I only ask because I know of a business for sale up in Bankstown airport and BAL is now privatized which got me curious about the grievances it is causing. 11th Apr 2018 03:32
Given that the premise of your question is what is in it for Australia, the answer is not much.
There is a fundamental necessity to distinguish from stock and flow with respect to capital. A stock of capital represents the asset. As other posters pointed out, these assets were built with revenues from previous generations. Adding to Australia's capital stock ought be something that defines a nation. Each nation adding to the stock so that the
inter generational contract holds: The current generation leaves it better for the next generation. Was it a government's to sell?
Having built a good stock of capital, the asset (in this case an airport) generates a flow of capital, like landing fees, retail lease space revenue etc. Am sure you get the point. The dividend is derived from the stock.
Privatisation represents a theft. Faced with a baby boom of entitlements, governments of all persuasions realised they could sell what the public already owned, thereby disposing of stock (raise dollars) and then sell the flow of capital (at a discount).
Not that much of the capital raised was spent on new projects building more stock and then flow, it went into consolidated revenue: It got spent by the government of the day on 'budget expenditure' be it salary wages or things. It has for the best part of three decades allowed cracks in terms of deficit budgets to be papered over; the proceeds from sale covered the structural problem.
If memory serves correctly, the recent NSW sale of 'poles and wires' for a 99 year lease (total sale) was for a combined dividend(flow) of 17 years. Mike Baird could win an election on the
promise of more schools and hospitals, but the state lost the stock and the flow.
The electricity grid in Victoria is pretty much controlled by State Owned Interests of a country to Australia's north. Should Australia actually decide to side with the USA, Victoria may need a lot more wax candles. Same for ports, airports, water and telecommunications. What sort of a government allows this to happen? All Australian governments and Australians voted for it.
Was the real value of the asset ever actually calculated? The same firms that value these assets for the government (nudge nudge) participate in the sale as consultants, underwriters and legal advisors.
The sale of Sydney airport to Macquarie was an interesting discount and such a good deal that Max Moore-Wilton, stepped out of Prime Minister Howard's service, right into the recently privatised Sydney Airport CEO position. Coincidence? More likely a pay off. Mr Robb the former trade minister parachuted out of Parliament into a lucrative gig with the Chinese, having successfully concluded a Chinese FTA just before retirement. Of course pure coincidence too!
Short of a guillotine in Canberra much of Australia's stock, built over decades of nationhood was pillaged by a generation of
self serving politicians and Australian let it happen.
The member for canning has made mention of the decision Australia needs to make with respect to our assets.
If Australians think the world under an American hegemony is uncomfortable should a certain country to our north gain ascendancy in our region, and asset sales are one of their strategic platforms, then Australia may well long for a return of a more western empire.