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Beazley Prevaricates on Privatisation

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Shadow Minister for Privatisation . Warwick Smith M.P. 25 February 1991 Beazley Prevaricates on Privatisation

The Minister in charge of airline and telecommunication sales, Mr Beazley, is between a rock and a hard place according to the Shadow Minister for Privatisation, Warwick Smith.

'Past policy positions and decisions are stymieing the Government's efforts to privatise its capital starved enterprises.

'Beazley's latest thoughts about attaching pay television rights to Aussat in order to make it more attractive to investors and increase its price has to be pitted against the effect this would have on our sick television industry.'

'This follows his request to Austel to determine the effects of issuing several regional licences rather that a single national licence. Mr Roger Price, chairman of the caucus telecommunication group suggests that the "open slather" competition which would occur at the end of the duopoly (1997) needed to be reviewed. Will they now

extend the duopoly to 2000 thus compounding the folly of the initial policy?'

'On the matter of the airlines the questions are what price will they bring in the current economic climate with airlines world-wide in a tail-spin, should we wait until thing improve, should we allow a higher level of foreign investment and how should they be sold?'

'The ALP special conference on privatisation endorsed a foreign investment level of 40% in aggregate for Australian Airlines and 35% for Qanfcas. Will Mr Beazley breach this? His talks with Garuda, Singapore, Cathay and British Airways may convince him that the limits imposed are unrealistic.'

Ά sale now will not maximise price to government. It is not in Australia's interests for the airlines to be sold at "fire-sale' prices especially to overseas interests. Australians should be given an opportunity to purchase a stake in their own assets and share in the profits of privatisation.1

Ά broad share float must be part of the airline privatisation proposal. A selected 100% trade sale of Australian Airlines will negate the opportunity for wide share placements. The public ought to be able to participate in privatisation and employees must be given a chance to own shares in their enterprise. A consortium purchase and non-listing on the Australian Stock Exchange will deny the benefits

of market discipline and efficiency privatisation can bring. Mr Beazley is about to deny this to the Australian public.




“...working for Australia’s economic prosperity.”



'It must be indeed galling for the left wing of the ALP, having reluctantly endorsed the privatisations to find they may not maximise price to government and, given the budget surplus wipe-out, the revenue from those sales cannot be used for infrastructure investment. It will be even worse if the Government is forced to lift

the foreign investment level in order to achieve a sale. These are however the economic facts of life imposed on Australia by the "terminal" economic policies Paul Keating has delivered.'

'We are waiting for the prevaricating Minister to enlighten us on his latest thoughts. Perhaps there will be some answers in the March 12 statement.'

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