20 Jun 2013
A substantial amount of work is still needed to understand the costs and benefits of selling Queensland government assets, including QIC, according to Queensland Treasury.

In a letter to theinstoreport, dated 17 June, deputy chief of staff Matthew Jeffries, from the office of Treasurer and Trade Minister Tim Nicholls, responded to questions about a possible timeline for the divestment of QIC.

“The government has … indicated that it will give further consideration to the possible divestment of other government businesses, but that a substantial amount of further work needs to be undertaken to understand the costs and benefits of such a course of action,” Jeffries wrote.

“I reiterate that the government does not currently have a policy to sell government businesses and remains fully committed to seeking a mandate from the Queensland people before divesting itself of any government business.”

He indicated the government had confirmed it would not sell its electricity distribution and transmission businesses, including Ergon, Energex and Powerlink.

Queensland has experienced a rapid increase in debt since 2004, amounting to $62 billion in the 2012 fiscal year. It is expected this amount will rise to $85 billion by 2014/15.

The deterioration of the state’s financial position led to a downgrade of Queensland’s credit rating in 2009/10, which increased the costs of servicing the debt.

An Independent Commission of Audit into Queensland’s Financial Position was established last year to review potential solutions to reducing the mounting debt, and it recommended in April that the government should sell a number of assets, including the $71 billion asset manager QIC.

But Jeffries confirmed no businesses would be put up for sale before the state election, which is scheduled to take place on or before 20 June 2015.

Written by Wouter Klijn.
A substantial amount of work is still needed to understand the costs and benefits of selling Queensland government assets, including QIC, according to Queensland Treasury.

In a letter to theinstoreport, dated 17 June, deputy chief of staff Matthew Jeffries, from the office of Treasurer and Trade Minister Tim Nicholls, responded to questions about a possible timeline for the divestment of QIC.

“The government has … indicated that it will give further consideration to the possible divestment of other government businesses, but that a substantial amount of further work needs to be undertaken to understand the costs and benefits of such a course of action,” Jeffries wrote.

“I reiterate that the government does not currently have a policy to sell government businesses and remains fully committed to seeking a mandate from the Queensland people before divesting itself of any government business.”

He indicated the government had confirmed it would not sell its electricity distribution and transmission businesses, including Ergon, Energex and Powerlink.

Queensland has experienced a rapid increase in debt since 2004, amounting to $62 billion in the 2012 fiscal year. It is expected this amount will rise to $85 billion by 2014/15.

The deterioration of the state’s financial position led to a downgrade of Queensland’s credit rating in 2009/10, which increased the costs of servicing the debt.

An Independent Commission of Audit into Queensland’s Financial Position was established last year to review potential solutions to reducing the mounting debt, and it recommended in April that the government should sell a number of assets, including the $71 billion asset manager QIC.

But Jeffries confirmed no businesses would be put up for sale before the state election, which is scheduled to take place on or before 20 June 2015. – See more at: http://www.theinstoreport.com.au/articles/substantial-work-needed-on-assessment-of-qic-sale#sthash.UheILI5f.dpuf

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