Plans to privatise Western Power should be scrapped, the opposition says, amid reports the West Australian government won't commit to selling off the electricity company in next week's state budget because MPs are divided on it.
The poles and wires company could fetch $15 billion and pay off some of the government's $30 billion debt load, which Premier Colin Barnett admits is too high.
However the government is expected to steer clear of committing to a sale because of National Party resistance and will give them room to oppose it.
Treasurer Mike Nahan, who supports asset sales, would not comment on Thursday other than to say through a spokeswoman that the state government's plans for Western Power would be revealed in the budget.
The Nationals, representing three out of the 17 government cabinet ministers, has already blocked the proposed $2 billion sale of Fremantle Port.
The government's failure to privatise assets has cost it the chance to access the Commonwealth infrastructure money on offer through the $5 billion asset recycling fund, which Victoria and NSW collected $3.3 billion from but was scrapped in this week's federal budget.
Labor Opposition Leader Mark McGowan said the WA government shouldn't be having "fire sales" of important public assets to pay off debts that should not have been accrued during the mining boom.
"All you do by selling off these assets ... is remove recurrent income from the balance sheet, creating major problems for yourselves in the future," he told reporters.
"There is a very real potential for significant cost increases on people across the community and a reduction in services, particularly the outer suburbs and across regional Western Australia.
"Western Power is a big income generator for the state that provides services across an area the size of many European countries."
WA lost its AAA credit rating several years ago, having suffered a string of downgrades since then, and ratings agencies and analysts had called for the state government to help reform the economy and use the asset recycling fund.
The Electrical Trades Union and Australian Services Union are campaigning against Western Power's sale, citing the example of poorly-maintained privatised powerlines contributing to Victoria's Black Saturday bushfires, which killed 173 people.
