How does the past week’s business news affect you? Mojonews.com.au business editor ARON LEWIN looks at the good, the bad, and the dodgy stories coming out of the business world.
Hockey decides: The Budget
More than 70 mental health groups signed an open letter addressed to Prime Minister Tony Abbott and Health Minister Sussan Ley in a plea for the Government to withdraw its plans to cut funding to the sector.
It follows the completion of a government ordered review – not yet released – by the National Mental Health Commission, which further fuelled concern about the future of many mental heath service providers.
The Australian refers to a Mental Health Australia survey that found “40 per cent of [not-for-profit metal health] groups … [are] already [losing] staff due to uncertainty over funding, while 53 per cent had reduced services”. In response, Ms Ley said mental health funding would be finalised “as soon as possible.”
But Aboriginal legal services were given a reprieve last week when Attorney-General George Brandis backflipped on plans to cut $43 million of funding.
Brandis’s back down came a day after 26 organisations signed an open letter urging Tony Abbott to dump plans to cut Government-supported legal assistance services, including the National Aboriginal and Torres Strait Islander Legal Services (NATSILS) and Community Legal Centres (CLC).
The open letter states the planned cuts come at a time when there are “crisis levels of Aboriginal and Torres Islander peoples’ imprisonment, high rates of Aboriginal and Torres Strait Islander children in the child protection system and growing rates of family violence”.
Brandis did not refer to the letter when he explained why he would not follow through with the cuts, attributing the Government's decision to a “greater appreciation of where the needs lay and where the priorities lay” after “the passage of time” since he announced the funding cut in December 2013.
The Monthly editor Russell Marks questioned how “cuts were ever justified in the first place, and for so long”, and the Government’s Chief Advisor on Indigenous Affairs, Warren Mundine, created Bitstrips comics to show his satisfaction with the backdown.
There are also rumours of tension between Foreign Affairs Minister Julie Bishop and Treasurer Joe Hockey over reports that foreign aid will be further slashed, despite Finance Minister Mathias Cormann's assurances that “he knew of no plan to make fresh cuts”.
In New Matilda, Ben Eltham writes that foreign aid is always first to be cut because it “has no strong lobby group or noisy affected industry to complain when funding is cut”.
How much do companies charge to retain our data for the Government?
On Thursday, metadata retention laws – which require telecommunication companies and internet service providers to retain client data for two years and allow Government authorities to access it, except if they are "journalists" – passed the senate.
How much the Government plans to pay telecommunication companies to retain data remains unknown. Greens Senator Scott Ludlam and Telco companies across Australia were dumbfounded that the Government has not finalised expenditure for the law, but it’s estimated to cost between $188 million and $319 million.
In Technology Spectator, Supratim Adhikari wrote: “While an incumbent like Telstra can afford to encrypt and store customer metadata in Australia and has the financial and technical muscle to comply [with] the legislation, many smaller operations won’t.”
The ABC defines metadata and the Financial Review explains whom the laws will affect, while Junkee provides tips on how to avoid the data retention laws.
ACCC investigates Andrew Forrest over iron ore production cap comments
He argued a cap on production would precipitate a rise in demand, increasing prices and forcing China to pay more for the commodity.
At the dinner – he said he knew he was on the record – Twiggy said he was “absolutely happy to cap my production right now” at 180 million tonnes. Conveniently, this is how much Fortescue Mining currently produces, whereas Rio Tinto produces 290 million tones of iron ore with plans to increase it to 360 million by 2017.
Gina Rinehart and Hockey rejected his proposal for an alliance with BHB, Rio Tinto and Brazil’s Vale, saying a boost in infrastructure in developing countries will stimulate iron ore profits, while Rio Tinto chief executive Sam Walsh labelled him “hare brained,” and it has led to an investigation by the Australian Competition and Consumer Commission, because “it is illegal to enter into collusive arrangements”.
Etihad Stadium tempts fans with cheaper food and beer
On Thursday, Etihad Stadium followed in the footsteps of the MCG when it lowered prices for some of its food and beer.
AFL CEO Gillon McLachlan said it showed Etihad Stadium is listening to fans after they were “paying overs” for food and drinks. It’s hoped it will draw more fans to the stadium after attendance hit an all time low in May 2014.
Work for the Dole program set to expand
News.com.au reports that the Government’s Work for the Dole program – which requires job seekers aged between 18 and 30 in some areas to work to receive welfare assistance – will expand to those aged 49 in July 2015.
“The new mutual obligation requirements will see Australians under 50 having to undertake work for the dole programs for 15 hours a week, for six months of every year they remain unemployed,” the site reports
“People under 30 will need to do 25 hours of work each week, and all job seekers will need to apply for 20 jobs per month – half of what the government initially proposed when it released the details of tender process this time last year and was forced into a backdown.”
Quantifying the financial contribution of science
A report commissioned by Chief Scientist Professor Ian Chubb and the Australian Academy of Science concluded that physics, chemistry, mathematics and earth scientists contribute a combined $145 billion – 11 per cent – to Australia’s GDP.
According to The Australian, the report also concludes that hard science departments – such as chemistry, biology, physics, and astronomy – contribute 23 per cent to Australia’s goods and services exports, and labour productivity in “advanced physical and mathematical sciences is 75 per cent higher then that of workers in the rest of the economy”.
Prof Chubb also wrote that the Abbott Government must take on his recommendations, including a “strategic approach to scientific development in Australia” and “boosting the numbers of well-qualified science teachers”, if Australia is to have a seat at the debate on issues such as nuclear energy, climate change and renewable energy.