OPINION: NSW promised to spend $15 billion on infrastructure and debt repayments that it is instead gambling on global financial markets.
After 12 years of Liberal leadership, encompassing four premiers and four treasurers, NSW is sadly degenerating into one of the worst run states in Australia.
Kean has blown a $7.1 billion improvement in NSW’s budget with $8.8 billion in new spending next financial year alone. As a lender to the state, my worry is that this tale of mismanagement gets worse. It seems as though Perrottet’s government has been systematically misleading taxpayers.Perrottet claims he is selling taxpayer-owned infrastructure to invest this money in new infrastructure. It seems, however, that Perrottet has sold billions of dollars of NSW infrastructure only to pay his mates extraordinary sums to gamble this money on global markets.
The NGF is managed by Perrottet’s pals in NSW’s investment arm, which is called TCorp. Last financial year, Perrottet and TCorp tried to take this misadventure one crazy step further: they wanted NSW taxpayers to take on tens of billions in extra debt to expand TCorp’s gambles on global stocks and other high-yield assets.The explicit goal, which TCorp acknowledged, was the hope that stocks and junk bonds paid higher returns than the cost of NSW debt.
The question is who has benefitted from this scheme? Who has a vested interest in it? Unsurprisingly, it is the folks punting the money. That is, TCorp.The NGF represents about 15 per cent of TCorp’s assets. Former Perpetual chief executive David Deverall, who runs TCorp, has been desperate to turn it into a global asset manager, and aggressively grow its capital.
Yet Perrottet and Kean still refuse to invest the original $7 billion from the sale of the first half of WestConnex in 2018 into the infrastructure they promised.
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