Sell power assets: AIG

THE Queensland Government has again been urged to sell off its power assets as it attempts to get the state's budget under control.

In it pre-budget submission, the Australian Industry Group predicts selling Queensland's package of power assets has the potential to raise between $9-12 billion for the state's coffers.

Similar moves in other states, most notably New South Wales, have been controversial.

But AIG Queensland director Matthew Martyn-Jones says the private sector is far better equipped to manage such assets.

"Power assets in other states have been successfully privatised and it is, undoubtedly, the sensible path for Queensland to pursue," Mr Martyn-Jones writes in the submission.

AIG also recommends the offloading of a number of government-owned real estate assets as it addresses Queensland's "fiscal challenge".

Interestingly, Mr Marty-Jones says there is a "sound case" for the government to consider outsourcing, particularly in the area of support services, to achieve efficiencies.

For example, the state might be better served by the private sector being charged with tasks like cleaning and maintenance in the state's schools and hospitals, he argues.

Mr Martyn-Jones says while significant reform is "always difficult and contested", the people of Queensland handed Premier Campbell Newman a mandate.

While supporting the government's goal of reducing government spending and streamlining public sector service delivery - it suggests a 5% reduction in the size of the public sector over the next three years - the AIG urges the government to make "sensible" decisions and retain the right people.

"The government needs to be mindful to retain public sector talent so that robust policy development capability can be maintained within the public service.

"Queensland needs a modern, flexible, clever and responsive government and the public service needs to be a leader in innovation and best practice."

Mr Martyn-Jones says Tuesday's budget, the Liberal National Party government's first since its landslide election victory in March, needs to achieve fiscal consolidation while ensuring the state's continued growth.

He warns the cuts to public spending need to be carefully targeted so as not to risk the drivers of growth in the state.

The AIG identifies mining, construction, agriculture and tourism as the "four pillars" that will drive Queensland's economic growth.

"In addition to these we emphasise other pillars such as manufacturing and services which collectively employ the great majority of Queenslanders. They have a critical role to play in ensuring that the state continues to develop as a diverse, competitive, innovative and resilient economy," Mr Martyn-Jones says.

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