Rees to pick NSW cabinet, tackle economy

NSW Premier Nathan Rees is adamant he will appoint the cabinet he wants on Sunday, and then immediately put it to work pulling the state out of its steep economic dive.
Emerging from his second financial briefing since being installed as premier during
Friday's unprecedented events in state politics, the new leader said the situation
was more bleak than he expected.
He confirmed much of Friday's scathing assessment from Michael Costa, saying the
health budget had blown out by more than $300 million, while there was "in the order
of $90 million a month in shortfalls in revenues".
Cutbacks in areas such as capital works would be necessary, he said.
"There are difficult decisions to be made," Mr Rees told reporters in western Sydney.
"I want to make those decisions quickly and send the right signals to the investors,
send the right signals to the financial market and make sure we can get cracking on
the capital works program that enables us to put hospitals, rail lines and schools
and so on on the ground as quick as we possibly can."
But before he can get to work on the mini-budget due within 10 weeks, Mr Rees must
manoeuvre his cabinet past the powerful Centre Unity faction that ambushed former
premier Morris Iemma, effectively ending his political career.
Embattled Health Minister Reba Meagher withdrew from cabinet contention, and
treasurer Michael Costa has already been dumped - twice.
They were two of the heads on the chopping block in the cabinet reshuffle Mr Iemma
took to the powerful right faction, along with Tony Kelly, Kevin Greene and Graham
West.
One Labor insider said Mr Rees would find it difficult to impose his will on those
remaining right faction MPs "jealously guarding" their positions.
Caucus will meet at 10am (AEST) Sunday to finalise the cabinet, an hour after a
scheduled Centre Unity meeting.
"I'm not going to speculate today on where the process is going," Mr Rees said when
asked about his caucus on Saturday morning.
"There's a process underway ... and there will be people with phones melting as we
speak.
"I'm not one of them, I'm away from it.
"I've made my criteria for getting into my frontbench very clear. Talent, hard work
and courage."
Mr Rees, who resigned from the left on Friday night, spent part of today raising his
public profile in the seat of Ryde, which Labor hopes to retain in the by-election
caused by deputy premier John Watkins' resignation.
He shook hands with shoppers alongside his new deputy, Carmel Tebbutt. She and David
Borger are expected to be the only new frontbench injections from the left.
Mr Iemma told his final press conference he had hoped to include Steve Whan, Michael
Daley, Tanya Gadiel, Virginia Judge, Jodi Mackay and Paul McLeay in cabinet. Earlier
today, at least two of them said they still hoped to make the cut.
Mr Costa, dumped first by Mr Iemma and then again by Mr Rees, said NSW was at risk
of losing it's AAA credit rating.
"The task that I've inherited is to make sure that that downgrade doesn't occur," Mr
Rees told reporters today.
When asked if the situation was better or worse than he had expected, Mr Rees told
reporters: "Worse, clearly."