Australian Politics 2015-03-11 15:52:00


In his latest offering, conservative Australian cartoonist ZEG is disgusted with Germs Greer

Abbott Seeks to Douse Furore Over Outback Comments

Must not criticize blacks

Prime Minister Tony Abbott sought to douse a furor over comments suggesting people living in remote Outback communities are making a “lifestyle choice” shutting them of jobs and economic opportunity, telling indigenous critics to consider his record of trying to improve the lives of aboriginal Australians.

Mr. Abbott, who promised to make his country’s checkered record of treatment of its indigenous population a priority after winning elections 18 months ago, this week backed a decision by conservative allies in Western Australia state to abandon up to 150 remote communities on the grounds they were too costly and difficult to maintain.

“What we can’t do is endlessly subsidize lifestyle choices if those lifestyle choices are not conducive to the kind of full participation in Australian society that everyone should have,” Mr. Abbott told a radio station in the remote town of Kalgoorlie on Tuesday.

“If people choose to live miles away from where there’s a school, if people choose not to access the (radio broadcast) school of the air, if people choose to live where there’s no jobs, obviously it’s very, very difficult to close the gap,” he said.

Indigenous Australians make up around 2.5% of the 24-million population and suffer lower life expectancy and higher rates of joblessness than other Australians, as well as greater levels of domestic violence and substance abuse. In 2007, then-Prime Minister John Howard sent police and troops into remote communities to curb widespread child sex abuse.

Mr. Abbott promised to govern as “a prime minister for aboriginal affairs” and told parliament last year that failures toward Australia’s indigenous people were “a stain on our soul.” He promised to “sweat blood” to secure recognition for indigenous Australians in the constitution, backing a national vote on the issue.

But his comments this week prompted a storm of protest from indigenous leaders, with aboriginal lawyers and land rights campaigner Noel Pearson calling them “disappointing and hopeless.” The chairman of Mr. Abbott’s own Indigenous Advisory Council, Warren Mundine, said as many as 12,000 people could be affected or forced to move from their homes.

“It’s about their life, it’s about their very essence, it’s about their very culture,” Mr. Mundine told state radio.

Around 12,000 people live in 274 indigenous communities in Western Australia and the state’s conservative government wants to close around half of those. WA Premier Colin Barnett has said some have as few as five residents.

The conservative leader of the neighboring Northern Territory, Adam Giles, whose government overseas a far-flung and largely indigenous population, said he didn’t believe lawmakers should be telling people where to live, particularly indigenous communities with strong ties to traditional lands.

Mr. Abbott, who last month survived a challenge to his leadership brought on by slumping polls and policy gaffes, said people should look at his record on indigenous rights, including a week spent last year running the country from a remote aboriginal community in the Northern Territory made famous by the Crocodile Dundee films.

“I’m very comfortable with my credentials when it comes to doing the right thing by the aboriginal people of Australia,” he said.


The next war: Can Australia put up a fight?

War talk is erupting all over the world. From The Middle East to Eastern Europe. From the South China Sea to Afghanistan. But what about Australia? Can we fight with what we’ve got?

REGIONAL defence budgets have surged dramatically in recent years.

India is spending up big on expanding and modernising its military. China is exercising its new-found muscle with provocative manoeuvres in the East and South China Seas. Indonesia, Malaysia, Singapore and Taiwan – a litany of neighbouring nations – are making big ticket purchases including fleets of new submarines and stealth fighters.

Just like Australia.

The Australian Defence Force is embarking on two of its most expensive defence procurements ever – the F-35 Joint Strike Fighter and the replacement submarine project .

Controversy mires both.

The Soryu class submarine is the favoured but controversial contender for a $20 billion project. The proposal is for a fast-tracked “off the shelf” purchase made without the rigorous risk analysis and transparency a formal tender process normally entails.

The F-35 Joint Strike Fighter is a much-delayed and over-budget stealth warplane which also bypassed formal procurement processes. Now fears about its fundamental capabilities are continuously being raised.

We’ve already had an undeniable string of enormously costly defence matériel procurement disasters: The Seasprite naval helicopter program — abandoned. | The helicopter dock landing ship conversions — scrapped. | Tiger attack helicopters — wracked by turmoil.

Defence insiders say we simply cannot afford to get it wrong again.

So will Australia be ready for the next war? Some analysts say maybe not.

Critics say Australia faces serious weaknesses in its ability to sustain any fight for its far-flung borders. Primarily the problem is the purchase of equipment that doesn’t meet our nation’s needs.

The who, the how, the what and the where of any future conflict is – of course – unknown.

But there is plenty that we do know. Any attack on our interests will likely come from the north. We know we have key economic assets and trade routes through areas such as the East Timor Sea.


Prime Minister faces fracking protest in south-east South Australia

Prime Minister Tony Abbott says decisions about unconventional gas mining will remain with state governments.

Mr Abbott touched down in Mount Gambier this week, where he faced a protest from South Australian farmers over fracking, a practice used to extract gas from within the earth.

Farmers at the protest expressed concern fracking would damage prime agricultural land and contaminate water supplies.

The Prime Minister said Australia should be “cautious” about unconventional gas mining but deflected decision-making to state governments.

A parliamentary inquiry into fracking in the south-east of SA is underway, with a committee due to make recommendations to State Government ministers after analysing submissions and hearings.

Mr Abbott said he did not want to see any practice that would “jeopardise the long-term future of some of the finest agricultural country” in Australia but did not commit to a national inquiry.

“I think it’s important that the State Government should take seriously the inquiry, which has now been launched by Liberal members of the South Australia Parliament and let’s see what the inquiry comes up with,” he said.

“So far it seems that the problems people fear have not arisen but, when in doubt, it’s best to proceed with caution.

“It is, in the end, a matter for state governments.”


CEO Ahmed Fahour still walking the line at Australia Post

Ahmed Fahour says that there are not many companies that have shown the compound growth in revenue and earnings that he has achieved in Australia Post’s parcels business since he took over as chief executive in 2010.

Revenue has grown at an average rate of 23 per cent a year, to $3.1 billion. Earnings before interest and tax have grown a rate of 21 per cent, from $171 million to $371 million.

Parcels have not been the game-changer for Australia Post that mobiles have been for Australia Post’s sibling, Telstra, however.

Both groups emerged from the old Postmaster General’s Department, and both have been dealing with massive and potentially catastrophic change delivered by the digital revolution.

As the revolution undermined Telstra’s fixed line telephone network it supercharged the emergence of alternatives that were at least as important, however: mobiles. They generated almost $10 billion of revenue for Telstra in 2013-2014, and the group finished the year with net assets of $14 billion.

The digital revolution did pump up Australia Post’s parcels delivery business as internet shopping expanded, but not by enough to offset the digital destruction of what was once its core business, letter delivery.

The group’s net assets were a fraction of Telstra’s at $1.8 billion at June 30 last year, and last week Fahour announced a 56 per cent lower first half group profit of $98 million, and a $151 million loss in the letters business.

Australia Post was on course to record its first full-year group loss since 1982, he said, and last Tuesday  the Abbott government finally agreed to a restructuring that Fahour had seeking for more than a year.

Assuming aspects of the deal are approved by the ACCC and not voted down by the Senate, the group will  increase the regulated price of a standard stamp from 70¢ to $1, reclassify its standard letter delivery as a higher-cost, unregulated premium service, and lengthen the new standard delivery time by two days, to five days.

“We are not going to make a profit, ever, on letters,” Fahour says. “But what I can say is losses that have been growing will now stop growing, and actually shrink.”

About 70 per cent of the letters Australia Post delivers is bulk pre-sorted mail from big governments and businesses including banks, telcos, power companies and governments. Stamp prices for those customers have been deregulated for about three years.

Only about one-third of the household and small business letters that remain are expected to move over to the new, unregulated premium letter product. The jump in the standard letter price from 70¢ to $1  creates headroom for higher unregulated pre-sorted mail prices, however, and the group’s operating costs will come down as the standard delivery time lengthens.

“I think people understand our situation,” Fahour says. “We’ve already lost $1.5 billion in the mail business. Business and government overall is 97 per cent of the mail, so Australian taxpayers have  already subsidised businesses and governments by about $1.5 billion.” Without changes, the letters business is forecast to lose $12 billion over the next decade. “Are we saying we should take the money out of hospitals, schools, the police force and so on to subsidise that?” Fahour asks. “The senders of the mail should pay.”

The group needs to continue to balance three things, he says. Management of the continued decline of the letters business, a simultaneous search for new services and new business lines that can replace letter revenue that is leaking, and the engagement of everyone involved in the tightrope-walk. Not everybody would agree, he acknowledges, “but so far I think we’ve done a reasonable job”.

Fahour reckons that Australia Post is about six years behind the much larger Telstra in its digital era development, partly because it has been diverting resources to subsidise mail delivery losses.

With that problem eased if not solved ,the group can be more focused on growth options he says, adding: “Some people think e-commerce world is just logistics but there’s also payments: when you go shopping online, you have to got to pay as well. And what about document movement, what about  storage, what about our digital mailbox, what about identity? I think we are only scratching the surface of what Australia Post can be.”

The group is still a curious hybrid however. It is corporatised, but still government-owned. It is on the hunt for commercial growth, but also both tied to and still looking for ways to build on the legacy it has created

It is also criticised for private sector pay deals, even as it struggles internally to find ways to introduce more private sector-style incentives.

Fahour’s own pay packet was $4.6 million in the year to June 2014, and more than half it was tied to performance hurdles.

Overall there are 36,000 Australia Post employees and 2000 managers, however, and Australia Post’s current bonus pool is only about 2 per cent of the total pay pool, and 15 per cent of the management pay pool.

Arguably, it should be higher.  “On those percentages I suspect we are probably one of the leanest structures you will find compared with the ASX 100,” Fahour says, adding: “You can’t say that we should be more commercial, beat all the other companies, and also say we shouldn’t pay bonuses.”

At the same time the corporate hybrid can’t become too much of a sales and marketing organisation, Fahour says. “You can’t over-pull the commercial lever. There is a community lever too: the art of management is not overplay one or the other.”