Asset sales tipped to raise up to $5b
State-owned office buildings and shares in lucrative developments will be sold along with a slew of power assets including wind farms and streets lights in a bid to fix the Barnett Government’s ailing bottom line.
On the same day it emerged the Government would put Fremantle’s historic port on the chopping block in a move aimed at raising billions, Treasurer Mike Nahan fleshed out the details of a planned “second tranche” of asset sales while handing down today’s State Budget.
Dr Nahan put a “conservative” figure of $3-$5 billion on the value of the assets earmarked for selling – with most of that to come from Fremantle port – and said he hoped the money could be booked in time for next year’s budget.
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As flagged by The West Australian this week, the sell-off will include the 55MW Mumbida wind farm and the 10MW Greenough solar farm, both of which are owned by State-controlled electricity provider Synergy.
According to the Treasurer, the two plants could fetch up to $100 million, particularly given their power is contracted long-term to the Water Corporation.
The Muja AB coal-fired power station near Collie, which is also owned by Synergy, will be put on the market, although Dr Nahan suggested the Government may hang on to it for longer to capitalise on its current profitability.
Regional provider Horizon Power is also likely to be targeted in the sales process, with a peaking power plant it owns in Karratha to be flogged off.
And in a surprise move Dr Nahan revealed the Government would look at selling “non-core” assets owned by electricity distributor Western Power such as its street lights.
It is understood Western Power owns hundreds of thousands of the lights across the State’s south west and selling them to a private investor, such as a superannuation fund, could yield more than $100 million.
Other areas being eyed up for asset sales are the Government’s portfolio of office buildings and developments wholly or partially owned by State developer LandCorp.
Dr Nahan did not identify which offices or developments may be offloaded, but it is believed some buildings such as Dumas House in West Perth have been ruled out, as have projects where the Government wants to maintain control.
Other buildings such as Albert Facey House in the city, which houses public servants, are likely to be considered.
On top of those sales the Treasurer said the Government would also get the Forest Products Commission to divest its softwood plantations to generate almost $100 million.
And the State would look to shift its ownership of assets held in a scheme known as Government Regional Officers Housing, which accommodates teachers, nurses and police officers in regional areas across WA.
The Government has already announced it wants to put the TAB on the market, with Dr Nahan today saying the betting agency was under “technological attack” and it would be better off in private hands.
However, Regional Development Minister Terry Redman, who is the Nationals Leader, stressed the any sale would need Cabinet approval and his party would not agree to anything that disadvantaged regional areas.
