The Prime Minister, Julia Gillard’s, New Year’s Message

The Prime Minister, Julia Gillard’s,  New Year’s  Message

The New Year is a time to look with gratitude on the good things of the last 12 months and look forward with confidence to the year that stretches before us.

It’s a time for new hope and new beginnings.

Perhaps a personal resolution like spending more time with family or a big life decision like starting a university or TAFE course or opening a business.

Whatever the New Year holds for you, I trust it will be a safe and happy one.

Let’s also remember that the 1^st of January is the anniversary of Australian nationhood.

So let’s also resolve to make this great country of ours even stronger.

Yes we’ve achieved remarkable things in our nation’s journey.

But I firmly believe that even better days lie ahead.

Together let’s make 2012 a year of which every Australian can be proud.

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How to get more

Economic growth is possible in a finite world – if we increase productivity.

But what does that mysterious, economists’ word,  really  mean?

Getting more blood out of a stone, perhaps, by working smarter, not harder.

Frustration with the way we are expected to work is very common  and – all often – thoroughly justified.

Your correspondent has some experience with this, as joint author of a book on productivity, called “Because no Bastard Ever Asked Me.”

The anecdote, which led to that odd title, was  of a production worker,   Bob,  who worked in factory making  washing machines.

But too many of those washing machines were so unstable that they “walked” around laundry floors.

In desperation, Bob’s boss had hired consultants, to find out why.

As the consultants watched machines moving down the production line, Bob’s boss heard Bob, mutter “another bad one.”

Bob did that  once or twice more.

So the  boss asked him if he could identify machines that would “walk” before they left the factory.

“Yes,” Bob said.

“They have rough metal under the rim of their bowls.”

“We have had this problem for for a long time,” the boss replied.

“Why didn’t you speak up?”

“Because no bastard ever asked me,” Bob said.

(We still have a few copies of the book. Email me at alanthornhill@netscape.net if you want one).

The Treasurer, Wayne Swan, also argued the case for increased productivity at the weekend, saying the government is pursuing it by:-

• A doubling of the investment in roads, rail and ports over the six years from 2008-09;
• Building the National Broadband Network, which will help drive down costs of doing business;
• A greater focus on skills, training and apprenticeships, including the $3 billion investment in the Budget;
• Putting a price on carbon pollution, which will help shift our economy to clean energy and low-pollution technologies in a way that provides maximum support to productivity growth;
• Promoting innovation through better targeting of tax incentives, and $9.4 billion in spending on science and research;
• Reducing regulatory barriers and business red tape by working with the states on consistent rules and processes, such as uniform occupational health and safety laws and a national occupational licensing system;
• Building on our tax reform agenda, such as cutting the company tax rate to boost competitiveness, and tripling the tax-free threshold to provide workforce incentives; and
• A Fair Work Act built on enterprise bargaining that supports firms’ efforts to be more productive, and balances fairness and flexibility.

That’s the government’s response to the Coalition’s argument that it is wasting taxpayers’ money.

It’s a wordy one,  though.

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ABC fends off Murdoch

The ABC will keep Australia’s international television service, the Australia Network.

The Network supplies non stop television programs to more than 44 countries across Asia, the Pacific and Indian subcontinent.

The Federal government had put the service out to tender.

That attracted a bid from Sky Television, in which Rupert Murdoch has a significant stake.

However the government announced tonight, after a Cabinet meeting, that it had decided that the Australia Network would become “a permanent feature of the ABC. “

The Communications Minister Stephen Conroy admitted that there had been problems.

“The Government was hoping that the tender process for the Australia Network would have been completed in good faith,” he said.

“ However, several leaks have compromised the process and prevented a fair consideration of the bids,” he added.

“The Government believes it is unfortunate that this process did not reach a satisfactory solution, Senator Conroysaid.

“However, in light of the circumstances it is now in the national interest to make a clear decision about the future of the service rather than allowing uncertainty to continue,” he said

“Having reflected upon the process to date, and what the service really needs to provide, the Government has determined that Australia’s international broadcasting service should be delivered by the national broadcaster.” he said.

Senator Conroy described the Australia Network as “a major public diplomacy platform.”

“And, as is the case with comparable operators such as the UK’s BBC World Service and Germany’s Deutsche Welle, the Government believes the service should be provided by Australia’s national broadcaster, the ABC,” he said..

The Senator said this decision provides certainty for the future.

“It also allows the ABC to get on with the job of delivering an outstanding international broadcasting service for Australia,” he said.

“The Government also believes that the ABC is well placed to explore the opportunity to combine the Australia Network with its current international radio service,” Senator Conroy said.

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Very briefly

The Federal Treasurer, Wayne Swan, has blasted the National Australia Bank, which announced today that its home loan customers will get only a 20 basis point cut in their mortgage rates, even though the other big banks are all passing on the full 25 point cut, announced by the Reserve Bank.

“It’s a kick in the guts to working families,” Mr Swan said.

It’s a greedy decision from the NAB and it is not justified in my view by fundamentals,’’ he added.

However, the NAB said its standard variable home loan rate is still the lowest offered by any of the major banks.

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Qantas expected to resume flights this afternoon

Qantas is now expected to start lifting passengers again from 3pm today, but authorities believe it won’t be able to restore full services until Wednesday.

Meanwhile its rival, Virgin, will be providing 3,000 extra seats today, to help clear passenger backlogs.

The Prime Minister, Julia Gillard, described the action of Qantas chief, Alan Joyce, who grounded the airline on Saturday as “extreme” and said her government had acted as quickly as it could to restore the airline’s services.

The government won an order from Fair Work Australia, which Ms Gillard described as “the independent umpire” for a cessation of all industrial action, including the lockout.

The Opposition Leader, Tony Abbott, has accused the government of failing to intervene early enough, in the dispute.

Qantas has said earlier that it would resume services as soon as possible, but there were no passenger flights this morning.

The airline had to wait for clearances from the Civil Aviation Safety Authority.

The lockout left thousands of passengers stranded – and many Federal members wondering if they could get to Canberra, for vital Spring sittings this week.

It also disrupted the travel plans of thousands of Australians, including many who wanted tickets to Melbourne, for the Melbourne Cup tomorrow.

The Qantas lockout followed the airline’s announcement, back in August, that it would cut at least 1,000 jobs.

Efforts to get Qantas planes back into the air resumed, before Fair Work Australia, at 2pm Sunday.

FWA issued its cessation order twelve hours later.

The dispute has further damaged business confidence, particularly in the small to medium enterprise sector, which depends heavily on air transport.

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Carbon tax:How you will be hit

Political debate in Australia often confuses, when it should inform.

Yet, what our politicians decide can have a big impact on our personal budgets.

The proposed carbon tax legislation is, very much, a case in point.

The House of Representatives approved it today, on a 74-72 vote.

The 19 Clean Energy Bills, which contain it, now go to the Senate, which is expected to vote on it later today.

They are likely to be approved there, too.

So how will all this hit your pocket or purse?

Well, you probably won’t be hit directly, with the new tax.

It will apply only to about 500 of Australia’s biggest polluters.

The main impact, for most of us, will be through flow-on effects, through things like higher electricity bills.

Jobs, like those of factory workers, employed in industries that compete heavily with imports, could also be affected.

The government argues, though, that a low carbon economy is needed, to prevent Australia falling behind other countries, which are also moving to clean energy.

People, on social security, will be compensated for the extra costs, that will come with the new tax.

That will be done through changes to social security, family assistance, veterans’ entitlements, military rehabilitation and compensation, farm household support and aged care, and for what the government calls “related purposes.”

Under the Government’s plan, there will be a new Clean Energy Supplement.

That will deliver a 1.7 per cent increase in pensions, allowances and family payments.

The extra assistance will mean:
• Up to $338 extra per year for single pensioners and self-funded retirees, and up to $510 per year for pensioner couples combined.
• Up to $110 per child for a family that receives Family Tax Benefit Part A.
• Up to $69 extra for families that receive Family Tax Benefit Part B.
• Up to $218 extra per year for single income support recipients and $390 per year for couples combined for people on allowances.
• Up to $234 per year for single parents in addition to the increased family payments they receive.

Will that be enough?

Independent organisations, like the Brotherhood of Saint Laurence, which have checked the government’s figures, think so.

Indeed, the Brotherhood has congratulated the government on all this.

What about the rest of us, though?

The wage slaves, who are not on welfare.

Well, several important tax reforms have been announced, to coincide with the new carbon tax.

These include the government’s decision to raise the tax threshold to $18,200 from July 1, next year.

The Treasurer, Wayne Swan, has even been talking of raising the threshold to $21,000, as soon as the government can afford to do so.

Voters have long memories, so Treasurers, must be confident that such promises are realistic, when they talk like that.

But – as its name implies – the proposed Clean Energy legislation is really meant to be about tackling global warming, not just changing tax laws.

The government, itself, admits that the transport sector accounts a big slice of our greenhouse gas emissions.

About 15 per cent in fact.

So won’t the carbon tax hit us at the petrol pump?

Not unless you are driving a heavy truck.

That is a vehicle of 4.5 tonnes, or more.

Light vehicles, like the family car or tradie’s ute will be permanently excluded.

What about air fares.

Domestic air fares will be hit.

On the best estimates, though, the tax would add about $2 to the price of a seat on a flight between Melbourne and Sydney.

Why not wait for until you are on the plane, for your coffee, instead of having it at the terminal.

That way you’ll come out ahead.

The airlines, though, won’t have to pay the tax on the fuel they use on their international flights.

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Regard Lagarde

There’s no doubt about it.

These are unsettling times.

Australians had sensed that long before the stock market shocks of recent weeks.

That’s why we stopped shopping – and started saving.

Austerity might be good – for families.

It’s not enough, though, for national or global economies.

Scrimping might seem wise, in times like these.

That’s why the experts have been prescribing austerity programs for sick economies, like Greece and Ireland.

Only a few scattered voices, like that of the Nobel Prize winning economist, Paul Krugman, have challenged this view.

That is until the former French Finance Minister,Christine Lagarde, spoke at the weekend.

The new IMF chief told central bankers, at a conference in Jackson Hole, Wyoming, that firm action is needed to tackle the grave financial risks the world is facing.

Measures like:-

-Stimulating domestic demand in developing countries, which have big export surpluses

-More aggressive mortgage relief in the United States and

-Giving job creation priority over deficit reduction, in the immediate future.

Ms Lagarde also proposed substantial injections of both public and private capital into frail European banks, stimulating demand and renewing economic growth.

Austerity programs carry hidden risks.

They cut cash flows and jobs.

Back in the 1930s, the world discovered – at the cost of more than 50 million lives – just what can happen when unemployment gets out of hand.

Unemployment rates of 20-30 per cent, back then, quickly led to political extremism and, ultimately, world war.

Australia’s unemployment rate, of 5.1 per cent, is now enviable, by world standards.

The US rate is still above 9 per cent, while Greece has 16.6 per cent unemployment and Ireland 14 per cent.

There are tipping points, in world affairs.

The situation now is not as bad as it was back then.

However those points might be dangerously close, if things are allowed to get worse.

Austerity is not the way back from these cliffs.

The paths away may not seem obvious.

And they do require courage.

But Christine Lagarde is pointing the way.

She must be heard.

Carbon price announcement Sunday

The central plank of the Federal government’s proposed carbon tax legislation – its price – will be revealed on Sunday.

The Prime Minister, Julia Gillard, announced that tonight.

“After hearing a report on the discussions of the Multi-Party Climate Change Committee, Cabinet agreed tonight that sufficient progress had been made to allow an announcement date to be set for Sunday 10 July 2011,” she said .

Ms Gillard said “considerable common ground has been achieved” in the committee’s talks over recent weeks.

“This reflects the genuine commitment of members of the (committee) to tackle climate change to protect Australia’s environment and support the economy.

“While there will be additional discussions with the committee this week, followed by further Cabinet consideration, it is expected that the remaining details will be finalised in these discussions ahead of Sunday’s announcement,” she added.

“The Gillard Government’s priorities in designing the carbon price have been cutting pollution, protecting household budgets, and supporting jobs,” the Prime Minister said.

“A carbon price is an important reform that will create incentives to lower Australia’s carbon pollution at the lowest cost to the economy,” she added.

“It will do this by putting a price tag on the pollution of fewer than 1,000 businesses,” she said.

“More than half the revenue raised will be used for tax cuts and increased payments to households, which will be generous, fair and permanent and will keep pace with cost impacts from the carbon price in the future.

“After announcing the policy the Government intends to introduce legislation to Parliament later this year.

“This will be an opportunity for all MPs to decide whether they accept the scientific advice that climate change is real and whether they accept the economic advice that a market mechanism is the cheapest and most effective way of reducing pollution.”

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