$20B Power Sale can mean more homes for NSW

12 September 2007

The privatisation of state government owned power generation and electricity retailing could help take pressure off the States housing affordability crisis, according to Aaron Gadiel CEO of the NSW Urban Taskforce. NSW has a growing population and the supply of housing is falling well short of whats needed.

This means that rents are spiralling out of control and homes are priced beyond the reach of many young families.

The most recent figures show that annual increases in median rent for one bedroom units are as high as 24 per cent in Auburn and 20 per cent in Marrickville. In 17 local government areas there have been rental increases of 10 per cent or more for two bedroom apartments.

The $20 billion that could be raised through electricity privatisation should be ploughed back into urban infrastructure, Mr Gadiel said.

A large scale government investment in new motorways, new train services, new schools and health facilities will make it easier for more affordable housing to be developed.

Homebuyers will be able to access new areas currently out of reach because of poor transport links, or inadequate local facilities.

Anyone who wants to see more affordable housing should back plans to privatise the States electricity generation and retailing assets.

The report by Professor Anthony Owen shows that if the power companies remain in government ownership up to $15 billion will need to be found to keep them going.

Another $15 billion worth of borrowing for state-owned energy companies will come at the expense of much needed urban infrastructure.

Financial experts have estimated that $3.3 to $4 billion can be raised by the sale of the States electricity retailers and a further $12.5 to $15.5 billion for the States power generators. The NSW Urban Taskforce is a property development industry group, representing NSWs most prominent and important developers, builders and property financiers.

The NSW development industrys annual turnover is $35 billion and employs 180,000 people, accounting for six percent of the States total employment. It is the fifth largest contributor to the State economy.