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March 1st, 2013 
David Schulberg the 3rd 
A Queensland finance audit has reportedly recommended the state sell major assets to reduce debt.
Source: AAP
THE Queensland government has been advised to sell electricity and port assets, and open services such as transport and corrective services to outsourcing.
The executive summary of the Commission of Audit, headed by former federal treasurer Peter Costello, was released on Friday.
The commission recommends the government dispose of businesses in commercial markets in the energy and ports sectors and in funds management, for instance the Queensland Investment Corporation.
“These are mature businesses capable of being owned and managed efficiently by the private sector and there is no need for the government to lock up scarce capital in such mature assets,” its report says.
It says the government is not well placed to manage the commercial risks involved or fund investment for the ongoing viability of the business.
If the government keeps its capital tied up in its government-owned corporations, it is forced to borrow money at higher rates to undertake new capital investment elsewhere, it says.
“Sale of these assets would release funds for investment in new areas to enhance the productivity capacity of the economy,” it says.
The report lists child safety, corrective services, social inclusion and public housing services as areas that could be outsourced.
“Contestability should be introduced progressively on a phased basis, concentrating initially in southeast Queensland where competitive market conditions are most likely to be found,” it says.
The report also says the government faces an increasing cost burden in the subsidies it pays to provide public rail and bus transport services.
“The commission considers that these services should be restructured to be delivered through contestable contracts under franchise and lease arrangements,” he said.
Treasurer Tim Nicholls said the commission advised that rapidly reducing the debt by more than $25 billion was needed to regain the AAA credit rating.
“The commission says that achieving this would require Queensland to deliver a budget surplus for the next 50 years and recommends the state government concentrate its limited financial resources on service delivery, rather than asset ownership,” he said.
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