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MAC decision could lose $69-128m in Federal funding

Treasurer Koutsantonis’s decision in the MYBR to raid MAC reserves to prop up his budget will cost taxpayers at least $69 million, and possibly up to $128 million, in lost Federal funding.

Under Treasurer Brett Rowse has given evidence to the Budget and Finance Committee that the Government believed its MAC privatisation would comply with the Federal Government’s 15% asset recycling bonus payment scheme.

This would mean that after 2016 when MAC is privatised, South Australia would get a $150 million ‘bonus’ payment for every $1 billion received for the privatisation.

Mr Koutsantonis’s MYBR yesterday actually raids MAC reserves by $853 million this year well prior to any privatisation in 2016. This $853 million is divided into two parts - $459 million as a ‘dividend’ and $394 million as a ‘return of surplus assets’ or ‘equity’ repayment.

The MYBR therefore reduces the ‘value’ of the MAC privatisation in 2016/17 to just $300 million.

“This would mean the 15% asset recycle bonus would only be applied to the $300 million privatisation proceeds in 2016/17 rather than the total $1153 million,” said Mr Lucas.

“It also means that South Australia would lose the 15% bonus on at least the $459 million ‘dividend’ and possibly on the total $853 million MAC payment made this year.

“This would mean SA losing at least $69 million and possibly up to $128 million.

“If SA loses between $69 million and $128 million as a result of Mr Koutsantonis’s desperate ploy to prop up his budget, South Australian families will be understandably furious.

“If SA does lose Federal funding then Mr Koutsantonis will stand condemned for putting his ego and desire to manufacture a false surplus at the expense of the long-term interests of the budget and the state.

“If that was the case it would be yet another example of the financial mismanagement and incompetence of the Labor Government since 2002 in managing our budgets.”