Proposed privatisation of electricity causes division in NSW

NSW premier Morris Iemma has dismissed
media reports that rumours of a leadership clash amidst rank-and-file opposition to his plan to privatise
electricity in the state, will
scuttle the project.

The Iemma government plans to sell-off the state's electricity
assets for as estimated $10 billion AUD, releasing more funds for
essential services such as roads and hospitals. Under the proposal,
the government will sell electricity retailers and lease generators
however a considerable public backlash against the proposal, led by
the state's unions, has media reports suggesting the premier is
backing away from the proposal.

The Sydney Morning Herald has also
reported of a split between Mr Iemma and the man believed to be the
real power behind the NSW ruling Labor party, Treasurer Michael Costa
-- the leading proponent of the privatisation plan.

Backbench Labor MPs are pressuring the premier on the issue saying the proposed sell-off is unpopular with
constituents according to a
report from the SMH. "The real worry is that if the privatisation
proceeds as planned, there'll be a lot of money in the bank for the
Libs to spend after they win the election," a Labor MP told the
newspaper.

"The MPs are extremely nervous. They are getting smashed at
branch meetings every night. There is a strong belief in caucus that
the package would have been accepted by the unions if it had not been
for Costa's attitude. He plays the man and not the ball and just when
you think you can work it out, Costa opens his mouth and blows it all
apart," the MP added.

However the premier told reporters
rumours of a split were “absurd and ridiculous” and said the
privatisation plan will go ahead regardless.

"The government has made its decision - it's gone through the
caucus and it's gone through the cabinet," he said.

Treasurer Costa said: "This smacks of desperation from people
who can't put up a decent argument against the Government's policy."

Union representatives, though, seized on the reports to suggest
the unpopular privatisation policy was being reconsidered.

Unions NSW assistant secretary Matt Thistlethwaite said: "We
believe it is in the Premier's and the Government's best interests to
listen to the people of NSW and heed their advice and come up with
some other alternative."