The Canadian Press - ONLINE EDITION

Australian government plans to sell $117 billion in assets to ease budget squeeze

  • Print

CANBERRA, Australia - Australia plans to raise up to $117 billion from sales of state assets, the finance minister said Thursday, as the government tries to bridge a gaping budget deficit.

The announcement comes after the International Monetary Fund highlighted the challenge Australia faces to return its budget to surplus in the aftermath of the global financial crisis. The task has been made harder by tax revenue falling short of expectations as a mining boom cooled.

The federal budget is headed for a 47 billion Australian dollars ($42 billion) deficit in the current fiscal year that ends June 30. Gross debt will peak at AU$667 billion, according to the latest government projections.

Finance Minister Mathias Cormann was not specific on what assets were being considered for sale, aside from his government's plan to sell health insurer Medibank Private, which is estimated to be worth up to AU$4 billion.

Treasurer Joe Hockey, who chairs a meeting of Group of 20 finance ministers in Sydney this month, will likely reveal more of his privatization plans when he delivers his conservative coalition government's first annual budget to Parliament on May 13. He is developing the asset sale plans in conjunction with state governments.

The conservative coalition took office after winning elections last September after five years in opposition.

"There is opportunity for both the federal government and state and territory governments to recycle capital by selling infrastructure which appropriately can be sold and then reinvest the capital," Cormann told Australian Broadcasting Corp. radio. He said assets sales would boost economic growth and create jobs.

Cormann said AU$130 billion ($117 billion) "is the potential" amount of money that could be raised.

Analysts at ANZ said the greatest beneficiaries would likely be the New South Wales and Queensland state governments, which own the majority of public assets.

The IMF warned the federal government that it would have to make "sizeable cuts" in projected spending if it is to return the budget to an enduring surplus.

"We are very conscious of the challenge in front of us. The Treasurer and I are very focused on turning the situation around that we've inherited," Cormann said.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Eddie the fat cat has dropped two pounds on diet

View more like this

Photo Store Gallery

  • An American White Pelican takes flight from the banks of the Red River in Lockport, MB. A group of pelicans is referred to as a ‘pod’ and the American White Pelican is the only pelican species to have a horn on its bill. May 16, 2012. SARAH O. SWENSON / WINNIPEG FREE PRESS
  • A goose comes in for a landing Thursday morning through heavy fog on near Hyw 59 just north of Winnipeg - Day 17 Of Joe Bryksa’s 30 day goose challenge - May 24, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Do you support a proposed ban on tanning beds for youth under 18?

View Results

View Related Story

Ads by Google