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New inquiry into the harm from capital concentration to consumers, competition

THE House of Representatives Standing Committee on Economics is commencing a new inquiry into the implications of capital concentration and common ownership in Australia.

Committee Chair, Tim Wilson MP, said,"This inquiry is urgent -- there is already high concentration of ownership of ASX listed companies by an increasingly small number of ‘mega funds’ and that trajectory will increase.

"The House Economics Committee has been asking regulators about these risks for nearly a year. Recently the chair of the ACCC informed the committee common ownership posed threats to competition when it hits 10 percent, yet some have already hit 30 percent’.

"We don’t want a stock exchange where a hand full of ‘mega funds’ make all the decisions, and ordinary investors are locked out and higher costs are paid by Australians. Some ‘mega funds’ have already said that as their ownership increases they’d de-list public companies," Mr Wilson said.

"Common ownership’s flow-on risks higher prices and collusion, corporates imposing public policy agendas while bypassing democracy, and disempowering ordinary investors. The law shouldn’t empower capital over citizens and that’s what we’ll be inquiring into."

Common ownership refers to when a fund or collaborative funds simultaneously own shares in competing firms. The committee will investigate the impact of common ownership by institutional investors (such as banks, super funds, investment funds, hedge funds and others).

"This inquiry will shine a bright light ‘under the hood’ of the ownership of the ASX today, and ensure that we update the law, regulations and regulators to address the challenges of the future so we empower citizens, not organised capital," Mr Wilson said.

The committee is inviting submissions from stakeholders and interested parties. The full terms of reference are available on the committee’s website.

Submissions are being sought by Monday, September 13, 2021. Submissions can be made online or by emailing This email address is being protected from spambots. You need JavaScript enabled to view it..

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Central Coast Council review opens door to privatisation of local water and sewer services

THE local government union has warned the Central Coast community that the council’s review into local water and sewerage operations "could open the door to the sell-off of these vital community services by the cash-strapped council".

The United Services Union (USU) has also foreshadowed a relentless campaign to protect the jobs and services of this current council operation to prevent any moves to privatise it.

Central Coast Council has announced an independent review into how water and sewer operations are managed, which will examine options including the full privatisation of the services, a transition to a council-owned corporation, and a joint service with Hunter Water.

The USU said the publicly-owned water and sewer infrastructure — which the council says is worth nearly $4 billion dollars — not only provides an essential community service, but also generates ongoing income for the council.

“The privatisation of water and server services would be catastrophic for the Central Coast community,” USU organiser Luke Hutchinson said.

“We are strongly opposed to any sell-off and will be engaging in a wide ranging and relentless campaign to protect local jobs and essential services for the Central Coast community.

“These services not only provide a reliable, affordable, essential service, they generate ongoing income, making their retention in public hands vital to turning around the financial crisis that saw Central Coast Council placed into administration. Privatisation simply does not make any sense.

“A sale of these assets — which have been entirely paid for by the local community — would see them run for the profit of their new owners, rather than in the best interest of the Central Coast community.

“The Central Coast is already struggling with the effects of the COVID pandemic and ongoing lockdowns, the last thing they need is for their water and sewerage assets to be sold off to private interests," Mr Hutchinson said.

“If water and sewerage assets are sold off, it will lead to higher water bills, lower service, and the loss of good local jobs.

“The threat of privatisation is also causing extreme hardship for Central Coast Council workers who have already faced 10 months of uncertainty due to the current financial crisis, including the loss of 287 jobs.

“The Central Coast community needs to send a clear message to the council and the administrator that the sell-off of local essential services is not an acceptable way to address council’s financial mess.

“The USU has a very strong and proud record of protecting jobs and community assets and is committed to leading vigorous and continuous opposition to any moves to sell these community assets.”

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ACA and unions warn construction to remain shut down unless key workers authorised to travel

THE planned widescale reopening of Greater Sydney construction sites, outside of the locked down Local Government Areas (LGAs), is at risk unless the NSW Government authorises key workers residing in these areas to travel to work, according to both the CFMEU and the Australian Construction Association. (ACA).

Currently, workers in a locked down LGA are only able to travel outside the LGA they live in if they are required to leave home for work and are classified as an authorised worker. The list of authorised workers does not include workers in the construction industry.

Australian Constructors Association CEO Jon Davies said,“Many construction sites will struggle to reopen following the end of the two-week industry shutdown as over half the workforce is located in the locked down LGAs and is therefore not authorised to travel."

CFMEU NSW secretary Darren Greenfield said, “Many of these workers are required to supervise site activities, ensure work is undertaken safely and operate critical plant and equipment."

CFMEU and ACA have called on the Government to add these supervisors and critical operators to the list of workers authorised to travel from locked down LGAs to projects located in other areas.

“Construction has been significantly impacted by the two-week shut down and we can’t afford any further delay in reopening of work sites," Mr Greenfield said.

Mr Davies said, “We are confident that the agreed further tightening of what were already comprehensive COVID-safe operating protocols and procedures, will keep workers and their families safe and prevent transmission of the disease on construction sites," 

ACA members and the CFMEU are working collaboratively with the NSW Government to implement rapid antigen testing across construction sites in order to stay one step ahead of the virus.

Mr Davies said, “Construction is all about managing risk and as an industry we have shown since the since the start of the pandemic that industry can effectively manage the risk of COVID transmission on our worksites."

Mr Greenfield said, “CFMEU is working with industry to get information to workers who want to get vaccinated as quickly as possible.”

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ALAND chief reacts to construction industry lockdown in Sydney

WESTERN SYDNEY development and construction company ALAND chief executive George Tadrosse has hit out at the clumsiness of the current Sydney lockdowns and the devastating impact it is having on his industry and the families it employs.

"As a prominent Western Sydney developer, I feel it is our duty to highlight the devastating effects this shutdown will cause to so many families and businesses ALAND proudly works with them every day," Mr Tadrosse said.

"The lack of consultation and disproportionate restrictions placed on the affected LGAs (compared with earlier exposure events on the Northern Beaches and Eastern Suburbs) needs to be called out and immediately reconsidered to determine a feasible, fair and sustainable solution.  

"ALAND currently has approximately $925 million in real estate under construction across LGAs impacted by the current construction lockdown, including; Blacktown, Liverpool, Campbelltown and Parramatta LGAs," he said. "This equates to roughly 1450 new dwellings across five major construction sites -- of which, approximately 30 percent of the developments have fully drawn finance facilities and are awaiting occupation certificates.

"Every year, both directly and indirectly, ALAND is responsible for billions of dollars of contributions into the economy of Greater Western Sydney.

"The Premier’s decision will mean that thousands of individuals including tradespeople, project managers and suppliers to our major construction sites across Western Sydney will not be able to return to work, creating ongoing uncertainty for them, and their households. ALAND alone employs 145 direct staff and over 1000 subcontractors on any given day.

"ALAND, like so many other businesses working within the construction industry, have already adapted their construction sites and Work Health Safety plans to accommodate additional COVID-19 precautions. We are confident with ongoing consultation we can continue to operate safely within affected LGAs and urge the government to allow all construction to resume across all of NSW," Mr Tadrosse said.

"We need the government to provide clear answers, conscious decision making and a clear pathway for families and businesses to support economic stability and eventual recovery through these challenging times."

ALAND’s current Sydney-based developments include Schofield Gardens, Schofields; The Hoxton, Liverpool; Paramount on Parkes, Parramatta; and Costello, Edmondson Park.

 

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Home Affairs and ASD respond to industry on Security of Critical Infrastructure

THE Parliament’s Intelligence and Security Committee will hold its fourth public hearing tomorrow as part of its Review of the Security Legislation Amendment (Critical Infrastructure) Bill 2020 and Statutory Review of the Security of Critical Infrastructure Act 2018.

The committee will hear from the Department of Home Affairs and the Australian Signals Directorate (ASD) at a recall hearing to address evidence presented by industry and subject matter experts from previous hearings and in further submissions received to the inquiry.

Senator James Paterson, Chair of the committee, said, "The committee has heard from a wide range of independent experts and entities proposed for regulation by the Bill and the existing regime.

“The committee has heard important evidence, not just on how these laws may impact critical infrastructure service providers and their customers, but also on the scale of the cyber threat from both criminal and state actors.

“Committee members will seek the feedback of the Department and ASD to that evidence to assist us in formulating our report and recommendations.”

Further information on the inquiry can be obtained from the Committee’s website.

Public Hearing Details

Thursday, 29 July 2021
2pm – 5pm (AEST)
Committee Room 2R1, Parliament House, Canberra and via videoconference

A program for the hearing is available on the Committee’s website and the hearing will be broadcast live at aph.gov.au/live.

 

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QRC welcomes approval of metallurgical coal mine extension in Central Qld

THE Queensland Resources Council (QRC) today welcomed the State Government’s decision to approve an $82 million extension to the Isaac Plains metallurgical coal mine near Moranbah, calling it a huge vote of confidence in Queensland’s high quality coking coal industry.

QRC chief executive Ian Macfarlane said metallurgical coal prices were currently at record highs due to a surge in world steel production.

According to the latest Resources and Energy Quarterly report, the value of Australian metallurgical coal exports is forecast to reach almost $32 billion by 2022-23.

Volume-wise, exports of metallurgical coal are expected to increase from 171 million tonnes to 186 million tonnes by 2022-23 due to increased demand from rapidly modernising South-East Asian economies.

Mr Macfarlane said mine owner Stanmore Resources’ plans to expand output from its Isaac Plains complex was great news for every Queenslander, with its new open cut mine project expected to contribute $200 million in royalties to the state budget over its 10-year life span.

“Mining royalties help pay for the essential government services that every Queenslander needs and benefits from,” he said.

“That’s why it’s been so essential for the resources sector to keep working, earning and employing its way through the Covid-19 pandemic, because so many jobs and businesses rely on resources companies for their income.

“We take this responsibility very seriously, which is why our companies have gone above and beyond to follow Queensland Health protocols so we can continue to keep our workforce and the communities in which they live and work safe.”

Mr Macfarlane said the injection of 250 new construction jobs at Isaac Plains, plus ongoing work for 300 workers currently employed at the site and new supply chain opportunities, will stimulate growth in Central Queensland, which will flow through to the state economy.

www.qrc.org.au

 

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Temporary insolvency protections sensible as lockdowns continue  

THE Australian Small Business and Family Enterprise Ombudsman Bruce Billson has urged the Federal Government and regulators to consider the reactivation of temporary insolvency protections, to support small and family businesses doing it tough in lockdown.

Mr Billson said the re-introduction of measures, such as the extension to existing safe harbour provisions, would provide temporary additional protections for small and family businesses that may be trading insolvent due to lockdown trading restrictions.

“Small businesses aren’t like a light that can be switched on and off,” Mr Billson said.

“With full respect for the need for public health orders, lockdowns do have a significant and immediate impact on small and family businesses and a cumulative effect when those businesses have endured multiple lockdowns. 

“Many have far less cash in reserve, having eaten into savings to get through previous lockdowns.

“CreditorWatch has released data revealing a 75 percent increase in businesses entering administration in the last week of June, and that trend is widely expected to continue with payment times stretching out.

“Bringing back temporary protections that were in place last year, would be a sensible and appropriate policy measure, particularly for those small and family businesses impacted by recurring and protracted lockdowns in Melbourne and Sydney," he said.

“Insolvency protections introduced temporarily last year worked to reduce the threat of creditors taking action against a small business impacted by trading restrictions and offered temporary relief for directors from any personal liability for trading while insolvent.

“Crucially its measures like this that give otherwise viable small businesses more time to recover or turnaround, preventing a wave of unnecessary insolvencies. By giving a small company breathing space to restructure, you also help mitigate the risk of small business creditors getting swept up in the domino effect of insolvencies.”

In the meantime, My Billson is encouraging small businesses experiencing financial hardship to sit down with their trusted, accredited financial adviser for a viability assessment.

“We know the sooner a small business owner experiencing financial stress reaches out to an accredited professional such as their bookkeeper or accountant, the better the outcome,” Mr Billson said.

“Without the right professional advice, cash flow issues, compounded by falling revenue can prove devastating for the business owner, staff and their families.

“Now is the time to get expert, tailored advice on the state of your business so you can make an informed decision about the future.” 

www.asbfeo.gov.au

 

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HESTA named top major super fund for customer satisfaction

HESTA scored the highest customer satisfaction rating among industry and retail funds, according to independent research agency Roy Morgan’s latest Superannuation Satisfaction Report. 

Measuring customer satisfaction ratings for the six months from January to June 2021, the report found HESTA (Health Employees Superannuation Trust Australia) was the leading major superannuation fund as satisfaction reached record levels during the reporting period.

“Our focus on putting members first in everything we do sees us continually look to improve the experience our members have with us and drives innovation in how we support members to have a better financial future,” HESTA chief experience officer Lisa Samuels said.

Ms Samuels said the focus on delivering outstanding investment performance, while also having a positive impact, has helped contribute to strong member satisfaction levels.

“Our members consistently tell us that they want us to be a gutsy advocate on the issues that impact them and their financial futures,” Ms Samuels said.

“We know issues like gender discrimination and climate change are risks that can affect the long-term performance of companies our members are invested in. That’s why our focus on global leadership in responsible investment sees us continue to find new ways to deliver strong, sustainable investment performance for members.”

HESTA’s Sustainable Growth option was last week named the country’s top performing balanced option for the year, leading across one, three, five, seven, 10 and 15-year timeframes*, according to third party ratings agency, SuperRatings’ latest Fund Crediting Rate Survey.

The Sustainable Growth investment option achieved a stellar 23.03 percent return for the FY20/21 financial year and delivered 11.28 percent a year over a rolling 10-year period to 30 June 2021#. It was also the leading option across 1, 3, 5, 7, 10, 15 and 20-year time periods, compared with other dedicated sustainable investment options^.

The MySuper authorised option, Balanced Growth, also achieving a record 19.03 percent return for the financial year and 8.87 percent a year over 10 years #. According to SuperRatings, Balanced Growth achieved top quartile performance versus other balanced options over three, five, seven, 10 and 20-year time periods*.

“Our members know they can have a positive impact through their super while also benefitting from leading investment performance to help them achieve a more secure financial future and a better world to retire into,” Ms Samuels said.

 

About HESTA

HESTA is the largest superannuation fund dedicated to Australia’s health and community services sector. An industry fund, HESTA has over 880,000 members and manages more than $62 billion in assets. As a responsible steward of their members’ retirement savings, HESTA focuses on achieving strong, sustainable, long-term returns while making a positive difference to the world members will retire into.

 

 References

^ SuperRatings Sustainable Fund Crediting Survey June 2021
* SuperRatings Fund Crediting Survey June 2021, Balanced (60-76)

#Past performance is not a reliable indicator of future performance. Investment returns for HESTA Retirement Income Stream are different to those presented in this Media Release refer to www.hesta.com.au for further details of investment performance for all investment options.

 

 

 

 

 

Economics Committee to examine financial advice sector then IFM investors

THE House of Representatives Standing Committee on Economics will hear from key industry bodies, as well as from a range of financial advice firms at a public hearing via videoconference on Thursday July 29, 2021, as part of its ongoing Review of the Four Major Banks and other Financial Institutions.

The chair of the committee, Tim Wilson MP, said, "These hearings are an important mechanism for the Parliament to publicly scrutinise and hold Australia’s financial advice sector to account.

"Many Australians turn to financial advisers and mortgage brokers to help them navigate important financial decisions, such as finding the right mortgage or determining how to best invest in and secure their retirement. It is essential that Australians can trust that financial advisers and mortgage brokers are always acting in their client’s best interests, rather than the interests of the adviser or any third parties.

"The committee is looking froward to hearing what lessons have been learned by the industry over the course of the pandemic and what policy changes and technological innovations have been adopted in light of the Hayne Royal Commission.

"There is ongoing anger and frustration from financial advisers about regulation surrounding their sector, the Committee will also scrutinise the justification and consequences that lead to financial advisers leaving the sector and the increasing limit of financial advice to those who cannot afford upfront payments."

Following the Financial Advice hearing, IFM Investors will appear before the committee from 4.15pm for a superannuation sector hearing.

Public hearing details

Financial Advice

Date: Thursday, 29 July 2021
Time: 9am to 3.45pm
Location: Videoconference


Superannuation

Date: Thursday, 29 July 2021
Time: 4.15pm to 5.15pm
Location: Videoconference

The hearings will be webcast at aph.gov.au/live.

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Treaties Committee virtual road trip

THE Joint Standing Committee on Treaties will be on a virtual road trip this week as part of the committee’s inquiry into the Regional Comprehensive Economic Partnership Agreement (RCEP).

RCEP is a regional free trade agreement between Australia and the countries of ASEAN, China, Japan, the Republic of Korea and New Zealand.

Committee chair Dave Sharma MP said, "The committee will be holding three virtual public hearings this week, including witnesses from Sydney, Melbourne, Perth, Brisbane, and Canberra. Unfortunately, COVID-19 restrictions have meant the Committee is unable to hold these hearings in-person as planned."

The committee will discuss a broad range of issues associated with RCEP, including trade in goods, intellectual property, services, health, and human rights.

Public hearing details

​Tuesday 27 July 2021
Time: 9.30am – 11.30am AEST
The program for this hearing is available online.
​The hearing can be accessed online.

Wednesday 28 July 2021
Time: 10am – 12 noon AEST
The program for this hearing is available online.
​The hearing can be accessed online.

​Friday 30 July 2021
Time: 10.30am – 12.30pm AEST
The program for this hearing is available online.
​The hearing can be accessed online.

Further information on the inquiry can be found on the inquiry website.

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Australian building boom has Sweetman in the sweet spot

THE COVID-induced Australian construction boom has led to a timber shortage that has a growing number of buyers turning to Sweetman Renewable Timbers (SRT) in an effort to shore up supply.

Australian federal and state governments have recognised the potential of the industry to help lead the post-COVID economy revival, with the latest round of government budgets directing a quarter of a trillion dollars to infrastructure projects from 2020-21 to 2023-24, Deloitte Access Economics figures show. 

The value of total building work done in Australia during the March quarter rose 3 percent to $30.4 billion compared with the previous quarter, according to the Australian Bureau of Statistics, while new homes being built jumped 40.6 percent compared to the March quarter of 2020.

The Housing Industry Association said the record volume of building has led to material shortages.

At the same time, the 2019-2020 bushfires and lack of new plantation investment over more than a decade have further exacerbated the chronic timber product supply, which is having serious implications for building and construction activity. A division of Sweetman Renewables Ltd, SRT’s sawmill and timber processing facilities in the Hunter Valley, NSW is the only hardwood sawmill between Sydney and Newcastle, and is built on the sawmilling business established by the Sweetman family a hundred years ago.

SRT’s managing director for timber, Campbell McInnes commented on the company's direction, “We are working to strengthen long-term timber products supply arrangements with major timber wholesalers, and other companies in the building products supply chain.

"This will include expanding existing hardwood sawmilling capacity, increasing the production of quality hardwood products from certified forests and plantations. We are also seeking to develop additional avenues of log supply and timber products sources.

“With expanded opportunities for authorised log supplies, SRT will be able to make a valuable contribution to timber products supply to wholesalers, merchants and to construction and building customers.”

Sweetman Renewables chairman John Halkett said the company had a focus squarely on quality timber production and sustainable forest and plantation management via SRT, plus its biomass to renewable energy initiatives through its Sweetman Biomass division.

"Sweetman Renewables is proud of its ability to make a meaningful contribution towards sustainability, carbon storage and renewable energy that will collectively assist climate change abatement,” he said.

As well as planning capital expenditure to improve sawmilling and timber processing productivity, SRT will have the capacity to offer a wide range of timber products through an expanded timber products supply capability that includes a collaborative arrangement with a major timber products wholesaler, with a network of wholesale facilities across Australia.

“Our increased synergies across the supply chain will assist in strengthening the commercial performance of SRT’s sawmilling and timber processing operation in the Hunter Valley. This will also bring positive regional development and employment opportunities to the region,” Mr Halkett said.

www.sweetmanrenewables.com.au

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