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Legislative Assembly for the ACT: 1999 Week 1 Hansard (2 February) . . Page.. 64 ..

MS TUCKER (continuing):

The Government has said that these breakdowns were the result of poor regulation rather than ownership, but can we be sure that a regulatory framework will be good enough to avoid the same sorts of problems?

The breakdowns in Sydney's water treatment system demonstrate that there are some inherent problems with privatisation that are difficult to resolve with regulation. A key problem is the significant reduction in public scrutiny that is allowed once a government body is privatised because of the veil of commercial-in-confidence that a private company is able to invoke. In the Sydney water case, all details of the contract with the private water treatment company were declared commercial-in-confidence and the person undertaking the inquiry into Sydney water, Peter McClellan, had to be granted the powers of a royal commissioner by the New South Wales Premier in order to obtain this information.

Another major problem is that service provision by a private operator is reduced to whatever is the exact wording in the contract and no more. Rather than resolving problems internally between Ministers, government departments and authorities, in a privatised environment disputes can end up becoming legal battles between government and a private operator. In the case of the breakdown of the sewerage treatment works in Adelaide, I understand that part of the problem was that the private company was responsible only for maintenance of the treatment system and not for the replacement or upgrading of equipment, which then led to confusion over which body was responsible for repairing breakdowns, and ultimately the Government had to pay the costs of remediating the system.

While a regulatory framework for electricity and water services will always be necessary, I do not believe that we can rely on it as a panacea for addressing all the problems that can arise from privatisation. Even if ACTEW is not sold, I think that the work should and must continue on the regulatory framework. I would ask the Chief Minister or a member of her Government to give a commitment to the Assembly today to maintain the regulatory reform task force so that it can continue its work of reviewing current regulations and, in consultation with the community, develop a new regulatory framework that addresses issues such as consumer protection, complaints mechanisms, public health and safety, water quality, environmental safeguards, price determinations and community service obligations.

I have seen a letter today from the Chief Minister giving a commitment to maintain the employment of ABN AMRO in this regulatory task force, but I am not quite sure what was actually being said in the letter. We want to see the task force kept in its present form. We want to see much more public, open process in terms of its membership and how it is operating. I believe that it is also important that such a task force remain in place to develop a body of expertise to manage regulation in the ACT Public Service. I hope to get confirmation from the Chief Minister at the close of debate today that, in fact, that is what she is committing to, because it is not clear from the letter that was sent to us today.

One of the motivations behind the ACTEW sale has been liquidising the assets of ACTEW before they lose value and before the Government is exposed to any more risk. I have already commented that I do not believe that ACTEW is subject to major

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