I think that most people who gave the matter more than a passing thought, would believe that the primary role of governments is to protect its citizens and their rights; to ensure that proper infrastructure, such as hospitals, roads, schools and others, are set up and well maintained, and to ensure that the economy is stable, in order for the people to be safe, healthy and happy.
I also think that most reasonable people would not believe that it is acceptable for their governments to behave as though it is involved in organised crime, in particular to deliberately conspire to victimise its citizens by running a racket or engaging in extortion?
Once upon a time, governments in Australia were all about providing a range of essential public services, which were funded through the raising of the necessary revenue (taxes) to meet the costs involved. Certainly governments were not in the business of providing essential services on the basis that they would generate substantial profits by extorting from their citizens.
Which brings us to where we are today.
Last week the NSW Audit Office confirmed that the NSW government owned electricity sector produced after tax profits of $1.7 billion to June 30th, 2013, up $500 million (42%) on the previous year. As a result, the sector contributed $1.8 billion to the NSW government, up $400 million (29%) on the previous year, with $1.4 billion (77%) of that amount being contributed by electricity distributors, $600 million (75%) more than last year.
Whilst the NSW Audit Office also confirmed that the return on equity for NSW government owned electricity companies came in at 21.2% for the same period, it is estimated that, after taking account of other benefits, including financing and income tax credits, that the real return on equity for the NSW government ran closer to 35%, more than three times the average return of 10% generated by ASX industrial companies and more than twice the return generated our favourite corporate oligarchy, the banks, who managed only a lousy 14-15%.
Talk about a license to print money …. what a racket!!
Now, unless you've been asleep or in goal for the past five (5) years, you'd know that your electricity bill has increased by more than 100% over that period. You'd also likely believe that the increases were primarily driven by the need to fund the replacement/expansion of essential infrastructure, not just to provide a wind-fall gain to the state's treasury.
Or at least that is what our politicians have told us …. again & again & again.
Of course, notwithstanding the continued assurances from Macquarie Street "that this pain was good for us", the evidence of "goldplating" of the electricity network at huge expense to NSW consumers was soon apparent.
That this dreadful waste of resources was a function of a flawed business model, that acted to incentivise more and more capital works on the part of the energy providers, has never been acknowledged by our politicians, although organisations such as the Manning Alliance have been highly successful in exposing the fraudulent waste involved and in some instances, stopping it.
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