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April 12th, 2013 
NSW Treasurer Mike Baird has announced a deal to privatise the state’s ports for the next 99 years.
Source: AAP
THE NSW government has accepted a bid to privatise two of Australia’s biggest ports, in a deal that will earn $4 billion for infrastructure projects in the state.
The 99-year lease for Port Kembla and Port Botany was awarded to the NSW Ports consortium for $5.07 billion.
The consortium is comprised of three Australian companies, Industry Funds Management (IFM), Australian Super and QSuper, and Tawreed Investments, a wholly-owned subsidiary of the Abu Dhabi government.
About $4.3 billion of the net proceeds will be invested in the state government’s infrastructure fund, NSW Treasurer Mike Baird announced on Friday.
It means the government’s $1.8 billion commitment to the WestConnex motorway between the M4 and Port Botany was now funded, he said.
The sale would also provide funding for the Princes Highway, the Bridges for the Bush program and a further $100 million for projects in the Illawarra region.
“It’s a great win for NSW, the infrastructure funding for this state has had a massive boost,” Mr Baird said.
However, opposition Treasury spokesman Michael Daley has criticised the sale, saying the money raised was a “drop in the ocean” when it comes to building major projects like the $10 billion WestConnex.
He said the sale would also cause a rise in petrol prices because the new operators had “unfettered powers” to increase all port fees, rents and charges.
“The industry has long warned that petrol and LPG prices could soar under the privatisation of ports because new fees and charges will be imposed,” Mr Daley said on Friday.
“It’s also likely to compel a number of lease holders to move their operations to other ports such as Brisbane and Melbourne.”
Mr Daley also criticised the government for removing the cap on the number of components that would move through the port each year.
“This will mean a massive increase in trucks in and around Port Botany and the airport,” he said.
The head of the company that led the NSW Ports consortium, IFM CEO Brett Himbury, wouldn’t confirm if the ports would be expanded.
“We expect the state of NSW will continue to grow rapidly and with that there will be a level of growth, but that will be done in a responsible manner that ensures the community also benefits,” he told reporters in Sydney.
The Sydney Business Chamber welcomed the sale, saying it would free up billions in capital to reinvest in new assets.
The Australian Industry Group’s NSW Director Mark Goodsell, meanwhile, said the port privatisation should “give confidence” that the electricity network can also be safely privatised in the future.
Some employees of the Sydney Port Corporation and Port Kembla Port Corporation would transfer to the new port lessee, Mr Baird said.
Those on enterprise agreements would receive a two-year employment guarantee, a transfer payment of up to 30 weeks’ pay and retain their current superannuation and other entitlements and conditions.
The NSW government would also retain regulatory oversight of the ports, as well as responsibility for safety and security.
Infrastructure Partnership Australia (IPA), Australia’s peak infrastructure body, said the NSW government should be congratulated on the sale of the ports.
“The excellent sale price will allow the state to make meaningful inroads into tackling the state’s substantial infrastructure backlog and will prove a win for taxpayers, commuters and the state’s freight sector,” IPA chief Brendan Lyon said in a statement.
“The recent negative credit outlook from rating agencies reinforces the need to sell assets and rein in spending.”
Mr Lyon said the sale should give other governments the confidence to follow the NSW government’s lead.
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