Royal Commission into union corruption confirmed

Attorney-General George Brandis says a Royal Commission into trade unions will tackle the "systemic", "ingrained" corruption in the labour movement.

And he has accused federal opposition leader Bill Shorten, a former trade union leader, of opposing a Royal Commission because he was the "nominee off the trade union movement".

Senator Brandis confirmed on Sunday the announcement of a wide-ranging judicial inquiry was imminent, declaring it would be "irresponsible for the government not to respond in an appropriate way" to public concerns.

The inquiry would examine allegations of impropriety at the health services, construction and Australian workers unions.

"The revelations we have seen in recent months suggest it is much more widespread and systemic and an ingrained problem with the trade union movement than mere slush funds," he told Sky News.

"You'd expected Bill Shorten to protect trade union bosses, because Bill Shorten was a trade union boss and is only the leader of the Labor Party today because he is the nominee of the trade union movement.

Senator Brandis dismissed Mr Shorten's call for a joint police taskforce, rather than a judicial inquiry, as "lame".

Mr Shorten wants a multi-jurisdictional taskforce, led by the Australian Federal Police and include state police forces, to investigate the corruption allegations.

Labor's workplace spokesman Brendan O'Connor said on Sunday the opposition would not support a royal commission because it did not have the power to arrest criminals and would not be able to act quickly enough to tackle corruption.

"Our view is let the crime-fighting agencies fight crime-fighting agencies fight crime,' he told the ABC.

"The [government] agenda - it sounds like a political agenda. It sounds like a political timeline rather than a crime timeline."

The Abbott government has been poised to call a Royal Commission for weeks. News Limited reports today that former high Court judge John Dyson Heydon will lead the inquiry.

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Public hospital cuts could ease health crisis: think tank

Targeting inefficiencies in the public hospital system could save $1 billion a year, a former top health bureaucrat has found, dwarfing the possible savings from a controversial proposal to charge $6 for GP visits.

Stephen Duckett, a former head of the federal Health Department, has told the National Commission of Audit "there is considerable scope for efficiency improvement in all states and territories in delivery of public hospital services". Early work suggests such efficiencies could save up to a billion dollars a year.

Dr Duckett, now the health program director at the Grattan Institute, has identified significant variation in the average costs of similar procedures between states and between individual hospitals.

"For example, the cost of a hip replacement in hospitals which do a lot of them varies 100 per cent."

At the six public hospitals that perform the most hip replacements, the average cost varies from less than $10,000 to more than $20,000.

Dr Duckett said the research, to be published next month, showed the average cost of hospital care varied. He has previously suggested the Commonwealth could save a further $2 billion a year by changing the way it pays for drugs.

Dr Duckett's intervention comes as Prime Minister Tony Abbott warned the nation to prepare for pain in the May budget, while Health Minister Peter Dutton has warned that health costs will become "unmanageable" without change.

Health spending has grown faster than any other area over the past decade, largely due to increased spending on hospitals. If current trends continue, health spending is set to consume an extra 1.5 per cent of gross domestic product by 2023.

Dr Duckett warned against "panic" about the sustainability of the health system, arguing "overall" the Australian system was efficient by international standards.

"We're cheaper than the average of developed countries in terms of cost per head of population and we're better than the average in terms of life expectancy," he said.

He urged against "quick fixes" such as the $6 GP co-payment proposed by Terry Barnes, a former policy adviser to Mr Abbott. Mr Barnes told the commission his proposal would deliver $750 million over four years in savings by reducing "avoidable" GP visits.

But Dr Duckett said evidence showed countries that strengthened their primary care systems were able to save money by treating problems before they became acute.

Mr Barnes said public hospitals sucked in resources that could otherwise be spent on primary care and prevention. But he said the introduction in July of activity-based funding - under which the Commonwealth provides its share of hospital growth funding based on a national efficient price - would drive improvements. He said the public was willing to make a greater contribution to the cost of their treatment, despite doctors and other health groups being almost unanimously opposed to his idea.

Alison Verhoeven, the chief executive of the Australian Healthcare and Hospitals Association, said there may be efficiencies to be made but added: "We don't think efficiency should come at the cost of providing good access to services to all Australians, particularly those in regional, rural and remote areas where it can be more expensive to deliver services."

Neal Blewett, health minister in the Hawke government when Medicare was introduced, said hospitals must be made "much more efficient".

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Gillard's coastal shipping mess

Hiking costs for everyone in order to prop up a few Bolshie unionists

Every day, Australian ships ply the coastal waters with their loads of interstate cargo - ships with names like the Portland, the Victorian Reliance, and the Tasmanian Achiever. Also doing the job are vessels from the other side of the planet - such as the Norway-registered Hoegh London, Liberia's Maersk Dubrovnik, or Panama's Navios Soleil.

Shipping goods interstate is not the primary purpose of these foreign vessels, of course. They sail to Australia with foreign cargo, unload, sail to another Australian port, load fresh cargo, and sail overseas. But when sailing from one Australian port to another, they usually take goods for the short haul.

And that is the problem for Australian shipping. Foreign-registered vessels were once minnows in the coastal goods market but, thanks to cut-price rates - afforded by generous overseas tax regimes and cheap foreign labour - they have shifted most of the sea freight since 2010.

As a result, the number of Australian-flagged coastal cargo vessels has more than halved, from 55 in 1995 to 23 in 2012. Industry sources put the present figure at 18 and estimate it could halve again, to just nine within two years.

Concerned over the prospect of the extinction of Australian shipping, the Gillard government passed laws in 2012 to revitalise the sector, providing tax and depreciation breaks. As part of the changes, foreign ships handling interstate goods had to pay their crews Australian wages, had to undertake at least five coastal voyages in a year and could only be hired if no Australian vessels were available.

Shipping rates have since surged - as has the ire of customers. Rio Tinto unit Bell Bay Aluminium told the Productivity Commission inquiry into Tasmanian shipping its freight costs had soared 63 per cent as a result of the 2012 laws.

The inquiry also heard that the legislation required, for one company, an extra 1000 hours of labour annually to administer. The Department of Infrastructure, meanwhile, estimates the cost to the Australian economy at $202 million in addition to $70 million a year in forgone tax revenue.

The Productivity Commission inquiry is continuing, but the draft report, released two weeks ago, condemns the Gillard changes.

"Given higher shipping costs, adverse effects reported by Tasmanian shippers and … the likely deleterious impact on Australian businesses … the justification for the 2012 changes is now questionable," it states.

The Abbott government has foreshadowed a fresh review into coastal shipping and the inquiry's draft recommendation urges the review proceed "as soon as possible". "The objective of the review should be to achieve the most efficient coastal shipping services feasible for Australia."

Infrastructure Minister Warren Truss, who is responsible for shipping, has signalled that the 2012 laws are dead in the water. "Shippers tell me that container rates from Melbourne to Brisbane are almost twice the cost of those from Singapore to Melbourne," he said in October. "Bulk freight rates on the east-west route have reportedly doubled in the past year. It is cheaper to transport sugar from Thailand than from Queensland.

"To put it bluntly, there is no point in artificially propping up our coastal shipping industry if it is unable to compete - it will have an impact on the broader economy. Let me make it clear - I want a strong Australian shipping industry with an increasing market share. I want vessels to be Australian flagged, but most of all I want an industry that is efficient, reliable, safe and doing the job that its customers expect."

The free-market Institute of Public Affairs has long argued for deregulation of coastal shipping. Cabotage - protection of Australian-flagged ships against foreign competitors - had existed in some form since Federation, but that was no reason to keep it going, said research fellow Aaron Lane.

"What some shipping industry representatives want to do is tinker around the edges with the legislation or wind it back pre-2012. While that would be a good start … I don't think there should be any coastal shipping laws at all."

Lane, who appeared before the Productivity Commission inquiry with an IPA submission, said it did not matter whether a ship was Australian or foreign registered. "At the end of the day it doesn't matter if you have one Australian-flagged ship or a hundred … 85 per cent of coastal shipping freight is bulk products. It's about making those goods cheaper, it's not about propping up Australian-flagged vessels. What matters is, are these ships providing a cheap and efficient transportation system for producers of bulk goods?"

Lane was scathing about the 2012 laws and pointed out that the Fair Work Act of 2009 also affected shipping costs.

"For the first time in 200 years of coastal shipping, the foreign vessels that solely employ foreign crews were made to pay Australian wages. That has never happened before," he said, describing Bell Bay Aluminium's 63 per cent increase in shipping costs as "extraordinary" and "incredible".

The idea that the 2012 laws would, in the long term, bolster the numbers of Australian-flagged vessels was flawed, he said. "Protectionism never works in the long run. Protectionism never starts an industry. It never increases, it always eventually gets to the point where it has to be opened up to trade."

More optimistically, Lane believes there will always be an Australian-flagged fleet. International ships go from port to port on an ad hoc basis whereas local vessels can offer a timetabled service. "International vessels are carrying interstate freight when it's convenient to them," he said. "There's always going to be a demand for freight that needs to get to its destination by a certain deadline. There will be a market that remains for Australian operators to take advantage of that situation."

Finally, he rejects the idea that national defence requires a domestic maritime fleet. "The same argument is touted for keeping Qantas as a national carrier. The Commonwealth has to maintain a defence force and I think the defence force should be adequate."

Despite the desire of the IPA and the Business Council of Australia to fully deregulate the industry, the Coalition was unlikely to do so, said Angela Gillham, manager of industry operations at the Australian Shipowners Association. "That would mean foreign-flagged vessels could move any domestic cargo wherever they liked without needing a licence. That's not a probable solution, not even with this government. It would take a very brave government to get rid of cabotage completely," she said.

The ASA - whose members use both Australian and foreign-flagged ships - rejected deregulation but would also like to see the 2012 laws changed, Gillham said.

The requirement that foreign vessels make a minimum of five coastal voyages a year caused particular resentment, she said. Nor were taxes lowered enough to make Australian vessels competitive.

"The zero tax regime was actually just a tax deferral," she said. "As soon as you went to pay shareholders, it was taxed at the full rate. It's competition that has driven Australian operators out of the market. We just can't compete on the same cost base."

The real growth for Australian shipping, she believes, may lie in international trading rather than coastal trading. Ten per cent of the world's sea trade passes through the nation's ports, overwhelmingly transported by foreign-flagged ships. Australian-flagged international ships, however, are at the same tax and wages disadvantage as their coastal counterparts. There were only six such ships at present, said Gillham, but with the right reforms this could change.

"We don't see a huge potential for growth in coastal trading. The real growth area is for Australian companies taking Australian international cargo."

This would require legislation to permit a mix of Australian and foreign crews as well as tax changes.

"We think it is in the national interest to have a vibrant and viable Australian shipping industry. We're an island nation. We rely on shipping," she said. "Our view is that changes to the 2012 act would take the heat out of the issue and solve most people's major concerns."

The Maritime Union of Australia, in its submission to the Tasmanian inquiry, also believes tinkering with the 2012 act is the way to go and has condemned the Productivity Commission's draft recommendation.

"A review could be a useful mechanism to … clarify some ambiguities and flaws in the legislation," it stated. However, "what the Productivity Commission is clearly proposing is wholesale deregulation of Australian coastal shipping - the repeal of the 2012 act. What is proposed is not even a return to the previous permit system or some form of regulatory framework that promotes competition … this is, in effect, a recommendation for the complete dismantling of an entire Australian service industry."

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Nazi strip show outrage

Even mocking Hitler is unsafe

ORGANISERS of the Fringe Festival have defended a free public performance held in Civic on Friday night that featured a performer in a Nazi-style uniform and wearing a Hitler moustache who stripped down to her underwear, amid claims it was anti-Semitic.

ACT opposition multicultural affairs spokeswoman Giulia Jones said the burlesque performance, which allegedly also featured a man pretending to masturbate, was offensive.

She called on Multicultural Affairs Minister Joy Burch to explain how approval was given to spend government funds on support for a show that, in her view, was offensive and racist.

"There were lots of kids around at the time, there were families," Ms Jones said. "The real issue we need to know is how the minister thought it would be acceptable to hold a show with Nazi references within the footprint of the multicultural festival where we had Jewish, German and other stalls nearby?"

The director of the show - titled Die Fringe Burlesk! - Jorian Gardner, said he apologised if anyone took offence but the whole point of the event was to be edgy, and screening meant the show was not directly visible from Civic Square.

"We had a girl dressed up in a fuehrer's outfit and she had gold wings - and I'm not sure Hitler had wings - and she danced around with a Hitler accent," Mr Gardner said.

"If anything it was making fun of Hitler; it was not anti-Semitic in any way shape or form, and everyone who was here was having a laugh at the ridiculousness of it.

"Often with satire it's subjective, I guess, and in this case I think most of the audience saw it was a funny satirical skit, nothing else."

Mr Gardner said it had been the biggest night in the festival's history, and he had not received a single complaint from the jubilant crowd.

"We've given fair warning … of the risque nature of the show; no one can say we haven't promoted it. If people are coming to a burlesque show and a comedy show, they need to know what they're up for and that comedy could push the boundaries. You've got to deal with it."

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Julie Bishop's stance on the legality of Israeli settlements appears to be right



Julie Bishop is the Foreign Minister in Australia's conservative government  -- a government which I am pleased to say is very pro-Israel

Julie Bishop had some sensible things to say in Jerusalem, as she broke ranks from a cosy, normally unexamined international consensus: the idea that, by permitting Jewish residence in the West Bank, Israel is violating international law.

Asked if she agrees Jewish communities located beyond the Arab/Israeli 1949 armistice lines are illegal, Bishop replied: "I would like to see which international law has declared them illegal."

Her reply has drawn attacks from perfervid Palestinian spokesmen - such as Palestinian Authority veteran official Saeb Erekat - who cite Article 49 of the Fourth Geneva Convention. But what does Article 49 actually say?

Drafted to outlaw the horrors of Nazi mass deportations, Article 49 prohibits "individual or mass forcible transfers, as well as deportations of protected persons from occupied territory to the territory of the occupying power or to that of any other country, occupied or not". It ordains that "the occupying power shall not deport or transfer parts of its own civilian population into the territory it occupies."

"Transfer" is not rigorously defined in international law, but it has an accepted meaning: it entails some form of compulsion. Yet Palestinians are not being deported from the West Bank to another territory. Nor are Jews being deported from Israel to the West Bank; they are moving of their own free will.

The West Bank, illegally seized by Jordan in 1948, captured by Israel following Jordanian attack in 1967, is unallocated territory under international law. Only Israeli annexation or an Arab/Israeli agreement could alter its status - neither of which have occurred. In short, Article 49 has no bearing on the situation, as it deals solely with sovereign territories.

The original international decision at the 1920 San Remo Conference earmarking this territory for Jewish settlement has never been superseded by an internationally binding agreement. The 1947 UN partition plan, which sought to create Arab and Jewish states, could have been such an agreement, but it was rejected by the Arab powers and Palestinian Arabs. Being a UN General Assembly resolution, the plan had no legal force of its own.

In contrast, the 1993 Oslo Accords do possess legal force, but as these contain no prohibition on the existence and growth of these Jewish communities, Jewish rights remain unimpaired. Whatever one's view of the conflict, all should be able to agree on this. Yet Erekat denies it, even though the Palestinian Authority he represents signed the agreements.

He cited two other legal sources: the 2004 International Court of Justice (ICJ) advisory opinion, and the 1998 Rome Statute of the International Criminal Court. He didn't mention that the ICJ opinion was advisory and therefore non-binding, nor the perversion of legal norms by which it arrived at its conclusion - the ICJ opted to spuriously invest a General Assembly resolution with the authority for a legal determination of this kind.

The Rome Statute, which Erekat says makes Jewish settlement illegal, says nothing about Israel or the territories in question. It reiterates the Fourth Geneva Convention's prohibition on transfer of populations. It seemingly widens the scope of "transfer", by adding "directly or indirectly", but if compulsion is the touchstone, these qualifiers change little. But even if they did, some 40 countries, including free societies such as India, Israel and the US, have either declined to sign or to ratify the Treaty, making its application here nugatory.

Erekat is also incorrect to assert that the Abbott government's position represents an aberration. While differing from her predecessor, Bob Carr, Bishop's position is consistent with Australia's historic bipartisan stand.

Bishop was right to dismiss the notion that Jewish residence in the West Bank is illegal as the flat-earth assertion that it is. Inasmuch as this fiction inflames Palestinian ambitions to delegitimise Israel and uproot hundreds of thousands of Jews, it presents a profound obstacle to peace settlement.

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