Tuesday, May 26, 2015
Qld. Chief Justice Tim Carmody: I’ll quit to ‘stop the bleeding’
His fellow judges thought he had jumped the queue in becoming CJ. Judges tend to be very status and seniority conscious
The Chief Justice of Queensland, Tim Carmody, is poised to quit in what he describes as a bid to “stop the bleeding” and end extraordinary tensions unleashed at the judiciary’s highest levels.
In an exclusive interview with The Australian, Chief Justice Carmody yesterday revealed his intention to resign from a job he started just 10 months ago, saying the in-fighting and dysfunction had become untenable, with no realistic prospect of improvement.
However, he wants the four-month-old Labor government led by Premier Annastacia Palaszczuk to agree on a new reform agenda for the courts, including the establishment of a judicial commission, that would follow his departure.
As he would be giving up a career, salary and benefits worth almost $500,000 a year three years before becoming eligible for a generous judicial pension, “fairness and just terms” would also need to be agreed in a bipartisan way with the government and the opposition.
Chief Justice Carmody revealed he had told the Attorney-General, Yvette D’Ath, in the middle of last month of his preparedness to resign to ensure the judiciary’s reputation would not be further trashed by the ongoing and unprecedented row with fellow judges.
He said he was still waiting to learn what steps, if any, were being contemplated by the government to resolve a crisis that has seen judges warring publicly — and one secretly recording a heated private conversation with him in his chambers.
“I want to find a solution and I want others to help find it,’’ he told The Australian in a candid interview at his inner-Brisbane home yesterday.
“Because this is not just about me, it’s about the court. It’s about the system. It needs a considered response from all sides that have the best interests of this important social institution in mind. I have one senior judge who won’t sit with me on any cases. I have another senior judge who secretly records a conversation with me. “That makes governance and my ability to do my job impossible.
“I have to balance what gives the most net gain to the people of Queensland — me staying, or me going. My view is that I will leave if there is that net gain and that’s how it looks to me at the moment.
“If I know that the reforms that need to be done will be done, then I will leave on just terms. There are reforms and changes that need to be made that I can’t make by staying.
“It upsets me so much that we have reached this low point — that the court is at such a point that it can even happen, and that it is not tenable for me to continue as Chief Justice in the circumstances.
“It also shows that the reason I went there, the changes I wanted to make which are overdue, can’t be done. I can’t do what I set out to do.
“It is an opportunity lost because of the behaviour of others. But bad behaviour can’t be rewarded.”
The decision of Chief Justice Carmody to flag an exit strategy will be welcomed by the overwhelming majority of the judges on the Supreme Court and Court of Appeal, most of whom have signalled their lack of confidence in him.
It is also likely to be welcomed by the new Labor government after it had inherited the Chief Justice, a highly controversial appointment by the then Liberal National Party premier Campbell Newman last year. Strong criticisms of the appointment by former and serving judges, and leading legal figures including former solicitor-general Walter Sofronoff QC and the former anti-corruption inquiry chief Tony Fitzgerald QC, have not abated.
Many of the judges and legal figures who have questioned Chief Justice Carmody’s credentials have also privately, and publicly, depicted him as a political stooge for the LNP. They have pointed to some of his comments and actions to support the proposition.
A senior trial judge, John Byrne, secretly used his smartphone earlier this year to record a private, heated and expletive-laden conversation in which the Chief Justice accused some of the judges of being like “scum” for undermining him, and for the hurt caused to his wife and family.
Justice Byrne was recording the conversation because he was concerned about the prospect of a possible inappropriate interference by the Chief Justice in a case on a disputed election result which, if the case had proceeded, could have led to the LNP being in a position to form a government for its second term despite the January poll result.
Chief Justice Carmody rejected as fanciful and ludicrous the suggestion he has been a political stooge or would do anything to compromise justice. “Make no mistake: their purpose from the beginning has been to oust me from this position,” he said. “In their minds, I didn’t deserve it, should never have been offered it, should not have taken it and should not have dared to think I was capable of discharging the obligations of high office.
“I have no doubt that seeing the back of me has been the single-minded objective of a hard core of judges and others from outside the court with similar views and goals.
“Well, they might end up achieving that but the cost of that triumph will be a lost opportunity for the people of Queensland and the legal system.
“If I thought the judges would get in behind me and support me instead of undermining me, we wouldn’t be having this conversation, but they are not going to do that.
“The people of Queensland are the losers here. They deserve a court that engages with them, that they respect and trust and that is accountable for what is done, not only through the judgments they write but through their conduct and how they treat other human beings.”
Chief Justice Carmody warned that the fight over his position set a “precedent that if judges whinge and whine long enough and loud enough and damage the very thing they are there to look after, they can achieve the goal, which in this case was ousting me”.
“That is the thing that concerns me, that the will of the executive and, through the executive, the will of the people, can be effectively sabotaged by other interest group. My going would be an historical artefact but nobody who has had a hand in my going should be rewarded for their bad behaviour.”
His wife, Acting Magistrate Robyn Carmody, said: “I support Tim’s decision to offer to resign to break this impasse. He is an honourable, decent man with a proven track record in reform. As a family, we pay a heavy price for lending him to public service. We will always support him.”
‘A significant gesture’
Queensland’s Attorney-General has welcomed the Chief Justice’s offer to resign, describing it as a “significant gesture,” writes Sarah Elks.
Yvette D’Ath confirmed she had a meeting with embattled Chief Justice Tim Carmody weeks ago, in which he offered to quit the state’s top judicial position if reforms were introduced, including a judicial commission.
Ms D’Ath told ABC Radio in Brisbane this morning that she welcomed Justice Carmody’s move.
“I consider that a significant gesture to put the court’s interest before himself,” she said.
Ms D’Ath has no legal power to make Chief Justice Carmody resign, until he reaches the retirement age of 70. She said she would consult on the concept of a “judicial commission”, which New South Wales already has, but said she could not change pension arrangements for Justice Carmody.
Any offer of an early pension would be an “inducement” she said, and a criminal offence.
Shadow Attorney-General Ian Walker, a solicitor before entering parliament, said the decision was “distressing” but “gracious”.
“The CJ has made a gracious and generous offer to move in a certain direction to resolve the matter...that’s something we should be appreciative of him for,” Mr Walker told ABC Radio, adding it was a concern the situation had come to that.
Mr Walker said it was now up to the government to work out whether Justice Carmody’s offer could be accepted.
NSW government to pull pin on ads in Leftist paper
Hot on the heels of Qantas dumping Fairfax newspapers from its lounges, planes and gates, the Libs are preparing to pull their advertising spend from The Sydney Morning Herald.
The NSW government spends close to $2 million a year on recruitment advertising and The Herald has historically carried the lion’s share of the state government’s job advertisements.
Senior Liberals have discussed with NSW Finance Minister Dominic Perrottet removing the ad spend from the SMH.
It is understood Perrottet is open to the suggestion and is examining alternatives such as more digital advertising or a forum that is accessible to all taxpayers. He has ruled out advertising on the Services NSW website.
The official reason for the potential move is to find a more cost-effective and efficient way of advertising public service positions to ensure they’re accessible to all of the public, not only the Herald’s readers.
But Fairfax Media’s prominent coverage of ICAC’s public shaming of Liberal MPs and their staff would not have helped.
It is reminiscent of changes made by federal Labor to remove print as an essential component of government advertising campaigns. This was interpreted by some as punishment for News Corp’s critical coverage of the Gillard and Rudd governments and prominent campaigns on their stimulus package rollout.
Fake couples who marry for a visa and claim single welfare benefits will be stripped of entitlements
FAKE couples who have orchestrated “contrived marriages” to gain Aussie visas and then claim separate welfare cheques will be stripped of entitlements as part of a nationwide crackdown to be announced by the Federal Government today.
Thousands of people have potentially declared sponsorship of a partner for immigration purposes but are then claiming single welfare payments because they are not together.
The Daily Telegraph has learned taxpayers were milked $132.7 million last year in welfare payments that were fraudulent.
Immigration Minister Peter Dutton and Human Services Minister Marise Payne will today announce a new data matching system which will find couples who claim to be either married or in a de facto relationship but are providing separate departments with different information.
Legitimate couples, who are happily married, but claim to have split so they can earn more money from separate payments will also be targeted.
Australia’s welfare bill is expected to balloon by close to $40 billion over the forward estimates, from $150 billion to almost $190 billion.
Mr Dutton confirmed “contrived marriages” were on the rise. “Last year, my department identified an increase in the number of allegations relating to the facilitating of contrived marriages,” he said.
“This data-matching program is part of a whole-of-government approach to fraud detection and prevention. People who deliberately take advantage of Australia’s welfare and migration system will be caught.’’
Those found to have defrauded the system face losing their visa, being forced to pay back the money and criminal charges.
Mr Dutton said visas obtained through fraudulent relationships cost taxpayers significant amounts of money and blocked genuine people from being granted a spot in Australia.
Senator Payne said some legitimate couples had worked out they are financially better off to pretend they have split, yet remain a couple.
“The Government is committed to protecting taxpayers’ money and the integrity of Australia’s social security system by ensuring people receive the right payment at the right time.’’
The announcement comes after the government yesterday confirmed yesterday a senior Australian Federal Police officer will be hired to head a crack welfare taskforce to identify fraud.
Last year the government cracked down on the $16 billion Disability Support Pension rort, ordering new applicants to see a Commonwealth appointed doctor to determine if they were eligible for the welfare.
Prime Minister Tony Abbott said the government was committed to cracking down on welfare cheats.
Eight out of 10 Australian taxpayers are needed just to cover the national welfare bill. The partner visa data-matching program will begin next month and initially run for a year.
Jeep complaints now under official investigation
CONSUMER cops are investigating whether the maker of Jeep has misled car owners about their rights to refunds or replacements.
The Australian Competition and Consumer Commission has been gathering evidence from angry customers, including Ashton Wood, who raised $19,000 in a Kickstarter campaign to destroy his faulty vehicle after attempting — unsuccessfully — to use “guarantees” enshrined in law to push for a refund or replacement. The ACCC in now grilling dealers.
Jeep’s parent company Fiat Chrysler Automobiles (FCA) is aware of the probe, which is understood to also cover Fiats. No other carmaker is under investigation.
If the ACCC believes FCA customers have been misled, it could ask the Federal Court to impose multimillion-dollar fines, as well as other sanctions.
But for FCA the even-more-significant consequence of an adverse finding would be its effect on what have been rapidly growing sales. Australians spent about $1.5 billion on new Jeeps alone last year, up 37 per cent on 2013.
An ACCC spokeswoman told News Corp Australia the focus “of our inquiries is to determine whether claims are being handled consistently with the consumer guarantee provisions and ensuring consumers are not being misled about their rights”.
The spokeswoman said the ACCC could not name the carmaker under investigation, but she did say there was only one.
News Corp Australia has spoken to four FCA car-brand owners who have been interviewed by the ACCC as part of its probe. Furthermore, FCA has confirmed it is the subject of the ACCC investigation.
A spokesman told News Corp Australia that “FCA Australia President and CEO, Patrick Dougherty, has referenced his significant global experience in aftersales and customer care in personally addressing any potential issues in the Australian business, increasing resources, improving logistics, and streamlining our process of working with dealers.”
“We are encouraged by the positive response from our dealers around the country and the huge majority of owners who tell us that the investment we have made, and are making, in boosting our customer service is paying off.
“We will continue to work with all of our customers to ensure they are happy in their vehicles. We are unable to comment on the actions of the ACCC.”
Federal laws that took effect in 2011 provide consumers with guarantees that new vehicles are of “acceptable quality” — meaning they must be safe, durable and free of defects — and fit for any purpose the customer or supplier has specified. They must also match their description.
If there is a “major” failure to meet any of these guarantees, a customer is entitled to choose between a refund, replacement or compensation. The Federal Government has told the motor industry a major failure is when “a reasonable consumer would not have bought the motor vehicle if they had known about the full extent of the problem. For example, no reasonable consumer would buy a new car with so many recurring faults that the car has spent more time off the road than on it because several mechanics have been unable to solve the problem”.
Being unsafe is considered another major failure.
Consumer Action Law Centre CEO Gerard Brody — who believes Australia needs a so-called “lemon law”, as exists in California — said: “This issue demonstrates that the consumer guarantee regime works when businesses are amenable to providing repairs, refunds or replacements, but if they are not it can be challenging if not impossible for consumers to assert their rights”.
FCA sells about 50,000 cars a year in Australia. Jeep is its most popular brand, with sales of more than 30,000 in 2014. Jeep’s flagship is the Grand Cherokee, which is the nation’s most popular large SUV, bought by nearly 17,000 families last year alone.
25 May, 2015
Another ALP infight as union heavy questions Qld. recruitment policy
A FORMER top union boss and successful state Labor treasurer has called for less union influence in the party, saying the movement has a skewed hold over the party. Ex-NSW treasurer Michael Costa said Labor was now dogged by “a gerrymander in favour of the unions”.
The Labor stalwart made the comments as Premier Annastacia Palaszczuk and her Cabinet colleagues yesterday insisted their move to require public servants to recruit new union members was nothing new.
The Labor stalwart made the comments as Premier Annastacia Palaszczuk and her Cabinet colleagues yesterday insisted their move to require public servants to recruit new union members was nothing new.
The quietly reinstated “union encouragement policy”, revealed yesterday in The Courier-Mail, was blasted by Prime Minister Tony Abbott as “delivering for the unions”.
“I’m always disappointed when any government governs for one section of the community rather than everyone and this is a government here in Queensland which was elected on union money and on union campaigning,” he said.
Mr Costa said there should be a level playing field within the workforce, adding that his comments were relevant across the board and not just to Queensland.
“Governments shouldn’t actively discourage unionism, but they shouldn’t actively encourage it either,” he said. “There needs to be a reduction of union influence in the Labor Party.”
The Courier-Mail can reveal union bosses played a role in pushing for the policy, which will boost membership. It comes at a time its numbers within the public service are flagging.
It also comes just weeks after The Courier-Mail revealed key union bosses were boasting about the influence they now wield within the new Government.
The annual report for the Together Union, one of the biggest public sector unions, shows its membership numbers have fallen to about 28,000 people, from more than 38,000 in 2012, its lowest level since 2006.
Together Union secretary Alex Scott admitted to the union playing a role in discussions around the union encouragement policy. “We asked them to consider reissuing the department policy to make it simpler as well,” he said. “We argued it was a legal entitlement ... it’s helpful to have it as part of the department policy.”
But Mr Scott said it reflected a clause within existing enterprise bargaining agreements, which Newman government laws had made unenforceable.
Shadow Attorney-General Ian Walker said the policy saw balance tip in favour of unions. “There is a role for unions but it shouldn’t get to the point where the Government … becomes their de facto recruitment agency,” he said.
Queensland Council of Unions boss John Battams said his organisation played no role post-election in negotiating for or discussing the policy, but had raised it beforehand. “The role we played was to get the commitment before the election. We just expected it to happen and it did,” he said. “A Government keeping commitments shouldn’t be coloured as payback.”
He said there were more than 100,000 public sector workers who were union members.
Department of Premier and Cabinet director-general Dave Stewart has been charged with ensuring all other directors-general put the policy into effect.
Ms Palaszczuk said the policy had been in place for a decade before former premier Campbell Newman.
A dramatic testimony to the wreckage of the Australian economy by the Rudd/Gillard regime
While Rudd and Gillard were running up half a trillion in debt, and getting nothing for it, John Key was governing N.Z. prudently
Australia's warmer climate and higher wages have long lured droves of New Zealanders across the Tasman Sea with the aim of making a better life in the 'lucky country'.
But with Australia's economy stumbling and New Zealand's improving, the trend has begun to reverse.
New Zealand figures released Thursday showed that in April, for the first time in 24 years, 100 more people moved east from Australia to New Zealand than moved in the opposite direction.
The trend has been emerging for some time. Two years ago, a net 34,000 New Zealanders moved to Australia. That fell to 11,000 last year and to 1,900 in the most recent data for this year.
An agreement between Australia and New Zealand allows citizens of both nations to live and work in either country.
In New Zealand, the loss of its people over decades to its larger neighbor has proved a political sore point.
In 2008, when the current prime minister John Key was the leader of the political opposition, he stood in an empty sports stadium in Wellington to illustrate the thousands of people who were leaving each year and vowed to turn that around.
Robert Muldoon, who was prime minister in the 1970s and '80s, once quipped that the exodus raised the average IQ of both countries.
But now, the turnaround may pose new political challenges. The figures released Thursday show record annual immigration of 57,000 people to New Zealand, which added more than 1 percent to the population of 4.5 million. Many people believe immigration is helping fuel skyrocketing home prices in the largest city, Auckland.
Australia's economy has been struggling after the price of iron ore, its most lucrative export, slumped due to a slowdown in China's economy. Still, Australia's debt level remains low compared with most countries and its standard of living higher than in New Zealand.
New Zealand has been enjoying relatively strong economic growth, and its unemployment rate has dropped to 5.8 percent, below Australia's rate of 6.2 percent. But it, too, faces economic challenges, including lower prices for its agricultural exports due to the slowdown in China.
Australian food companies feed investor returns
Buttressed by demand from the emerging economies to the nation's north, Australia's $50 billion agribusiness sector is burgeoning. But the paradox for the sector is that it struggles to attract capital from Australia's super funds.
A recent survey of 114 superannuation funds, commissioned by accounting group BDO and conducted by the University of Queensland Business School's commercial arm UniQuest, found that Australia's super funds invest on average just 0.3 per cent of their assets in the agriculture sector.
In contrast, overseas pension funds are "very keen" on Australian agribusiness assets, says Tim Biggs, founding partner and chief investment officer at agribusiness investment firm Laguna Bay Pastoral Company. "We find that the North American pension funds really 'get' the Australian agribusiness investment opportunity.
"Australia's real natural advantage is that it produces some of the highest-quality agricultural products in the world, both bulk and niche, with an impeccable record of safety and traceability, it is on the doorstep of the emerging consumers in Asia who want traceable, repetitively deliverable high-quality product, and it has excellent logistics to export that produce," Biggs says.
US-based pension funds are even more conscious, says Biggs, of the institutional investor's holy grail: authentic uncorrelated returns. "Agricultural investments are generally negatively correlated to financial investments, stocks and bonds. They have different return streams, and thus can diversify an investment portfolio more widely."
US investors also have concerns about the drought in California, he says. "Ninety per cent of the world's almonds come from the San Joaquin Valley in California. That has always given the Australian producers a classic counter-seasonal export opportunity, but now in the US, they're thinking, 'What if we don't have the water to feed our crops?'" If the water situation in California gets worse, investors will be looking at Australia, he says.
The final piece of evidence in Australia's favour is that when the pension funds investigate this market they see "probably the most sophisticated water trading market in the world," says Biggs. "Australia confronted the value of water a long time ago, and we price water appropriately." Producers in the US are being forced to confront the value of water, he says.
The water market in Australia can offer investors uncorrelated returns, but it is still small, says Cullen Gunn, director and CEO of farmland and water investment manager Kilter Rural. He says about $1 billion of water is traded annually, most of it in the Murray-Darling Basin, which produces one-third of Australia's food, almost all of its rice and cotton, and 45 per cent of its dairy output.
"The Australian water market channels water up the economic value chain, to where it finds its highest-value use," says Gunn. "The primary vehicle is a water entitlement, which is a perpetual share of water available in the system. Then there is the secondary vehicle, the allocation, which can differ depending on the amount of water in the system.
"They're both tradeable, but the allocations trade much more readily, and are a lot more volatile. They're sold to producers who need water for their crops. The sale of allocations creates yield," he says.
Kilter Rural manages both water and farmland investments for super funds, and says the "uncorrelated returns story" is slowly gaining traction, as is the level of returns. But he says many funds consider the market to be too small.
"If we're trading $1 billion a year, that is, pardon the pun, not liquid enough for most super funds, who simply like to invest in bigger licks," says Gunn. "They know that given the emerging demand from Asia for food, as an investor, holding agricultural land and water rights makes a lot of sense, but they'd like to see the market a bit bigger."
Gunn says holding entitlements and selling allocations will deliver between 4 per cent and 7 per cent a year, but it's volatile between seasons. "We're moving more towards generating investment products built around leasing water, where there is an indexed lease rate that is really the same as a commercial office lease." The leases generate between 5 per cent and 8 per cent a year, indexed and reviewed annually, he says, with a diversity of clients; dairy farms, nut and fruit growers.
"It's a terrific asset, because you're investing in the major input to meeting the export demand for Australian food, but you're not taking the agricultural risk of producing that food."
Michael Dundon, CEO at the $13 billion not-for-profit super fund VicSuper, has invested in water holdings and environmental remediation through Kilter. While mostly happy with the experience, Dundon sees the problems that other super funds may have in making similar forays.
"We're getting close to generating 9 per cent a year, after tax, which is where we wanted to be with a long-term investment, and it is uncorrelated return," Dundon says. "But at the same time, there is a scale question, and it's probably fair to say that super funds find themselves fairly constrained in that market. Large funds tend to want to invest more than the market can accommodate. We've yet to work out how much further would we be prepared to go."
One factor that may induce more super funds to consider these types of investments, he says, is that the return is "truly" uncorrelated. "A lot of what are considered 'alternative' investments, which purport to offer uncorrelated returns, are in reality hedge funds and absolute-return strategies, and that's not truly uncorrelated, in our view," says Dundon.
VicSuper does not consider its agribusiness and water holdings as part of its "alternative investments" exposure: it allocates them to "real assets", along with infrastructure and direct property. "We would have 7 per cent to 8 per cent in real assets, and within that, probably about 2 per cent of the fund would be in agribusiness/water.
"In this asset class, I think funds are going to want to invest directly. If they view it as a 'real asset' play, they're probably not going to want to go through ASX-listed stocks," he says.
Shane Kelly, principal at agribusiness corporate advisor Latitude 232, says the next generation of investment products will offer super funds exposure to agribusiness, without the need to take on operating and commodity risk. "Super funds that have previously had bad experiences in agriculture were primarily involved in owning and operating farms. Super funds need stable returns, so it makes sense for them to steer clear of operating and commodity risk and focus on buy and lease back investment models that deliver regular income and long term capital growth," Kelly says.
"There is opportunity for super funds to own the underlying land assets, which will be leased to good operators, such as a blue-chip, large-scale family company or a corporate agribusiness. In some instances this may involve taking land off-balance sheet, while in others it will support an expansion of the area under management. This approach ensures that the people who have the experience operate the farms, while the super funds can earn stable returns from leases that will vary from 4 per cent to 10 per cent, depending on the risk weighting applied to the commodity sector and the quality of the counter-party involved."
Another potential approach is the "agri private equity" style of fund, such as the new Food and Fibre Fund offered by 3F Asset Management. "We're concentrating on assets that sit in the supply chain, between the farm gate and an Asian consumer," says 3F director Craig Anderson. "That could be on the input side – such as services that get supplied to farmers, machinery businesses, agronomic services, technology providers that increase efficiency and effectiveness of Australian agriculture – and then on the output side, from storage to logistics to wholesaling, cold-storage and transport and even distribution assets in Asia."
Anderson says the fund would either buy or invest in those businesses, "like a normal private equity player would".
Australia could miss out on second LNG boom, Chevron says
Natural gas exports have been touted as Australia's great white hope to replace plunging iron ore earnings, but oil major Chevron has warned the nation risks missing out on the next wave of investment.
Among the problems were too much regulation to get approvals, an inflexible industrial relations systems, high labour costs and taxes and government policies that don't support investment, said Chevron's Australian managing director Roy Krzywosinski.
He also took a veiled swipe at Australia's services companies that supply the industry, suggesting they needed to lift their game and better support oil and gas producers.
Australia's march to soon becoming the world's largest exporter of liquefied natural gas was a success story but its rapid growth was unprecedented and testing the capacity of those services industries, he said.
There was a potential $US100 billion ($127 billion) waiting in the wings with the associated economic benefits if the next wave of investment could be attracted.
However global competition was increasing, particularly with the new waves of US LNG projects due to an abundance of gas there driven by the onshore shale boom.
Not enough co-operation on logistics between LNG projects was occurring either to drive down costs, as mostly occurred in the Gulf of Mexico and North Sea, he said.
"We need to recognise there has not been a final investment decision on an Australian LNG development since 2012," Mr Krzywosinski told the Australian Petroleum and Exploration Association conference.
"As many of us forewarned, the second wave of LNG investment for Australia - which promised to deliver further benefits - is at serious risk of not happening, at least in the foreseeable future.
"A major contributor is Australia's falling international competitiveness."
Seven new LNG plants are due to come online over the next three years to add to the three current ones, with Chevron involved in building two of them: Gorgon and Wheatstone in Western Australia.