Professor Quiggin, a laureate fellow at the University of Queensland who has long made his position on privatisation in regards to income-generating assets clear, said the government was yet to prove why asset sales were necessary.

Treasurer Tim Nicholls says the state has three “Strong Choices” to resolve the “debt crisis” – increase taxes, reduce services, or sell/lease assets.

He aims to reduce the state's $80 billion gross debt by the $25-$30 billion recommended in the Peter Costello-led commission of audit.

Professor Quiggin said the government was making “spurious” claims.

“I am not against privatisation in every case - my main point is the arguments that have been put forward for privatisation both by the current LNP government and by the previous Labor government are spurious and so we have a misleading case for a policy which really needs to be evaluated on a case by case basis,” he said.

“The claim made by this government and by its predecessor is that by selling assets, we can avoid the need to increase taxes or reduce services. We can get, in essence, something for nothing and those claims are embodied in the Strong Choices website.

“When we sell income generating assets, we lose income from that asset. Of course if we use all the proceeds to repay debt, you manage to save interest and those two things roughly balance out, but of course we have no actual money left over.

“If we sell the assets and spend it on something desirable, but it doesn't produce any income, then we have lost the income from the asset and that is a continuing hole in the budget going forward.

“It is understood by all economists, whether they support privatisation or not, that the case being put forward by the government doesn't stack up.”

Professor Quiggin said by concentrating on the state's gross debt, rather than its net worth, the government had created a case for its argument.

“There are a range of measures which includes net worth - which includes everything the government owns, roads, schools, hospitals and that sort of thing - that's a very positive number, around $160 billion, that's a net worth and as a state, we own far more than we owe,” Professor Quiggin said.

“You can then look at the income generating side of the equation - that is all the debt we have, the businesses and so forth - that net debt is around $25 billion, so it is much smaller than the gross debt number that the government keeps going on about. That number is just chosen to make it sound as scary as possible.

“...It is presenting an overstated picture of our official situation in order to produce a crisis, which can then be used to justify the policies they are putting forward. That certainly true of the audit commission and we have seen the same audit commission manoeuvre essentially with every change of government at least conservative parties for the past 25 years or so. The findings are always the same.”

Professor Quiggin said Queensland, like the rest of Australia, did face a choice, as the nation “tried giving ourselves tax cuts and high quality services”, but there was “no urgent need to sell assets”, which he said would not provide a long term solution.

Treasurer Tim Nicholls, who had been challenged to a debate with Professor Quiggin, said he would continue speaking with “Queenslanders across the state” rather than Professor Quiggin, who he called the Electrical Trades Union's “paid economist”.

“[His] views are already well known, he publishes on a blog, he's written about it,” Mr Nicholls said.

“I intend to talk to ordinary Queenslanders...they are the ones who are obviously flocking in great numbers to the [Strong Choices] website, who want to be listened to, those will be the ones I will listening to.”

But Professor Quiggin said while the ETU “like what I say”, he had been “saying it for a long time before the ETU was involved in this issue”, having worked as a professional economist for more than two decades.