New South Wales Treasurer Michael Costa has told Labor MPs that their electorates will be starved of funding unless they support the Iemma Government’s bid to privatise the power industry. Government ministers have also been trying to lure backbenchers who are committed to opposing the sale with suggestions they may be promoted to the cabinet if they fall into line.

On May 8, the NSW Opposition set down five clear criteria for supporting the privatisation. All five have been met. End of story? You’d think so, but there are machiavellians in the Liberal Party who can see angles invisible to the rest of us. They think that the privatisation plans are a Labor plot and are urging Barry O’Farrell to vote against them at tomorrow’s sitting of parliament.

New South Wales Premier Morris Iemma has recalled parliament a month early to vote on his $25 billion electricity sell-off proposal. Mr Iemma may need the support of the Liberal Party opposition to get his legislation through parliament, with some Labor MPs in both houses threatening to cross the floor to defeat the bill.

To say NSW Opposition Leader Barry O’Farrell is non-committal about the power industry privatisation is an understatement. He has already started to downplay the auditor-general’s report, and as time goes by will no doubt find further fault with the proposal, arguing all the while that his motivation is the public interest.

Under the proposal, retailers EnergyAustralia and Country Energy would be sold and generators Delta Electricity and Macquarie Generation leased out in long-term agreements. A public share offering of a combined entity consisting of Integral Energy and generator Eraring Energy is expected to generate $10 billion, while the New South Wales Government says it will save $15 billion in the cost of a new generator needed by 2014.

The State Government has called on the Opposition to support the sale because it is concerned about a lack of solidarity among its own backbenchers, with NSW Premier Morris Iemma calling on Opposition Leader Barry O’Farrell to back the planned sale. The Auditor-General had been requested to assess the sale of the government-owned electricity industry assets to assuage State Opposition concerns over the proposals.