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Unions NSW says Parliamentary report whitewashes farm labour exploitation

THE release of a parliamentary report into the Working Holiday Maker visa is a whitewash of a failed program, and paves the way for continued coercive labour practices and exploitation in agriculture, Unions NSW said.

Workers and their unions have repeatedly blown the whistle on the deep problems with the scheme, which funnels tens of thousands of backpackers into farm work in return for an extension of their visa. There have been widespread reports of abuse, sexual harassment and exploitation under the scheme, with workers reporting being paid as little a $2.50 per hour.  

“The joint committee on migration has missed an opportunity to stamp out exploitation with the release of such a weak report,” said Mark Morey, Secretary of Unions NSW.

“The key problem at the heart of this program is that all power rests with the employer to sign off on whether the backpacker has performed the necessary hours to have their visa extended. This creates an utterly lopsided arrangement, leaving backpackers ripe for exploitation.

“This committee report has done nothing more than tinker at the edges. The truth is that this visa should be abolished. If the agriculture sector can’t afford to pay Australian wages it needs to completely rethink the economics of the sector. No industry has the right to subsidise itself through cheap, exploited labour.

“It is unconscionable to erect and maintain a secondary labour market, where the origin of your passport determines whether you can enforce your labour rights," Mr Morey said.

“Both the Government and industry know what the problems are. Another round of navel gazing through inquiries and sub committees won’t resolve the problem. This is the same Government that failed to provide any meaningful support for temporary migrants by excluding them from JobKeeper or JobSeeker during the worst economic crisis in a generation.”

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Inudstry Super wants new laws to put more money in members’ accounts, not shareholders

THE OWNERS of more than a million super accounts holding more than $30 billion in assets may never be told their fund is a dud unless a crucial government performance test includes all fees and charges, according to Industry Super Australia (ISA).

The government’s Your Future, Your Super exposure draft legislation suggests it will stick with the inferior net-investment return benchmark - which excludes administration fees and other non-investment charges, according to ISA chief executive Bernie Dean.

"This distorts outcomes because it does not measure what a fund deposits into a member's account and allows dud products to hide their lousy performance. Benchmarks must be based on net returns – investment returns minus all fee and charges,"  

There is also no plan to roll out benchmarks to most of the trouble-plagued ‘Choice’ sector – despite a government review finding that sector had the biggest fee gougers and worst performing products, according to ISA.

“Dud super funds continue to drain the savings of too many Australian workers, they must lift their game or face closure, no matter where they are,” Mr Dean said.

“Rigorous, universally applied benchmarks that measure outcomes from a member’s perspective are the only way we’ll avoid millions of workers being stuck in a dud fund for life.

“Addressing this should be beyond politics or ideology While some seem intent on using these reforms to pursue ideological objectives at the expense of member outcomes - our focus is firmly on ensuring they are in members' best interests, just like with everything we do," Mr Dean said. 

 “We’d be concerned if the government was returning to the old battle lines, because we know that will lead to poor financial outcomes for members.”

ISA analysis of APRA's publicly available five-year MySuper returns shows that $145 billion in assets would not meet the more rigorous net-return benchmark - compared with $108 billion using the government's model.

The Productivity Commission, ASIC, APRA, the Cooper Review, analyst firm SuperRatings, AIST and even Superannuation Minister Jane Hume have all said net returns after fees and taxes is the most relevant fund performance measurement for members. It must be the test.

Products are considered underperforming if they drop below 50 basis points of the benchmark.

Members are told that their fund has underperformed when they first miss the benchmarks, consecutive underperformance results in funds being barred from accepting new members. This does little to stop existing members from being fleeced, so the ultimate punishment for chronic underperformance should be removal from the system.

There is also no plan for the benchmarking regime to be applied to more than 80 percent of the near $1 trillion Choice sector – despite this sector being littered with dud products.

The difference between being in a good fund and a bad one can mean more than $500,000 less at retirement, these reforms must be strengthened so that fewer workers are in underperforming funds.

Before the government proceeds with its plan to “staple” workers to their first fund it must remove the duds from the system – benchmarks must be robust and applied to the entire system equally.  

Industry Super Australia supports the government's Your Future, Your Super package and its crucial performance benchmark tool, but is concerned unless important improvements are made, members could end up worse off.

ISA supports sensible changes in members' best interest including:

Ø  Net-return as a performance benchmark rather than net-investment return

Ø  Forced closures of chronically underperforming funds

Ø  Expanded coverage to ensure all funds and products – including the Choice sector – must also pass the benchmark tests, with no carve outs

Ø  Sequencing of reforms to ensure performance measures are implemented before stapling

ISA welcome all universally applied laws that would mandate spending by super funds should be solely for the financial benefit of members – not the parent company’s shareholders.

Advertising is a cost-effective way to attract and retain members passing on benefits of scale. It is also a useful financial literacy tool to help explain to members the impact on their savings of potential policy changes.

All ISA’s activities are in the best financial interests of members – this is a statement Banking Royal Commissioner Kenneth Hayne agreed with, according to Mr Dean.

Media reports have suggested the proposed changes to the sole purpose test are deliberately designed to disadvantage industry funds. ISA will carefully examine if the effect or intent of the legislation is to damage industry funds competitive position in the marketplace.

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Resources can help Qld become an energy superpower: QRC

QUEENSLAND can become Australia’s number one ‘Energy State’ and a global energy superpower thanks to abundant coal and gas reserves and easy access to renewables, Queensland Resources Council chief executive Ian Macfarlane said today. 

Mr Macfarlane told a gathering of more than 500 people at the QRC’s annual lunch in Brisbane, which featured Premier Annastacia Palaszczuk’s first major industry address since her government’s re-election, that Queensland was on the verge of an historic new era for resources.

He said Queensland’s ability in the not too distant future to produce vast amounts of zero-emission green hydrogen from solar and wind-generated electricity and the CCS-Pyrolysis process on coal and gas would position Queensland as a significant, reliable source of clean energy to meet growing world energy needs.

“The Palaszczuk government’s agreement to work with the QRC to deliver a Queensland Resources Development Plan will enable Queensland to work and earn our way out of COVID, supercharging Queensland’s economic recovery and delivering decades of responsible prosperity,” Mr Macfarlane said.

“A coordinated response is an opportunity to put Queensland - and hundreds of thousands of Queensland jobs - at the international forefront of areas such as advanced manufacturing, renewable energy and battery storage deployment and hydrogen industry development.” 

Mr Macfarlane said there were strong parallels between the plan and the historic 1968 Central Queensland Coal Associates Agreement which put Queensland’s coalfields on the global resources map half a century ago.

“Just as that historic agreement established a new foundation for growth in investment, jobs, production and exports in Queensland’s coal industry at the time, a well-implemented Resources Industry Development Plan will take our industry to a whole new level,” he said. 

“In the meantime, the resources sector remains committed to ensuring our sector operates responsibly, respectfully and safely and we will never lose sight of the fact there are families and a global community of people relying on us to do just that.

”Mr Macfarlane said the industry’s latest economic contribution data shows resources added a record $82.6 billion to the Queensland economy over the past financial year, equating to a $10 million contribution from resources every hour of every day. 

“Resources contributes one in every five dollars to the Queensland economy and one in six jobs, which is why our sector’s performance is so crucial to a strong COVID recovery,” he said.  

Mr Macfarlane said the number of jobs supported by resources rose by 13 percent in 2019-20 to more than 420,000 jobs. Of these, almost 53,000 people are direct employees and more than 367,000 jobs are supported by the sector. The number of Queensland businesses directly supported by resources rose 5 percent to 15,200, with companies reporting a 19 percent increase in spending to reach $27 billion.

Mr Macfarlane said resource companies exported $56.5 billion worth of goods last year, which represented 80 percent of Queensland’s total exports.

“This export result has been achieved at a time of global market upheaval and volatile commodity prices, which makes it an even more extraordinary outcome,” he said.

Mr Macfarlane said every Queenslander benefits from the billions of dollars in royalties that resources companies pay annually to the State Government, with the industry contributing $4.5 billion in 2019-20.

“The royalty taxes contributed each year by resources companies help the Queensland Government pay for the nurses and doctors who care for our families, the teachers who educate our children, the police officers who keep us safe, and the hospitals, schools and roads we need for our communities to function,” Mr Macfarlane said.

“When you take into account the overall contribution of resources to the state economy – the value of the jobs we support, economic activity we generate, taxes we pay, businesses we support, commodities we export plus royalties – our contribution is extremely significant.”

Mr Macfarlane said QRC members were heartened by the Premier’s commitment to work with industry to develop a plan to chart Queensland’s recovery from COVID-19 and beyond. 

“I hope in 50 years’ time people will talk about the Queensland Resources Development Plan in the same way they speak about the Central Queensland Coal Associates Agreement of 1968,” he said.

“The QRC looks forward to working with the Premier and her government to maximise Queensland’s ability to recover from COVID and become Australia’s number one Energy State.

“You can count on resources to help Queensland recover.”

www.qrc.org.au

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Faster payments to Victorian small businesses to kick-start economy

THE Australian Small Business and Family Enterprise Ombudsman, Kate Carnell has welcomed the Victorian Government’s commitment to pay its small business supplier invoices within 10 business days.

Ms Carnell said the new payment terms, which will apply to all new contracts valued under $3 million from January 1, 2021, is exactly what small businesses need as they recover from months in lockdown and severe trading restrictions.

“Fast-tracking payments to small businesses is a sure-fire way to help them get back on their feet following what has been an incredibly tough year,” Ms Carnell said..

“The Victorian Government’s new small business payment policy will also flow through to the broader economy, by getting money moving again.

“We know that small businesses, particularly those hardest hit by the COVID crisis, urgently need cash flow.

“The latest CreditorWatch data for October shows businesses are being paid an average of 31 days overdue – an increase of 157 percent on this time last year. This is having a devastating impact on small business, which highlights the importance of paying small businesses on time.

“This should be seen as a benchmark for governments at all levels. If Victoria can do it, there’s no reason why it can’t apply across the board," she said.

“Big businesses should also do the right thing by their small business suppliers and pay them faster. Too many big businesses have used the COVID crisis as an excuse for poor payment times, which is clearly unacceptable.”

www.asbfeo.gov.au

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Ombudsman welcomes 30-day payment restoration by CIMIC, UGL

THE Australian Small Business and Family Enterprise Ombudsman, Kate Carnell has welcomed a commitment by engineering group UGL to restore 30 day payment terms for its small business suppliers in the new year.

The announcement by CIMIC – which owns UGL – follows concerns raised by the Ombudsman in September 2019 regarding reports the engineering company had extended its payment terms to 65 days and notified suppliers to contact Greensill Capital if earlier payment was required.

This prompted the ACCC to look into issues around extended payment terms and reverse factoring.

“We welcome the announcement that CIMIC and UGL plan to return to 30-day payment terms for all of its small business suppliers by early next year as part of its yet-to-be-released Small Business Policy,” Ms Carnell said.

“CIMIC says it will publish its Small Business Policy for its operating companies, including UGL and CPB contractors in the coming weeks, in which suppliers will be eligible for 30-day payments. My office looks forward to reading this policy in detail.

“We also acknowledge the leadership shown by Greensill Capital, which pledged in May to discontinue the use of supply chain finance facilities by companies that misuse its products by pushing out payment terms. 

“We know that late payments make a huge difference to small business’ bottom line and that is only amplified for small businesses that have faced unprecedented challenges in 2020," Ms Carnell said.

“The latest CreditorWatch data for October shows businesses are being paid an average of 31 days overdue – an increase of 157 percent on this time last year. This is having a devastating impact on small businesses, particularly those hit hardest by the COVID crisis.

“Ultimately cash flow is king for small business and we know that if small businesses are paid on time, the whole economy benefits.”

www.asbfeo.gov.au

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Refreshed Business Funding Guide supports COVID crisis survival

AN UPDATED Business Funding Guide, which has been revised to reflect feedback and support small businesses impacted by the COVID crisis, has been released today.

The guide, developed by the Australian Small Business and Family Enterprise Ombudsman in partnership with Scottish Pacific Business Finance, is primarily written for accountants, bookkeepers and other accredited financial advisers, to assist their small business clients to find appropriate funding and increase their chances of getting approved for finance.

“Trading conditions have changed dramatically since we released the first Business Funding Guide last year,” Australian Small Business and Family Enterprise Ombudsman Kate Carnell said.

“The guide was originally intended to help small businesses secure funding for growth, however given the heavy toll the COVID crisis has taken on small businesses, the focus is now firmly on their survival.

“While many small businesses are still eligible for government support, these measures are temporary and plans will need to be made to fund their recovery, reinvention and growth.

“This independent guide provides comprehensive up-to-date information about a range of funding options available to small businesses, along with a step-by-step pathway to becoming ‘finance fit’ to give small businesses their best chance at success with the application process.

“Even at the best of times, many small businesses face an uphill battle to secure funding," Ms Carnell said.

“We know many have not bothered to apply due to the onerous application process and unrealistic serviceability requirements. Even for loans that have been 50 percent guaranteed by the Federal Government, small businesses have been asked for all sorts of documentation including director guarantees, which really means the family home.

“That’s why it is crucial small businesses understand the growing range of financial providers and products on the market – the big four banks are not the only game in town.

“Small business owners that need funding to stay afloat and recover from this challenging period need to consider all of the funding options, including those that are not tied to the family home, to make the best choice for their business," she said.

“Finally, it is vital small business borrowers ensure their lender is an AFCA member and talk to their trusted accredited financial adviser – who has our Business Funding Guide – before taking out a loan.”

www.asbfeo.gov.au

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Victoria’s massive energy efficiency investment to drive jobs boom - EEC

THE VICTORIAN Government has doubled down on last week’s record investment in energy efficiency in the residential sector with a swathe of smart stimulus measures targeted at businesses, community groups and government operations.

Together, this $1 billion energy management package will create thousands of local jobs and ensure every part of the economy is supported through Victoria’s economic recovery, acccording to the Energy Efficiency Council’s CEO, Luke Menzel.

“Last week the Andrews Government took a leadership position on energy efficiency, with a record $797 million investment in energy efficiency upgrades, with a focus on social housing residents and concession card holders,” Mr Menzel said. 

“Today they doubled down, extending the benefits of energy efficiency stimulus to every part of the Victorian economy, and ensuring no business is left behind.”

Today’s budget includes $91 million of energy management support for Victorian businesses and community groups, including:

  • A $31 million co-investment fund for large energy users to transform the way industry uses energy and helping businesses save money, to be spent in the next twelve months;
  • A $30 million top up for the Agriculture Energy Investment Plan to support Victorian farmers to improve their energy management;
  • $9 million for Victorian Energy Upgrade (VEU) incentives targeted at small businesses, to accompany the $38 million going towards 15,000 solar rebates for businesses; and
  • $21 million for climate change community action, which will include funding to help community groups install renewable energy systems, storage and energy efficiency improvements in community buildings.

In addition to supporting Victorian businesses, the Andrews Government is leading by example, committing almost $100 million over four years to increase the energy performance of its own operations, including:

  • $40 million for LED lighting and solar PV in public hospitals; and
  • $59.9 million to the Greener Government Buildings (GGB) Program and creating a revolving fund that will see energy savings reinvested in further buildings upgrades for years to come.

The budget also included $10 million for supporting the clean economy workforce, including setting up a Clean Economy Skills and Jobs Taskforce, which would develop a Clean Energy Workforce Development Strategy and oversee the rollout of a $6 million for a Clean Economy Workforce Capacity Building Fund.

Energy experts applauded these investments.

“Today’s announcements bring Victoria’s total commitment to energy management stimulus investments to $1 billion,” Mr Menzel said.

“This is smart stimulus. We know that energy efficiency upgrades have the biggest jobs multiplier of any form of clean energy investments. Victoria is harnessing that jobs multiplier to supercharge their post-COVID recovery, creating thousands of good, local jobs and cutting carbon along the way,” he said.

This major new stimulus effort is consistent with evidence from bodies like the International Monetary Fund and the International Energy Agency, who call energy efficiency a ‘job-creation machine’, and have advocated for it to be put at the heart of economic recovery programs post COVID-19.

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National Redress Scheme hearings continue

THE Joint Select Committee on Implementation of the National Redress Scheme will hold a public hearing this week. The Committee will hear from individuals who have engaged with the Scheme and service providers who are supporting survivors.

The Committee’s First Interim Report, tabled in May 2020, made 14 detailed recommendations that were intended to inform the Scheme’s legislated second anniversary review.

Committee Chair Senator Dean Smith noted in September that, while the second anniversary review is ongoing, a number of issues associated with the operation of the Scheme need to be considered now.

“The Committee will hear evidence directly from survivors and the support services on the ground to ensure that the National Redress Scheme … is suitable for all survivors including First Nations people,” Senator Smith said.

Public hearing program

Date: Thursday, 26 November 2020
Time: 1pm to 5pm
Location: via teleconference

The hearing will be broadcast live at aph.gov.au/live and public hearing programs will be available at the Committee website prior to the hearing.

 

Grocon collapse should spur national security of payment laws - unions

THE collapse of construction company Grocon shows Australia needs effective national security of payment laws to ensure workers, subcontractors and small businesses are not left carrying the can when builders and property developers go into administration or liquidation, says the CFMEU.

“In nearly all instances it is small businesses and subcontractors who do the majority of the work on sites, but it is the big developers who hold back payments,” said Dave Noonan, CFMEU National Construction Secretary.

“This is a massive rort that has been besetting the industry for decades. The latest Grocon collapse is just like Groundhog Day for anyone who has been around the construction industry for any length of time.

"The Federal Government is well-aware of the problem and commissioned John Murray, former CEO of Master Builders Australia and a former construction lawyer with decades of experience to investigate the widespread industry practice of non-payment or late payment of money owed for work done.

"The Murray Report made 86 recommendations around national security of payment laws and the introduction of statutory trusts which the government has been sitting on since 2017," Mr Noonan said.

“Master Builders Australia have consistently acted to stop the introduction of security of payment laws which only serves interest of big property developers and builders, and damages the small businesses and subcontractors who actually do the work in the industry.

“We call on the MBA to support the recommendations made by their former CEO, John Murray, and do right thing for small businesses and subcontractors.”

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GST fraudster sentenced over multi-million dollar scheme

MICHAEL RAY, a 38-year-old fraud syndicate member who conspired to defraud the Commonwealth of more than $5 million through Goods and Services Tax (GST) refunds, has been sentenced to five years imprisonment with a non-parole period of three years after facing the Melbourne County Court today.

The Australian Federal Police (AFP) and Australian Taxation Office (ATO) joint investigation, known as Operation SPINEL, identified and charged the South Melbourne man, in May 2017, along with two other members of the Victorian-based fraud syndicate.

Mr Ray was charged after detectives identified he had attempted to obtain a share in over $5 million and did dishonestly obtain a share in more than $2.5 million from the GST fraud scheme which had operated between November 12, 2010 and December 14, 2012.

The scheme was concocted to illegally obtain personal identifying information. This information was then used to create false entities and register them for GST. Business activity statements (BAS) were then lodged to claim false GST refunds, which were directed to bank accounts that had been created using the stolen identities.

In total, the scheme intended to defraud the Commonwealth of more than $5 million.

Police executed search warrants at a number of Melbourne properties and safety deposit boxes, seizing more than $1.5 million in cash.

Mr Ray was sentenced today to five years imprisonment, with a non-parole period of three years, after he pleaded guilty to conspiracy with the intention of dishonestly obtaining a gain from the Commonwealth, contrary to Section 135.4(1) of the Criminal Code (Cth).

ATO Assistant Commissioner Ian Read said this was a successful result under the partnership of the ATO and AFP, who work together to investigate serious criminal activities.

"Tax crime affects the whole community by reducing the revenue that is available to fund essential community services," Mr Read said. "We know the majority of people are honest, but there is a small percentage of people who deliberately abuse the tax and super system for their own financial benefit. Today’s sentencing shows that these people will be held to account.

“$1.5 million has been recovered and those who had their identity compromised were provided support to help get their affairs back on track. This is an excellent result,” Mr Read said.

This matter was prosecuted by the Commonwealth Director of Public Prosecutions.

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Report on retirement income welcomed by AIR.

THE Review Panel final report on Retirement Income has been welcomed by self-funded retirees "as it provides a much-needed fact-based assessment of the three pillars of the Age Pension, compulsory superannuation and private savings that are the foundation of Australia’s retirement income system,” according to Wayne Strandquist, president of the Association of Independent Retirees (AIR).

“Retirement income derived by self-funded retirees can be drawn from one or any combination of the three pillars of Australia’s retirement income system and self-funded retirees have a direct interest in any changes that may be contemplated by the Government as a result of the Review Panel report,” Mr Strandquist said.

“The Association of Independent Retirees is pleased to note that the key observation of the Review Panel was that ‘the Australian retirement income is effective, sound and its costs are sustainable’,” he said.  “This observation provides a sound basis for consideration of any changes that may arise from the report to address issues of inequity and ensuring the system delivers a retirement income that achieves a reasonable balance in relation to working life earnings and retirement income.

“When compulsory superannuation was introduced in 1992, the government of the day and subsequent governments have supported tax concessions to encourage greater independence of the working population in funding their retirement. The Superannuation Guarantee has not as yet reached full maturity and there is still a requirement to encourage more Australians to be less dependent on the Age Pension.
 
“Self-funded retirees need to be sure that they have adequate savings to fund their retirement for a multitude of reasons apart from funding a reasonable standard of living," Mr Strandquist said. "

These reasons being having sufficient funds invested to ride out economic instability in instances such as the GFC and COVID-19, cover inflation affecting the cost of living, providing for higher health care costs in old age, providing for residential aged care if required, and providing for times of low-interest rates.
 
“AIR is looking forward to working with the Government to draft legislation that will address issues raised in the fact-based report on retirement income,” Mr Strandquist said.

 www.independentretirees.com.au

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