Industry Super Funds Deliver Lifeline To Abbott Privatisation Plans

Getty/Matt Cardy

As the political debate rages about Australia’s infrastructure needs and the selling of Commonwealth and State assets to help fund much-needed public works, it seems that Australia’s Industry Super Funds (ISA) might be about to throw Tony Abbott’s privatisation plans a lifeline.

Privatisation of public assets is hotly debated across the political spectrum, as the maelstrom caused by ACCC Chairman Rod Sims comments about an Australia Post sell-off earlier this week showed.

Likewise Tasmanian Premier, Lara Giddings, told the Australian that the Abbott Government was putting “undue pressure on Tasmania to sell off key assets like the (power generator) Hydro and (power transmission company) Transend” in return for vital infrastructure funds.

It’s a multi-faceted debate with issues of national interest, in terms of the ownership of important infrastructures assets, competing with the fiscal rationale of selling these same assets to free up cash and bring forward the dividend stream that would otherwise be earned over decades.

Add into the mix political views on either side of the political divide about who should own and run Australia’s infrastructure and we have an often fractious debate.

But in what might be a wonderful compromise in satisfying all stakeholders, The Australian reports this morning that: “The nation’s biggest super funds are pressing for government action on $92 billion in potential sales by citing new research showing community support for deals that leave the assets with long-term Australian investors.”

The push is coming from the industry super funds which are those funds with links to the very workers, unions and employers in the businesses that are to be privatised and throughout the broader economy.

The Australian, citing the ISA submission to the Government, says that they have research noting:

The public has been rightly concerned by public sector asset sales where new owners have been motivated by short-term incentives to slash costs, cut jobs, gear up and bail out without regard for the long-term needs of the business or community.

Superannuation funds as buyers have the potential to cut through community concerns about private sector ownership and potentially change the game.

It’s hard to argue with the logic, which neatly puts a bow around all sides of the debate.

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