So in the end what your saying David, is. Companies lowering wages and raising prices is a good thing.

Not only that Cobber, but he seems to be also saying reducing essential maintenance (money saving) to the point where poles fall over and start impossible to stop wildfires, with huge loss of PRIVATE PROPERTY AND LIFE; is also a good thing!

You just can't check white anting from the air! But you can have a nice joy ride in a very expensive piece of equipment, and write off lots of tax!

Perhaps he thinks the budget bottom line could be a lot slimmer?

And given the privatization often results in foreign ownership?

Repatriate all the price gouged profits and most of the tax liability!?

A good thing also?

And it's not just the domestic market smarting under the new electricity charges but business as well, who must respond by raising prices; which all too often results in huge wage breakouts across the board, given just how much increased energy prices impact on the overall cost of living!

And London to a brick he was one of those pollies that waffled on about how dreadful the carbon tax was?

Unless you're getting a generous expense account, which isolate you from the consequences of downright dumb government decisions!?

And seriously increased brown outs and blackouts, many with huge commercial consequences as thawing food goes bad/is lost or causes multiple food poisoning outbreaks, another good thing!?

And the price increases that automatically follow privatization is a double blow, but particularly for assembly line business, which is totally dependent on power, like say GM in SA, which under a privatized model, now has the highest power prices in OZ!? Another good thing?

Even as Holden packs up and prepares to exit these shores!

Why? Well a much larger power bill, may well have been the final nail in that coffin!

But that's probably okay as well, given David's job or generous after politics pensions aren't threatened by any amount of privatization?

But his personal investment portfolio, may be seriously fattened by it? And via a captive market!?

Well, that would be a good thing wouldn't it?
Rhrosty.

David, your antiABC rant is ridiculous! Decline in advertising revenue is the thing that's causing the hollowing out the rest of the news industry. If we didn't have the ABC we'd be even worse informed than we are now.

And what is the source of your claim that " a majority of Australians never watch or listen to the ABC"?

And on your main issue, the case for privatising monopolies iv very far from straightforward. Firstly there's the value argument; do you doubt the government would now be financially better off if it hadn't privatised Sydney Airport?

Secondly, the owners exploit the way the regulation works. Victoria's new electricity infrastructure has been "gold plated" so that the owners can charge the customers more.

Thirdly, some of the staff cuts can be false economies. There's a greater risk now of Victoria's electricity infrastructure sparking bushfires. And the benefits of the staff cuts don't seem to have been passed on to consumers.

Fourthly it's just not true that "Government-run businesses are never run as well as private businesses." The most you can say is that they're NOT ON AVERAGE as well run as private businesses. But there have been some well run government businesses and some very badly run private ones. The privatisation of Britain's railways is a particularly conspicuous example.

And finally, the need to provide essential services puts taxpayers at risk EVEN WHEN THEY'RE PRIVATIZED. If the company operating them goes bust, the government will have to step in. And when they do, they're likely to find that the wealth of the company has already been transferred to the shareholders but the liabilities remain.

Public bureaucrats are difficult to deal with, "Private" bureaucrats are impossible!

There do seem to be a lot of claims made in the article with no attempt to substantiate those claims. Whilst this is an opinion site the claims mostly seemed to be presented as established facts. Some references to sources would be useful.

I went looking to see what I could find regarding the electricity network price issue. The best coverage I've found was from the ABC http://www.abc.net.au/news/2015-03-25/fact-check-does-privatisation-increase-electricity-prices3f/6329316 also some interesting material at https://www.nsw.gov.au/sites/default/files/miscellaneous/electricity_network_services.pdf

A worthwhile point to take from the latter is the different cycles of network investment between states.
"For example, over some of this period, the networks in NSW and Queensland have invested particularly heavily in their networks.
In contrast, the businesses in Victoria are approaching a stage in their life cycle which may require substantial further investment. South Australia may also have recently entered a similar stage in their investment life cycle as is the case in Victoria."

Also worth noting from the second report the disparity in non-network cost rises.

There is also some interesting material at http://www.rba.gov.au/foi/disclosure-log/pdf/101115.pdf entitled "HOW ARE ELECTRICITY PRICES SET IN AUSTRALIA?" Appendix 1: Input Costs summarises input costs for Energex on Network Capital Expenditure. There are also some interesting comments on Victorian actual spending and submissions for expected spending.

My overall impression is that the way David tries to portray this issue with his claims is not backed by evidence.

R0bert

You don't have to lower wages to cut costs. You just have to cut out all the dead wood. Look at what happened in the Latrobe Valley when the SEC was privatised. A big percentage of the redundant work force disappeared. We are still not paying a lot. My last bill was 20.7 cents per KWH for the power used.

David

"Privatisation is not just good economics. It's good for the community."

David.

Well it appears that the foreign owners of Victoria's power network, engage in aggressive tax avoidance.

So how can this be good economics?

David, I disagree with you strongly when you state that the government-subsidised, ad-free ABC is responsible for hollowing out the rest of the news industry.
The last phrase describes one of the innate problems of commercial operators; this is the belief that news can be an industry.

An industry exists to create a product then sell it.

News is not a commodity which can be sold; it is knowledge, awareness, information which is sought as a natural learning event by interested people.

Its commercialisation is peripheral to this activity. People do not buy newspapers, listen to radio, or watch television news so that they can absorb advertising. In many cases, the amount of advertising clutter engenders corporate resentment of the disseminator.

That is why the ABC ranks well above commercial organisations as a source of trusted news reportage; it is a national community service in a similar way to hospitals, museums and schools, and deserves funding by the government so as to preserve honest, reliable, trustworth reporting on news issues, without advertising influence.

I suspect that many commercial news markets are failing because they treat news as merely a vehicle for advertising revenue, and as advertising drops off, so does their operational viability.

The ABC has a vital role in society, hence should never be privatised.

The author needs to read and understand Professor Mariana Mazzucato's book The Entrepreneurial State. Prof. Mazzucato comprehensively demolishes the Public v. Private Sector myths. He could also learn plenty from Nature's Trust by law Professor Mary C. Wood.

On page 109 of the paper back edition there is a diagram showing the sources of the technology Apple includes in its "i" products. All the high tech gimmicks (touch screens, GPS, click wheels, cellular systems etc,) come from basic government research.
In the same way most USA medical drug developments flow from government owned laboratories or from government funded research.

As for the ABC; I neither watch nor listen to anything else. I refuse to spend my spare time listening to crappy advertisements for what are often even crappier products or to shock jocks who know little but are full of themselves. Sometime I despair at the lack of economic understanding displayed when ABC interviewers question politicians but where would we be without Four Corners, Big Ideas and the ABC produced drama programs?

So the privatisation of the Commonwealth Bank and Teltra were worthwhile? Financial services profits were less than 5% of total profits within Australia. The profits are now about 30%. Someone is being skinned and it isn't the already wealthy.

Maybe the author is not aware that due to deregulation and poor prudential behaviour the private banks had to be bailed out by Rudd, Gillard Swann and Tanner.

Had Telstra not been privatised the copper wires would have been phased out long ago. Telstra started using fibre about 40 years ago. That process slowed decisively when privatisation was first aired.

I wonder if David, is one of those people who never watch the ABC, or are they just people he has heard of.

Gogglebox anyone.

Not quite correct, David. How a business is privatised is critical and is often done badly, so we land up with monopolies screwing the public. The best airport in the world for example, is Changi in Singapore. Owned by the Singapore Govt, but run as a corporation, which is what our Govts do so badly. Compare that to Sydney, where IMO people are simply fleeced because they can be and your theory is clearly mistaken.

I am against selling poles and wires in a place like WA, as what will happen is that service and maintenance simply won't be done, whereas right now Colin Barnett has finally bitten the bullet and is spending a fortune on finally upgrading the lines. They don't need to be gold plated, but every time a power pole topples over in summer, we land up with another fire started, with some pretty dire consequences. We need a reliable electricity service, even in the country, where it does not pay it's own way directly, but certainly does indirectly, as without the country areas, Perth would starve and go broke for lack of exports.

Rubbish ,we need to keep the bankers honest.http://kingworldnews.com/ecb-to-steal-greek-bank-deposits-as-greece-to-default-within-two-weeks-sending-shockwaves-around-the-world/

While I could write a paragraph, I find it easier cutting & pasting Yabby's succinct statements which are well worth repeating:

"Not quite correct, David. How a business is privatised is critical and is often done badly, so we land up with monopolies screwing the public. The best airport in the world for example, is Changi in Singapore. Owned by the Singapore Govt, but run as a corporation, which is what our Govts do so badly".

The real problem with privatising public assets is that are no longer public. Profit motive means user pays and if you can't pay you don't get to use. We as a nation seem to forget that utilities were made public because private enterprise would stop delivering services to those who couldn't pay. They are called ESSENTIAL services for a reason... that is that are ESSENTIAL.

Effectively it called selling the cupboard bare. When the service or entity stops being a money making concern the private company wants out (i.e.. stops investing, upgrading services, employing people to fix problems etc) and we the public have to buy it back. It is a cost all round for the public - the water system in Victoria is terrible compared to 20 years ago, Telstra isn't too crash hot either. Normally it sold under value (read all the public utilities under Kennett), then will be sold back to us at current value despite it being neglected for many years and we, the public, lose again.

It is beyond short sighted and only makes things look good on paper for the very short term.

The modern liberal (and labour, unfortunately) idea that paying tax is a bad thing would have the truly forward thinking liberals of Playford, Bolte and (even) Menzies turning in their graves with the short-sightedness of it all. And Labour are part of the problem also. These twits want power for power's sake and don't want to leave any sort of legacy for the country except for more debt, more division between those who have and have not and more idiots thinking privatisation is a smart way of running a country.

What utter garbage grumpy old man.

Taxes never ever got any where near modern rates for middle income earners when they were running the place. It was Whitlam who started the rot, followed by every Labor government since.

In 1964, when I first got to earn the average wage, I was paying just 7.5% income tax. Granted I had an uncle who was earning 10 times the average wage complaining he gave 54% of his pay to the government in tax, but average wage earners paid nothing like the ridiculous amount in PAYE we do today.

We also paid less than half the tax/excise we do today on fuel, tobacco & alcohol. There was no GST either.

Government spending was a much smaller percentage of GDP, & public servants were paid low wages in exchange for job security.

Sales tax brought in much that is GST today, & import duty also was a good stream of government income, but in general, taxes were much lower, as was government waste.

Just asking a few question here but do these leaders of ours when selling out our assets do their figures include welfare payments for all the unemployed people from these sales/lease, and when its government run how much difference is in the balance of payments
Also when these leases are getting near the end, how much DEFERRED maintenance would a private company do
one of the things i have notice different between gov vs private is that private doesn't generally employ schoolboys (never had a job) to run their businesses, Why does Government ?

What is interesting is the numbers of politicians who jump right into public/private companies.

There was a news article about some of the Queensland politicians sliding into corporate jobs.

Politicians and honesty! Who ever believes that also believes 'Cows can fly!"