From Pit to Port: Privatisation's impact on Queensland

At the beginning of June, Queensland awoke to find Premier Anna Bligh having ordered the privatisation of $15 billion worth of significant state assets, including Queensland Motorways Ltd, Forest Plantations Queensland, Queensland Rail's coal freight business and the Abbot Point Coal Terminal.

In the following weeks, this move has been seen by environmentalists and unions alike as a direct attack on Queensland workers and the global climate. Despite its rhetoric about real action on climate change, we have seen the Bligh Government firmly commit to immediate financial gain ahead of the welfare of its citizens.

Premier Bligh's key argument for the sell-offs has been that it is needed to patch a $14 billion hole that has been punched in the budget surplus by the global economic downturn. The Queensland public, however, thought differently. In the run up to the State elections in March, Queenslanders strongly rejected the privatisation in letters to the editor and on online blogs and talkback radio. Indeed, in a Courier Mail poll that asked the question “Should public assets be sold to balance the budget?” a resounding 91% answered 'no'.

Despite overwhelming popular opposition, including workers threatening extended strike action if the privatisation went ahead, Bligh has powered on regardless, hammering the proposal through the Labor Party State Conference despite the party's overt anti-privatisation stance.

Such an elitist and heavy handed approach has led to a left faction split and even Bligh's own branch of South Brisbane unanimously voting for her ejection from the party.

It is clear that the Bligh Government has throughly overruled the voices of the public and has committed to selling out both Queensland workers and the climate.

Selling out the climate

Bligh appears to view such popular opposition to privatisations as the flounderings of an incoherent and ignorant public, but there are some real, deep-seated issues which are at stake here.

Firstly, the publicly owned coal infrastructure that has been earmarked for privatisation currently contributes to making Queensland the largest coal exporting state in the largest coal exporting country in the world. Fossil fuels such as coal are inextricably tied to the shifts that we are seeing in the global climate, and a reduced dependency on their use is essential to avoid the worst scenarios recently modeled by the United Nations’ Inter-Governmental Panel on Climate Change.

Currently, the Bligh Government has shunned UN climate science and had forged ahead with expansion plans to make Queensland coal the world’s main contributor to climate change.

With government plans to double the state’s coal output, the Abbot Point Coal Terminal is currently undergoing an expansion of export capacity to 50 million tonnes per annum, a significant contribution to world CO2 emissions. Queensland Rail's coal freight network is also in the midst of upgrades and expansion. Meanwhile, the Government's ClimateSmart 2050 climate change strategy does nothing to address the role of coal exports in the state's contribution to global climate change.

To reduce dependency on fossil fuels, climate science demands that all governments must act immediately to transition towards renewable energy production. In Queensland, this action must involve a plan to phase out the coal industry in the state and develop an energy export economy that is based on renewable alternatives to provide work for the 19,000 people currently employed in the coal industry (which, in comparison, is just less than the number of people working in Target stores in Australia).

Despite its inaction on addressing the state's coal exports, the Queensland Government still has a key role to play in facilitating future resource re-distribution to enact this long overdue shift in industrial policy. Publicly controlled energy assets are essential in making this shift as successful as possible and to assist in the net increase of 7000 jobs created within a low-carbon economy, as modeled by the Newcastle University’s Centre for Full Employment.

Privatisation of state owned coal infrastructure makes this immensely more difficult. Giving partial control of Queensland's greatest contributor to climate change to corporations driven predominantly by a financial bottom-line would be an unmitigated disaster for the global climate.

Future government action to increase the sustainability of the industry and to enact a transition away from fossil fuels will be actively hindered by the lobbying efforts and financial motives of multi-national coal corporations. The Bligh Government appears set on making it even more difficult for an already deeply flawed Federal emissions trading scheme to have any effect whatsoever on Australia's emissions levels from its coal exports.

Selling out Queensland communities

Historically, privatisation moves have resulted in increased pressures on local community viability and wide-spread job losses. Australian Services Union Queensland branch secretary David Smith has predicted that 5000 workers will lose their jobs due to the Bligh Government sell-offs.

From July 2007, the gas and electricity industry of South Eastern Queensland was privatised, opening up the sector to the competition of free market economics. Citing similar arguments to those promoted by the Bligh Government this week, the move led to the redundancy of 165 Energex workers and numerous more staff did not receive renewed contracts. Under the new owners, staff are paid up to $17,000 less per year and suffer from decreased job security, and the newly appointed Queensland Energy Ombudsman already dealt with 3786 disputes before mid-2008. Meanwhile, the privatisation of energy infrastructure in Australia has previously passed on additional costs to citizens in other states in the form of higher taxes and environmental costs.

These future costs are increased by the propensity of private energy companies to public utility assets to depreciate, essentially holding state governments to ransom over continued public utility costs. The most insidious outcome of the privatisations will be the effective control of some regional Queensland economies by coal corporations, from coal pit to coal port. In South Australia and Victoria, such a dependency already exists, there have been significant increases in community insecurity as the shifting forces of the free energy market leaves unemployment, unaffordable housing, higher crime rates and social dislocation in their wake.

Placing control of regional economies into the hands of inherently transient corporations is a travesty of care by the Queensland Government, ultimately rendering vast swathes of Queensland unviable as coal fortunes shift.

A just solution is required

Retaining public ownership Queensland's coal infrastructure is essential in maintaining strong regional communities and enacting a transition to a low-carbon future. Government facilitation of this shift is key in the time that we have to avoid catastrophic climate change, and where the alternative option is big business ownership that favours ecologically destructive energy production.

Climate change stems inherently from corporate power that places the importance of shareholder profits above the will of the community upon which land it works. Achieving a truly sustainable future will thus require much more than replacing a centralised energy system based coal to one based on renewable economy. Current inequalities and patterns of oppression are tied up in dealing appropriately with climate change, and disadvantaged voices must be heard if we are to create a socially and ecologically just transition to a low carbon future.

At present, already disadvantaged groups in Australia, including Indigenous Australians, rural and low-income communities are disproportionately impacted by the costs of climate change. This can be seen from the extreme weather events in Victoria and Queensland earlier this year, to the higher taxes that have been created from past privatisation of energy infrastructure. These voices must be heard in the development of a just transition policy for Queensland.

A just transition requires a government that is willing to listen to its people, and accept that climate change provides us with a unique opportunity to break from historical patterns of disadvantage that have been reinforced by a centralised energy economy.

A just transition is a process and philosophy that puts people above profits, listens to all community voices and recognises that viable communities and strong economies are fundamentally linked to a safe and stable global climate. The Queensland Government must find its place within a just transition to remain relevant in the low-carbon future that is urgently required.