From Berejiklian in 2018 through to Perrottet in 2023 - the many promises made by the NSW Coalition Government to fund redevelopment of Grafton Base Hospital

 

THE IDENTIFIED NEED

The Daily Examiner, 31 July 2018, p.1:

Grafton Base Hospital will offer inpatient mental health services when a $263.8million redevelopment is funded.

For the first time the Northern NSW Local Health District has made the hospital its number one priority in its Asset Strategic Plan for 2018/19.

The Daily Examiner, 20 October 2018, p.4:

In July the Northern NSW Local Health District made a rebuild of the hospital its top priority for the coming year at a cost of $263.8million.

It’s report on the priority listing noted the hospital was close to capacity with inpatient beds, emergency, renal dialysis and chemotherapy infrastructure expected to reach capacity by 2022 and infrastructure for ambulatory care services was to reach capacity in 2020.

It also noted the construction of Australia’s largest jail, due for completion south of Grafton at the end of 2020, would also place stresses on the region’s health services.

The Daily Examiner, 22 November 2018, p.5:

Clarence Valley Council has also thrown its support behind the redevelopment of the Grafton Base Hospital.

It will write to the premier, deputy premier, minister for health, and member for Clarence Chris Gulaptis expressing its support for the $263.8m redevelopment.

THE HALF-PROMISES BEGIN

The Daily Examiner, 8 December 2018, p.22:

More hospital funding remains in his sights with the potential $268 million rebuild of the tired piece of infrastructure.

The Daily Examiner, 19 December 2018, p. 9:

Mr Gulaptis said he was continuing to pressure the government to allocate the $268 million funding for the hospital…..

THE REPETITIVE PROMISES

Clarence Valley Independent, 13 March 2019:

Gulaptis promise of $263m Grafton Hospital overhaul

The Daily Examiner, 21 June 2019, p.3: 

The $263 million commitment to the Grafton Base Hospital redevelopment was made in the final weeks of the campaign in March and is just one of many major infrastructure promises outlined in the 2019-20 Budget Papers. However, there there was no specific line item in the 2019-20 Budget and Nationals MP Chris Gulaptis was quick to point out it would take time.”

The Daily Mercury, 31 July 2020:

HEALTH NEEDS CONTINUE UNMET

North Coast Voices, 21 February 2021:

PUBLIC HOSPITAL ELECTIVE SURGERY MEDIAN WAITING TIMES IN NORTH-EAST NSW......

Grafton Base Hospital:

Hip replacement - the median wait was 6 days in 2011-12 and blew out to 77 days by 2017-18 and latest figures for 2019-20 stand at 67 days.

Total knee replacement - the median wait was 10 days in 2011-12 and blew out to 145 days by 2017-18 and latest figures for 2019-20 stand at 135 days.

Shoulder joint replacement - the wait was 8 days in 2016-17 and blew out to 11 days by 2017-18 and latest figures for 2019-20 stand at less than 5 days.

Ophthalmology - the median wait was 285 days in 2011-12 and latest figures for 2019-20 stand at 326 days, the highest median waiting time in the last nine financial years.

Between July and September 2020 a total of 652 unspecified elective surgery procedures were performed.

Clarence Valley Independent, 10 August 2022: 

The Clarence Valley Independent hit the streets last week and asked members of the public to share their thoughts after the Northern NSW Local Health District (NNSWLHD) revealed Grafton Base Hospital (GBH) had no on-site obstetrician, or available locums to cover shortages, and subsequently, expectant and birthing mothers were being referred to Lismore Base Hospital and Coffs Harbour Health Campus.

The NNSWLHD released a second statement two days later, announcing staff had altered their rosters to ensure previously advised gaps in specialist obstetrician cover were filled.....

THE PROMISES CONTINUE AND SO DO THE PROBLEMS

NSW Nationals, media release, 25 January 2023:

Regional Health and Mental Health Minister Bronnie Taylor, Nationals’ Member for Clarence Chris Gulaptis, and Nationals’ candidate for Clarence Richie Williamson have announced a major step forward in the $264 million Grafton Base Hospital redevelopment.

ABC News, 25 January 2023:

After her knee replacement surgery was cancelled twice last year, Yamba woman Rosalind Walsh could not bear to think it might happen again.

The 72-year-old was scheduled this week for orthopaedic work at Grafton Base Hospital in northern New South Wales, but was called on the day by hospital management asking her to stay home.

"They just said, 'We don't have a bed'," Ms Walsh said.

"They said, 'We can't do the surgery, but you're still booked in'."

Anaesthetist & former Grafton Medical Staff Council chair Allan Tyson said there were real repercussions for people who missed out.

"It is common," he said.

"We have to say, 'Sorry, you have to go home because the surgery can't be done'.

"It's not just elective surgery, if you can't walk."

Dr Tyson said the Grafton hospital was operating well beyond its capacity.

"We've got 18 patients in a ward today that is funded for eight patients," he said.

"Last week our fly-in surgeon missed out on three or four joint surgeries that we should have done, but didn't have the bed space.

"In the end, it's our patients that miss out."

For Rosalind Walsh, however, a long wait outside the hospital was worth it.

The ABC understands hospital management was able to redirect patients from the emergency department, resulting in a spare bed so Ms Walsh could have her knee surgery & recover in hospital.

Paid doctors with nowhere to work

Northern NSW Local Health District chief executive Wayne Jones said surgeons, including those flying in to regional hospitals to help reduce elective surgery waitlists, were at times unable to operate.

"As chief executive it hurts to the bone to pay money I'm not getting a return on," he said.

"The reality is at times you can't avoid that.

"There is [an] unprecedented bed block that we're experiencing."

Mr Jones said administrators were planning as much as they could.

"It is worth noting that we're seeing a real decline in those overdue waits, over the last four or five months, as we're starting to develop more models of care," he said.

"We're doing surgery in our smaller facilities, we're freeing up beds & facilities in places like Grafton, so we are getting through more."

NSW Regional Health Minister Bronnie Taylor visited the hospital this week to commit to a new $274-million new hospital in Grafton — a similar pledge to a 2019 state election promise…...

Less than 10 weeks out from a NSW state election and Perrottet & Co. don't seem to be winning over hearts and minds yet

 

The Poll Bludger, 22 January 2023:

Today’s Sunday Telegraph has a YouGov poll suggesting Labor is headed for a comfortable win at the New South Wales state election on March 25, leading the Coalition 56-44 on two-party preferred and 39% to 33% on the primary vote, with the Greens on 11% and others on 17%.

The poll also encompasses questions on the Dominic Perrotet Nazi costume scandal (67% say it won’t affect their vote, 20% say it will make them less likely to vote Coalition, and 8% demonstrate the problems with this sort of question by saying it makes them more likely to vote Coalition), cashless gaming cards (61% are in favour with 19% opposed), better party to deal with the cost of living (30% Labor, 25% Liberal, 26% neither) and issue salience (39% cost of living, 17% economy, 14% health, 10% each for housing affordability and environment). The poll was conducted January 14 to 17 from a sample of 1069.

Newcastle Herald, 23 January 2023, excerpt p.2:

The NSW government is on track to lose the March state election as Premier Dominic Perrottet's popularity wanes.

A YouGov poll shows the Coalition well behind in both first preference and two-party preferred standings.

Labor led the Coalition by 56 per cent to 44 per cent on a two-party preferred basis, while it was ahead by 39-33 per cent on first preferences…..

Both figures point to a parliamentary majority for Labor, which was buoyed in the poll by strong backing from young voters.

Support for Mr Perrottet also dropped, with only 44 per cent of those surveyed preferring him over Labor leader Chris Minns. But Mr Minns says he isn't paying attention to the latest poll as many voters remain undecided.

EveningReport.nz, 23 January 2023, excerpt:

On other topics, the poll found a majority of voters supported cashless gaming cards (61% in favour, 19% opposed). On the party best to deal with the cost of living, 30% selected Labor, 25% the Liberals, and 26% neither. Cost of living was rated the most important issue by 39%, far ahead of the 17% who rated the economy most important.

This YouGov poll found 46% of NSW voters supported a federal Indigenous Voice to Parliament, while 30% did not.

If these recent polls are accurate, the Coalition is likely to be defeated in March after three terms and 12 years in government. If this happens, Labor would govern federally and in all states and territories except Tasmania.

Cynicism burns strong in the Northern River as the March 2023 state election date draws nearer

 

Echo, 13 January 2023:

With the NSW election looming on March 25, there will no doubt soon be a government bonanza of promises to impress, you, the good-looking and articulate voter, into thinking that this or that party will govern with your interests at heart.

Politicians want to be taken seriously now? How cute!

State governments use your taxes to pay for health, education, police and roads, among many other services.

Other things they use your taxes for include throwing huge wads of cash at electorates they think they can win (called pork barrelling), or generously repaying their campaign donors.

That aside, another crucial role state governments have is with planning.

As we saw recently with the NSW planning minister’s intervention on [Byron Shire] Council’s holiday letting policy – local governments are merely a corporate arm of the state government, and will be reined in if they do not reflect the government’s views.

The views of the current NSW Liberal-Nationals government appears to deny local decision-making, renege on that promise, and undermine any chance to address the housing crisis.

And also, presumably, repay their campaign donor mates in the holiday letting industry.

The current government aren’t doing that well across the state, and with any luck there will be a much-needed change of direction after election day.

Or will NSW Labor act in the same way?

Moving on, a planning policy that is currently on the table from the NSW Department of Planning and Environment (DPE) is reforming the State Environmental Planning Policy (Housing) 2021, (or Housing SEPP).

The current Housing SEPP, as the peak body for local government, Local Government NSW (LGNSW), says, contains ‘blanket provisions that override local controls [and] undermine this framework for local strategic planning, by disrupting outcomes endorsed through councils’ local strategic planning processes’.

It’s widely known that affordable housing SEPPs don’t work as intended. Or as a cynic may say, they are working perfectly for the one per cent. Just not those who need affordable housing.

For example, LGNSW support affordable housing, developed under the Housing SEPP, to be in perpetuity, ‘not 15 years, as current provisions allow’.

Also, unlike the current government, LGNSW supports ‘locally-developed responses to short-term rental accommodation (STRA)’.

To have your say on the housing reforms, which are on exhibition until January 13, visit www.planning.nsw.gov.au/Policy-and-Legislation/Housing/Housing-SEPP.

Hans Lovejoy, editor

Perrottet Government finally commits to bringing the Volunteer Rescue Association's emergency communications capability up to scratch

 

The Volunteer Rescue Association of NSW (VRA) formed in 1969 says of itself :

NSW VRA has over 1500 volunteer members across 53 squads, including specialist rescue operators working for their communities across New South Wales. They are primary responders for Road Crash Rescue, General Land Rescue, Vertical Rescue and many types of specialist rescue encountered by Emergency Service personnel and primarily operate in rural and regional New South Wales. The NSW VRA also includes Aerial Patrol, Remote Area Communications, Cave Rescue, Ski Patrols, Swift Water Teams and other Rescue Support Teams.

The VRA funding model is a mix of government grants, community fundraising and donations. This model results in a very tight budget.

So when in 2018 then Premier & Liberal MLA Gladys Berejiklian and her then Treasurer & Liberal MLA Dominic Perrott had the bright idea of charging commercial rental rates for use of around 800 communications towers on Crown land and abolishing rent rebates, the VRA feared it would have to cease using these towers as the organisation couldn’t bear the additional costs.

Tower rental costs in rural and regional low population density areas were foreshadowed to increase by 19 per cent.

By November 2019 the NSW Coalition Government appears to have decided that rebates on communication tower rents could still be made to eligible organisations on application, but these rebates would still require payment of the statutory minimum rent.

I suspect that the $4.7 million government funding injection mentioned in the article below is in part a workaround for a situation that Premier Perrottet himself helped create in 2018-2019.

Echo, 9 January 2023:

The Volunteer Rescue Association of NSW (VRA) will soon have access to seamless communications coverage across the state.

Minister for Emergency Services and Resilience and Minister for Flood Recovery Steph Cooke said a $4.7 million government funding injection will overhaul the VRA’s radio network to bring it into line with the other emergency services.

The funding will provide for 421 new radios and equip 100 vehicles with Vehicle as a Node technology.

Vehicle as a Node

The Vehicle as a Node capability integrates radio, mobile phone and satellite networks to provide a communication system that is resistant to ‘blackspots’, which often occur when natural disasters impact infrastructure.

VRA Acting Commissioner Andrew Luke said the upgrade will also give volunteers access to a duress button that is centrally monitored.

‘At the press of a button our members can request urgent assistance if they are in danger, enabling an immediate response,’ he said.

A consistent and reliable radio network

Ms Cooke said this multi-million dollar boost will give VRA volunteers access to a consistent and reliable radio network which is compatible with other agencies and guarantees their ability to communicate anywhere in NSW.

‘The VRA is the only agency in the State solely dedicated to rescue and its volunteers and staff have done an incredible job, particularly over the past 12 months supporting flood operations.

‘The independent Flood Inquiry highlighted ways we can enhance our emergency response and we will continue to ensure first responders have the resources they need to keep regional, rural and remote communities safer and stronger.’

‘Being able to send and receive life-saving communications in all conditions is vital to the safety of everyone, including our 1,218 members,’ said Acting Commissioner Andrew Luke.

Perrottet and Toole faced with an approaching tidal wave of condemnation, retreated from their latest attempt to drive NSW koalas into species extinction

 

This was going to be the scheduled North Coast Voices post title today: "Dodgy duo Dom Perrottet and Paul Toole are hoping that NSW residents, ratepayers and voters will forget this act of political bastardry once the state parliament goes into recess until February 2023. How wrong they will be in many a coastal council area".

But then, with an eye to his political legacy, retiring NSW Christian Democrat MLC Fred Nile spoke out.....

The Sydney Morning Herald, 14 December 2022: 

The NSW government has been forced into a humiliating backdown in the latest koala wars after Christian Democrat MP Fred Nile refused to back its native forestry bill, guaranteeing it would have failed on the floor of parliament. Agriculture Minister Dugald Saunders confirmed late on Monday that the Nationals would pull the hugely divisive bill in a bid to avoid an embarrassing loss for the Coalition in the final sitting week of parliament before the March election. The death knell for the bill came when Nile ruled out support for changes to native forestry laws, which would have made it easier for landholders to remove trees.....

Without Nile’s support, the bill could not have passed the upper house and it was also likely to fail in the lower house because Nationals MP Geoff Provest told Nationals leader Paul Toole on Monday that he would not support the bill. Liberal MP Felicity Wilson also ruled out supporting the bill. Millionaire businessman and environmental crusader Geoff Cousins, who waged the high-profile campaign to stop the Gunns pulp mill in Tasmania during the 2007 federal election campaign, also delivered a blistering warning to the NSW government, saying he would “do everything I can to run a major campaign against the Perrottet government in the next election” in response to the bill. “I would liken the sort of campaign I would run to the Gunns pulp mill campaign,” Cousins, a former adviser to John Howard, said. “If they want to go up against that, that’s fine. But it would include a major advertising campaign and I would do everything I could to bring down a government that would put forward legislation like this.” .....

In addition to dissenting members of the NSW Parliament, it was obvious that individuals and communities all along the est. 1,973km long NSW mainland coastal zone and, as far inland as the Great Dividing Range, were prepared to resist the Perrottet Coalition Government's attempt to lock in destructive legislation ahead of the March 2023 state election. In what looked suspiciously like an erstatz insurance policy for their timber industry mates - just in case the Coalition lost the forthcoming state ballot.

Somewhat predictably, in this approach the Perrottet Government was aping the failed former Morrison Government and, thereby doing itself no favours.

BACKGROUND

Newly minted NSW National Party Leader & Deputy Premier Paul Toole 
and newly minted NSW Liberal Party Leader & Premier Dominic Perrottet. IMAGE: ABC News, 14 October 2021

 

Following in the footsteps of a disgraced Liberal premier and a disgraced Nationals deputy premier (both of whom resigned
office and left the NSW Parliament) it seems no lessons were learnt......

The Sydney Morning Herald, 14 November 2022, p.1:

NSW Premier Dominic Perrottet faces a damaging internal battle in the final week of parliament as Liberals threaten to cross the floor over the revival of the so-called koala wars which almost tore apart the Coalition two years ago.

As NSW parliament sits for the last time before the March election, the bitter issue of protecting koala habitat could split the Coalition, with Liberals who face challenges from teal candidates fearing it would ignite a backlash against the government.

The Nationals have introduced a bill to make it easier for landholders to clear private native forestry without duplicate approval processes between state and local governments. However, critics have warned it could water down environmental regulation and destroy koala habitat.

Climate 200 founder Simon Holmes a Court described revisiting the koala wars as a "gift" for the teal movement in NSW, which would seize on the NSW government's position in northern Sydney seats.

Holmes a Court said Perrottet had made three significant environmental missteps in recent weeks, which included committing to raising the Warragamba Dam wall and appointing former Sydney Hydro boss Paul Broad as a special adviser.

Broad, who was appointed by Perrottet while Energy Minister Matt Kean was overseas, has been a critic of NSW's energy road map, which provides long-term contracts for renewable generation and grid services. Broad has called the plan, devised by Kean, "fundamentally flawed". He also backed the former federal government in its push for a large new gas-fired power plant in the Hunter Valley.

"Until recently, it's been hard for the teals to find strong differentiation in states with almost-good-enough environmental credentials like Victoria and NSW," Holmes a Court said.

"Dominic Perrottet has handed the movement a gift through deciding to flood a UNESCO site with many significant Aboriginal sites, reopening the koala wars and putting Angus Taylor's gas man in the Premier's office."

Asked yesterday about Broad's appointment, Perrottet said he was "highly regarded, and his experience in water, engineering and infrastructure is second to none in this country".

Perrottet said Broad's remit included raising the Warragamba wall and ensuring the $3.5 billion Narrabri gas project was online as soon as possible.

The Coalition battled internal warfare over koala planning laws in 2020, when former deputy premier John Barilaro threatened to take his Nationals MPs to the crossbench if proposed new rules to protect an increased number of tree species home to koalas were adopted.

Then premier Gladys Berejiklian stared him down and Barilaro withdrew the threat.

The bill to change planning laws for private native forests will be debated his week and is likely to be particularly problematic for Liberal MP James Griffin, who is environment minister and holds the seat of Manly, which has a very active independents' group.

Several senior government sources said other at-risk Liberals, including North Shore MP Felicity Wilson and Port Macquarie MP Leslie Williams, are considering crossing the floor or abstaining. Nationals MP for Tweed Geoff Provest could abstain.

Wilson, Williams and Provest were contacted for comment.

In an indication of how damaging Wilson thinks the bill could be, she gave a private members' statement to parliament last week when she wanted her "support for a plan to transition the native forestry industry towards sustainable plantations" placed on the record……

Opposition environment spokeswoman Penny Sharpe said Labor would oppose the bill…...

Local Government NSW president Darriea Turley said the bill had been rushed into parliament without any consultation with local government.

"This bill undermines the crucial role councils play in the regulation of private forestry operations," Turley said. "It will have devastating impacts on native habitats, particularly for koalas and many threatened species."

Ministers and Members of the NSW Perrottert Coalition Government abandoning ship at March 2023 state election:

And the list is getting longer the closer New South Wales comes to the March 2023 state election.......

Perrottet Government ministers and backbenchers who have announced they will resign at the March 2023 NSW state election

• Minister for Infrastructure, Minister for Cities, Minister for Active Transport & MLA for Pittwater Rob Stokes – in parliament 16 years;

• Speaker of the House & MLA for Davidson Jonathan O'Dea – in parliament 16 years;

• Minister for Customer Service and Digital Government, Minister for Small Business, Minister for Fair Trading & MLA for Ryde Victor Dominello – in parliament almost 14.6 years;

• Minister for Corrections, Minister for Veterans, Minister for Western Sydney & MLA for Parramatta Geoffrey Lee – in parliament 12 years;

• Transport Minister David Elliott – in parliament 12 years;

• Lib MLA for South Coast Shelly Hancock – in parliament 20 years;

• Lib MLA for for Riverstone Kevin Conolly – in parliament 12 years;

• Lib MLA for Vaucluse Gabrielle Upton – in parliament 12 years;

• Nats MLA for Clarence Chris Gulaptis – in parliament 12 years;

• Nats MLA for Myall Lakes Stephen Bromhead – in parliament 12 years;

• Nats MLA for Oxley Melinda Pavey – in parliament 8 years.

Minister for Health & MLA for Wakehurst Brad Hazzard is rumoured to be considering retirement. Hazzard has been in parliament since March 1991. Retirement confirmed by reports in mainstream media later on morning of 25 October.

Earlier this year Lib MLC Catherine Cusack resigned on a matter of principle after 19 years in parliament and Lib MLC Don Harwin resigned for unstated reasons after 23 years in parliament.

State of Play: New South Wales general election March 2023

The Sydney Morning Herald, 24 September 2022, excerpt:

The result, if replicated on March 25, would put Labor in majority government. The ALP needs to win at least eight seats to secure that majority.

Voters have also made it clear that the election will be fought on the rising cost of living, with 30 per cent identifying it as the No.1 issue of concern, while 10 per cent of voters singled out health and aged care, followed by the environment and climate change as well as economic management.

Despite the support for Labor, voters are not warming to either leader, with Premier Dominic Perrottet and Opposition Leader Chris Minns equal on the preferred premier rating.

Both are on 28 per cent (a slight drop for Minns from 32 per cent in February when he overtook Perrottet as preferred premier) but crucially, 44 per cent of voters are undecided…..

Read full article here.

Six months out from the state election and NSW Premier Dominic Perrottet adds a new dimension to the term 'city-centric'

 

The Daily Telegraph, 8 September 2022, p.5:

NSW will be a thriving economy of six cities with fast rail, ambitious affordable-housing targets, more apartments and townhouses, and more defence and space jobs under a bold new plan from Premier Dominic Perrottet.

The state government and the Greater Sydney Commission will today unveil a discussion paper on the six-city plan – which includes Lower Hunter and Greater Newcastle City, Central Coast City, Illawarra-Shoalhaven City, Western Parkland City with the new Western Sydney International Airport at its centre, as well as the Central River City and Eastern Harbour City.

Map of the one and only newly created 'region' NSW Premier & Liberal MP for Epping Dominic Perrottet and Minister for Cities & Liberal MP for Pittwater Rob Stokes apparently care about.....

Six Cities Discussion Paper Mapping

NSW Greater Cities Commission, The Six Cities Region: Delivering global competitiveness and local liveability, September 2022, excerpts from the Discussion Paper's 68 pages:

• We are actively and effectively managing climate vulnerability, proactive climate proofing, urban heat and planning, and designing our built environments to withstand flooding, bushfires and coastal erosion.

• As we grow, we must ensure our region strengthens its resilience in the face of the increasing climate-related risks and natural hazards of drought, bushfire, floods, extreme heat and overexposure to UV radiation that are already impacting our communities. This is embodied in the objectives and priority actions set out in the NSW Climate Change Adaptation Strategy.

• The 2019–2020 bushfires across eastern Australia caused loss of life, property, infrastructure and devastating impact on communities, vegetation, wildlife and ecosystems across our region. There were additional health and economic impacts from the thick smoke blanketing the region for months.

  In early 2020, major flooding impacted parts of Greater Sydney, the Central Coast City and the Illawarra-Shoalhaven City. Floods returned to parts of the region in late 2020, 2021 and 2022, causing more devastation, disruption and landslips.

  
  

One might be forgiven for thinking that the Perrottet Government has its sights squarely fixed on those zones where the bulk of the state population (therefore the bulk of registered voters) are to be found. That it is the issues, concerns and aspirations of voters living between the Illawarra-Shoalhaven and Newcastle-Upper Hunter which matter most when it comes to planning and implementing climate change mitigation, resilience measures and urban design & development. 

Seemingly wider regional New South Wales and its high climate risk communities will only get noticed between now and the March 2023 state election if the smaller number of regional voters outside of those "six cities" manage to transform themselves into very politically prickly problems for the government in Macquarie Street.

"Since Premier Dominic Perrottet was appointed NSW treasurer in January 2017, he has presided over an unprecedented, $106 billion surge in taxpayer debt" and "has been systematically misleading" NSW voters about how he created this multi-billion dollar debt mountain

What the Premier is telling the people of New South Wales

We have transformed our state - and we will keep transforming it.

We are going to build our way forward.#SMHInfrastructure

— Dom Perrottet (@Dom_Perrottet) May 31, 2022

Another perspective on the "transformation of our state" 

From the pen of Financial Review contributing editor, Christopher Joye, @cjoye, Portfolio Manager & Chief Investment Officer at Coolabah Capital…...

Live Wire, 25 June 2022:

In the AFR I write that after 12 years of Liberal leadership, encompassing four premiers and four treasurers, NSW is sadly degenerating into one of the worst run states in Australia.

Since Premier Dominic Perrottet was appointed NSW treasurer in January 2017, he has presided over an unprecedented, $106 billion surge in taxpayer debt. That means Perrottet and his fierce internal rival, Treasurer Matt Kean, will have saddled NSW residents with $13,000 of extra debt per person. One day, that debt has to be repaid.

If the annual interest rates on this debt converge to current levels around 4.2 per cent, NSW taxpayers will be paying almost $7 billion a year in interest alone. Put differently, NSW residents will be spending the equivalent of seven new hospitals each year in interest.

It is ironic that supposedly imprudent Labor leaders are running rings around NSW, with resource-rich states like Western Australia and Queensland reporting budget surpluses, which has allowed them to slash debt issuance as the economy rebounds post pandemic. Even Victoria is starting to look more fiscally conservative. In the coming financial year, NSW will issue twice as much debt as Queensland, one-third more than Victoria, and about six times more than Western Australia. It is also more than quadrupling South Australia’s debt supply.

In a desperate attempt to cling to power, Treasurer Matt Kean has blown a $7.1 billion improvement in NSW's budget with $8.8 billion in new spending next financial year alone. This means that NSW will issue almost $10 billion more debt in the 2023 financial year than it did in 2022 when the budget was smashed by COVID-19. Perrottet and Kean are literally stealing from future generations to bribe the current one to allow them to remain in power.

While some of this debt was unavoidable due to the pandemic, Perrottet’s government increasingly resembles a degenerate gambler, addicted to spending money they don't have.

As a lender to the state, my worry is that that this tale of mismanagement gets worse. It turns out that Perrottet’s government has been systematically misleading taxpayers. The 39 year old Premier promotes himself as the great "asset recycler". Perrottet claims he is selling taxpayer-owned infrastructure to invest this money in new infrastructure….

But this was untrue. Instead of funding new infrastructure, Perrottet took $7 billion of the $9.3 billion in WestConnex proceeds and put it in a speculative investment vehicle called the NSW Generations Fund (NGF). Technically, the money was actually allocated to a subsidiary fund inside the NGF called the Debt Retirement Fund.

Since 2018, not a single cent of the $7 billion has been used to pay for infrastructure. It has instead been gambled on stocks and illiquid junk bonds, amongst other risky assets. Amazingly, this has involved lending money to Russia ($75 million), Saudi Arabia ($45 million), China ($225 million), UAE ($15 million), Cayman Islands ($30 million) and Angola ($15 million).

Perrottet might have actually helped build President Vladimir Putin’s new palace rather than NSW roads, schools or hospitals. (After we expressly warned this was nuts last year, NSW has had to write-off $30 million of the money it lent to Russia.)…. [my yellow highlighting]

Yet in 2022, NSW taxpayer’s $7 billion still sits in the NGF. It is still invested in listed equities, private equity, and junk bonds. And it has lost money in 2022 (as it did in 2020) as markets have tumbled. In fact, since its 2018 inception, the NGF has now formally failed to meet its own performance benchmark of a return in excess of inflation plus 4.5 per cent.

The question is who benefits from this scheme? Who has a vested interest in it? Unsurprisingly, it is the folks punting the money. That is, TCorp. The NGF represents about 15 per cent of TCorp’s assets. Former Perpetual CEO David Deverall, who runs TCorp, has been desperate to turn it into a global asset manager, and aggressively grow its capital.

While TCorp blames NSW Treasury for the now-discarded plan for NSW to issue tens of billions in extra debt to enable TCorp to speculate on markets, the truth is that TCorp are the ones who directly benefit. Across TCorp’s 180 staff, the average compensation cost in 2021 was a staggering $323,000 per person. That is almost double the average pay of the RBA’s 1,300 plus employees.

The NGF is currently worth $15 billion, partly because it has been bolstered by the asinine decision to divert billions of NSW taxpayer royalties and income to it, and due to a debt-funded transfer of more than $2 billion to the NGF in 2020, despite the NSW budget being in record deficit.

This revenue had to be replaced with extra NSW debt, which explicitly contradicts the legislated objectives of the Debt Retirement Fund. These focus on three goals: maintaining NSW’s AAA rating, which Perrottet lost in 2020; reducing the cost of NSW borrowing, which has soared; and repaying NSW debt.

After widespread criticism last year, NSW suddenly stopped diverting taxpayer revenue to the NGF and then belatedly committed to using $11 billion from the sale of the second-half of WestConnex in 2021 to repay taxpayer debt.

Yet Perrottet and Treasurer Kean still refuse to invest the original $7 billion from the sale of the first half of WestConnex in 2018 into the infrastructure they promised. They also refuse to use this money, and the NGF’s remaining (partially debt-funded) $8 billion, to meet the Debt Retirement Fund’s legislated mission of repaying taxpayer debt.

We can quantify the cost of this madness: Perrottet and Kean would rather NSW taxpayers spend $630 million a year in extra interest on the $15 billion in new debt they will issue next year (but could have avoided) just to allow their TCorp pals to gamble this money on markets…..

Our interest in this matter is that as a fund manager, we lend money to all Australian states, including NSW. And we expect them to behave ethically from an ESG (specifically the “g” or governance) perspective. The huge ESG conflict of interest at the heart of the NGF—whereby NSW taxpayers have to pay $630 million a year in extra interest to allow TCorp to continue to punt their money—is unacceptable to all stakeholders.

Kean says he cares about ESG concerns. Time will tell if this is actually true.

Read the full article here.