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Motion: Electricity Privatisation

19 June 2024

The Hon. R.A. SIMMS: Before I address the substance of the motion, I wish to amend the motion as follows.

After paragraph 2, insert a new paragraph as follows:

3. Calls on the Malinauskas government to establish a commission of inquiry to examine reviving ETSA and returning South Australia's electricity distribution and transmission network to public ownership.

I might use this opportunity as well just to indicate that the Greens will not be supporting the amendments advanced by the Hon. Ben Hood on behalf of the Hon. Heidi Girolamo. In doing so, I do make it clear, though, that I do have some sympathy for the critique that the Liberals have made of Labor's inconsistency on the issue of privatisation. Were there to be a separate standalone motion dealing with the Labor Party's history of privatisation, that is something I would be open to considering.

But this is an opportunity to highlight what was in effect the original sin in South Australia's energy policy, the decision that has bedevilled generations of South Australians; that is, the Liberals' decision to sell off ETSA, to sell off our electricity systems here in South Australia and to sell out the people of South Australia and lock generations of South Australians into higher prices and unreliable power. That is a key event that should be condemned by this council.

Also, the Greens want to go further, and our amendment actually calls on the Malinauskas government to establish a commission of inquiry to look at what mechanisms there are that are available for us to take back ownership of our electricity distribution network here in South Australia.

To speak to the substance of the Hon. Reggie Martin's motion, it acknowledges that the decision to privatise ETSA has not delivered favourable outcomes for the South Australian community. With respect, that proposition should be a no-brainer for this chamber. I have not heard the Liberals, in their contributions, advance one positive outcome that has been delivered by the privatisation of ETSA, not one. In fact, all the evidence demonstrates that that has produced bad outcomes for the people of South Australia.

They talk about blackouts, but they have been locked in a state of perpetual blackout for the last 25 years. It is as if the last 25 years did not happen and they have this collective sense of amnesia, and they pretend that they did not sell off our electricity network and they were not the authors of the crisis that our state faces in terms of energy.

It is not just the Greens who are saying that privatisation has been bad news for South Australia. Indeed, 40 per cent of South Australians, according to the Australia Institute back in 2019, blamed the privatisation of ETSA for higher power prices. Three out of five people (60 per cent of South Australians) considered the privatisation to be one of the main sources of upward pressure on prices. They believe it, and they believe it to be the case because it is true.

I was a Chair of a parliamentary inquiry into privatisation when I started in this chamber, and we received a submission from SACOSS that talked about the impact of the privatisation of South Australia's electricity network on increasing inequality. I will draw from some elements of the media release that SACOSS issued in relation to that submission. I will quote from the release directly:

'This new analysis draws on the internationally famous work of economist Thomas Piketty on the drivers of inequality,' said SACOSS CEO Ross Womersley. 'While the data is not perfect, it is…[very] clear that the privatisation of the electricity network in SA has contributed to increased inequality.

'And while it is concerning that the privatisation of the South Australian electricity network looks to have increased inequality, it is even more alarming that the energy regulator is setting rates of return on capital at levels which will continue to increase inequality in years to come.'

The SACOSS submission put three propositions to the multiparty committee:

  • The rate of return to the owners of the network is greater than the growth rate of the economy, which (as per the analysis of economist Thomas Piketty) will lead to increased inequality.
  • This is the case based on both the regulated rate of return and the final return to shareholders.
  • Because of the regressive consumer expenditure patterns, in theory, new capital investments, and in practice schemes like the Residential Energy Productivity Scheme, are more equitably funded from the tax base…rather than by the electricity companies where costs are passed on to consumers.

So SACOSS, through their research and drawing on the views of a leading economist, concluded that privatisation was one of the key factors that was driving inequality. Indeed, over the last 25 years since the privatisation of ETSA we have seen power prices go up here in South Australia by more than 200 per cent. That is astronomical. That is a fact.

There is an opportunity here for the Liberal Party to make amends with the people of South Australia, for them to say, 'We made a mistake,' and to learn from those mistakes. But no, instead what we have seen from the Liberals is brain flatulence over in Canberra: a bizarre, ill-conceived proposal from the Leader of the Opposition, Peter Dutton, to create a nuclear reactor here in South Australia—to set up a nuclear reactor and to put that impost on the people of Port Augusta, with no plan for what is to happen with the nuclear waste.

We know that whenever the Liberals talk about nuclear they are happy to dump the waste on remote communities. That has always been their approach. Where else is it going to go? They do not want it to be in the city and they are happy to dump it in the regions. What is the cost? This proposal has not been costed by the Liberal opposition, but we know, based on the experience in other jurisdictions that have gone nuclear, other places around the world, that the cost will blow out by billions and billions of dollars, and that it will be impossible for us to address our energy needs within the time frame that the Hon. Peter Dutton and the Liberals have identified, because we know that nuclear technology takes a very long time to establish and get off the ground, and it is hugely costly.

This is a burden that the Liberals are proposing should be carried by the taxpayer. Why on earth would we go down that route when we could instead beef up renewables here in South Australia, beef up battery storage and ensure that we can provide publicly owned renewable electricity to the people of our state? Why would we go down the Liberals' radioactive path? It does not make sense.

The other thing that I find really baffling about this latest brain flatulence from the Liberal Party is the fact that they are reviving this idea of a royal commission into the nuclear industry. We had a royal commission, so why are they flogging that dead horse? We had a royal commission and the commission found that this was not economically viable for South Australia. Instead of coming up with any new ideas, the Liberals just pull out that frozen pizza, get it out of the freezer, heat it up again and serve that stale offering up to the people of South Australia. Surely they can do better than that.

I urge them to repent and to support this motion that has been put forward by the Hon. Mr Martin. Mr President, I see you waving at me. I have listened to some of my colleagues speak for two hours tonight and this is my first contribution of the evening, so I am being short, but there is an important point to make, with respect, Mr President. I urge members of parliament to—

The PRESIDENT: The Hon. Mr Simms, I was just waving to you; I just love seeing you, that's all.

The Hon. R.A. SIMMS: Thank you. I urge my colleagues to support this but also to support the Greens' amendment that actually adds some verbs into the Labor Party motion and compels them to do something to ensure that we can take ownership of our electricity providers here in South Australia.

The final point I will make before wrapping up is that I do commend the Malinauskas government for supporting a bill that I initiated on behalf of the Greens to prevent the privatisation of public assets in the future without consideration of a parliamentary inquiry, and without approval of both houses of parliament. This is a really important safeguard and it will ensure that we never repeat these mistakes again. But today is a time to condemn the Liberals for selling off and selling out our state.