NSW Premier Mike Baird at Newcastle’s John Hunter Hospital on Thursday. Photo: Darren Pateman The Premier has refused to say who in his office phoned UBS about its report on electricity part-privatisation. Photo: Darren Pateman
NSW election 2015: full coverage
Premier Mike Baird has refused to say who in his office called an investment bank before it altered a report on electricity privatisation to make the findings more favourable to his government.
Opposition Leader Luke Foley on Thursday questioned if global investment firm UBS was offered “inducements” to rewrite the report, and said Mr Baird was “treating people with contempt”.
Just nine days out from the March 28 election, Mr Baird has been forced into a fresh defence of his cornerstone re-election policy: part-privatisation of the state’s electricity “poles and wires”.
It emerged on Wednesday that UBS, one of the two banks handling the power proposal for the government, had released a report saying it would damage the state’s budget in the long term because billion of dollars in dividends and other payments would be lost.
But the bank, which stands to benefit by earning millions of dollars in fees if the transaction proceeds, reissued the report with an addendum removing a statement that the transaction was “bad for the budget”.
On Wednesday, Mr Baird admitted staff in his office had contacted the bank shortly before it reissued the report, indicating UBS was told the original version did not take into account broad economic benefits flowing from the power plan.
Mr Foley said reputable firms such as UBS “don’t lightly change the public advice they issue”.
He demanded to know who in the government contacted UBS, and whether Mr Baird spoke to UBS Australia chief executive Matthew Grounds.
“Were inducements made, was pressure brought to bear? There’s many questions to be answered here,” Mr Foley said.
“Did Mr Baird direct one of his people to place a call to UBS and put pressure on them to rewrite their advice to their clients?”
At a news conference on the Central Coast on Thursday, Mr Baird refused to answer questions about the report, including who in his office called the investment bank, whom they spoke to or when the Premier’s office first learned about the report’s damaging contents.
“The MD of UBS put out a statement on this yesterday,” Mr Baird said. “He has dealt with it. End of story.”
Mr Baird denied directing any staffer to call the bank himself but would not provide details.
Asked again at a later press conference to reveal who called UBS, Mr Baird said: “UBS acknowledged in their own research that they did not take account of the broad economic impacts. At their own instigation. Full stop. End of story.”
On Wednesday, a UBS spokeswoman said the initial report was independently determined by the bank “to be incomplete as it had not taken into account the budgetary impacts of the investment proceeds”.
“The analyst then reviewed publicly available information about the investment proceeds and reissued his research based on his own views,” she said.
UBS has been contacted for further comment.
Mr Foley said the Premier’s request that voters “trust” the government will reap $13 billion for the privatisation, rather than the $11 billion suggested by the report, was “treating people with contempt.”
“Saying ‘trust me’ doesn’t cut it in an election campaign when all of our party’s policies are rightly scrutinised,” he said.
“I trust the expert advice. If he can only get $11 billion, what are the $2 billion worth of infrastructure projects … he will ditch?”
The government says the sale proceeds will be used to fund a range of big-ticket infrastructure projects including a second rail crossing of Sydney Harbour.
Labor has promised a more “modest” $10 billion suite of spending, which would delay construction of the harbour crossing by four years.
Mr Foley on Thursday announced a Labor government would spend $55 million to help NRL clubs expand their community programs, by strengthening links to their local areas.
It would deliver community-based amenities, such as playing fields, aquatic centres and visual arts spaces. 2015 NSW election: Policy reckoner
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The original release of this article first appeared on the website of Wuxi Plastic Surgery Hospital.