Another banker joins the Iemma cheer squad


Ed Lewis

Another banker weighs in on the Iemma-Costa side of the NSW electricity privatisation battle today, although it’s obvious Babcock and Brown’s Stephen Loosley is a bit better informed about the present state of the Labor Party than either Paul Keating or Bob Carr.

NSW Labor state secretary from 1983 to 1990, Loosley crossed over from corporate consultancy PricewaterhouseCoopers to merchant bank Babcock and Brown in 2006. B&B, like Macquarie Bank, invests quite a bit in public infrastructure projects.

Writing in The Australian
, Loosley describes Labor treasurer Mick Costa as a visionary and says Costa is getting around parliament talking about the precedent of Bob Carr’s savaging of workers compensation laws in a series of steps (which it called tort law reforms) from the late 1990s until about 2004, against union opposition.

The Carr government claimed it had to act to reduce insurance premiums and later cited a reduction of about 25 per cent in personal compensation cases. The law reforms didn’t reduce the number of people being injured by negligent employers, but simply the number of people able to run successful claims for compensation.

The main result was that more people with serious injuries had to rely on social security, so the cost was shifted to taxpayers and the injured themselves, and away from individuals and organisations whose negligence caused the injury.

Whether there was any reduction in insurance premiums is a moot point, as most insurance costs have headed steadily northward in recent years.

It was over this change to the law that left-wing Labor MP George Petersen crossed the floor, supporting union and community opposition to the changes, and was expelled from the Labor Party.

According to Loosley, it is to this precedent that the “visionary” Costa is now appealing in his efforts to rally support for the privatisation push.

Loosley holds out hope for a negotiated settlement based on the position advanced largely by John Della-Bosca and Ian Macdonald at the Labor conference, but vetoed by Costa with Iemma’s approval.

Loosley ends up by accusing the Labor conference of trying to dictate to the Labor government. In his view, it seems, it’s all right for the Labor politicians to promise the unions pre-election that they won’t privatise and then move to privatise after the election has given them another four years in office.

That’s not dictatorship, apparently, but the ranks having a say about the government’s deliberate deceit is dictatorship. Welcome to the logic of merchant banking and corporate consultancy.


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