Premier Mike Baird forced to find billions of dollars for infrastructure after Chinese bid blocked

PREMIER Mike Baird has been forced back to the drawing board to find billions of dollars for major infrastructure projects after Treasurer Scott Morrison confirmed Chinese bids for electricity network Ausgrid have been blocked.

Mike Baird said that the state government would potentially sell Ausgrid to overseas bidders. Picture: Adam Yip/ The Daily Telegraph

PREMIER Mike Baird has been forced back to the drawing board to find billions of dollars for major infrastructure projects after Treasurer Scott Morrison confirmed Chinese bids for electricity network Ausgrid have been blocked.

The state government was eyeing a windfall of at least $10 billion by flogging 50.4 per cent of Ausgrid to either China’s State Grid Corp or Hong Kong-listed Cheung Kong on a 99-year lease.

The federal government scuttled the bids last week, blaming national security concerns, and Mr Morrison reaffirmed that ruling yesterday after a seven-day period in which both companies were offered the chance to address the alleged security risks.

“In making this decision, national interest concerns have been paramount. They relate to the transaction structure as currently proposed and the nature of the assets,” Mr Morrison said.

“We will continue to work closely with NSW to ensure that national security requirements are met under any future transaction process.”

Mr Baird insisted the state government will sell Ausgrid, potentially still to overseas bidders, and have the proceeds in the bank in time for the next year’s Budget. Transgrid was sold for $10.25 billion in a similar transaction last year.

The funds from these “poles and wires” sales are badly needed to help fund a series of major infrastructure projects.

“There are many bidders that are interested in this asset ... we’ll be going back to the market to secure those bidders,” said Mr Baird.

Opposition Leader Luke Foley claims NSW will receive less for Ausgrid after the failure of this transaction.