A stream of QANTAS faults: When will it ever stop?

If all this does not indicate the need for a complete overhaul of maintenance procedures, I do not know what would. The story immediately following the first article below may, however, indicate that the penny has at last dropped

QANTAS has grounded another jet due to technical problems with passengers enduring a seven-hour delay at Sydney Airport. San Francisco-bound flight QF73 was due to depart at 1.55pm (AEST) but its takeoff has been pushed back until 9pm. A Qantas spokeswoman said routine pre-flight checks had picked up a "minor technical issue that required rectification" but would not say what the problem was. She said passengers were advised of the delay before checking in.

The incident is the latest in a recent run of setbacks for Australia's national airline. Yesterday a Qantas jet was grounded in Melbourne because of noise from an air-conditioning fault. The Canberra-bound Boeing 737 jet returned to the terminal and passengers were transferred to another plane, finally leaving Melbourne 90 minutes later, just before 1pm (AEST).

Last week, a domestic flight was forced to return to Adelaide after a wheel bay door failed to close.

A Qantas Boeing 767 flight turned back to make an emergency landing at Sydney airport on August 2 after a hydraulic fluid leak was discovered.

On Monday, a jet was grounded for almost three hours after a technical fault was discovered in a pre-flight inspection at Sydney airport.

The spate of problems started last month when an explosion ripped a hole in the fuselage of a Qantas jet en route from Hong Kong to Melbourne, forcing an emergency landing at Manila.

Qantas chief executive Geoff Dixon said this week that the airline's reputation had been tainted by the incidents and Qantas had to work hard to retrieve its good name.

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Qantas cancels overseas maintenance check

QANTAS has shelved plans to send two 737 planes to Malaysia for heavy maintenance checks. The decision was made while the Civil Aviation Safety Authority (CASA) investigated the airline over a series of incidents in recent weeks, including the emergency landing of a Melbourne-bound jumbo in Manila when a two-metre by four-metre hole was blown in its fuselage. The airline faced another maintenance problem yesterday. Flight QF107 was prevented from flying to Los Angeles because a screw needed to be replaced.

The airline's decision to send its 737s to Malaysia for maintenance checks has come under intense scrutiny after the first plane sent there two months ago came back with 95 defects. It was grounded in Melbourne on Thursday because of noise from an air-conditioning fault. Malaysia Airlines issued a statement yesterday defending its checks and calling Australian reports on defects unsubstantiated.

Two other planes were earmarked for heavy "C" checks - a regular procedure lasting more than a week, in which engineers have to check most of the airplane's parts - in Malaysia. But the airline's monthly maintenance schedule put out last week showed the planes were rescheduled to be checked at Tullamarine in Melbourne. As a result, checks on two other planes that were to take place at Tullamarine will now take place at Avalon in Victoria, and two planes that were to be checked at Avalon will be sent to a third party, John Holland Aviation Services, in Tullamarine. "We don't know why it changed, but it's likely tied to the fact that CASA are yet to finish their investigation [into maintenance procedures]," a source said.

The executive general manager of engineering at Qantas, David Cox, confirmed the maintenance work will now be done in Australia. "We only have overflow heavy maintenance work undertaken overseas," he said. "We explored options for checks on two 737-400 aircraft. Once space became available at our Tullamarine facility, the decision was taken to have the work done there."

A CASA spokesman said the decision was made by the airline and was not the result of an order made by the authority. He confirmed that the airline has regulatory approval to conduct maintenance checks at the Malaysian base but investigations into the aircraft that returned from that facility earlier this year were continuing. "It's too early to say whether [the aircraft's grounding in Melbourne] was related to the maintenance check in Malaysia or not," the spokesman said.

The senior general manager of Malaysia Airlines, Mohammed Roslan Ismail, defended the checks in a statement yesterday, saying Qantas had 12 personnel attached to its maintenance team. "All the highlights were rectified, to the satisfaction of the Qantas team, before aircraft delivery to Australia," he said. "With regards to the 'string of faults' that were reported in the media, [Malaysia Airlines] investigated and established that these were unsubstantiated. "This is based on the fact that all these aspects were originally checked and found to be free from defect during the maintenance check and test flight, with the concurrence from the Qantas team."

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The two sides of the global warming debate

The story below from "The Australian" gives a much more comprehensive account of the realist view than one normally sees in a major newspaper

Has global warming stopped? The question alone is enough to provoke scorn from the mainstream scientific community and from the Government, which says the earth has never been hotter. But tell that to a new army of sceptics who have mushroomed on internet blog sites and elsewhere in recent months to challenge some of the most basic assumptions and claims of climate change science. Their claims are provocative and contentious but they are also attracting attention, so much sothat mainstream scientists are being forced torespond.

The bloggers and others make several key claims. They say the way of measuring the world's temperature is frighteningly imprecise and open to manipulation. They argue that far from becoming hotter, the world's temperatures have cooled in the past decade, contrary to the overwhelming impression conveyed by scientists and politicians. As such, they say there should be far greater scepticism towards the apocalyptic predictions about climate change. Even widely accepted claims, such as that made by Climate Change Minister Penny Wong that "the 12 hottest years in history have all been in the last 13 years", are being openly challenged.

"She is just plain wrong," says Jennifer Marohasy, a biologist and senior fellow of the Institute of Public Affairs. "It's not a question of debate. What about the medieval warming period? The historical record shows they were growing wine in England, for goodness sake; come on. It is not disputed by anyone that the Vikings arrived in Greenland in AD900 and it was warmer than Greenland is now. What Penny Wong is doing is being selective and saying that is a long time ago."

But selective use of facts and data is fast becoming an art form on both sides of the climate change debate now that real money is at stake as the West ponders concrete schemes to reduce carbon emissions. So what is the validity of some of the key claims being made by these new blogger sceptics? Their first claim is that the most basic aspect of climate change science - the measurement of global warming - is flawed, imprecise and open to manipulation.

The earth's temperature is measured using land-based weather stations - in effect, a network of thermometers scattered unevenly across the globe - as well as via satellites and ocean-based weather sensors. There are four agencies that measure the world's temperatures and each has different methodology and produces varying, although not dramatically different, results.

Sceptics accuse climate change believers of always quoting the agency that shows the highest level of warming, the US National Aeronautic and Space Administration's Goddard Institute for Space Studies run by prominent climate change scientist and activist James Hansen. An independent study by Yale University in the US shows GISS says the earth has warmed by 0.025C a year during the past eight years while the other best-known measurement agency, London's Hadley Centre, says it warmed by only 0.014C a year during the same period. Not surprisingly, the Hadley figures are the most quoted by climate change sceptics while the GISS figures are most popular with climate change believers.

David Evans, former consultant to the Australian Greenhouse Office, says Hansen's GISS is unreliable because it is the only measurement agency that relies almost wholly on land-based data instead of satellites. "Land-based temperature readings are corrupted by the urban heat island effect," he says. "Urban areas encroaching on thermometer stations warm the micro-climate around the thermometer due to vegetation changes, concrete, cars and houses." As such, he alleges that the GISS figures - which are enormously influential in the climate change debate - are "hopelessly corrupted" and may even be manipulated to suit Hansen's views on global warming.

A group of weather buffs in the US also has attacked GISS's methodology, putting together an online photo gallery of US weather stations at website www.surfacestations.org that shows some thermometers situated next to asphalt runways and parking lots where they would pick up excess warming.

But GISS says the distorting impact of this urban warming is negated because data from these stations is modified to remove these effects and give a true reading. Hansen acknowledges there may be flaws in the weather station data because temperature measurement is not always a precise science. But he says this does not mean big-picture trends can't be drawn from the data. He says: "That doesn't mean you give up on the science and that you can't draw valid conclusions about the nature of earth's temperature change."

Hansen has been infuriated by the attacks on GISS by climate change critics. Last year Canadian blogger and retired businessman Stephen McIntyre exposed a minor mistake in Hansen's figures that had caused GISS to overstate US temperatures by a statistically small 0.15C since 2000. Sceptics were energised. "We have proof of man-made global warming," roared conservative American radio host Rush Limbaugh. "The man-made global warming is inside NASA."

Hansen struck back, saying he would "not joust with court jesters" who sought to "create a brouhaha and muddy the waters in the climate change story".

What the bloggers have succeeded in doing is to highlight that measuring climate change is an evolving science. But their success has been at the margins only. So far they have failed to prove that these discrepancies negate the broader core arguments about the trends of global warming.

However, the second argument being put forward by blogger sceptics is more accessible to the public and therefore is having a greater impact. They argue that, contrary to the impressions given about global warming, the earth's temperatures have plateaued during the past decade and may have cooled in recent years. This, they argue, should not be happening when carbon emissions are growing rapidly. This was not what the climate change modellers predicted. Their conclusion therefore is that carbon emissions are not the driver of warming and climate change and that the earth is not heading for a climate change apocalypse caused by greenhouse gases.

"All official measures of global temperature show that it peaked in 1998 and has been declining since at least 2002," says climate change sceptic Bob Carter, a science adviser to the Australian Climate Science Coalition. "And this is in the face of an almost 5 per cent increase in atmospheric carbon dioxide since 1998. Spot the problem?"

A careful analysis of global temperature graphs from each of the measurement agencies confirm that - despite variations between them - there has not been any notable warming since 2000. Depending on which graphs you use, global temperatures since 2000 have been more or less flat. Some, such as the GISS data, show a modest rise, while others show negligible movement and even a small fall in recent years.

Sceptics like to use graphs that date from 1998 because that was the hottest year on record due to El Nino influences and therefore the temperature trends for the decade look flattest when 1998 is the starting point. But ultimately this is a phony war because most mainstream scientists do not dispute that global temperatures have remained relatively flat during the past decade. Where they differ with the sceptics is on how this outcome should be interpreted.

"The changes in temperature over the past 10 years have basically plateaued," says Andy Pitman, co-director of the Climate Change Research Centre at the University of NSW. "But scientists did not anticipate a gradual year-by-year warming in temperature. What matters is the long-term trend. This outcome does not change any of the science but it does change the spin climate deniers can put on it."

The sceptics are having a field day with this trend. The IPA's Marohasy says: "In the last 10 years we have seen an increase in carbon dioxide levels yet temperatures are coming down. That, if anyone looks at the actual data, is not disputable. Carbon dioxide is not driving temperatures because there are other important climatic factors at play."

Most scientists are adamant that any assessment of climate change based on only 10 years of data is not only meaningless but reckless. "From a climate standpoint it is far too short a period to have any significance," says Amanda Lynch, a climate change scientist at Melbourne's Monash University. "What we are seeing now is consistent with our understanding of variability between decades. If we hung about for another 30 years and it kept going down, then you might start to think there is something we don't understand. But the evidence at this point suggests this is not something we should hang around and wait for."

Climate change scientists say we must go back much further than the past decade and pay attention to the longer-term trend lines that run through the temperature data and clearly trend upwards. Lynch says other factors beyond temperature are also relevant. "In the last 10 years there has been a catastrophic and massive Arctic sea ice retreat. We've seen glacial retreat, permafrost thaw and ocean thermal expansion, so temperature is not the whole story."

But the sceptics are undeterred. "It is widely alleged that the science of global warming is settled," says the US-based Science and Public Policy Institute. "This implies that all the major scientific aspects of climate change are well understood and uncontroversial. The allegation is profoundly untrue ... even the most widely held opinions should never be regarded as an ultimate truth."

Matthew England, from the Climate Change Research Centre, describes the latest blog war by climate change sceptics as an amazing phenomenon. "Climate change is a robust area of science and there is plenty that is still being debated and new discoveries are still being made," he says. "It is a topic (that) will keep attracting different opinions from enthusiasts and from bloggers. They are a minority but they are proving to be a very vocal group."

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Need for tax cuts identified

Treasury chief Ken Henry has handed the Government a political time bomb with a report presenting a case for slashing company and capital gains taxes. Treasury's review of the Australian tax system shows there is little scope for lowering personal income tax, as the nation's total tax on wages isalready well below the average of OECD industrialised countries. But it says taxes on "investment capital" - including company tax, capital gains and property taxes - are the highest in the world. "It is a surprising result in a globalising world with increasingly mobile capital flows for a small, open economy to have the highest weight given to the taxation of capital income," says the Treasury discussion paper released yesterday.

The Government ordered Treasury to conduct the review following its 2020 Summit in April, hoping it would allow it to go into the 2010 election with a comprehensive tax reform package. However, the tax review shows the area in most urgent need of reform is cutting the disincentive to foreign investment, which carries no votes.

Wayne Swan stressed that the report released yesterday was just a discussion paper, saying he would not be commenting on any of the issues it raised. However, he made it clear he did not agree with all the report's observations. "I don't necessarily find thateverything in this paper gels with everything that I have said on tax in the past, and that is as it should be," the Treasurer said. Dr Henry indicated that Treasury was aware the report would not be accepted by everyone. "Some of those observations will no doubt be controversial," he said.

The review's terms of reference explicitly asked it to consider the balance between the taxation of labour income, investment and savings returns and consumption, although not the GST. Tax specialists said yesterday the cost of correcting the punishing tax on capital would be extremely high. Australian School of Taxation director Neil Warren said that getting rid of dividend imputation and lowering the company tax rate from the current level of 30 per cent would help to make Australia more competitive. "But you will hurt everyone who has put savings into superannuation and all those small businesses that are accumulating franking credits," he said. "That could be tricky politically."

Treasury quotes OECD figures showing that when former treasurer Peter Costello cut the company tax rate from 36 per cent to 30 per cent in 2001, it gave Australia the eighth-lowest tax rate in the developed world. But while Australia has stood still, the rest of the world has moved on, and its tax rate is now the 10th-highest, and well above the OECD average of 26.6 per cent. Dr Henry said yesterday that Australia had highly profitable companies and that the share of the economy going to company profits was at a record high. However, he said this did not explain why Australia raised more of its tax from capital than other countries.

Australian Taxation Institute tax director Michael Dirkis said the drive to lower company taxes was being led by Europe, where many nations did not mind imposing high levels of personal income tax. He said nothing would be gained by a "revenue-neutral" cut to company tax, which was paid for by getting rid of business allowances. "The alternative for the Government is do the unpopular thing of shift the tax burden to the community and lower the tax rate on the corporate sector," Dr Dirkis said.

The paper did not identify high effective marginal tax rates as a key area for reform. It also steered clear of several contentious areas, with no mention of negative gearing and little discussion of state taxes. And while it has been barred from looking at GST, it found that Australia raised about the same share of its total income from consumption taxes as other countries.

Dr Dirkis said that, given the difficulty of cutting company and other capital taxes without raising the burden on individuals, the Government would be tempted to focus on reducing the complexity of the tax system. As they prepare their submissions to the review, business groups are likely to use Treasury's initial findings to argue for more favourable treatment.

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The unpopular voice of reason on industry protection

Logic versus vested interests but the vested interests seem to have the ear of the Labor party government

A key government economic adviser has launched a scathing attack on Labor's industry policy, railing against a "new protectionist" push for extra assistance and slower tariff cuts for car, textile and other manufacturing industries. Productivity Commission chief Gary Banks has rejected arguments by Kevin Rudd and his Industry Minister, Kim Carr, that Australia must act to protect its manufacturing base. And as the Government prepares to release special reviews into car and textile industry assistance, Mr Banks has insisted the economy would be better off by billions of dollars a year if the Government proceeds with scheduled plans to wind back tariffs and government payments.

In a speech that has deeply angered the Government, the Productivity Commission chairman also criticised Labor's recent decision to give Toyota a $35 million grant from its $500 million green car fund, which he said would neither help innovation nor cut greenhouse gas emissions.

He also attacked the Government's commitment to a "mandatory renewable energy target" - to encourage power sources such as solar and wind - and its promise to compensate electricity generators for the loss of asset value under its new emissions trading regime.

The Government controversially decided not to get the Productivity Commission to conduct its car and textile reviews, instead setting up "expert panels" with secretariats in the Industry Department - a decision Mr Banks said was unprecedented and meant the Government ran the risk of not being "properly informed". Senator Carr said yesterday "the Productivity Commissioner appears not to understand that these reviews are not reviews of tariffs but are in fact much broader than that". Senator Carr has received, but has not yet released, a report from former Victorian premier Steve Bracks into the automotive industry.

Some sources suggest the report will recommend proceeding with the scheduled cut in tariffs on imported cars and components from 10 per cent to 5 per cent in 2010 but will argue for a continuation, in some form, of the Automotive Competitiveness and Investment Scheme, which is worth $2.8billion over the five years to 2010 but is scheduled to be phased out by 2015. Mr Rudd has promised "a new car plan" as a result of the review.

Senator Carr has said Australian carmakers require a "level playing field" with the substantial industry assistance offered by other carmaking nations. He repeated yesterday that in achieving this outcome "tariffs remain a second-order issue".

But Mr Banks, who was appointed Productivity Commission chairman by the Howard government, said arguments about a "new world order" were really "old wine in new bottles", like the discredited arguments for protectionism in the past. "As illustrated by the latest reviews of auto and TCF (Textile, Clothing and Footwear), ongoing pressures from globalisation and emerging exporters, exacerbated by exchange rate appreciation caused by the mining boom, have been prompting calls for new measures to provide relief against imports or other assistance," Mr Banks said in a lecture at the University of Queensland on Wednesday.

He cited Productivity Commission findings that current car industry protection costs consumers and taxpayers $2 billion a year, or $300,000 a year for every car industry job. He said that slowing tariff reductions or offering new financial assistance could make industries less innovative because they were shielded from global pressures. He said the Government's response to the two reports and a separate review of its broader industry assistance was critical and would "effectively set the course for industry policy and its contribution to Australia's economic future".

A spokesman for Wayne Swan said the Government "listens closely to the Productivity Commission's views, but at the end of the day we will take our decisions in the national interest". The Prime Minister voiced his support for the manufacturing sector by saying he did not "want to be the prime minister of a country that doesn't make things any more".

Senator Carr has said he is determined to ensure a future for manufacturing. But Mr Banks said "manufacturing should not be seen as having any special place - maintaining any particular industry should never be an end in itself". Federal Chamber of Automotive Industries chief Andrew McKellar said the speech was "a reflection of the Productivity Commission's ongoing struggle to define its relevance".

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