Labor is facing a campaign from some unions to torpedo the Abbott government’s “asset recycling” initiative because of concern the new budget incentive will drive a fresh round of privatisation of state assets.



The Electrical Trades Union (ETU) and the United Firefighters Union (UFU) have launched a last-ditch push against the proposal, with legislation scheduled for debate in the Senate on Monday.

The ETU wants any legislation ultimately adopted by the parliament to make clear that essential services – gas, power and water – cannot be privatised by governments. The Firefighters Union wants the entire proposal scuttled.

The “asset recycling initiative” is a program funded by the Coalition in the May budget connected to future infrastructure investments. The program would see Canberra reward the states for selling their public assets and ploughing the proceeds into new spending on roads and other transport projects.

Labor in the looming parliamentary debate is pursuing two key amendments: one ensuring that all new projects are subject to a proper cost-benefit analysis if they are valued at more than $100m; and another that would give parliament a right of veto over privatisations if they are judged not to be in the public interest.

But the ETU’s Victorian secretary, Troy Gray, told Guardian Australia he wanted the Australian Labor party (ALP) to go further than it has foreshadowed. “We don’t think the amendment goes far enough,” he said.

“We think essential services – gas, power and water – should never be privatised. Labor needs to go further to exclude essential services,” he said.

The national secretary of the UFU, Peter Marshall, is not interested in compromise. He wants the bill scuttled. “If governments keep selling off assets, then we’ve got nothing left,” Marshall said.

The Asset Recycling Fund Bill 2014 and the Asset Recycling Fund (Consequential Amendments) Bill 2014 are listed indicatively on the draft Senate notice paper for Monday.

Labor secured support in the lower house for its two amendments from the Greens deputy leader, Adam Bandt, and from Clive Palmer. That debate wound up late last week.

Labor’s expectation is the Greens will vote in the same way in the Senate as they did in the house, but that eventuality is not yet clear. The Greens are understood to be reserving their position in the Senate.

Bandt suggested Labor needed to toughen its stance. “Tony Abbott wants to turbocharge the privatisation of state government assets by creating a $5bn slush fund and Labor looks set to help him. Labor can either vote with the Greens to defeat the bill, or side with Tony Abbott and help state Liberal governments go on a public-asset selling spree,” Bandt said.

Labor has shown no sign that it intends to alter its stance in the Senate debate.