Meandu Coal Mine south of Kingaroy and Kogan Creek coal mine near Chinchilla will be sold by the Queensland Government along with their respective owners and electricity generators, Stanwell Corporation and CS Energy.
The sell-up was announced by Treasurer Tim Nicholls this afternoon as part of the Government’s 2014-2015 budget and draft plan of action to ” reduce the $80 billion state debt and $4 billion interest bill”
Also going under the hammer will be the electricity networks of Powerlink, Energex and Ergon Energy. Ergon Energy’s retail arm will be sold off as well.
The Port of Gladstone, Port of Townsville and the Mt Isa Rail Line will be offered to the highest bidder for long-term lease.
“At their current value, the asset transactions proposed to reduce debt could potentially deliver proceeds of $33.6 billion, enough to return state debt to more sustainable levels and invest in vital infrastructure needed for a growing Queensland,” Mr Nicholls said.
Mr Nicholls said the Government’s innovative private sector investment proposal will allow Government to retain 100% ownership of ordinary shares in the three electricity network businesses, but invite private sector participation via a hybrid instrument.
This would involve the private sector funding infrastructure investment in exchange for a share in the revenue streams of these entities. The Government would also retain a share of revenue.
The Government claims none of the proposed transactions would take place until the Government has secured a mandate for them at the next state election.
“The recent Federal Budget also had an impact, making two of the choices available to the State Government – to significantly increase tax or reduce services – less palatable,” he said.
“We know everyday Queenslanders are already dealing with cost of living pressures and we will not burden them with a ‘double whammy’ of tax increases on top of tax increases, or reduce services that have already been made more efficient.
“Not everyone will agree with all the choices we make about how to pay for things in the future.
“The new debt level would mean Queensland’s annual interest bill would drop from $4 billion to $2.7 billion,” Mr Nicholls said.
Deputy Premier Jeff Seeney said the Royalties for the Regions program remains a key focus of government spending for 2014-15.
“The Royalties for the Regions program ensures a share of the royalties earned by the resources sector in regional areas is returned to the people of those regions to help create vibrant, liveable communities.”
“We’re spending $101.5 million in the 2014-15 Budget for Royalties for the Regions projects for the construction and upgrade of essential community infrastructure,” Mr Seeney said.
Other highlights of the 2014-15 Budget for the resources sector include:
- $2.5 million per year over the next four years to fund the independent GasFields Commission. The Commission is an independent statutory body established to manage relationships between rural landholders, regional communities and the onshore gas industry.
- $1.5 billion for the Rural and Regional Roads Fund
- $700 million for the Rural and Regional Economic Development Fund.
The Draft Plan for Action can be read online or downloaded at www.StrongChoices.qld.gov.au.