An Upper House Inquiry has been told the failed NSW electricity sell-off is to blame for the state's troubled finances.
Treasury officials have been called to front an Upper House inquiry into the need for a November 11 mini budget – where the government is being forced to prioritise its Capital Works program.
This means many projects including the North West Metro and the M4 east extension will be left under the cloud.
With the state put on credit watch, Treasury Secretary John Pearse has told the inquiry about the impact of the electricity privatisation failing to pass parliament.
Despite a watered down model going ahead, he says the flexibility is needed to fund upgrades to the electricity sector.
Rating agencies have warned that would leave the state’s debt level unsustainable to fund some key government promises.