NSW Generations Fund will grow through investment returns and future contributions. Following the proposed 51 per cent sale of WestConnex, the Government intends to place the State’s residual interest into the NGF, so ongoing returns on that asset are shared with the whole community.
The NSW Generations Fund will also deliver for people today with up to half of returns on the fund enabling My Community Dividend, a new initiative that empowers citizens to take more control over the way public funding is allocated to local projects. My Community Dividend will give residents an opportunity to nominate and vote on projects that strengthen and enhance their local communities. To launch the program, $27.5 million has been allocated in the 2018-19 Budget to fund projects expected to range in value from $20,000 to $200,000.
“My Community Dividend is about empowering the people of NSW to get the projects that matter to them and their communities off the ground,” Mr Perrottet said.
No-one could sensibly object to the formation of a Generations Fund. The political problem is its reliance on privatisation for the source of funding when real alternatives are available in a social market economy that can tap international and local corporate sources of finance for legitimate investment in infrastructure and community development.
In true neoliberal traditions, Treasurer Dominic Perrottet has also leased a 51 per cent share of the Sydney Motorway Corporation (West Connex) at a net gain of $9.3 billion to top up the NSW Generations Fund for additional general infrastructure funding and community development spending to $10 billion and $25 billion in a decade (Media Release 18 December 2018).
As the cash cow provided by privatisations is allocated by current expenditure and capital works programmes, the real challenge is a quest for alternative sources of funding (Parliamentary Research Service 2017):
After the sale of key public assets in NSW, the state LNP government is running out of new cash cows to privatise. Revenue from the long-term leasing of electricity transmission and distribution has been diverted into a Restart NSW Fund:
Restart NSW is the vehicle for the delivery of the Rebuilding NSW plan, which is the Government’s 10-year plan to invest in new infrastructure funded by the electricity network transactions, Commonwealth Government Asset Recycling Initiative payments, and investment earnings. These proceeds are first deposited into the Restart NSW fund before being invested into infrastructure projects.
Infrastructure NSW is responsible for assessing and recommending Restart NSW projects which improve the productivity and competitiveness of NSW across all sectors. They include a mixture of NSW Government agency-led infrastructure projects, as well as local and community infrastructure projects led by local government, non-government organisations and other agencies, the majority of which are recommended following a submission-based competitive process.
The budget papers for 2018-19 show the projected decline in capital expenditure in the next three budgets to 2021-22.
Treasurer Dominic Perrottet has extended privatisation processes to some of the operations of NSW Treasury (NSW TCorp) (Media Release 13 December 2018). These changes will become operational in April 2019:
The contracts will cover all Government transactions including payments, receipts, cross-border banking and purchasing cards and are expected to save up to $5 million each year in fees and charges.
Treasurer Dominic Perrottet signed the contracts after an extensive tender process.
“The finance sector is evolving rapidly, and the NSW Government has selected the providers who will ensure we offer both the best services to consumers and are an early adopter of innovative technology and new ways of banking,” Mr Perrottet said.
“These contracts will also allow greater flexibility and as technology evolves, a better experience for the millions of people who transact with the Government each year.”
Other advantages, which will flow from the new contracts, include a more streamlined approach to transactions, more payment options for customers, improved security and greater use of digital payment options.
The three-year contracts will commence in April 2019 with the opportunity available for parties to extend the agreement by up to three years.
Westpac and ANZ will provide transaction banking services, payment services and cross-border banking services. Citi will manage the Government’s purchasing cards.
NSW Treasury Secretary Michael Pratt said this was an excellent outcome for the State.
“The new contracts set-up a platform for the NSW Government to execute its long-term banking and payment strategy by allowing us to tap into the expertise of a broader range of leading Australian and international banks,” he said.
One possibility is the opening of NSW Treasury loan raising to Investment Bonds to maintain the momentum of infrastructure and community development during the 2019-2023 term of government.
These options could be tested by the Labor Opposition through parliamentary committee processes available to review the economic dogmatism of the NSW Government.
Budget Papers 2018-19 offers a convenient short-term bench-mark in infrastructure spending in both the NSW Government Sector and in the Public Non-Financial Corporate Sector (PNFC) (Budget Paper No. 2 2018-19):
Public-private partnerships can also assist the private sector to achieve more social market goals from the equivalent of new projects like the existing Parramatta Square Project which is currently being managed by the Walker Group.
Treasurer Dominic Perrottet is protected from the macro-politics of NSW in his safe electorate of Epping despite a strong resurgence by Labor’s candidate Alan Mascarenhas:
As the privatisation bonanza of the state LNP runs out of fresh assets in a slowing national economy during the 2019-2023 term of the re-elected government, it is Labor’s responsibility to come up with viable alternatives to the slash and burn style of neoliberalism which has been the hallmark of the current government.
Denis Bright is a member of the Media, Entertainment and Arts Alliance (MEAA). Denis has qualifications in journalism, public policy and international relations. He is committed to citizens’ journalism by promoting discussion of topical issues from a critical structuralist perspective. Readers are encouraged to continue the discussions in this current series of Trending Issues for Australians in this national election year.
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