New government might be more stable than it looks

Despite the initial onslaught from angered Coalition members that the government - propped up by a Green and three independents - was illegitimate, defied commonsense and was even corrupt, a key point has been ignored.

The new government is a coalition of self-interest - and never bet against self-interest. For it to collapse, one of Andrew Wilkie, Tony Windsor, Rob Oakeshott or the Greens' Adam Bandt will have to abandon it and presumably force another election.

This, one would assume, would produce a return to normal with a majority government. The four minor players would have dealt themselves back into irrelevancy.

This point has not been lost inside Labor. After all the shooting stopped last week, there was relief Bob Katter was not part of the equation. Of all the independents, he was the most unpredictable and would have been the hardest to accommodate.

The other four have their differences, but all agree in principle to a carbon tax and a profits-based tax on mining, the two most contentious policy issues on the horizon for the next three years. Katter opposes both these measures.

Nor is the point lost on the minor players. The opposition and other detractors are hoping for the Greens to blow the show up with their "extreme" policy agenda. Yet the Greens leader, Bob Brown, and his deputy, Christine Milne, are proving a lot more savvy than they have been given credit for.

When they signed the deal with Labor the week before last, it was deliberately devoid of any contentious policy ideas. Even Abbott said he would have accommodated 99 per cent of its demands.

Milne said afterwards that the Greens and Labor alone do not constitute a majority in the lower house. Everything the Greens suggest has to bear that in mind.

Last week, Brown admitted he did not push for a ministry because it would have been fuel for a Greens-Labor axis-of-evil scare campaign to exert pressure on the independents yet to make up their minds. At the same press conference, journalists tried to get Brown to say he would push for death duties, which are official Greens policy. Given neither the government nor the opposition would ever countenance such a proposal, Brown said "the answer is no".

The new arrangement, yet to be tested, has the potential to be a slow, plodding beast, but whether it collapses rests with the players, none off whom have an interest in allowing that to happen. Abbott should bear that in mind as he mulls his frontbench options this week.

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Amazing: Kevin Rudd to run East Timor immigration "solution"

JULIA Gillard will make Kevin Rudd deliver her asylum seeker solution just months after cutting him down because his own border protection policies had failed.

The Prime Minister yesterday insisted she would call the shots on foreign policy and her new minister would have to work closely with her on international diplomacy.

Mr Rudd was appointed Foreign Minister on Saturday and the Prime Minister said one of his tasks would be to help implement her plan for a processing centre for asylum seekers in East Timor.

"It will be part of Kevin Rudd's job, of course, working with the new Immigration Minister, Chris Bowen, to further the Government's policy of having a regional framework and a regional processing centre," she told the ABC.

Ms Gillard cited border protection as one of the problem areas when she toppled Mr Rudd in June, saying the Government had "lost its way" under his leadership.

Hours before he was deposed, Mr Rudd warned Labor against "lurching to the right on the issue of asylum seekers". However, the Prime Minister said Mr Rudd backed her new tack, which would involve setting up an offshore processing centre in East Timor.

"I think Kevin Rudd, like me, understands that it is not in the interests of asylum seekers to risk their lives at sea and get on a boat," she said. "It's not in the interests of this nation to have unauthorised arrivals by sea. We don't want to see people pay people smugglers."

The man he deposed as prime minister in 2007 said Mr Rudd deserved time to settle in the job. Speaking from New York, where he attended a ceremony marking the anniversary of September 11, Mr Howard said: "We'll wait and see how he goes. I always judge people on their performance, and it's too early to say."

Mr Rudd took to Twitter to thank supporters for their good wishes and posted that he was: "Really looking forward to role as Foreign Minister. Lots of work to do."

Ms Gillard said Mr Rudd, a former diplomat and Labor's former opposition foreign affairs spokesman, would not run the portfolio on his own and it would be run by the Government "as a team". "We will work as a team," she said. "There will be involvement by the Cabinet. "Ultimately, of course, I'm the leader."

Labor's former foreign affairs minister, Stephen Smith,stood aside to make way for Mr Rudd.

Deputy Opposition Leader Julie Bishop has claimed the rolled PM would be ineffective because of his strained relationship with Ms Gillard, who ousted him in July.

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Australia's coal industry is safe, insists new Climate Change Minister Greg Combet

Putting a miners' representative in charge of the environment is amusing -- and very telling

THE nation's new Climate Change Minister, Greg Combet, has vowed to bring "common sense" to the climate change debate, warning that he will fight for coal industry jobs as he pursues a price on carbon.

The former union leader has predicted the coal industry "absolutely" has a future as he pursues his three key policy reform objectives: pursuing renewable energy; energy efficiency; and the development of a carbon price for Australia.

Insisting the Climate Change portfolio was an economic reform challenge, he said: "You don't take the back of the axe to the fundamentals of the Australian economy."

Julia Gillard yesterday moved to stamp her authority on her new government after elevating her predecessor, Kevin Rudd, to the senior portfolio of Foreign Affairs and shifting Stephen Smith to Defence. With 42 ministers and parliamentary secretaries, the front bench and junior ministry now outnumber Labor's own back bench.

Among the biggest winners were senator Penny Wong, who was shifted from Climate Change to the important Finance portfolio, and Peter Garrett, who takes up the Schools portfolio, despite the insulation scheme debacle happening on his watch as environment minister. Mr Combet's new role puts him in cabinet for the first time.

As part of its deal to secure government, Labor signed a formal alliance with the Greens, whose policies include the eventual phasing out of the coal industry, Australia's biggest export earner. But in an interview with The Australian, Mr Combet said his background as a former coal engineer, union official and MP with coal workers in his NSW electorate meant he did not believe his job was to shut down the coal industry. "I don't agree with that. That's not part of my job at all," he said.

"I am acutely aware of the challenges that this policy presents. But people jump to these absolute positions, and I just don't think that's appropriate. "I've got a responsibility to support those people's jobs. The coal industry is a very vibrant industry with a strong future. What you've got to do is look to how we can achieve in the longer term things like carbon capture and storage for coal-fired power stations."

Greens leader Bob Brown has described Australia as being like a heroin addict "feeding the habit" of the world's reliance on coal. The party's stated policy is to oppose development of any new coalmines or the expansion of existing coalmines and to phase out all existing coal subsidies. It wants to work towards stopping the development and granting of export licences for all new coalmines.

But in a statement last night, Greens senator Christine Milne, who has the party's portfolio responsibility for climate change, said she did not intend to rehash the policy differences with Labor as she sought to build "trust" with the new Gillard government.

"I have put in a call to Greg Combet to congratulate him and begin the exciting conversation," she said.

"In the meantime, I hope we can all respect the delicate process of building trust between people coming from different policy positions so we can achieve the best outcomes possible for the climate."

Mr Combet said his job as minister was to build a stronger, deeper consensus on climate change issues, including election campaign policies to develop efficiency standards.

During the election campaign, the Prime Minister vowed to ban new coal-fired power stations that use "dirty" technology and require that any power station built can be retro-fitted with developing clean-coal technology.

But yesterday, Mr Combet said he was not in the business of applying the adjective "dirty" to coal.

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Child killer Derek Percy paid $20,000 a year while in jail

Another bureaucracy careless with the people's money



DERANGED child killer Derek Percy has continued to be paid up to $20,000 a year in taxpayer-funded benefits despite federal authorities promising to end the rort years ago. For the past 41 years, Percy – an accused serial killer known as "The Spook" – has been given payments, contributed to by taxpayers and administered by government, because he was in the Royal Australian Navy at the time of his arrest and was found not guilty of murder by reason of insanity.

Percy, who turns 62 next Wednesday and is Victoria's longest serving prisoner, served less than 20 months in the navy. But he is believed to have since amassed a small fortune estimated between $220,000 and $300,000 courtesy of money from the federal agency ComSuper. He has invested his government super – ranging from $5200 a year to now up to $20,000 – into cash deposits, gold investments and even a precious stamp collection.

But pressure is mounting for the funds to be stopped and stripped from the sadistic killer. Former Victoria Police inspector Tim Attrill is among those demanding the cash cease and assets and accounts accrued by Percy be seized.

Percy, who was jailed in 1969 for the horrific sex killing of Victorian schoolgirl Yvonne Tuohy, is suspected of involvement in eight other child abductions and murders. They include the Beaumont children in South Australia and Simon Brook's slaying in Glebe, Sydney.

He was an RAN member at the time of the Tuohy killing but because he was not convicted on the basis of being found insane, he was medically discharged from the armed forces in 1970 with payments of 60 per cent of his wage, which is indexed each year.

David Southwell, a veteran who served alongside Percy, said the killer would be now receiving 60 per cent of a recruit's current wage of $34,000 – meaning about $20,000. But Mr Southwell said Percy's claimed mental disorder existed before his enlistment in the navy and therefore Percy was not entitled to the medical benefits. "It should be cancelled immediately – there are plenty of other veterans who have to fight tooth and nail to get anything at all", Mr Southwell said.

In April 2007, then-Veterans Affairs minister Bruce Billson promised to investigate the payments to Percy. "This example troubles me greatly ... I am also seeking advice whether there is grounds for recovering what's been paid out," Mr Billson said at the time. But the Coalition government lost power later that year and the money has continued to flow.

ComSuper refused to comment on what it was paying Percy. "In regards to your inquiry regarding Mr Percy, ComSuper cannot comment on individual member's details," spokeswoman Danni Woods said.

Percy's navy service record "blue card", now held by the National Archives, also appears to have been altered to state his service continued from 25/11/1967 to 24/11/1976 – listing his engagement as nine years.

This is despite clear reference on the same personnel record that Percy was in the navy for just two years before being charged with the 1969 Tuohy murder and he remained in jail from that year on.

In a bizarre parallel, Former inspector Attrill also served alongside Percy in the navy in the electrical mechanics section on HMAS Queenborough and was brought into the police's cold case unit to help continuing investigations into Percy in the mid-2000s.

During his navy days, Mr Attrill remembers Percy as odd, extremely detached and fixated on carrying knives in his scabbard – an obsession he believes was reflected in later knife mutilation killings linked to Percy. "Back then I would describe him as cold, aloof and withdrawn, on reflection years later I would consider him asexual and emotionless," Mr Attrill said.

Mr Attrill said for Percy to receive the Defence Force Retirement and Death Benefits Scheme payments, the precursor to ComSuper, he would need to have suffered a mental or physical injury because of his military service.

"On the pension issue – Percy is highly suspected of the Wanda Beach murders and the murder of Allen Redston in 1966, prior to joining the navy," Mr Attrill said. "The investigation into him, conducted by the Victoria Police cold case unit revealed incidents of child molestation and severe and alarming character traits from adolescence.

"Percy did not suddenly become affected by some experience whilst in the navy, (but) in fact entered the service with all the sadistic and murderous leanings which would later come to light. "An argument could be used to prove, on the balance of probability, that he in fact had a pre-existing condition which thus should absolve the DFRDB from pension liability."

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Absurd submarine plans could be scuttled

They haven't even got the last lot working yet. Only one out of six is at present seaworthy

THE new defence minister will come under pressure to scrap Australia's most expensive defence project - the plan to build 12 new submarines at a potential cost of $36 billion.

Defence sources have told the Herald that the change in the leadership of the Labor Party and the new government's reliance on the Greens and independents have given some people within Defence hope that the controversial submarine plan could be sunk and replaced with a more modest version.

The sources say there is likely to be a stringent review of the most recent defence white paper - in which the submarine plan was announced - and a new white paper could be drawn up ahead of schedule.

The plan to build 12 submarines is widely considered to have been the baby of former prime minister Kevin Rudd, to the extent that some with the Defence community refer to them as "Rudd's subs".

There were initial suggestions that Mr Rudd might be given the defence portfolio in the imminent reshuffle, but he is now almost certain to be the next foreign minister, which would remove one potential obstacle to the ditching of the submarine plan.

"One of the big issues for whoever ends up as defence minister in the Gillard government is going to be whether to write a new defence white paper, and if so, how soon. The 2009 white paper did leave a lot of big questions unanswered, and it did commit a lot of funds to some very big capabilities without adequate strategic argument," said Hugh White, Professor of Strategic Studies at the Australian National University.

The independent MP Andrew Wilkie, a former army lieutenant-colonel and intelligence analyst who gave his support to Labor to form government, said he would need to study the case for the submarines in detail before commenting on whether he believed they were affordable. But he said he fully supported a review of the white paper.

"There does need to be a fresh look at the white paper; there are clearly question marks over the document. For example, we can't even crew the submarines we've got, so it is arguable that we can double the fleet from the current six Collins class submarines."

The Greens leader, Bob Brown, said his party did not have a concrete position on the submarines, but is keen to see large projects reviewed as soon as a new defence minister was appointed.

"There are clearly differing opinions as to whether those projects are the best way to spend the defence dollar. It's a matter of real public interest," Senator Brown said. "I think this will be a matter for the whole of Parliament to discuss, including the opposition."

Sources say there is a growing belief within the defence force - including the navy - that the money could be better spent.

The 2009 white paper was heavily criticised for focusing on large defence projects - particularly ships and submarines - but without an accompanying clear explanation of why they were needed and how they would be paid for.

"Nowhere in this white paper are we told how particular numbers of submarines, surface ships or fighter aircraft have been determined," the defence expert Paul Dibb said after the paper's release. "This leaves us with a highly unsatisfactory picture about why we need to have what some are touting as the largest expansion of the Australian Defence Force since World War II."

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