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Legislative Assembly for the ACT: 1999 Week 4 Hansard (20 April) . . Page.. 968 ..


ACTEW - Proposed Merger

MR STANHOPE: Mr Speaker, my question is to the Chief Minister. In the developing debate over the proposed merger of ACTEW and Great Southern Energy the existence has been revealed of a favourable retail electricity price difference between the ACT and the region serviced by Great Southern, probably arising from economies that accrue to ACTEW because of the compact area that it covers compared to the huge rural area serviced by Great Southern. It has been suggested that a merger would see prices brought into line over time. Clearly, there is an implication that a merger, in itself, would force a price increase on ACT residents, quite apart from other influences of the predicted elimination of the perceived cross-subsidies, a double whammy for the households of Canberra. Mr Speaker, will the Chief Minister assure the Assembly that calculations of the value of a potential merger will take the impact on the domestic consumer of Canberra into account.


MR STANHOPE: That was very helpful in the context of the debate, Mr Speaker.

MR SPEAKER: Order! Ask your supplementary question, please.

MR STANHOPE: I thank the Chief Minister for her answer, Mr Speaker. Whilst I welcome her response, will she concede that her support for the merger is driven by her desperation to get her hands on some cash to insulate her from having to manage the ACT economy for the first time? Is she prepared to expose Canberrans to additional utility costs just to salvage some form of a win after her previous failed attempt to flog ACTEW?

MR SPEAKER: You can answer if you wish, Chief Minister.

MS CARNELL: Mr Speaker, I am very happy to answer that. In terms of need to access cash, those opposite have already recommended that we take some $300m out of ACTEW to move across to the Superannuation Provision Account. In fact, this Assembly has suggested to the Government that we do that. We know that $300m is at the maximum, or the real upper limit, of what ACTEW could handle while maintaining its credit rating and its capacity. Even at that level, it will certainly affect dividends to the ACT. The reason I understood that the Assembly recommended that to government is that every member of this place believes that our unfunded superannuation liability should be addressed. Yes, without any doubt, this Government does need to access cash from ACTEW. In fact, this Assembly told us that that is exactly what we should do. I am surprised that Mr Stanhope has forgotten that.

The Government is interested in looking at whether a merger is a possibility or not, because this Government is not going to sit on its hands and allow ACTEW to become a smaller, less innovative organisation with a greater risk profile and returning less to the ACT taxpayers. Mr Quinlan admitted during the debate on the ACTEW sale that he believed that the retail arm of ACTEW would be worth, to use his term, "zip" in the

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