Thursday, August 28, 2008


Iemma losing power over electrical sale

By Simon Benson and Joe Hildebrand

August 28, 2008 12:00am

THE $10 billion sale of the NSW power industry will be scuttled today by Liberal leader Barry O'Farrell after a vote by the Liberal Party room to oppose privatisation.

The death of the sale plan could spell the end for Premier Morris Iemma, with MPs predicting his defeat could cost him the leadership.

The shadow cabinet will make its final decision at 8am today, when Opposition finance spokesman Mike Baird is expected to make a last presentation to his colleagues to change their minds.

With both the Nationals and Liberal MPs now jointly opposed to privatisation, the sale is doomed.

A Liberal Party spokesman said the majority view of the Coalition MPs was that the model presented by the Government "failed the public interest test".

"It was also agreed that Labor could not be trusted, it was not the right time and that there was uncertainty over an emissions trading scheme," the spokesman said.

The Liberals had planned to keep their position a secret but one of their MPs, Brad Hazzard, confirmed it to Labor backbencher Kerry Hickey when they bumped into each other in the men's bathroom.

The business community has warned the Liberal Party that it risked losing all credibility if it torpedoed the sale.

Despite four reports in 12 months, including a recent auditor-general's report giving the green light to the sale, the Liberal MPs unanimously voted on a strategy which appears to be based on trying to bring down Morris Iemma.

The Premier, now facing an uncertain future with his leadership, was expected to be put under increasing pressure.

Treasurer Michael Costa said last night legislation will be brought on in the Upper House today regardless.

"These are just excuses . . . the enabling legislation doesn't dictate time or structure. Their excuses just don't fly," he said.

"They are a direct contradiction of the Auditor-General's report."

An 11th hour meeting of Labor MPs pledging to block the sale in the Upper House was held last night at the Liquor Hospitality and Miscellaneous Workers Union headquarters near Sussex St.

The six left-wing MPs - Penny Sharpe, Lynda Voltz, Ian West, Helen Westwood, Mick Veitch and president Peter Primrose - have all signed an undertaking vowing to uphold ALP policy and vote against the Premier.