The extent of the NSW Government’s asset sales has been laid bare in a budget estimates hearing. From The ABC [My emphasis]:
The New South Wales Government has sold off more than 20,000 properties including schools and public housing dwellings since it came into office in 2011, raking in more than $9.1 billion.
The figures were confirmed during a budget estimates hearing, where Finance Minister Victor Dominello was forced to defend the extent of the asset sales.
“It’s in the context of $142 billion worth of assets that we’ve got,” Mr Dominello said.
The hearing was told there was another $1 billion of property sales “in the pipeline”.
Upper House Labor MP Daniel Mookhey said the government was approaching a situation where 10 per cent of its asset base would be sold off.
Social Housing properties were among the biggest sellers.
Chief Executive of Property NSW Brett Newman said the Department of Family and Community Services had put more than 4,000 social housing dwellings under the hammer…
Mr Newman also confirmed that the government had sold more than 380 Department of Education properties.
During the hearing, Mr Mookhey asked Mr Newman to guarantee none of the education properties would have to bought back, given soaring enrolment figures and increasing over-crowding in schools.
“I cannot sit here and give you a guarantee that the Department of Education may not need to buy back any asset the Government has previously sold in the past,” Mr Newman replied.
“But the way the department usually operates is it actually looks to identify and recycle often surplus parts of properties and under-utilised sites and then it uses those proceeds to go and buy new sites.”
Wow. So the NSW Government will soon have sold-off roughly 10% of publicly owned-assets in just six years!
Perhaps the Government feels that it has no choice in the matter. With NSW’s population growing at a break-neck pace, which is expected to continue for decades into the future (see below charts).
The NSW Government knows that without major ongoing spending on roads, schools, hospitals, public transport, and all other forms of physical and social infrastructure, NSW will become even more crush-loaded, destroying living standards for the incumbent population and leading to a voter backlash.
However, selling-off public assets to raise money to service an ever-growing population can only be a short-to-medium term solution. Over the longer-term, the government risks exhausting its pool of profitable public assets to sell, whereas under a program of endless mass population growth (immigration), demand for new infrastructure and services will continue indefinitely.
There is another option at hand that does not require borrowing: publicly demand that the federal government slashes Australia’s immigration intake, which is the primary driver of NSW’s rapid population growth, and/or demand that it provide direct funding to the states to cope with population growth.
It is the population influx bestowed on NSW by the federal government’s mass immigration program that has caused the pressures on economic and social infrastructure (e.g. roads and public transport, schools and hospitals), and has driven the imperative to sell-off public assets. Therefore, the federal government should share responsibility for providing a solution.