Former Labor Premier Morris Iemma says governments should not shy away from unpopular decisions to privatise public assets, in a message that implied support for the NSW Liberal government's main re-election pitch.

Speaking at a Sydney Business Chamber lunch at Parramatta on Thursday alongside former Liberal Premier Nick Greiner, Mr Iemma, who unsuccessfully sought to privatise the state's power industry in 2008, said there was "no magic pudding" to fund infrastructure.

Former NSW premiers Morris Iemma and Nick Greiner at the Western Sydney Business Chamber lunch in Parramatta. Credit:Jessica Hromas

A Fairfax/Ipsos poll this week showed fewer than one in four people support Premier Mike Baird's plan to partially privatise the state's electricity "poles and wires", and spend the proceeds on infrastructure such as a second harbour rail crossing.

Mr Iemma did not explicitly back the Baird government's proposal. But he said state governments were restricted in their ability to raise taxes and the public would not accept drastic cuts to services.