The Tasmanian government has ruled out the sale of assets to help clear a crippling unfunded superannuation debt.
Economist Saul Eslake on Wednesday suggested the state government consider the sale or lease of major infrastructure such as energy network poles and wires, to pay down a public sector superannuation liability of some $9 billion.
Mr Eslake on Wednesday presented the 2016 Tasmania Report which he penned for the state’s Chamber of Commerce and Industry, and noted that the growing superannuation liability is a thorn in the island state’s outlook.
“(It) is the main reason why Tasmania doesn’t have a triple-A credit rating,” he said of the liability, adding that the status is impeding the ability to borrow and therefore invest in long-term infrastructure.
“Every other dimension of our public sector performance suggests we’re in at least as good shape as Victoria and NSW who do have triple-A credit ratings.”
The former chief economist for ANZ and Bank of America Merrill Lynch who now works independently said Tasmania should look across Bass Strait for ideas to generate income which have proven successful.
“One way in which that could be achieved would be to do what other governments have done, of both political persuasions, to sell or lease assets that don’t have to be in public ownership indefinitely, such as poles and wires or ports, to offset some of that liability,” Mr Eslake said.
But the sale option isn’t on the table according to Treasurer Peter Gutwein.
“Nor will we sell government assets,” Mr Gutwein said, clarifying the stance of the state’s Liberal government.
With a population that is the nation’s oldest, unhealthiest, least educated and with poor engagement in employment, Tasmania’s per capita gross product lags 27 per cent behind the rest of Australia.
That gap will stretch to 33 per cent by 2025-26 and further to almost 40 per cent by 2040-41.
“We will be, if nothing else happens, almost 40 per cent worse off than the rest of Australia by 2040-41 unless we can increase our participation rate in employment at all ages, lengthen the average working week … or lift our productivity growth rates to be that of the mainland,” Mr Eslake said.