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Legislative Assembly for the ACT: 1997 Week 4 Hansard (8 May) . . Page.. 1147 ..

MR CORBELL: My question is to Mr Kaine in his capacity as Minister for Urban Services. Minister, I refer you to recent comments made by the chief executive officer of ACTEW, Dr Mike Sargent, who stated that the decision recently handed down by Mr Baxter not to grant ACTEW the price increases they were seeking would cost ACTEW between 40 and 50 jobs. Minister, you were quoted in the Canberra Times on Saturday, 3 May this year, as saying there would be no jobs lost from ACTEW as a result of the recent pricing commissioner's decision. Minister, who is right - you or Dr Sargent?

MR KAINE: First of all, Mr Corbell, as is often the case, misquotes me. What I said was that there should be no jobs lost from ACTEW because of the decision made by the pricing commissioner. I am prepared to argue that that is the case. If we look at the performance of ACTEW, we do not need to go any further than the recent assessment of their performance by the Steering Committee on National Performance Monitoring of Government Trading Enterprises, which found that the electricity part of ACTEW, in all of its trading parameters, is in a better position than any other electricity supply authority in Australia.

Mr Corbell: Then why did Dr Sargent say that jobs could be lost? Why did your chief executive officer say that, Minister?

MR KAINE: If Mr Corbell wants to answer his own question, I am quite happy, Mr Speaker; but he might like to listen to the facts instead of closing his mind and opening his mouth. These are not our evaluations; these are the evaluations of the independent steering committee on GTEs. ACTEW's operating sales margin for the year 1995-96 was 13.9 per cent, compared to 10 per cent for other distributors and 25 per cent for the electricity market as a whole. ACTEW's operating sales margin is the highest of all distributors reported. On a raw measure - and again I am quoting - ACTEW's domestic prices for 1995-96, at $83.60 per megawatt-hour, compare well with other domestic prices at $94 per megawatt-hour. When prices are considered as an index on the 1989-90 prices, ACTEW does not compare so well, but generally speaking the figures show that ACTEW is performing well. ACTEW's return on assets, at 7.3 per cent, is higher than the distribution industry average of only 6 per cent.

When you look at those figures - and they are not ours; they are produced by this independent authority - you have to say that ACTEW is a very successful business being run efficiently and effectively. Even after its prices have been capped by the prices commissioner, ACTEW is still expected to make a profit of about $45m next year. If you could see - - -

Mr Corbell: I raise a point of order. Mr Speaker, I asked the Minister specifically about job losses in ACTEW and whether or not he agreed with his chief executive officer. He has not mentioned jobs once yet. I would ask you to direct him to answer the question.

MR KAINE: Mr Corbell just needs a bit of patience and he will get the answer.

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