Month: March 2000

The deputy governor of the Reserve Bank of Australia, Stephen Grenville, caused something of a stir late last week when he began to explain the causes of the current economic slowdown. He was at pains to point out that the Reserve Bank’s actions of 18 months ago to increase interest rates could not possibly have caused the downturn. He pointed out that interest rate changes, particularly those coming off a very low base, could not have had such a large effect. More controversially, he mentioned the GST in the same breath as the word slowdown.

Dr Grenville said that business confidence had been affected by a several sources of pressure on business costs and cash flow: the GST, exchange rates and oil. He said also that the transition to the GST had affected business confidence adversely on two counts: first, the general bureaucratic requirements and accounting changes and secondly the rescheduling of construction activity in the economy. Many individuals and businesses brought forward construction activity in late 1999 and early 2000 in the knowledge that the GST was pending. This meant a commensurate downturn in late 2000 and early 2001.
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Three months ago the governor of the Reserve Bank, Ian Macfarlane, recommended to the major banks that they co-operate with an inquiry by the Australian Competition and Consumer Commission into their system of charges for credit card use. The banks, it seems, rejected that very sensible advice and continued with their system of extracting huge sums of money from consumers, credit-card users and businesses that are virtually forced to accept credit cards.

Now the banks pretend to be all hurt and wounded when the commission threw up its hands in despair and called upon the Reserve Bank to use regulatory powers to pull the banks into line. It seems as if the banks have had long enough to show that market forces, self regulation and competition could deliver a more reasonable system of credit card charging. They have failed and deserve to have regulation imposed.
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Australia, and other interested international parties, running grave risk of misunderstanding cultural sensitivities in Papua New Guinea when dealing with rebellious combat by some troops in Port Moresby. About 100 low- ranking soldiers have seized weapons at the Murray Barracks near Port Moresby as part of a protest against proposed reforms of the Papua Guinea Defence Force. The reforms include a recommendations by the Commonwealth Eminent Persons Group halves the force from about 4000 members to about 1900. Rank and file soldiers are upset. They presumably felt that only radical action could prevent such a drastic cut in the PNG Defence Force. Their action was fuelled by false rumours that Australian forces would be sent in to take control of the army headquarters.

Australia, understandably, has reacted with some alarm. Foreign Minister Alexander Downer has warned that any threat to the democratically elected government of PNG would be met with strong international sanctions which he said would not be in the interests of the rebels.
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The leader of the ACT Opposition, Jon Stanhope, made a landmark speech last week on the structure and process of government in the territory. He made some pertinent observations about the way some of these processes had been ignored during the past five years. More importantly, he set a benchmark of governmental behaviour to which the Labor Party aspires if it attains government.

A lot of the promises were high-minded statements of principle with which few people could disagree. The test for Mr Stanhope and Labor will not be in the stating of these principles, but rather in the detailing of them and whether he can live up to them if he is elected.

Usually there is only a small window of opportunity for laws and structures to be put in place to make executive Government open and accountable. This is the period of honeymoon immediately after an election before the government has made significant mistakes which it wants to lie about or play down. Mr Stanhope has promised several worthwhile legal and structural changes. These include such things as overhauling the Freedom of Information Act and the Administrative Appeals Tribunal, entrenching the fixed term, reviewing at the ministerial code of conduct and restoring the Public Accounts and Scrutiny of Bills Committees.
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The signs in Fiji for a return to democracy are looking very good. Developments in the past few days indicate that Fiji could return to democratic government under the 1997 Constitution quite quickly. Such a thought a month ago looked impossible. But earlier this month the Fiji Court of Appeal ruled that the coup of 19th May last year had been unsuccessful and that the Chaudhry Labour Government had been unlawfully dismissed. The court ruled also that the 1997 constitution was still in force. It seemed at the time that the court’s ruling might disappear as a meaningless piece of paper. Not so. In fact the Great Council of Chiefs and the interim administration that it had appointed took the Court of Appeal ruling seriously when they had the physical power to ignore it.

The interim administration headed by Prime Minister Laisenia Qarase resigned. However, President Ratu Josefa IloIlo rejected the resignation, calling on Mr Qarase to stay on in a caretaker role. In the meantime, the Great Council of Chiefs was left with the task of dealing with the Court of Appeal ruling. As a first step the chiefs confirmed Ratu Iloilo as President and then on Tuesday handed him a authority to deal with Fiji’s constitutional impasse. Apparently, the chiefs had been bitterly divided on what to do. The result however, is a good one because Ratu Iloilo has stated that the 1997 constitution should not be abrogated and should remain the fundamental law of Fiji.
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Telstra may be excellent at telecommunications, but it is not so good at public relations. On the same day it announced a record $2 billion half-year profit, it announced a $650 million cost-cutting exercise that will result in 10,000 jobs lost over the next two years. The juxtaposition caused outrage. It also caused an unlikely confluence of views between unions, the National Farmers’ Federation, the Labor Party and some National Party MPs.

From a corporate perspective, the program for job cuts in the face of competitive pressure and the profit figure go hand-in-hand. From the perspective of people on the receiving end and those who represent them the profit figure is unjustified. It should be lower, they argue, and jobs should be retained and services to the bush improved.

But the competitive pressure that Telstra is under was also illustrated on the same day. Many had expected an announcement that Telstra would float its internet arm. Instead, there was a more woolly announcement of some restructuring with possible floating of some bits of Telstra. The result was an immediate mark-down of Telstra shares. Now, Telstra has 2.3 million shareholders — most ordinary Australians with an interest in an efficient telecommunications company.
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The ACT Legislative Assembly (as distinct from the ACT Govenrment) has served the commnity poorly on the subject of disabilitiy services. That was demonstrated this week by the childish spat by ACT coroner Michael Somes against the ead of the disability inquiry, former Supreme Court justice John Gallop.

Mr Somes is conducting a coronial inquiry into the deaths of three intellectually handicapped people. Mr Somes, mounted high on his horse, refused a request to release hospital records obtained for him by the police to ACT Community Care to use them at the inquiry being headed by Mr Gallop. Mr Somes said, “”The coronial inquiry must take precedence of any other inquiry.”

He was not prepared to give up the documents and they would remain with the Coroner’s Court until he had finished with them.

Oh dear, here we are in the 21 century and our 19th century courts have apparently not heard of the very useful 20th century invention called the photocopier.

Counsel assisting the coroner, Richard Refshauge, SC, raised the question of whether Mr Gallop’s inquiry might be in contempt of Mr Somes coronial inquest.
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So Independent MLA Dave Rugendyke wants the Independent Competition and Regulatory Commission to investigate petrol prices in the ACT. His call comes after Prime Minister John Howard agreed not to take the 1.5 cent a litre additional excise that would flow as a result of the inflation spike caused by the GST. Mr Howard went further and agreed to end indexation of petrol excise altogether. Both Mr Howard and Treasurer Peter Costello called on the states to follow the Federal example. They wanted the states to give back to the motorist some of the GST money they get under a formula that includes an amount to replace former state petrol taxes. A Liberal backbencher is going to introduce a private members’ Bill to that effect, but it will quietly die once all the fuss has died down.

There has been a huge amount of political grand-standing on petrol. Mr Howard resisted forsaking the excise for as long as he possibly could, but so much noise was being generated by talk-back radio and the newly victorious Queensland Premier, Peter Beattie, that he eventually gave way – not because it would make any significant difference, but just to get the critics to change the subject. Alas, for Mr Howard they did change the subject – to his lack of credibility in saying one thing (petrol relief was impossible) one day and the opposite the next day (here is petrol relief).
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Life in Australia without the ABC would be unimaginable for a great many people – including nearly all its most trenchant critics.

The past couple of years has seen heightened fear that the Government wants to destroy the ABC, or at least reduce its influence or change what some have seen as its endemic left-wing pro-Labor bias. That fear was generated by key appointments to the ABC board of people seen to be close to the Howard Government most recently that of Jonathan Shier as managing director. That has been coupled with plans for more out-sourcing and the retrenchment or non-renewal of several key ABC figures and accusations that extra money has been spent on senior management at the expense of programs.

Mr Shier addressed the National Press Club yesterday. He certainly carved out a vision for the ABC – one that neither competes nor apes the commercials. Rather it was vision of the ABC playing a critical part in Australian national life in a new media world.

He made a sensible distinction between a desire for the ABC to be entrepreneurial and businesslike, without being commercial. “”Commercial” meant having money-making as the central aim. Being entrepreneurial and businesslike was getting value for money in pursuing social aims. Mr Shier expressly rejected any aim to dumb-down or chase ratings.
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Former Chilean dictator Augusto Pinochet enjoyed his first few days of freedom at the weekend after 16 months of custody and house arrest in Britain. Many human rights campaigners and those who suffered at his hands in Chile after the 1973 military coup will be in despair. It would have been better if at some time after military rule ended that Pinochet had been brought to justice to answer the allegations against him for the atrocities that undoubtedly took place while he headed the military government.

But at least people concerned about human rights can take solace in two important developments in those 16 months.

The first is that it is now recognised in Britain and several European countries at least that there is no immunity for former heads of state from human-rights charges. The Pinochet case is another step in a growing internationalisation and universality of the recognition and enforcement of human rights and the punishment of those who breach them.
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