January 19, 2015 | Graham

LNP running only half a campaign

I’m puzzled by the Queensland LNP campaign. It is leaving the Bligh government completely out of the frame.

For example, yesterday’s campaign launch included an announcement of a pay down of $2 bn of debt on Seqwater leading to a $100 cut in water bills. Fair enough, if the utility has lower costs it should pass them on.

But what is completely inexplicable is that Newman didn’t mention that this was the cost of the now mothballed desalination plant at Tugun, and that the reason water costs are as high as they are were the Bligh, and Beattie, governments mishandling of water.

Normally when you are running for your second term of office voters will accept the last term of the government you beat last election as evidence of what they would do if they beat you this.

Labor has a tenuous debt repayment policy, and what better evidence of their propensity to mismanage than the desal plant debacle.

The asset leasing program has been partly necessitated by the ill-advised capital program of Labor governments, financed by debt.

Another example of a lost opportunity is the $3.4 bn earmarked from the asset leases to lower the price of electricity. The price of electricity is so high because the former government implemented a feed in tariff paid to people who put electricity into the grid from their solar panels of 44c a kwh.

Not only is this around twice what the retailers can charge users for their electricity, it is currently around 10 times higher than many wholesalers are charging retailers. This was bad policy on steroids – a pork barrel designed to boost the Green support for the government and spruikers in the alternative energy sector.

The $3.4 bn merely represents the capitalised cost of paying the 44c fee, an obligation imposed by Labor.

What better example to use of how the debt has arisen, why the cost of living is so high, and why there is a need to lease-off assets.

Without the former government in the frame, this election seems to be centring around whether Campbell Newman is trustworthy or not, and from polling I am analysing at the moment, they’re pretty sure he’s not.

You generally win elections not on the basis that your policy and performance is the best in the world, but that, while it might not be that good, your opponents are even worse.

Having broken the mould on so many other things, it appears the government is trying to break the mould on this as well.


Posted by Graham at 8:14 am | Comments (10) |
Filed under: Australian Politics


  1. Graham, are you saying that Newman brought the rain and that Bligh et al were misguided when they accepted advice that security of domestic water supplies during drought periods depends on availability of desalinated water?

    If Premier Newman was to follow your advice today, then tomorrow he would be answering questions as to why his government has abandoned plans for drought-resistant water supplies when these were available only one election cycle ago.

    Even Campbell Newman can think one day ahead.

    Comment by John B — January 19, 2015 @ 8:49 am

  2. >The price of electricity is so high because the former government implemented a feed in tariff paid to people who put electricity into the grid from their solar panels of 44c a kwh

    As I understand the price structure the bulk of the high price comes from the trick that allows all capital equipment to be revalued as new and then depreciated yet again.

    The feed-in tariff is a small proportion of total costs.

    As for water, the supply was down to 16% and evacuation planning for Brisbane was underway. The desal plant was built in a great hurry and had all the symptoms of that. The plant was sufficient to provide drinking water to Brisbane. Later it did just that when Mt Crosby weir was silted up by excess rainfall

    Comment by Omar — January 19, 2015 @ 9:13 am

  3. JohnB, the desal plant was a complete panic reaction to the water problem, which Labor created anyway. If they’d allowed the Wolfdene Dam to be built Brisbane would not have had an issue. And they wouldn’t have panicked if they hadn’t listened to unqualified “experts” like Tim Flannery.

    Omar, the cost of the 44c kwh tariff is the $3.4 bn set aside to keep electricity costs low. You don’t know what you are talking about. And how could you justify paying people twice the retail price for their electricity on what ought to be a wholesale market?

    The previous Labor government was incompetent and needs at least another term in opposition to purge itself.

    Comment by Graham — January 19, 2015 @ 10:20 am

  4. It is somewhat refreshing not having the government harp on about the woefulness of the previous incompetent lot. They are standing on their own record, which I think is admirable. It is unbelievable that some Queenslanders would think that Anastasia would be the preferred premier over Campbell. The woman can barely construct a whole sentence let alone run our fine state. And let’s face it, we haven’t exactly had a great run with female leaders, think Bligh, Gillard, Kirner, Lawrence…

    Comment by Philip — January 19, 2015 @ 10:27 am

  5. Graham, that would be the dam which was too costly to justify, would impound water of too low quality (eg tainted by sewage) and had planning and environmental issues.

    You can’t have it both ways. If you demanded that the dam be constructed, then you also demand that the problems which were part and parcel of the proposal come to fruition – especially regarding cost.

    Perhaps the then Premier (Goss?) had it right, after all – desalination was a preferable option. Many thought so at the time.

    Here’s a very basic reference to refresh the memory. http://en.wikipedia.org/wiki/Albert_River_%28Queensland%29

    Comment by John B — January 19, 2015 @ 10:52 am

  6. Why don’t you read the link, instead of inserting it as though it proves your points? There was nothing wrong with the Wolfdene Proposal. And it’s fine to say a dam is too expensive, but compared to what? Everyone accepts that a desal plant is the most expensive way to get fresh water. Not only does it use huge amounts of power, but because it is at sea level there are huge costs involved in pumping the water uphill to reservoirs, and long distances to where it is needed.

    Comment by Graham — January 19, 2015 @ 11:31 am

  7. Yes Graham and instead of the disaster that was Traveston, the then Bligh government could have built a couple of vastly less costly smaller dams on high ground further up on crown land; then used a diversion tunnel to take some of the water and put it in Wivenhoe, via the upper reaches of the Brisbane river, when water supplies were low; the original excuse for higher electricity charges.

    I mean it cost some forty millions to resume land, not even suitable on any grounds, and where evaporation would have outpaced inflows!

    I don’t know if anyone is still getting 44 cents as feed in tariff.
    I’m getting just 8 cents, and since Ergon replaced the (running backwards) meter, I’m once again paying for electricity!

    I think Wolfdene would now run into similar problems that beset Traveston; the first being too many people to relocate and compensate. Or aren’t people and their homes, mostly small rural holdings, important anymore?

    The Coomera would be a better option and on crown land further upstream, where it comes out of a national park as unpolluted pristine and usually far more reliable water.

    Higher ground allows pipes to carry additional water to almost anywhere in regional Brisbane; or the growing Gold Coast, on gravity feed alone; and incorporate the possibility of turning a turbine or two on the way down, as might have been the case for an upper Traveston diversion project.

    Which might have allowed lower electricity prices, given the lack of fuel or energy inputs, ever!

    I don’t believe it was ever a case of Campbell Newman and the LNP winning the last election, but one where Labor and (she who must be obeyed) captain Bligh lost.

    And given the pendulum swung too far, time for some adjustment!

    I’m sorry, but Campbell seems to be a very slippery character, with early promises reneged on via a commission of inquiry, that showed, we couldn’t afford any of them.

    And again Campbell is promising to spend money yet to be found via the virtual sale of some state assets.

    Now, the new operators will need to not only make a handsome profit, but pay the additional monthly lease payments as well, and who will pay that?

    You guessed it, the long suffering electricity user, some of who, like former lucerne growers, can no longer afford to water their crops.
    What would a 400% increase in their electricity tariffs do?

    Well it’s what happened when Captain Bligh sold of our public gas company!
    And within weeks of the transfer of ownership!

    Or if they do manage to hang on, have to charge so much for the bales that half their customers bow out, with many smaller holdings once run as hobby farms for horse owners, already coming on the market.

    The Bjelke Government was in an even worse financial position but nonetheless borrowed like it was going out of fashion, to create income earning infrastructure, and then used the proceeds and cleverly leveraged development/population increases, to gradually retire debt.

    What’s wrong with more of that approach, and the creation of several thorium powered plants/micro-grids, to create the world’s lowest costing industrial energy, then wait while the rush to take advantage begins.

    New Aluminum or steel smelters that return a handsome profit anyone?

    And never a better time, to oblige the Fed to get on board, with safe nuclear options?

    John Bjelke has the right idea, get rid of payroll tax, and get industry along with their Payrolls, tax and rates receipts, to relocate here.

    Who would have thought what an exodus just simply getting rid of death duties would create!

    An exodus likely ended, given the now unaffordable nature of Q’ld’s housing; and only made so, because successive governments have used it and or the population as cash cows; as we the people, are made to serve their needs!

    Norwegian born Kiwi, Joh Bjelke once commented, he was at heart a social democrat, and the way he rolled out government owned income earning infrastructure possibly underscores that?

    And we really do need to decentralize and downsize government.

    We could do worse than a return to the voluntary unpaid boards (composed mostly of recently retired successful professionals,) that once ran health and education, water boards and what have you.

    Of course the Labor appointed Public servants are going to scream like wounded bulls, but not even the Premier is guaranteed his Job, so why should they be treated different?

    Particularly given their advice has created some/most/all of the current problems, they to date, have never been held accountable for?

    And somebody has to lock horns with the Fed and get an oil search started to our immediate north, in a region the literal size of Victoria, and which some expert opinion contends has hydrocarbon reserves to rival the Middle East?

    If its there, it’s our oil and gas, and we currently are running on the fumes, with just a weeks reserve of petrol.

    My guess is, that the many farmers going to the wall, (contemplating suicide) might get some relief, if we could just get some low cost indigenous fuel out to them, CNG or sweet light crude, needing just a little insitu chill filtering to make it into a superior diesel!

    And how about recovery costs of around $3-5.00 a barrel, and as ready to use diesel.
    And just a little better than a tourist industry going backwards or broke!

    Why we could place a 200% markup along with fair transport costs, and still make more money than this state would need to provide a full gamut of social services.

    What we need is a can do action man, not an excuse making/”cream” licking pussy, who trends to blame all our ills on previous admins.

    If they were so bad, why has he kept the bulk of the public service, essentially responsible with their fearless advice, for most of the so called, inherited problems.

    Austerity serves no one, least of all the formerly better off!
    Or forgotten rural and regional Q’ld in particular!
    Alan B. Goulding.

    Comment by Alan B. Goulding — January 20, 2015 @ 11:32 am

  8. Alan, your tactic seems to be to overwhelm the thread with irrelevant, although seemingly authoritative, statements. One example. You ask if anyone is still getting the 44c feedin tarrif because you aren’t.

    If you aren’t getting the 44c feed in tariff then you have only just put on solar power, because everyone who put it on until this government won election is still getting the 44c.

    I’m happy they are paying you more or less what it is worth, but don’t be disingenuous. You never got a higher figure.

    And the cost of having to continue to pay the higher figure to those who signed a contract with the former Labor government is $3.4 bn which is outlined in the Strong Choices plan, and made transparent by this government.

    Comment by Graham — January 21, 2015 @ 10:49 pm

  9. Disingenuous Graham, I don’t recall claiming that I ever got the higher figure, moreover, I believed that this government had rolled back the higher feed in tariff.
    You’ve got me mate, I was wrong.

    I was still earning a tiny piddling amount until the power authority decided to replace the meter that had started going backwards the day I installed the system!

    And they charge me a good deal more than the 8 cents I got.

    And if I sound authoritative, its because I actually give a fig about Friends and neighbors being driven into the ground by very bad policies!

    Your side of politics endlessly talks about small government, but when push comes to shove, whimp out after having made a token gesture.

    I’m a good deal older than you and can remember when times were much harder and budgets much smaller, yet we still managed to build the necessary infrastructure, before we built the suburbs that followed.

    And that was only possible because we basically dealt private players out.

    And ought to do so again given all they ever add is their massively increased profit demands!
    And spin the reasons they ought to be allowed to continue to do so, with phrases like natural cost or comparative cost, as opposed as always, to actual cost!

    Governments are invariably elected to serve the people, not just the business community, their cronies, cashed up foreigners or each other.

    When the Westminster system was first established the ministers worked for free, or a stipend to cover expenses, not huge and largely overly generous salaries!

    And arguably the reason career pollies have largely replaced/overwhelmed peopled genuinely concerned about their neighbors and how they were doing.

    And given you raised the 44 cent tariff topic hardly irrelevant.

    And I’m I to be critiqued for having ideas, even when the party you support is bereft of them or relies on endless spin and an even bigger helping of non core promises;just to retain power!?

    And it was you that complained they were only running half a campaign!

    Albeit, it would be disastrous if Labor won and returned some of the policies they were thrown out for, which has to include their cozying up yet again to the job/progress killing greens.

    And if you think I sound authoritative, well thank you very much for the very nice compliment.

    You have a nice day now, y’hear.
    Alan B. Goulding.

    Comment by Alan B. Goulding — January 22, 2015 @ 10:40 am

  10. On the other hand, a returned LNP, will be seen by them as a mandate for privatization; and just not on!

    Ideally they will be returned with the assistance of up to a half a dozen independents, all of who may be against the proposed privatization.

    [The people will decide, not any of the political parties!]

    An ideal outcome, given no upper house or state review system.
    And who may be able to overturn some of Campbell’s contentious appointments, in return for some level of needed cooperation?

    As would have been the case, when the two major conservative parties, were a coalition rather than the union that replaced it, in order to once again make the conservative side of politics electable, in an optional preference system!

    Look, if our assets are earning some 2 billion a year, then they can be used to leverage some additional funds for income earning infrastructure, and guarantee any repayments.
    Say up to 10 billion initially?
    And they must earn an income, as Joh’s dams did!

    A toll earning range crossing perhaps? And now viable, given the level of inland development?

    And which trucker would object to a $7.00 fee to save burning $10.00 worth of extra diesel, save huge wear and tear, and time earning money?

    Not to mention the nose to tail snail, that currently is the truckers lament and massive frustration, given the current range crossing followed by city limit speed limits, all of which would be dealt with by the project!

    Governments can usually borrow for around half that of private enterprise, and just as long as it’s not overdone; borrowing to create income earning infrastructure makes perfect sense, and will create employment, highest during the construction phase!

    And as those projects start paying their keep, they to can be leveraged to create even more income earning infrastructure projects!
    [I’m the man with the dangerous ideas, not the enemy!]

    And sure to improve the L.N.P’s popularity, and set them up for a better result next time round?

    Please don’t confuse courage of conviction with an authoritative attitude! There is a real difference!
    Alan B. Goulding.

    Comment by Alan B. Goulding — January 25, 2015 @ 9:08 am

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