The chief executive of NSW's government-owned power distributors, Vince Graham, has accused unions of acting against the long-term interests of their members by standing in the way of necessary changes to make enterprise agreements more competitive.
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Mr Graham said the unions' stance was not reflected by employees of the $25 billion Networks NSW, who appreciated the need for changes that would prevent an acceleration of outsourcing of jobs as the businesses headed towards a possible sell-off.
"I don't see how unions can continue to defend the indefensible when the employees themselves, their members, are not seeking to do that," Mr Graham said. "This isn't about future ownership. If we can't address uncompetitive enterprise agreements, we will simply accelerate outsourcing."
His comments come as UBS and Deutsche Bank are completing a scoping study on the NSW government's proposal to sell a 49 per cent stake in the state's "poles and wires", in what is expected to be a keenly competitive auction that could raise about $15 billion.
Industry players such as State Grid Corporation of China and Singapore Power are expected to be involved, as well as investorssuch as AMP Capital and QIC. The privatisation hinges on the government securing a mandate for the sale at the March state election.
Customers would be better off with a privatised distribution sector, Mr Graham said, given the greater operating and capital efficiency of networks companies in private ownership.
A report on the relative efficiency of transmitters and distributors, to be released in November by the Australian Energy Regulator and of which he has seen a draft, would support that view, he said.
"I have absolutely no doubt that that benchmarking report will underscore the efficiency of the public versus the private sector," said Mr Graham, who was head of NSW Railcorp and of Endeavour Energy before taking up the role of the combined distribution businesses when they were amalgamated in June 2012 by the state government.
The inefficiency of the government-owned businesses was not the fault of employees, who were dedicated and capable, but was due to the greater financial discipline of privately owned businesses, and uncompetitiveness labour agreements in NSW state-owned businesses that went back decades.
Those agreements encapsulate terms such as an extra 13 days a year of long-service leave after 10 years, up to 26 per cent employer contribution to superannuation and 18 days of sick or carers leave at one business.
"These aren't issues for the employees, they are issues for a public sector culture where political strength of the union movement has driven outcomes that are not in the interest of consumers," Mr Graham said.
