Magazine of Socialist Action in Australia

Oppose the further privatisation of electricity

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The Coalition government in New South Wales (NSW) has legislated to sell off the state’s remaining electricity generators. They may also take a plan to sell off the power poles and wires to the next election.

Successive governments, both Labor and Coalition in NSW, have supported the idea of privatising various parts of the electricity sector. Their aim has been to open up new sectors of the economy for capitalists to make profits. Far from benefiting ordinary people privatisation has meant higher prices and inferior services in every instance.

In 1997 Labor’s Bob Carr tried to sell off parts of the sector. It was only stopped by campaigning from trade union movement. In 2010 the ALP Premier Kristina Keneally sold the electricity retailers and the output from the generators for $5.3 billion – well below what it was worth. At the time Barry O’Farrell, then Opposition leader, opportunistically opposed the sale.

In 2012 O’Farrell did a dirty deal with the Christian Democrats and the Shooters Party in order to enable the sale of the state’s power generators. Part of this deal involved allowing shooters onto national parks and also the possibility of increased funding for the minor parties’ administrative needs.

Now the Liberal Party wants to go further by selling off the poles and wires. They have chosen their timing carefully with the ALP at an all time low in the opinion polls it seems highly unlikely that they will have any chance at the next election.

That said, even if the Liberals were re-elected in 2015 on the back of Labor’s woes, it would not be an indication of support for the idea of electricity privatisation. The most recent Nielsen poll shows that 75% of people oppose selling the state’s poles and wires.

This is not surprising given a recent report from the Australia Institute shows that electricity prices have increased 170% from 1995 to 2012 – an increase four times greater the CPI, a measure of inflation. This is a direct result of the privatisation of the industry and the profiteering that has taken place over the last two decades. Consumers know full well that the promises of increased efficiency and decreased prices were a lie.

A recent ‘Independent Pricing and Regulatory Tribunal’ report has suggested that consumers can expect a further 3% increase in electricity prices from July this year. This will be costs passed onto consumers as electricity retailers spend money attempting to ‘acquire and retain’ customers in the competitive market. In other words consumers will be subsidising the market so it can work!

The best way to keep electricity prices down is not via the anarchy of the capitalist market. Companies driven by a profit motive will always do what they can to increase profits regardless of the harm done to consumers, workers or the environment. The only way to ensure affordable electricity prices, decent wages and conditions for electricity workers, and the transition to clean energy is to put the electricity industry under public ownership and control. That way people can have a real say about a vital service that we all need.

None of the major parties support measures like this. They are all tied to big business interests and the capitalist market by a thousand strings. What we need is a new political party that will put ordinary people’s interests first. If the trade unions, community and environmental groups broke their links with Labor and set up a party clearly against cuts and privatisations it would quickly gain mass support.

By Gary Duffy


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