Motorway $11bn sale a boon for Sydney’s west

The NSW government has ­secured an $11bn deal to sell its ­remaining stake in the WestConnex motorway.

NSW Treasurer Dominic Perrottet in western Sydney on Monday. Picture: Jeremy Piper

The NSW government has ­secured an $11bn deal to sell its ­remaining stake in the WestConnex motorway, a move that will set aside almost half the funds for spending within western Sydney electorates and use the remainder to pay off government debts.

Announcing the sale in Western Sydney Parklands, Treasurer Dominic Perrottet said the sale would see $5bn devoted to a new fund for infrastructure projects in western and southwestern Sydney suburbs.

Dubbed “WestInvest”, the fund will allocate $3bn towards parks, sporting grounds, schools and suburban main streets, with another $2bn to be spent on “high priority projects” in consultation with communities.

The remainder of the sale proceeds will be placed in the NSW Generations Fund – the state’s sovereign wealth fund – and used to retire an equivalent amount of debt.

“This road project has ensured Parramatta Road flows faster, that people right across western Sydney are able to get to Sydney faster, get home to their families as quickly as possible,” Mr Perrottet said.

“It’s a testament to the strong financial management we’ve had since coming to office, unlocking capital and investing it in infrastructure.”

Sydney Transport Partners – an investor consortium led by Transurban – bought the remaining 49 per cent stake in WestConnex in a deal that allows it to control the network. The same consortium bought the initial 51 per cent stake in the roadway in 2018 for $9.26bn.

The privatisation continues a longstanding trend of “asset recycling” by the Berejiklian government and its Coalition predecessors, which have sold stakes in state-run power ­networks including Ausgrid, TransGrid and Endeavour ­Energy to fund infrastructure spending.

It also offers a clear policy ­distinction with the NSW Labor ­opposition, which has traditionally opposed the privatisation of state assets and on Monday criticised the sale of WestConnex as one that would drive up toll prices for economically impacted communities.

Politically, the move has also been interpreted by some observers as a concession to western and southwestern Sydney communities that have endured months of harsher stay-at-home restrictions compared with the rest of Sydney.

NSW Labor has recently likened Sydney’s pandemic crisis to a “tale of two cities” in which the west and southwest have suffered greater economic losses and ­social impacts due to government decision-making.

“Instead of focusing on saving people’s jobs, the Treasurer has instead wasted his time breaking a key election promise to sell off even more of the public’s assets,” Labor Treasury spokesman ­Daniel Mookhey said.

“It won’t make up for the economic devastation wrought by the unequal rules the government has unevenly applied during this lockdown. Western Sydney is ­entitled to ask why the Treasurer is making them pay for their own survival plan.”

Mr Perrottet dismissed suggestions the sale would result in higher toll prices.

“The Labor alternative is to not build the roads,” he said. “Labor opposed building WestConnex but we have already seen this vital artery slash travel times for tens of thousands of motorists.”

Transurban can raise tolls on WestConnex every year by the greater of 4 per cent or inflation for the next 20 years, and then by inflation from 2040 to 2060.

The company, which owns most of Australia’s toll roads and some in the US, has previously ­argued it has no pricing power, saying this is controlled by the state government.