State Budget debt shift to electricity business ‘sneaky’
TOO good to be true, is how one resource economist described a Queensland Government budget restructure plan to shift $4 billion in debt to the state's electricity businesses.
Treasurer Curtis Pitt has promised the move to transfer debt onto distributors Ergon, Energex and Powerlink would not mean forced job redundancies or less services.
He said the shift would not cause power bills to rise because the Australian Energy Regulator sets electricity distribution and transmission prices.
But CQUniversity Professor John Rolfe said it was difficult to see how shifting debt onto the companies would not lead to job cuts or services cuts.
"If the government forces corporations to have higher costs they can absorb that in the short term by delaying a lot of capital spending and maintenance, but in the longer term those delays come back to bite them," he said.
"All (the government) is doing is shifting the debt around."
The Palaszczuk government also plans to merge its distributors and generators, Stanwell Corporation and CS Energy, into two separate companies.
Prof Rolfe said it would be difficult to merge the generators as they were effectively competing with one another, but the distributors were covering different areas so it would be much easier.
Mr Pitt said the move would reduce interest payments on general government debt by about $600 million over the forward estimates.
"With the assets firmly staying in public hands, we need to get them operating more efficiently for Queenslanders," he said.
"With forecast electricity demand expected to remain flat over the next regulatory period, the businesses are under less pressure to expand their networks to meet customer needs."
Opposition treasurer spokesman John-Paul Langbroek labelled the plan the "sneaky Labor debt swap" and likened it to using one credit card to pay off another.
Mr Langbroek said it could only lead to more charges, less services and potentially job cuts.
- APN NEWSDESK