Thursday, 25 November 2010

UPDATE: Sale of Queensland Motorways postponed (originally Brisbane City Council keen to buy Queensland Motorways)

In a peculiar move, the Brisbane Times reports that Brisbane City Council appears set to bid to purchase the company Queensland Motorways when the Queensland State Government seeks to privatise it in 2011.  Of course this wouldn't be a "privatisation" at all, but rather one group of taxpayers buying a commercial company from another (and the group of buyers are also sellers)!

The intention is to establish municipal control of toll motorways owned by Queensland Motorways in Brisbane, so that tolls can be co-ordinated and the profits of Queensland Motorways channeled into Brisbane municipal projects.   The intention would be to transfer Brisbane City Council owned toll roads to a new company to incorporate Queensland Motorways.

The sale price is estimated to be around A$3 billion.  Queensland Motorways has been a success as a commercial company operating toll roads for the state government.  

Curiously, the council bid is led by Lord Mayor Campbell Newman, from the centre-right Liberal Party and being questioned by Labour Party councillors (who one might think would prefer council ownership to the private sector), showing politics in Australia is not always as partisan as it is elsewhere!

UPDATEThe Australian newspaper is reporting that the Queensland state Government has decided to delay the privatisation of Queensland Motorway Ltd because the market for toll roads is "soft".  Ownership will be transferred to the state government investment company Queensland Investment Corporation.   This is not entirely surprising given the state of infrastructure investment funds, although I personally have noticed ongoing interest that is largely driven by bargain hunting.  The Queensland Government is not needy enough for money to have to engage in a fire sale, so it isn't an unreasonable decision.

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