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Legislative Assembly for the ACT: 1999 Week 4 Hansard (20 April) . . Page.. 973 ..

MS CARNELL (continuing):

that much higher but because their equity is somewhat lower. Those are all of the issues the working party needs to look at to determine whether a merger is the right way forward.

If a decision is taken to go ahead, this Assembly will get an opportunity to debate the issue. But again, Mr Speaker, what those opposite are doing is a desperate attempt to undermine the approach prior to the details being put on the table. Why would those opposite try to do that? The reason is that they are knockers. They just want to knock off any option that may be in the best interests of ACTEW. It is very interesting that in the past Mr Quinlan has indicated that strategic partnerships that the ACT Government - - -

Mr Quinlan: Mr Speaker, I take a point of order about relevance. I asked about an acceptable debt-equity ratio and a parameter, a boundary, that the Government might set for its working party; that is all.

MR SPEAKER: Thank you. That is all right.

MS CARNELL: A merged entity, if it ever exists, will be significantly bigger than either Great Southern or ACTEW. In fact, initial indications are - and certainly it would be true - that the merged entity would be bigger than the sum of the parts, simply because its capacity to compete would be significantly higher, as would its capacity to buy better and to spread overheads. A 30 per cent debt-equity ratio is not a benchmark for utilities. Different debt-equity ratios would be appropriate for different sized utilities. It is simply ridiculous to assume that what is right for ACTEW or what is right for Great Southern is right for a significantly bigger entity that may eventuate as a result of a merger.

MR QUINLAN: It is a bit of a worry, is it not? I look forward to the shifting sands of debate.

MR SPEAKER: I look forward to the supplementary question, thanks, Mr Quinlan.

MR QUINLAN: My supplementary question, Mr Speaker, is: What does the Chief Minister believe is a reasonable difference in equity contribution for a merged enterprise where the ultimate control will be shared on a fifty-fifty basis?

MR SPEAKER: That is a hypothetical question, Chief Minister.

Mr Berry: No, it is not.

MR SPEAKER: I think it is.

MS CARNELL: Mr Speaker, it is a hypothetical question. What I can say quite definitely is that the ACT Government is looking at a fifty-fifty split so that the shareholders both from the ACT and from New South Wales have equal say.

Mr Stanhope: Subject to the outcomes of the working party.

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