Qld Budget 2009 Asset Sales - articles and discussion

[ozbob]

From the Brisbanetimes click here!

Another Rudd minister concerned over asset sales

Another Rudd minister concerned over asset sales
March 23, 2010 - 8:43AM

Anthony Albanese has become the second federal Labor minister to raise concerns about Queensland's plan to float Queensland Rail's coal business as a single entity.

The federal infrastructure minister says the Queensland government should look at other examples.

He has echoed concerns raised last week by federal Resources Minister Martin Ferguson, who questioned whether there was enough incentive for the new company to invest for growth.

The Queensland government plans to sell QR's coal haulage business and the freight track network together as one company, but big mining firms say it will hinder competition to have both in the same hands.

"We need to look very carefully at the lessons of Telstra and other entities where you've had vertical integration," Mr Albanese told the ABC.

"The Queensland government has to make those decisions based upon a full analysis of the facts and they'll make those decisions."

But Premier Anna Bligh has dismissed a comparison between the sale of Queensland Rail's coal business and the Telstra float.

"Running a business like Telstra is extraordinarily different to running a coal transport company," she told the ABC.

"Telstra provides a service into every household and every home and the bargaining power of a pensioner up against Telstra is a very different thing than the bargaining power of a Rio Tinto or a BHP with a transport company to get their coal to market."

Last week, Queensland Treasurer Andrew Fraser launched a scathing attack on critics of the coal rail assets float, describing them as "the dogs that caught the bus".

Mining companies have called on the government to stop the float of QR National in the final quarter of this year and consider an alternative plan.

The companies say QR National should be split into two companies, rather than allow it to own both the tracks and trains.

AAP

[mufreight]

That the Federal Transport Minister has expressed strong and well justified concerns with respect of the asset sales in this state, particularly the privatisation of the rail assets.
This tells a story in itself, undoubtedly driven now by concerns that the voter dissent at this illadvised state government decision will adversly influence the vote against Labor in the comming federal election, political self interest may well drive a change in the state government leadership and a backdown on the asset sales unfortunately after many millions has been wasted in the mad rush to carry out this ill advised policy before the voters (and owners of these assets) have the chance to express their opinion at the ballot box.
Maybe there is light at the end of the tunnel after all.      

[justanotheruser]

That the Federal Transport Minister has expressed strong and well justified concerns with respect of the asset sales in this state, particularly the privatisation of the rail assets.
This tells a story in itself, undoubtedly driven now by concerns that the voter dissent at this illadvised state government decision will adversly influence the vote against Labor in the comming federal election, political self interest may well drive a change in the state government leadership and a backdown on the asset sales unfortunately after many millions has been wasted in the mad rush to carry out this ill advised policy before the voters (and owners of these assets) have the chance to express their opinion at the ballot box.
Maybe there is light at the end of the tunnel after all.      

call me a cynic but I reckon it is just a federal politician not wanting voter backlash against them. This is because voters seem to be incapable of seperating state and federal issues when it comes to elections.
Once again we do not have to express our view or a vote for this. That is not how government was setup. If it was then as another poster said we would only need admin to implement the results of the twenty referendums we would have every week to determine what should be done. Rather the system is setup so if we are not happy with the job done we can vote them out next election. Of course at federal elections people just vote for whoever promises the biggest tax cut. The states need to be smarter as they don't have that luxury.

[frereOP]

That the Federal Transport Minister has expressed strong and well justified concerns with respect of the asset sales in this state, particularly the privatisation of the rail assets....

Ah, no.  If it wasn't for union self interest and political activism then it could be shown that the sale of this (and any other asset) is actually in the interest of the public.  If you have an investment and its isn't returning good value for money, then you have a duty to cash it in and put that money in a better investment.  Schools, police, hospitals and public transport are better places for that money and would serve the Qld public far better.  Unions don't want assets sold because they know their members will have to justify their existence in a competitive free market environment.  They might actually have to work for their pay.

call me a cynic but I reckon it is just a federal politician not wanting voter backlash against them. This is because voters seem to be incapable of seperating state and federal issues when it comes to elections.

To the contrary. Voters ARE very aware of the jurisdictions of State and Federal Governments when it comes to elections.  It has been shown time and time again they DO make a clear distinction at the ballot box.  Remember Martin Fergusson is a very left-wing former union leader and it would not look good for him to be supporting policies he so actively opposed in the past.

[ozbob]

From the Brisbanetimes click here!

Rail boss talks up privatisation

Rail boss talks up privatisation
STEVE GRAY
April 20, 2010 - 4:58PM

Queensland Rail is fit and healthy ahead of its planned privatisation and ready for expansion, chief executive Lance Hockridge says.

From July 1, Queensland's rail business will be split in two.

Its passenger and general freight business will remain state-owned, while the bulk freight, coal lines, manufacturing and heavy maintenance workshops will become a separate business under the name QR National.

The float of QR National in October or November will be the largest initial public offering on the ASX and among the biggest in the world this year.

It is expected to be one of the top 50 Australian listed companies, employing 9000-plus staff, with revenues of $2.3 billion, assets worth $6.9 billion and operating 2200km of track.

QR National will also own 700 locomotives and 15,000 wagons.

Touring some of QR's central Queensland assets today, Mr Hockridge said the company was well placed to take advantage of the resources boom.

"We believe that we have both an existing fantastic market position, and of course, going forward, we have the opportunity for growth, essentially on the back of growth in the resource industry," Mr Hockridge said.

QR National is 80 per cent leveraged to the resource industry in Australia.

"To the extent that the resource industry is going to grow, so we believe our company will grow," Mr Hockridge said.

"Put the other way around, an investment in what will be QR National is as much as anything else an investment in the future of Australia, certainly in the future of the Australian resource industry."

Eighty per cent of QR's business is based in Queensland, but the company also hauls coal in NSW, iron ore and freight in WA, and operates on the east-west intermodal corridor.

AAP

[ozbob]

From the Brisbanetimes click here!

Alternative privatisation plan 'inferior'

Alternative privatisation plan 'inferior'
DANIEL HURST
April 22, 2010 - 5:49AM

QR chief executive officer Lance Hockridge says heavy railroads exist to support coal delivery.

A Queensland Rail executive says an alternative privatisation proposal being pushed by the state's biggest mining companies is inferior to existing plans.

A consortium of 14 miners, including BHP Billiton, Rio Tinto and Xstrata, opposes the state government's plan to float Queensland Rail's coal freight business and haulage network as one company on the sharemarket.

The miners, represented by former NSW premier Nick Greiner, are in talks with the Australian Rail Freight Corporation about submitting a multi-billion-dollar counteroffer to buy the coal haulage network. They say two parts of the business should be run separately.

But QR Network executive general manager Michael Carter said it was important to keep the network and coal haulage business together.

"Separation is viable but in my strong view inferior to the integrated model," he told reporters at a briefing in central Queensland this week.

Mr Carter said the planned new publicly listed company, QR National, would have a good incentive to upgrade and efficiently run the rail lines.

This was because poor performance would not only hinder the movement of competitors' coal haulage trains but also its own.

"What needs to work is to get as many trains through the system so everyone wins," Mr Carter said.

QR chief executive officer Lance Hockridge said the whole reason the heavy railroads existed were to support the coal delivery.

"These are not different businesses," he said.

"The analysis we've done around the world is that the successful model for railroads around the world is the integrated model.

"It's about ensuring there is the right level of infrastructure investment and that that right level of investment is done at the right time."

Mr Hockridge said the miners' plan could create "another level of bottlenecks in the system".

Two federal Labor ministers - Anthony Albanese (infrastructure) and Martin Ferguson (resources) - last month expressed concern about the impact of a vertically integrated QR National on competition and whether the combined company would invest adquately in new infrastructure.

Queensland Resources Council chief executive officer Michael Roche said last month the miners believed the tracks should be sold separately from QR's coal haulage business, otherwise there could be unfair advantages given.

"[Under the state government's model] you have the owner of the track also being one of the operators trying to access that track," he said.

The comments come as the existing state government-owned Queensland Rail Limited prepares to split into two separate entities at the end of June, to reflect the parts that will be sold and the parts that will remain in public ownership.

QR National - which includes the coal freight and haulage network together along with manufacturing and heavy maintenance workshops - is to be floated on the sharemarket in the final quarter of this year.

The government-owned Queensland Rail will include the QR Passenger division, the general freight and passenger track and the Ipswich workshop.

The Bligh government's privatisation agenda has come under heavy attack from unions and the state opposition, which say the plans were not revealed before the March 2009 election.

The Queensland Council of Unions argues economic conditions have improved since the government announced plans to sell parts of Queensland Rail along with Queensland Motorways, Forestry Plantations Queensland and state-owned ports.

Mr Hockridge is currently touring Queensland Rail sites in a bid to secure employee support for the controversial changes.

QR National will employ about 9000 people, while the Queensland Rail remaining in public ownership will have about 6000 employees.

Disclosure: The writer attended the media briefing in Mackay with travel and accommodation costs paid for by Queensland Rail.

[ozbob]

From the Courier Mail click here!

Queensland Rail could be worth $7b when it lists on ASX

Queensland Rail could be worth $7b when it lists on ASX

    * James McCullough
    * From: The Courier-Mail
    * April 23, 2010 12:00AM

QUEENSLAND Rail is likely to raise about $4 billion in equity when it lists on the Australian Stock Exchange towards the end of the year.

Insiders close to the IPO say it is envisaged that the listed company, QR National, would join the bourse after raising $4 billion from the market and about $3 billion in debt, creating a $7 billion group that would be among the top 30 largest Australian companies.

The insiders say the coal companies' proposed alternative bid for the track assets is not likely to materialise.

The company is hoping by June 30 to split the QR passenger business and QR National, the soon-to-be-listed group, but this depends on a final report from the Queensland Competition Authority over access to QR's tracks.

The joint lead managers are still crunching the numbers and insiders say a final figure has not even been contemplated about the issue price of the shares.

However, analysts say a price of between $2 and $3 a share is likely, depending on whether the State Government opts for a straight IPO or instalment shares as used by Telstra when it listed.

Given the debacle at BrisConnections when it joined the ASX utilising partly paid shares, it's thought that a simpler version is likely to be considered.

"All the Government cares about is getting the cash in the front door," one analyst said last night. "I don't think they will be going for any flash model to get there."

On a roadshow in Mackay this week, chief executive Lance Hockridge would not be drawn on the exact numbers for the float other than to say "look at a few of our financials and you should be able to work it out".

QR National's latest balance sheet shows the company has assets of $6.9 billion, revenue of $2.3 billion and an EBITDA of $550 million.

One sector analyst said that based on these figures and comparing QR with its peers, "you would expect a market capitalisation of about $7 billion, with a debt-to-equity split of about 40 per cent debt to 60 per cent equity".

QR National has 700 locomotives and 15,000 wagons and is active in five rail systems in Queensland and one in NSW, the Hunter Valley system.

In Queensland it runs the Newlands, Goonyella, Blackwater, Moura and West Morton systems.

The numbers compare with its private sector rival Asciano's balance sheet of $6.9 billion in assets, $2.81 billion in revenue and $650 million in EBITDA.

QR has not put a figure on its expected capital spend, but Government sources estimate it to be about $5 billion in the next five years. Some say it will be significantly higher, perhaps up to $20 billion.

Macquarie Equities estimates that between $8 billion and $10 billion will be required in capital expenditure by 2015, with at least half to go toward the below-rail growth or track assets.

[justanotheruser]

haven't had much internet access recently but did have a thought. Where was the big upcry over the sales of other Qld govt. assests. Ones that were definitely making money like Golden Casket? See people don't really care about assest sales. It is only ones with big union involvment.

[Golliwog]

No neccessarily true. I would say that the ones with union involvement are definatly the ones making the most noise about it though. I'd be ok with the asset sales, if there was a legitimate reason to do so. My problem is the only reason they are doing it is because they spent too much, surely in the long run, keeping hold of businesses like QR, which make money, would be better?

[ozbob]

Premier and Minister for the Arts
The Honourable Anna Bligh
27/04/2010

Business leaders set to join QR National Board as IPO plans forge ahead

The establishment of a distinguished, well-credentialed Board is a strong vote of confidence in the new QR National, Queensland Premier Anna Bligh said.

In announcing the Board's make-up, Ms Bligh said the 'blue-chip' QR National Board would comprise senior, independent business directors in the areas of transport, logistics, resources and law with extensive public and private sector experience.

The new board members include the former CEO of Australia Post, the current chairman of Shell Australia and an ex-senior executive of Wesfarmers.

"It's a huge vote of confidence in the future of QR National that this group of respected business leaders have been prepared to bring their excellent reputations and strong track record of success to support and advise the company in its planned transition to a top ASX-listed company," Ms Bligh said.

"With its wealth of experience, it is a board that is strongly equipped to meet the challenges of growing QR National into Australia's leading transport and logistics company.

"This is an important milestone in the QR National IPO process," she said.

Ms Bligh said the new board members would add to the already strong level of commercial expertise of the existing QR Limited board members that would be joining the new QR National Board - QR Chairman John Prescott, Chief Executive Officer Lance Hockridge and Directors, Peter Kenny and Allan Davies.

Once established, following structural separation of QR Limited, the QR National Board of Directors will comprise:

New Appointments

John Atkin, Sydney based. Mr Atkin is currently CEO of Trust Company Limited, Australia's leading professional trustee company. Previously, Mr Atkin was Managing Partner of pre-eminent Australian law firm, Blake Dawson.

Russell Caplan, Melbourne based. Mr Caplan is currently the Chairman of the Shell Group of Companies in Australia and has been employed by Shell for 42 years.

Graeme John, Melbourne based. Mr John was Managing Director of Australia Post from 1993 to 2009. Prior to his tenure with Australia Post, Mr John acquired 30 years' experience in line management for road, rail and sea transport operations with TNT Australia including seven years as the former Deputy General Manager.

Andrea Staines, Brisbane based. Ms Staines is a [former] Director of the Australian Rail Track Corporation Board and is the former CEO of QANTAS subsidiary, Australian Airlines. She is currently a Company Advisor specialising in governance, strategic planning and risk management. Ms Staines has been a Director on the Board of the Gladstone Ports Corporation Limited (QPC) since 2006.

Gene Tilbrook, Perth based. Mr Tilbrook has extensive experience in corporate strategy and finance. He was previously an Executive Director of Wesfamers Limited from 2002 to 2009. Mr Tilbrook brings to QR a wealth of experience in coal mining, logistics and insurance. He was joint project leader on the acquisition of Australian Rail Group (now a QR subsidiary) and was the Chair of Westnet Rail for six years.

Incumbent Directors from QR Limited

John B Prescott (Chairman), Melbourne based.Mr Prescott is a Director of Newmont Mining Corporation. He was previously employed by BHP (now BHP Billiton) for a period of more than 40 years including a seven-year term as the company's Managing Director and Chief Executive Officer. Mr Prescott is a Member of the Australian Government Remuneration Tribunal. Mr Prescott has been Chairman of the Board of QR Limited since 2006.

Lance Hockridge (Managing Director), Brisbane based. QR Limited's current Chief Executive Officer and former BHP executive, Lance Hockridge will assume the position of Managing Director of QR National following the structural separation of the above rail coal and freight businesses, services operations and the coal network in preparation for the public listing.

Peter Kenny, Brisbane based. Mr Kenny provides a wealth of Queensland regional experience and insight to the QR National Board. He is formerly a Director of the National Farmers' Federation and is currently a member of the Cape York Heritage Committee, representing Queensland agriculture on the Premier's advisory council on Climate Change.

Allan Davies, Brisbane based. Mr Davies' experience includes decades of resource sector exposure including the specialised field of Australian and international coal and metalliferous mining. Mr Davies is a former Director of transport sector competitor, Pacific National.

The depth of experience within the QR National Board will include four Queensland representatives providing continuity of regional focus and a detailed appreciation of local issues.

The geographically diverse and complementary skill sets of the Board directly reflect the current requirements and future aspirations of QR National Limited to retain its market position as an innovative world-leading integrated transport and logistics provider.

"This is a large business with many challenges, but I have every faith that under the stewardship of John Prescott, the new QR National Board will provide the leadership that will see the big Queenslander get even bigger."

==============================================================

[frereOP]

No neccessarily true. I would say that the ones with union involvement are definatly the ones making the most noise about it though. I'd be ok with the asset sales, if there was a legitimate reason to do so. My problem is the only reason they are doing it is because they spent too much, surely in the long run, keeping hold of businesses like QR, which make money, would be better?

Assets SHOULD be sold if the money can be put into an investment that brings a better return to the community including infrastructure.  The only question about asset sales is whether it is moral to sell something to the public which as taxpayers they already own?  Telstra, Qantas, airports, QR National etc.  Maybe they should be demutualised instead with shares being evenly distributed to the existing owners (taxpayers).  That ain't gonna happen!

[Golliwog]

But in this case, isn't the money just being put straight into paying off the debt the state is in? To me this is sacrificing a long term benefit for a short term gain.

[#Metro]

The only question about asset sales is whether it is moral to sell something to the public which as taxpayers they already own?  Telstra, Qantas, airports, QR National etc.  Maybe they should be demutualised instead with shares being evenly distributed to the existing owners (taxpayers).  That ain't gonna happen!

Can't be "demutualised" as QR isn't a mutual organisation. For random example, UK's Network Rail could, however.
A non-profit health fund or a credit union could be demutualised, but QR not as QR does not have members or memberships.

Under the Constitution of Queensland, the Queensland Government has all the powers of an individual. This means the power to aquire or sell public assets. Part 5, Division 1, s51. It can also has these powers outside Queensland. Anna could sell QR to NZ if she wanted to.

I'm not too certain about the model (seems complicated) and I don't know if I fully trust QR to do the right thing owning the whole thing. But that aside, I think it is important to remember a few things:

1. There is an exchange in process.
QR is not being sold and then the cash being dumped at sea. We'll get 7 billion or so back in exchange.

2. Future "profits" have to be discounted, because a dollar today is worth more today than a dollar in 50 years time (which is probably how long it would take to make 7 billion after deducting future investments & expenses etc) .
This is due to the time value of money and inflation. There is also a high opportunity cost which has to be considered as this is a government which has to look after the community, not a private company. The money that it must invest in QR for expansion is money that can't be spent on government's other causes and goals.

3. I really want the ICRCS tunnel to be built. 7 billion invested in this will lock the money up in a community asset and make deep cuts into the costs of congestion, freeing up billions in lost time, lateness, bad health, car accidents and congestion.

[frereOP]

But in this case, isn't the money just being put straight into paying off the debt the state is in? To me this is sacrificing a long term benefit for a short term gain.

Not necessarily.  Retiring debt is still putting money into infrastructure, its just that the infrastructure is already built.  Whether this is the debt they are retiring or whether they are coving up wasted taxpayers dollars is a political question and I'm not going there.

[Golliwog]

I have no intention of going political. I don't get paid for that crap. Yes paying for the infrastructure is good, I still see QR as something that would give you a long term income source. However it seems this ongoing income would be less than the interest on the states loans?

[ozbob]

From the Brisbanetimes click here!

RACQ to announce plans to stop Queensland Motorways sale

RACQ to announce plans to stop Queensland Motorways sale
April 28, 2010 - 10:19AM

The RACQ will today release details of its campaign to stop the sale of the state government owned Queensland Motorways.

RACQ spokesman Gary Fites says the privatisation of the state-owned entity will condemn motorists to paying tolls on the Gateway and Logan motorways for the next 50 years.

"The only rationale for the sale is the generation of a once-off cash injection of $3 billion to $5 billion to get the Queensland Motorways debt off the government's books," he said.

Mr Fites said a private operator would be motivated by profit, not traffic movement around Brisbane.

"Brisbane's major bypass system should not be controlled by a private operator obliged to maximise returns to shareholders," he said.

He told ABC radio the sale of the Gateway and Logan motorways differed from other asset sales.

"When it comes to ports and rail freight for example, the monopoly operator there will have large corporations as their customers and those large corporations will be big enough to bargain for themselves," he said.

"It's a different proposition when it comes to Queensland Motorways. The customers there are mums and dads and small business operators."

AAP

[#Metro]

He told ABC radio the sale of the Gateway and Logan motorways differed from other asset sales.

I'm skeptical. It sounds like a NIMBY reaction.

Motorways & the car have been on all sorts of subsidy, including until recently a petrol subsidy (which was I suspect was probably rorted too) . It costs money to maintain these things. The other thing is that the tolls are self-limiting as alternatives do exist. Clem 7 is a perfect example of this. If the tolls are too high, people won't use it and the toll will have to come down or the company will face liquidation.

[justanotheruser]

From the Brisbanetimes click here!



RACQ spokesman Gary Fites says the privatisation of the state-owned entity will condemn motorists to paying tolls on the Gateway and Logan motorways for the next 50 years.

"The only rationale for the sale is the generation of a once-off cash injection of $3 billion to $5 billion to get the Queensland Motorways debt off the government's books," he said.



"Brisbane's major bypass system should not be controlled by a private operator obliged to maximise returns to shareholders," he said.

[/quote]
My understanding was that the state govt would put in controls so they could prevent toll increases without approval.

So what if it is to get the debt of queensland books. It is often forgotten that debt affects the credit rating of the government. The worse the rating the more interest they pay on new and EXISITNG loans. This causes less money to be available for other things. With the motorways it essentially is selling off the operation of the motorways not the motorway itself if they keep the conditions that the state govt said they would. 

[#Metro]

http://www.brisbanetimes.com.au/business/world-business/portugal-hits-back-after-financial-market-attack-20100428-tqhu.html

Portugal appears to be in this situation.

[ozbob]

From the Brisbanetimes click here!

Railing against privatisation
DANIEL HURST
April 29, 2010 - 5:39AM

[WTN]

Ministerial Statement: Business leaders set to join QR National Board as IPO plans forge ahead

http://statements.cabinet.qld.gov.au/MMS/StatementDisplaySingle.aspx?id=69493

Here's the interesting bit: scroll down and see who will be on the Board. 

[justanotheruser]

Ministerial Statement: Business leaders set to join QR National Board as IPO plans forge ahead

http://statements.cabinet.qld.gov.au/MMS/StatementDisplaySingle.aspx?id=69493

Here's the interesting bit: scroll down and see who will be on the Board. 

care to clarify as to what you mean by looking at who is on the board? There are several ways I can take that without doing in-depth research into the background of these people.

[WTN]

Notice the background of the directors.  One of them is with an oil company.  Potential for bias/vested interests?

[frereOP]

Notice the background of the directors.  One of them is with an oil company.  Potential for bias/vested interests?

That's a pretty serious allegation.  By law, directors of companies have to act in the best interests of the company and in my experience, most directors are very careful about declaring conflicts of interest.  There are plenty of cases where directors could be perceived to have a conflict of interest but work within the law to ensure impartiality.

[justanotheruser]

Notice the background of the directors.  One of them is with an oil company.  Potential for bias/vested interests?

That's a pretty serious allegation.  By law, directors of companies have to act in the best interests of the company and in my experience, most directors are very careful about declaring conflicts of interest.  There are plenty of cases where directors could be perceived to have a conflict of interest but work within the law to ensure impartiality.

gotta agree with this. I know a director who left one insurqance company and joined another. If he used his knowledge of the previous company to advantage the new company he would be unemployable pretty quick. While some do break these rules most do keep to them.

[WTN]

Folks, I was only suggesting a possible conflict of interest, not to say there is one.  But I'm glad the law protects against wrongdoing.

[ozbob]

From the Brisbanetimes click here!

Cracks in Labor over assets sale: LNP

Cracks in Labor over assets sale: LNP
DAVID BARBELER AND STEVE GRAY
May 4, 2010 - 8:38PM

The Queensland opposition says a senior Labor MP's call for the government to revisit its assets sell-off shows that cracks are forming in the Labor Party over privatisation.

Unions opposing the sale of state assets also see it as a sign their campaign is gaining traction.

Central Queensland Labor MP Paul Hoolihan says a new Access Economics report, predicting the government will reap higher-than-expected revenues from the mining sector, opens the door to other possibilities.

"If the report is accurate and our state's economy is $11 billion better off than originally forecast, I believe the sale should be looked at again," Mr Hoolihan said in a statement.

"I have no regrets about supporting the government's decision to sell the assets, because the reality at that time was money was needed to protect the jobs of Queenslanders during the global financial crisis.

"It may well be that the sale is still necessary, but it's important that, at the very least, it be reconsidered in light of the changed circumstances."

Opposition Leader John-Paul Langbroek seized on Mr Hoolihan's comments as proof of conflict within the ALP.

"What we're seeing clearly is cracks in the Labor Party about the privatisation issue," he said in Brisbane today.

"What he's really doing is saying that he's having second thoughts about this.

"I look forward to testing Paul Hoolihan and other Labor MPs to see how resolute they are on the floor of parliament."

Queensland Council of Unions general secretary Ron Monaghan said the campaign against the assets sell-off was gaining momentum.

"We would be very encouraged if other MPs came out as Paul Hoolihan has done and followed his example," Mr Monaghan said.

"I believe privately there are far more (MPs) than Paul Hoolihan that are very worried.

"I'm sure they see their jobs on the line."

A day after being jeered by unionists opposed to the sell-off and having his speech to a Labour Day rally drowned out, Acting Premier Paul Lucas said there would be no re-think.

"We have no choice. If we want to build more hospitals and schools and grow the state, then we need to ensure that government finances are able to be diverted into areas where the government is the only participant," Mr Lucas said.

He said the Member for Keppel was entitled to his views and would not be disciplined.

A Queensland government spokesman said the Access Economics report had been commissioned by Brisbane Lord Mayor Campbell Newman, as chairman of the Council of SEQ Mayors.

The report did not disclose the model used to make the claim of an $11 billion revenue increase, which was, he said, "extraordinarily optimistic".

AAP

[ozbob]

From the Queensland Times click here!

QR scores $45 million contract

QR scores $45 million contract

Zane Jackson | 15th May 2010

REDBANK'S Queensland Rail workshops has secured a $45 million contract to build 160 coal wagons for coal businesses in the New South Wales Hunter Valley.

Transport Minister Rachel Nolan with Queensland Rail's rollingstock head, Tony Gassman, at the QR workshops at Redbank.
Sarah Harvey

REDBANK'S Queensland Rail workshops has secured a $45 million contract to build 160 coal wagons for coal businesses in the New South Wales Hunter Valley.

The contract, which is expected to keep 100 workers at the QR Redbank workshops in work, comes after the business recently finished building 106 wagons for the same two firms.

Transport Minister Rachel Nolan announced the new contract at the site yesterday and said it proved the workshop and QR National was a competitive national business in the lead-up to its sale in September.

"The work is part of a rolling stock order by QR National Coal to support its new contracts with Peabody Energy and Felix Resources in the Hunter Valley," Ms Nolan said.

"This is a purely commercial money-making exercise and it proves QR can operate on a competitive basis in a national market."

The Member for Ipswich said she was aware the contract would be used as ammunition by privatisation critics, but said the government would press on with plans to sell QR National.

QR National will incorporate the group's coal haulage arm including the Redbank workshops, while QR Passenger will stay in government hands and control all passenger tracks and trains.

"It's a choice we have to make between going into debt to invest in coal wagons that pay off over time, or going into debt to invest in infrastructure for the people," she said.

"The decision this government has made is to invest in schools, hospitals and public transport, not necessarily in coal freight in New South Wales."

Rail Tram and Bus Union secretary Owen Doogan said workers are the site were concerned.

He said they felt the buyers of QR National could ignore investment at Redbank and concentrate on other regions.

[curator49]

The Minister says the assets sale means the Government will be investing in infrastructure for Queensland, not coal transport in New South Wales.

Typical convuluted political spin. Surely the cost of these wagons is being paid for (to the tune of $45 million) by the customers (Peabody Energy and Felix Resources) requiring them in New South Wales and is not being paid for by the Queensland Government. In other words this State is making money out of a requirement by coal haulage customers in New South Wales. The Minister is trying to put a big bad negative on this story so as to support the assets sale when in reality I would suggest it is a win for Queensland.

[ozbob]

From the Brisbanetimes click here!

Unionists find an unlikely ally in billionaire Palmer

Unionists find an unlikely ally in billionaire Palmer
KATE DENNEHY
May 23, 2010 - 3:00AM

It's not often that a billionaire and unionists agree but on the subject of the selling off the state's assets, they are at one.

Last week mining magnate Clive Palmer, one of Australia's richest men and owner of the Gold Coast United football side, echoed the Queensland Council of Unions' belief that no assets should be sold or leased out long-term.

"It's a great mistake to sell any of the assets,'' Mr Palmer said.

"The community owns them and once they're gone we'll never get them back. If the government does not control them, they are open to exploitation.'"

He said private business was more interested in profits than providing for the community.

"If private owners of the assets increase charges, those increases will be passed on to consumers.

"If the Port of Brisbane is privatised the government won't have immediate access in times of, for example, a national disaster. If port charges increase, export businesses will have less capital to invest and eventually people will lose jobs."

He said the Premier Anna Bligh was determined to privatise because the government had lost a lot of money in the economic downturn and she was "hell-bent" on keeping people employed.

"But it's not productive employment. You see people digging up roads and re-building them but that's not productive. In the future, if the state doesn't have the money to pay people, it's all going to come tumbling down."

Last week the Main Roads Minister Craig Wallace announced the short-listed companies chosen to expand the Port of Brisbane Motorway.

He said the multi-million expansion would mean hundreds more jobs.

"The Port of Brisbane is the third busiest container port in the country... moving around $30 billion in cargo a year," he said.

"Total trade (at) the port is projected to grow to 53 million tonnes by 2026 and we're rising to meet that growth.'"

Mr Palmer and the Australian Maritime Union's branch secretary, Trevor Munday said they couldn't understand why the port must be sold or leased if it's so profitable.

Mr Palmer was quoted in media reports last month saying he was considering making a bid for the 99-year port lease but last week rejected the suggestion:

"We're not really port operators and I'm more interested in employing people elsewhere.'' He said he thought Middle East companies would be interested.

The Treasurer, Andrew Fraser last week said the 99 year licence for Forestry Plantations Queensland (FPQ) which manages state-owned timber plantations, would be sold for $603 million to Hancock Queensland Plantations, a subsidiary of the US-based Hancock Timber Resource Group.

"The government should be investing in schools and hospitals, not funding a timber business that supports other big businesses," he said.

"This is the first of the five commercial businesses to be sold, licensed or leased to the private sector, as the government reforms the state balance sheet and builds a stronger Queensland economy."

The sale includes around 35,000 hectares of freehold land, about 10 per cent of the total estate.

State Opposition Leader, John-Paul Langbroek said this month's Federal Budget revealed "an unexpected cash windfall of $1.2 billion" for the Queensland government this year. He said the bonus cast "further doubt" on the need for privatisation.

Source: The Sun-Herald

[justanotheruser]

He said the Premier Anna Bligh was determined to privatise because the government had lost a lot of money in the economic downturn and she was "hell-bent" on keeping people employed.

and this is really what it all comes down to isn't it. There are more votes in keeping people employed than there is in keeping assets public owned. If this was a private company it would be done. EWnd of story. However because a elected government is involved then people use that to try and prevent job losses. Makes me think get them into private ownership and make the lazy ones work as well as the hard working employees. Bludging won't be so easy then.

Reminds me of a friend who worked for telstra. He said the only way some employees would actually do any work is if it was privatised. I doubt it is any different in these government organisations.

[ozbob]

From the Courier Mail click here!

Coal miners offer $4.85 billion for Queensland's coal track network

Coal miners offer $4.85 billion for Queensland's coal track network

    * James McCullough
    * From: The Courier-Mail
    * May 26, 2010 10:34AM

QUEENSLAND'S powerful coal companies this morning released a $4.85 billion bid to buy the below rail assets, the tracks, of Queensland Rail.

The long awaited bid is funded by 13 of the state's coal groups who account for over 90 per cent of total Queensland coal production.

Former NSW Premier Nick Greiner, who is heading up the coal company syndicate bid, said the offer represented a substantial premium to what is likely to be achieved under the Queensland government's proposed float of QR National expected in the last quarter of the year.

He cited volatile equity markets and the guaranteed upfront payment as two major reasons why the state government should give consideration to the offer.

The bid has been prepared under the Queensland Coal Industry Rail Group and Mr Greiner said it also gave some certainty about necessary capital required in the future to upgrade and maintain the tracks of QR.

The state government has said it would consider the bid by the coal companies if and when it emerged.

Analysts yesterday said the government would be mad not go give the bid serious consideration.

""In times of such volatile markets, it gives them a huge amount of cash on the table,'' one analyst said.

[ozbob]

http://www.artc.com.au/Article/Detail.aspx?p=6&id=276

Coal Industry offers A$4.85 Billion to acquire Queensland Rail's coal track network

26 May 2010

The following press statement was issued by QCIRG regarding the delivery of a full cash offer to the Queensland Government to buy the QR Central Queensland coal track network for A$4.85 billion. As part of this, Australian Rail Track Corporation (ARTC) will act as the dedicated manager of the rail network.

The Queensland Coal Industry Rail Group (QCIRG), today delivered a full cash offer to the Queensland Government to buy the QR Central Queensland coal track network for A$4.85 billion.

The Chairman of QCIRG, Nick Greiner, said the fully funded offer represents a substantial premium to what is likely to be achieved under the Queensland Government's proposed Initial Public Offering (IPO), or realised in recent comparable transactions.

"Importantly, our offer is able to be settled with the Government prior to the IPO and will not be dependent on volatile equity markets, removing major risk for the State while also providing early settlement," Mr Greiner said.

"We have considered the alternative model under the IPO and associated regulation and legislation and strongly believe it does not represent an optimal or even reasonable basis for assuring the future of the State's major export industry.

"The QCIRG offer has four goals: to encourage fair and open access, optimise network performance, enable early system expansions, and encourage rail haulage competition, all with flow-on benefits through enhanced investment, employment and royalties."

Mr Greiner said the QCIRG offer is for the Central Queensland track network, covering four systems and the Goonyella to Abbot Point Expansion, which are used predominantly or exclusively by the coal industry.

"The members of QCIRG are committed to expanding the network to support future growth and in addition to the offer, QCIRG has established a facility to fund the current QR capital plan and also further rail capacity growth," he said.

"QCIRG's conservative gearing would also provide clear headroom for financing the high growth requirements across the coal track network. QCIRG has secured an acquisition facility of A$1.35 billion, which is underwritten by ANZ, BNP Paribas and Citibank N.A. as well as a committed capex facility of in excess of A$2.05 billion to fund the current QR capital plan and catch-up maintenance.

"Clear processes and decision making arrangements have been included that will enable timely approval of capacity expansions."

QCIRG comprises 13 coal producers in the Queensland coal industry. Each of Anglo American Metallurgical Coal, BHP Billiton, Ensham Resources, Felix Resources, Jellinbah Resources, Macarthur Coal, Peabody Energy, Rio Tinto Coal, Vale Australia, Wesfarmers Resources and Xstrata Coal have signed equity Subscription Agreements.

In addition, Aquila Resources and New Hope Coal Australia are supporting parties and have the opportunity to provide equity at a later stage.

"In total QCIRG members comprise 98 per cent of the Queensland export coal industry – an export industry with much greater potential growth than realised to date," Mr Greiner said.

In addition to the coal industry participants, the Australian Rail Track Corporation (ARTC) will act as the dedicated manager of the rail network. It is their intention to participate as an equity owner and provider of long term railway management (operation and maintenance) services. As an experienced railway manager, the engagement of ARTC will ensure the coal network is managed and operated in an efficient and safe manner.

All QCIRG members have signed a Heads of Agreement, which provides a framework for the coordination of the industry consortium and the basis for the offer.

Mr Greiner emphasised that the industry has been committed to providing the Government with an attractive offer, as it strongly believes that its approach will be in the best interests of Queensland, the coal industry and the many businesses and jobs that rely on it, and other system users.

He said the starting point for QCIRG in its consideration has been to realise a structure for coal related rail operations that is in the best interests of the State and system users.

"Protection will be provided for all users through fair and equitable access arrangements for small and large companies, current and future users and non-coal users such as agriculture," he said.

Mr Greiner said the Consortium expected that the Queensland Government and QCIRG will discuss and agree a suitable transition process to be followed after completion.

"Key elements of the transition strategy would include fair and reasonable arrangements for QR Network employees transferring to the new organisation," he said.

The QCIRG offer excludes QR's above rail rolling stock assets and the freight businesses of QR. Under the offer, the Queensland Government will have the option to separately consider arrangements for the QR haulage business.

Mr Greiner said that the coal industry recognises that the offer is being provided at a time of great uncertainty over future taxation arrangements because of the proposed "resources super profit tax".

"QCIRG assumes that the proposed tax, if implemented, would not apply to infrastructure or the operations of QCIRG and that a sensible outcome can be achieved with the Commonwealth Government on any tax on resources such that the industry's growth ambitions can still be realised." he said.

"However, in any event, the industry is compelled to protect its existing coal businesses through direct ownership of the coal rail network infrastructure. The industry cannot be exposed to operational and financial risk from network ownership and operation not aligned with industry objectives.

"QCIRG is confident that, working in conjunction with the Government, there can be early completion of the transaction, well ahead of the IPO timetable.

"QCIRG is hopeful the Government will engage positively and provide due diligence information to facilitate this early completion."

Citi acted as sole financial advisor to QCIRG.

Last updated: 26 May 2010

[ozbob]

From the Courier Mail click here!

Union anger as Queensland Rail spruiked for sale to US investors

    * From: The Courier-Mail
    * June 02, 2010 11:00PM

QUEENSLAND Rail supremo Lance Hockridge has begun spruiking the state-owned company to international investors, further raising the ire of union bosses.

Mr Hockridge and QR's chief financial officer Deborah O'Toole are on a week-long whistlestop tour of the US in a bid to attract investor interest.

The Rail, Tram and Bus Union has accused the State Government of reducing a proud Queensland company into the "plaything of Wall Street bankers".

RTBU secretary Owen Doogan yesterday said that Mr Hockridge's 30-stop tour exposed the Bligh Government's spin that QR would be sold to mum and dad investors.

"The Premier promised in Parliament that the float will be offering preferences to Queenslanders as investors but Queensland mums and dads can forget about sharing in QR's success," he said. "Incredibly American fund managers are now getting more information than Queenslanders.

"This road trip is a desperate ploy for the Government and Hockridge to prop up a proposed sale that anyone can see is foundering under regulatory and political and market difficulties."

However, a QR spokesman said there would be room for all types of buyers in the float.

"Not surprisingly given the size and quality of the asset it is envisaged there will be a mix of retail 'mum and dad' investors as well as institutional investors when QR National is floated at the end of the year," he said.

Mr Hockridge and Ms O'Toole are meeting with institutional investors in New York, Toronto, Boston and on the US west coast throughout the week.

"Feedback has been extremely positive from US investors and there is a high level of understanding of QR National's vertically integrated model – the model almost universally used in North America," the spokesman said.

However, the float model was attacked again yesterday by Federal Resources Minister Martin Ferguson, who backed the $4.85 billion bid by coal companies for Queensland Rail's track assets.

"I welcome that bid, I've been supportive of it from day one because frankly both industry and government have got something to account for," Mr Ferguson said.

Steven Wardill and Emma Chalmers

[ozbob]

From the Courier Mail click here!

Hundreds of Queensland Rail workers walk off job un unauthorised strike

Hundreds of Queensland Rail workers walk off job un unauthorised strike

    * From: AAP
    * June 08, 2010 1:20PM

HUNDREDS of rail workers have walked off the job in an unauthorised strike in north Queensland.

The Rail, Tram and Bus Union (RTBU) spokesman Les Moffitt told ABC Radio rail workshop staff and train drivers in Townsville were striking for 48 hours over the Queensland Government's asset sales.

"While I don't condone what the guys have done, I can fully understand the decision that they're in and how they feel about it," he said.

A Queensland Rail (QR) spokeswoman told AAP QR was aware of the strike action.

"QR is aware of the illegal strike action and will seek an order from Fair Work Australia to return employees to work," she said.

[ozbob]

From the Brisbanetimes click here!

QR breached workplace agreements, Federal Court rules

QR breached workplace agreements, Federal Court rules
June 11, 2010 - 4:15PM

The Federal Court has found Queensland Rail breached workplace agreements in its rush towards privatisation, a union says.

Rail Tram and Bus Union (RTBU) state secretary Owen Doogan says the court's decision today made it clear Queensland Rail had failed to honour its own consultation clauses in the agreements.

"QR knew that it couldn't meet the timetable set for the share float later in 2010 but it took shortcuts, determining that breaking the law was worth the risk in their determination to support the Bligh government's unhealthy sprint to privatise Queensland railways," Mr Doogan said.

"QR should have told the government that there was no way to meet the share float timetable."

QR is due to be split into two entities on July 1, with QR National's bulk haulage system to be placed on the market through an initial public offering (IPO) later this year.

The RTBU was one of five unions with members working for QR which launched court action in February, claiming that QR had failed to properly consult with affected workers.

QR could face federal fines of up to $660,000 for breaching workplace agreements.

Mr Doogan said the media announcements in December 2009 detailing the new structure of a privatised QR were major structural changes.

"There was no meaningful discussion about this at all with workers or unions, and certainly no opportunity for input," Mr Doogan said.

"It's another example of QR rushing into a decision for their own benefit, and ignoring workers and the people of Queensland.

"QR has simply trampled on workers' rights in its rush to implement its share float and has not behaved appropriately as an employer."

Mr Doogan said the court decision was another reason to halt the sale of QR.

"A survey last week showed that 85 per cent of Queenslanders opposed privatisation because they know that it will have a detrimental long-term effect on the state," he said.

QR said it will appeal the Federal Court decision.

"QR strongly believes it has met all requirements to consult employees, and based on legal advice, will now appeal the decision," a QR spokesman said in a statement.

He said the court decision will not affect the timing of the separation process at QR or the IPO for QR National.

"We remain absolutely committed to consulting with our people about the changes we are making in creating these two new organisations, Queensland Rail and QR National," he said.

AAP

[ozbob]

From the Courier Mail click here!

QR hit with huge fine for failing to consult with workers over privatisation

QR hit with huge fine for failing to consult with workers over privatisation

    * Ursula Heger
    * From: The Courier-Mail
    * June 22, 2010 12:41PM

QUEENSLAND Rail has been fined $660,000 by the Federal Court of Australia for failing to consult with its workers over privatisation plans.

The rail provider will have to pay the fine to the five unions involved in the case.

QR has vowed to appeal the decision, handed down earlier this month, that it had breached 20 of its industrial agreements by failing to consult with workers over plans to privatise the coal and freight arm of the company.

Justice Logan, who presided over the case, said the breach was so comprehensive that the maximum penalty for each breach should be applied.

[ozbob]

From the Brisbanetimes click here!

Queensland Rail fined for breaching workplaces laws in privatisation bid

Queensland Rail fined for breaching workplaces laws in privatisation bid
June 22, 2010 - 1:30PM

A court has ruled Queensland Rail breached federal workplace laws.

Queensland Rail has been fined the maximum penalty of $660,000 for breaching federal workplace laws in its push towards privatisation.

Federal Justice John Logan ruled on June 11 that QR failed to consult its 15,000 employees about future employment arrangements arising from the upcoming sale of its haulage network and the subsequent restructure of the government-owned company.

Justice Logan handed down a maximum penalty of $660,000 in the Federal Court in Brisbane today.

He told the court that workers were never given the opportunity to discuss if they would be moved into the new private business, how the privatisation would occur, or if they wanted privatisation in the first place.

"It is truly radical change, it is obvious change, change that was obviously intended to be the subject of consultation and not to appreciate that, is to close one's eyes to the obvious," he told the court.

"Those workers were let down badly by senior management.

"Queensland Rail utterly failed to consult with their workers.

"To exclude workers is a very serious contravention ... of a very important modern workplace right."

Queensland Rail claims it hasn't breached federal workplace laws and will appeal the June 11 decision.

QR's bulk haulage network, QR National, will be split from the state-owned organisation on July 1 and will be placed on the market through an initial public offering later this year.

QR Limited was fined $396,000, and its subsidiaries QR Passenger and QR Network were fined $231,00 and $33,000 respectively.

The five unions involved in the court action will share the money equally.

AAP

[ozbob]

This is bizarre ... A GOC being fined for following a Governments directives??  Does this mean less for services and maintenance now?

Some explanations need to be forthcoming ...

[Derwan]

Very weird.  How can QR be fined for a decision it didn't make?