Canberra faces a real risk of recession, ACT Treasurer Andrew Barr said on Friday, ahead of the Commonwealth budget in May, which he warned could well bring economic dark times to the city.
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Mr Barr also foreshadowed a swath of asset sales, not even ruling out ActewAGL as a possibility for sale under a Commonwealth scheme that pays a bonus to states and territories for asset sales.
Federal Treasurer Joe Hockey has offered states and territories a 15 per cent incentive payment for selling assets to pay for approved new infrastructure.
Assets must be chosen within two years and infrastructure under way within five years, under a deal agreed to by the nation's treasurers yesterday and expected to be signed off in May.
Mr Barr said the ACTTAB sale would be first cab off the rank in Canberra, and possibly the country, with Mr Hockey confirming it would qualify for the 15 per cent bonus.
The building at 1 Moore Street, housing ACT Health, was also in the mix, along with the visitor information centre in Northbourne Avenue, buildings on Northbourne including Macarthur House, as well as public housing.
ActewAGL would be considered, Mr Barr said, pointing out that privatisation of electricity companies in NSW could well force the point in Canberra.
He stressed that any sale would involve only retail electricity, and not the distribution arm - the poles and wires.
''We need to examine the detail and the figures. I can't rule it out, but I'm dubious that the incentive is going to be great enough to make it worthwhile,'' Mr Barr said, with ActewAGL already half owned by AGL, making AGL the only realistic buyer. Having only one buyer meant there would be no competition for the sale, making it doubtful the government could get the price it needed to make a sale worthwhile, he said.
''The idea that we can just blanket-rule everything out forever is not a reasonable position. If they [AGL] made an offer, we couldn't refuse, we couldn't refuse it," Mr Barr said.
Mr Barr also foreshadowed borrowings to fund his ambitious infrastructure program - with plans for a new swimming pool, stadium, convention centre, roadworks and more. Projects would be brought forward to fit into the federal five-year cut-off for incentive payments.
And he welcomed the federal incentive payments for asset sales as crucial at a time when federal budget cuts ''could send the territory into recession''.
Nationally the economy was expected to grow below trend, and in the ACT growth would be significantly below trend, he said.
He had made strong representations to Mr Hockey about the real risk of recession in Canberra.
The proportional impact of Commonwealth downsizing on the territory would be a bigger hit than the loss of car industries in other states - so Canberra should also qualify for federal transition funding, he told Mr Hockey.
The Treasurer ''took that on board'', however, ''the pain is going to be significant and they are expecting everyone to share in that,'' Mr Barr said.
''So the ACT will not be spared budget pain. But we don't know the extent of those cuts.''
He had received a fair hearing from Mr Hockey, ''so to the extent that our issues have been raised and acknowledged, it was mission accomplished today, but we have to wait until the second Tuesday in May to know our fate'', Mr Barr said.
This year's ACT budget forecasts economic growth at 1.75 per cent, but the government is yet to put a figure on the expected hit on the ACT economy from the federal budget.
In some good news yesterday, Mr Barr learnt that the ACT's share of GST funding will rise from 2 per cent to 2.1 per cent, worth at least $13 million a year to the territory, or even more if the GST pool is bigger.
