$10b Ausgrid sale rejection 'right thing to do': Hogan
THE FEDERAL Government decision to scuttle the $10billion sale of electricity distributor Ausgrid to Chinese and Hong Kong investors was based on security advice and was the right thing to do says the Member for Page Kevin Hogan.
Mr Hogan, a Nationals member who has been a critic of Chinese buying Australian property, said Federal Treasurer Scott Morrison had little choice but to knock back the sale.
"I respect the decision of the security agencies, who recommended they not go ahead," Mr Hogan said.
"They're independent authorities and they had security concerns in relation to it and I respect that judgement."
Two bidders were in the running for a 50.4% stake in the assets: Chinese government-owned State Grid Corporation and the Hong Kong-based company Cheung Kong Infrastructure.
Both have passed muster with Australian authorities in the past.
Cheung Kong has controlling interests in electricity providers in South Australia and Melbourne.
Last year Mr Morrison gave the all clear to State Grid to bid for NSW electricity distributor TransGrid.
Mr Hogan also dismissed the treasurer's critics who said the move was an attempt to buy favour with fractious elements in the Senate, including One Nation, Nick Xenophon and Bob Katter.
"Let's not make this political," he said. "We have some very professional agencies in this country and I respect our security agencies and the decision they made."
Ahead of the 2015 State Election Premier Mike Baird famously announced he had "no Plan B" to fund his government's big-spend budget if he failed to secure the 99-year lease of his states poles and wires infrastructure.
Mr Hogan said NSW was not going to miss out on "poles and wire" funding of its infrastructure projects.
"The state are already saying they already have people putting their hand up and are going through another tender process," he said.
"There are Australian infrastructure funds and other infrastructure funds that would be putting their hands up with great anticipation."
The Member for Clarence, Chris Gulaptis, said the decision should have no impact on NSW infrastructure projects, which locally include the Pacific Highway upgrade, the second Grafton Bridge, the new jail and the Sportsmans Creek bridge at Lawrence.
"Lots of those projects are still in the formative stage," he said. "They won't go to construction for some time yet."
He was confident the sale and lease of the poles and wire could exceed its $20 billion target.
However, the treasurer's decision may not be final as Mr Morrison has stressed his rejection was only preliminary and invited the bidders to make further submissions by August 18.
"My preliminary view is that the foreign investment proposals put to me for this transaction are contrary to the national interest, in accordance with the required provision on the grounds of national security," he said.
He cited "critical power and communications services" Ausgrid provided to businesses and governments as his core concerns.
NSW Treasurer Gladys Berejiklian said the transaction process would continue.
"We can assure the people of NSW that regardless of how the process plays out, there will be no delays to our infrastructure pipeline and that we remain well on track to deliver on our promise to transform this state," she said.
"We will continue the transaction process for Ausgrid and note strong interest from investors in the asset."
Mr Morrison said Australia was still open to, and relied upon, foreign investment.
"As Treasurer I consider each foreign investment proposal on its merits," he said.
"Foreign investment has underpinned the development of our nation and we must continue to attract the strong inflows of foreign capital that our economy requires.
"Without foreign capital and investment, Australia's output, employment and standard of living would be lower.
"The foreign investment framework facilitates such investment while giving assurance to the Australian community that the investment is being made in a way that does not compromise Australia's national interest.
"We will continue to welcome foreign investment that is not deemed contrary to our national interest."
The NSW Government leased out 100% of TransGrid last year for $10.258 billion to a consortium of a Canadian pension fund, the Abu Dhabi Investment Authority and local infrastructure funds.