Saturday, January 08, 2011

Labour scarcity in Australia

America eat your heart out

WAGE costs have trumped taxes as the chief constraint on business investment in Australia, a survey indicates. The shift indicates that employees are seizing on labour scarcity to demand fatter pay packets.

For the first time in the 12-year history of the Australian Chamber of Commerce & Industry's Survey of Investor Confidence, wage costs have topped the list of investment constraints. The perennial gripe of taxes and other government charges was relegated to second place on the table.

ACCI chief executive Peter Anderson said rising labour costs along with increasing finance costs, were constraining the ability to "employ, invest and expand". "Unfunded wage increases (not matched by productivity improvements) during 2011 will simply compress margins closer to breaking point and dampen investment," he said.

More than 500 businesses from various sectors take part in the survey. The December survey found that businesses continue to harbour fears about the strength the economy as interest rates rise while the strong dollar weakens the competitive position of manufacturers.

Concerns about skills shortages also intensified, with businesses ranking the issue among the five biggest constraints on investment.

Mr Anderson said that while businesses remained guarded about trading conditions this year, the poll highlighted that "general business conditions and sentiment slowly improved" last quarter.
Most businesses expected profitability to improve over the next three months.

Separately, the Performance of Services Index published yesterday by Australian Industry Group and Commonwealth Bank indicated that activity in the services sector again contracted last month.


Negligent West Australian public hospital

Private hospital to the rescue

DANNY GREEN claims he was "horrifically misdiagnosed" by a doctor who turned him away from Busselton Hospital with severe stomach pain, labelling her "negligent and ignorant".

A gaunt and pale Green looked unrecognisable from the ferocious boxer he is inside the ring as he spoke of his nightmare week that culminated in him having his appendix and an abscess removed in an emergency operation, PerthNow reports.

Speaking quietly from a wheelchair at St John of God Hospital in Murdoch, the 37-year-old said the pain he had endured in the past week was more severe than anything he had experienced in his life. "This has been by far the worst case. I've had it ongoing for about seven years and hopefully this is the end of it," he said. "It was a pretty harrowing experience for five or six days of my life."

The International Boxing Organisation cruiserweight world champion had been troubled by the previously undiagnosed problem for most of his professional career. This is the 10th time he has been admitted to hospital with stomach issues.

Green says the doctor turned him away last week after he experienced severe stomach pain while on holiday in Yallingup. "I just got turned away from Busselton Hospital with severe abdominal cramps. Unfortunately she misdiagnosed someone in there horrifically, so I hope she realises she made a massive mistake, a massive mistake and I hope she doesn't make it again for some other patients because it could have been life-threatening.

His family were so concerned about his condition that they raced him on New Year's Eve to a medical centre 30 minutes away. After being given morphine, Green was driven by his father Mal and brother Brendan to Hollywood Private Hospital in Perth, where tests revealed he had an abscess "the size of a softball". "The car ride was hell," said Green, who has lost about 5kg since the ordeal.

Green has shelved plans to fight again in April and is unsure when he will be able to return to the ring. "I'll have to wait and see how I recover and what happens," he said. "This body's been through a hell of a lot; it's been hammered for the last six days."


Another millionaire backer for the Greens

There is a lot of this in America. Elitists stick together

A MULTIMILLIONAIRE internet entrepreneur worried about climate change bankrolled the Greens' federal election surge last year by making the largest single political donation in Australian history.

Wotif founder Graeme Wood, whose wealth is estimated at $372 million, gave $1.6 million to fund the Greens' television advertising campaign, helping to significantly increase votes for the party in key states. The Greens will hold the balance of power in the Senate from mid-year.

Mr Wood's benevolence helped the Greens, led by Senator Bob Brown, boost their national profile. They captured their first lower house seat and, with key rural independents, gained increased leverage over government policy.

His donation easily surpasses the previous record for a single private political gift - $1 million handed to the Liberals at the 2004 election by conservative British politician Lord Michael Ashcroft.

Mr Wood's money enabled the Greens to run ads on high rotation on TV for the first time. Independent market research after the August election found the ads contributed to significantly higher swings to the Greens in the states where ads ran most heavily.

The donation will be revealed early next month when the Australian Electoral Commission releases the annual return lodged by the Australian Greens. Most major parties will not reveal big donations for the federal election until February 2012, when they disclose funding for 2010-11. But the Greens will effectively disclose their donations a year earlier under an internal three-month rule.

Mr Wood has emerged as one of Australia's leading philanthropists in recent years, having given $8 million to the University of Queensland, where he graduated, and another $15 million to establish the university's Global Change Institute.

His private Graeme Wood Foundation holds about $20 million in assets and gives away about $1 million a year to a range of arts, youth and environmental causes, including helping to buy 27,000 hectares of Tasmanian native forest from timber company Gunns last year.

Four years ago, Mr Wood stepped back from executive duties at wotif, the online travel company he founded in 1999, but he remains a director and retains a 23 per cent stake, valued at $222 million based on yesterday's share price of $4.63.

Speaking exclusively to The Age, Mr Wood said his donation was motivated by disappointment with Labor and Coalition policies on climate change and the environment. "I didn't think either of those parties were being effective," he said. "They were being driven by people with vested interests."

Helping the Greens to secure the balance of the power in the Senate was a "critical step," he said.

The Greens' vote tended to drop away in the final weeks of an election campaign as the bigger parties outspent them on advertising, and in May Mr Wood approached Senator Brown to propose that he help fund a "proper" Greens advertising campaign. In the end, Mr Wood provided the vast bulk of the campaign funding himself.

Mr Wood denied either he or wotif had anything to gain from his donation. "There's nothing in it for me financially," he said. "I'm not looking for any favours."

Senator Brown told The Age he would be "forever grateful" for Mr Wood's donation, which he said was selfless and hazardous. "There's nothing that Graeme could possibly gain personally out of this," he said, including influence over policy. "Not ever has Graeme said, 'I'd like you to do such and such'."

It was a historic election result for the Greens, transforming them from a minor party to the third party in Australian politics. In both houses of Parliament, the Greens secured the highest vote ever achieved by a third party in postwar political history, including the Democrats' best results, in 1990, and the DLP decades earlier.

The Greens' vote in the Senate rose much more in the states where the ads played in higher rotation - particularly South Australia (6.8 per cent), Queensland (5.5 per cent), Western Australia (4.7 per cent) and Victoria (4.3 per cent) - than in the states where there was less investment, particularly New South Wales, where the swing to the Greens was under 2 per cent because there was not enough money to cover the state.


Refugees win access to courts

THE Gillard government is bracing for a wave of asylum claims to swamp the legal system. This comes after the government accepted the results of a High Court ruling that raises serious questions about the value of offshore processing.

Responding for the first time to the High Court's ruling on the rights of asylum-seekers to challenge procedural aspects of their cases in the courts, Immigration Minister Chris Bowen yesterday announced the government would appoint two new federal magistrates specifically to deal with the expected deluge in new cases.

Changes to the refugee review process will also greatly extend the appeal options available to asylum-seekers.

But, in a move likely to put the government on a collision course with the Greens and the Coalition, Mr Bowen said the government was already considering laws to limit access to the courts. He said one option was eliminating the jurisdiction of the Federal Court, something legal experts said could be done with an act of parliament.

The changes announced by the government yesterday, which were based on legal advice from the Solicitor-General, provoked fresh questions about the value of retaining Christmas Island as a processing hub for refugees.

The island, along with other parts of Australia's territory, was excised from the migration zone by the Howard government in 2001, a move that denied asylum-seekers access to the courts.

University of Sydney law professor and refugee law expert Mary Crock said that logic no longer applied. She said there was now virtually no legal difference between a protection application lodged at Christmas Island from one lodged on the Australian mainland. "But practically the gulf is enormous," Professor Crock added. "You are treated much more fairly onshore than offshore."

Professor Crock said there was no longer any point to offshore processing, which, according to the incoming government brief supplied to Mr Bowen by his department, was budgeted to cost $471.18 million. That compared with onshore detention costs of $93.76m.

The High Court unanimously ruled in November that two Tamil asylum-seekers were denied procedural fairness and failed to have their claims processed in accordance with the Migration Act.

The court rejected the government's use of the Migration Act to detain asylum-seekers on Christmas Island while claiming the assessment process was "non-statutory" - occurring outside of Australian law.

Mr Bowen, citing advice from the Solicitor-General, said yesterday that, as a result of the decision, failed asylum-seekers would now have access to the Federal Magistrates Court, the Federal Court and, finally, the High Court.

In an effort to streamline what is sure to be a longer, more expensive process, Mr Bowen said immigration officials would "triage" new asylum claims. As of March 1, when the regime takes effect, asylum-seekers with obviously weak or problematic claims would be sent straight to a newly established "independent protection assessment" reviewer. The protection assessment replaces the old independent merits reviewer who audited failed claims, and whose decisions were the subject of the High Court ruling. From there, they could appeal through the courts if unsuccessful.

The announcement greatly extends the appeal options available to asylum-seekers processed offshore, who prior to the court's ruling only had access to a single non-statutory reviewer appointed by the government.

The government's response was dismissed by Tony Abbott as "bureaucratic hand-wringing". He said as long as asylum-seeker boats kept coming, problems would remain. "Look, there's really only one way to address this and that is to stop the boats, and nothing in today's announcement by the government will actually stop the boats," the Opposition Leader said.

The Coalition's acting border protection spokesman, Michael Keenan, said the High Court decision had undermined the concept of Christmas Island, underlining the need for the government to process illegal arrivals in a third country.

"If the government is serious about streamlining the process, they should acknowledge their never-never East Timor solution is a complete farce and pick up the phone to call the President of Nauru," Mr Keenan said.

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