THE screening of non-sensitive commercial real estate and internal reorganisation (restructure) foreign investment applications will be undertaken by the ATO from April 1, 2017.
This is an internal administrative change by the Australian Government and will not require any action by Foreign Investment Review Board (FIRB) applicants.
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THE Australian Competition and Consumer Commission has issued a final determination denying authorisation to 16 insurance companies to agree to a cap of 20 per cent on commissions paid to car dealers who sell their add-on insurance products.
“The ACCC is denying authorisation because we believe this proposal is unlikely to change sales incentives or the quality of products, and consumers will still be sold products without being given adequate information or opportunity to make a considered decision,” ACCC Chairman Rod Sims said.
“While insurers would benefit from a cap at the expense of car dealers, this conduct is likely to lessen competition between insurers, including by creating greater opportunities for explicit or tacit collusion and greater shared knowledge between insurers of competitors’ costs.
“The ACCC is also concerned that these arrangements, if implemented, could significantly delay the development of more effective solutions to the problems that ASIC has identified,” Mr Sims said.
The ACCC published a draft determination in mid-February proposing to deny authorisation. Following the release of the draft determination the ACCC offered to extend the timeframe for consideration of the proposal to allow the insurers extra time to respond to the ACCC’s concerns. The insurers did not provide a submission in response to the draft determination.
Background
Add-on insurance products are products that may be sold at the time of purchasing a motor vehicle. The add-on insurance may be connected to finance associated with the motor vehicle such as consumer credit insurance, gap insurance, walk away insurance, and trauma insurance. Alternatively, it may relate to the vehicle itself, such as comprehensive insurance, extended warranty insurance, or tyre and rim insurance.
The Australian Securities and Investments Commission (ASIC) report, A market that is failing consumers: The sale of add-on insurance through car dealers, identifies issues such as a lack of price competition, poorly designed products, poor value for money relative to premiums, and a complex sales process that often does not disclose the total cost of the cover.
Further information about the application for authorisation is available on the ACCC Authorisations Register: Aioi Nissay Dowa Insurance Company Australia Pty Ltd & Ors - Authorisation - A91556 & A91557
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THE Queensland Resources Council has backed a Federal Government report calling for a ban on foreign-funded donations to activist groups.
One of the recommendations in the report on foreign donations, tabled in Federal Parliament today, was to extend a foreign donations ban to all other political activist groups. This would include preventing foreign funds being channelled through organisations engaging in political activities that were not subject to regulation under current laws.
QRC Chief Executive Ian Macfarlane said it was high time that donations to the anti-development activists were put under the microscope in line with other politically-motivated groups.
“Funding from overseas donors to these groups is disrupting and delaying job creating projects in Queensland, while providing a sophisticated tax reduction scheme to their personal wealth,” Mr Macfarlane said.
“Our country must stop foreign groups interfering in our resources development projects that have undergone immense scientific and social scrutiny before being approved by democratically elected governments in Australia.
“It seems ridiculous that someone living in Manhattan can be the financial backers of green activist tactics that hold up a project in Moranbah and cost Queenslanders job opportunities.”
www.qrc.org.au
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AUSTRALIAN Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell has refuted claims made by the Australian Bankers’ Association’s (ABA) chief executive Steven Münchenberg that eliminating all non-monetary covenants from small business loans under $5 million would raise the risk of lending to small business, saying the ABA – and the banks – are contradicting themselves in arguing against the reform.
“On the one hand the banks say they rarely use non-financial default clauses, but on the other, they say to remove them would increase risk for the banks. If you don’t use them, how on earth could it possibly increase the banks’ risk to get rid of the clauses?” Ms Carnell said.
“It is disingenuous to say that removing these clauses would drive up the cost of borrowing for small businesses, given the banks already take into account a higher level of risk in their small business loan costs.
“You can’t have it both ways; you can’t have a loan agreement that moves all the risk to the borrower, while also imposing a higher interest rate on small business customers.
“Over the last few days we’ve seen banks commit to implementing this measure in varying degrees, yet here we have the ABA claiming the sky will fall in if our recommendation is adopted,” she said.
During today’s House Economics Committee hearing, Westpac executives said they’re committed to removing non-monetary covenants from all small business loans under $1 million (secured against property), with the view to extending this to most loans under $3 million (total loan facility).
ANZ include – but don’t apply – non-financial default clauses in loans under $1 million and now say they’re going to consider the future use – but not removal – of such terms in agreements for loans of up to $3 million (total loan facility); CBA has committed to removing non-monetary default terms from agreements for loans up to $1 million, and may raise this to $3 million (total loan facility) with carve-outs; while NAB say they’re opposed to the removal of non-monetary covenants.
“Aside from NAB, these are all steps in the right direction, and we’re listening to what the banks are saying on carve-outs, but fundamentally non-financial default clauses must be removed from small business contracts under $5 million if we’re to ensure all small businesses are safeguarded against what can be the devastating impacts of these clauses,” Ms Carnell said.
www.asbfeo.gov.au
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TO COINCIDE with International Women’s Day (IWD), the ACS – the professional association for Australia’s ICT sector – will today participate in the Women in Cyber event in Melbourne, an initiative of the Office of the Cyber Security Special Adviser within the Department of the Prime Minister and Cabinet.
Roundtable discussions will focus on the barriers to women choosing cyber careers, the reasons women leave the cyber industry and ways to address these problems.
The ACS has long been an advocate for advancing diversity in ICT to capture the full potential of the digital economy. Its 2015 Report, The Promise of Diversity, shows that Australia is a long way from filling the gender equality gap, particularly in ICT, where women comprise only 28 percent of the ICT workforce compared to 43 percent of the wider workforce.
The shortfall is particularly acute in technical roles in the cyber security area, which has risen to the top of the international agenda as high-profile security breaches raise concerns around the potential impact on the global economy. Data from SEEK Employment Trends Report suggest that the number of cyber security roles advertised in Australia grew by more than 57 per cent year-on-year in February 2016. The opportunities for women to forge a career in cyber are many.
Chair of ACS Victoria, Maria Markman said, “The ACS is pleased to support the Women in Cyber event and we congratulate the Office of the Cyber Policy Special Adviser on this important initiative.
“Addressing the barriers for women in ICT requires short and long-term initiatives, supported by genuine commitment by employers, educators and governments to collaboratively tackle these barriers. This event is a significant step forward.”
ACS vice president, Yohan Ramasundara said, “Through committed, outcome-focused leadership the ACS is working to address the ICT gender disparity at all stages of women’s education and careers towards a more gender balanced world.
“The ACS values the contribution of women and promote gender equality in the Australian ICT sector. On International Women's Day we celebrate the social, economic, cultural and political achievement of our female colleagues around the world. The theme for this year #BeBoldForChange is a call for everyone of us to stand up and do our bit to help achieve womens full potential for a more prosperous future for us all.”
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A SUCCESSFUL Everest climber, former Telstra Business Woman of the Year finalist, and 30-year resources sector veteran has been recognised by the sector for her outstanding achievements.
Karen Alexander was presented the Exceptional Woman in Queensland Resources Award in Brisbane today by Minister for Employment and Industrial Relations Grace Grace, Queensland Resources Council (QRC) President Rag Udd and Women in Mining and Resources Queensland (WIMARQ) Chair Maria Joyce before a state-wide audience of more than 900 people.
They were attending, or viewing live via webcast, the annual QRC/WIMARQ International Women’s Day Breakfast and Resources Awards for Women presentation, hosted by BHP Billiton.
Karen, Manager of Strategic Alliances-Mining with Hastings Deering, was one of just two females among 800 male engineering students while studying for her mechanical engineering degree, and one of the first two females to ever complete this degree at the Queensland University of Technology (QUT).
And now, she is Hastings Deering’s first senior executive sales business leader.
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AUSTRALIAN Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell said the responses today from CBA and ANZ to the ASBFEO bank inquiry recommendations fall well short of what’s needed to improve current small business lending practices.
“Judging by the responses of the big banks so far, it’s clear they’re not listening to the growing chorus of concern about the way they treat small business borrowers,” Ms Carnell said.
“Both banks bloviated today about supporting various recommendations we’ve made in our inquiry report, but the devil’s in the detail; when you dig a little deeper, there’s always conditions attached, and without definitive timelines for action, all of this talk means absolutely nothing.”
Speaking at today’s House Economics Committee hearing, CBA CEO Ian Narev committed to removing non-monetary default terms, but only from agreements for loans up to $1 million, while ANZ CEO Shayne Elliott said his bank was only prepared to consider the future use – as opposed to removal – of non-monetary default terms in agreements for loans of up to $3 million. It follows NAB’s unwavering refusal on Friday to remove any such clauses from small business loan agreements.
“We simply don’t think it’s reasonable for the banks to be able to default a small business loan when people are compliant financially, and we’re absolutely resolute in our recommendation that all non-financial default clauses be removed from small business loan contracts of up to $5 million,” Ms Carnell said.
“The banks say they rarely use these clauses for loan impairment, so why insist on their inclusion in the first place? They claim that getting rid of them would drive up risk for the bank and cost for the borrower, but if they’re rarely used, how could this possibly be the case, not to mention the fact banks already factor-in the risk associated with small business loans, including small business loans secured against bricks and mortar such as the family home.
“Our inquiry heard heart-breaking stories from small business owners who’d been subject to such clauses, so for ANZ’s Graham Hodges to today maintain their inclusion is ‘good practice’ is just breathtaking,” she said.
Ms Carnell once again reinforced the practical need for the banks to change the way they define a small business.
“Mr Narev today said ‘there’s no magic number’ when it comes to stipulating what defines a small business loan facility. In fact, there is such a number and it is $5 million,” Ms Carnell said.
“$5 million isn’t a figure we’ve plucked out of the air, it’s a figure supported by others including David Murray, and more recently Phil Khoury, who was appointed by the banks to scrutinise their own code of conduct.
“Anything below $5 million is clearly an out-of-date concept that does not represent the true lending picture of Australia’s small businesses. $5 million covers 98 per cent of loans to small business so I call on the banks to heed our advice – and that of others – and acknowledge they’re severely out of touch on this.
“We don’t want weasel words about supporting changes; we don’t want the banks to cherry-pick certain details from our recommendations that best suit them. All of our recommendations are reasonable, do-able and do-able quickly, and all of them are designed to make a difference in the lives of small business people, and there’s absolutely no excuse for the banks to keep kicking the can down the road on this,” she said.
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QUEENSLAND Resources Council (QRC) Chief Executive Ian Macfarlane has released a statement on the Queensland Fly-in Fly-out (FIFO) Bill.
"The Queensland Government’s Strong and Sustainable Resource Communities Bill parliamentary committee report has been released this afternoon," Mr Macfarlane said.
"This Bill will add unnecessary extra red-tape to our sector’s operations, and lower the state’s competitiveness, at a time when the sector is rebounding and more jobs are coming onto the market.
"It is worth noting that of the (nearly) 50 operating coal mines in Queensland, just two were originally designed as 100 per cent FIFO mines.
"These two mines were approved as FIFO mines by the previous Labor Bligh government at a time when the sector was at its peak and there was an extreme shortage of skilled workers to fill jobs.
"However, since operations began at these two mines, both now use local contractors to service the mines and are therefore no longer 100 per cent FIFO.
"QRC is now working with the resources sector, schools and local communities to train young people with the skills needed to work in the sector through our educational and skills program the Queensland Minerals and Energy Academy (QMEA).
"The sector’s goal is, that in the future, this program will provide a local source of more skilled workers for mining and gas operations in Queensland."
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Organised by the Rice Extension team, the Rice Industry Field Day is an opportunity to see the latest rice R&D in action and learn how it can be applied on farm, as well as explore agricultural trends and share new perspectives.
Funded by the Rural Industries Research and Development Corporation (RIRDC), Rice Extension connects growers to research, the latest technologies and best management practice in the rice industry.
RIRDC Program Manager, Michael Beer said the Field Day brings the RIRDC Rice Program to life, highlighting the importance of RD&E investment.
“The Rice Program aims to improve the productivity and sustainability of the Australian rice industry and is delivering significant outcomes for industry and stakeholders. Of particular note is our recent evaluation of the Rice Program which found investment in RD&E delivered a cost-benefit ratio lying between 6.6 and 7.6 - an impressive result for any industry,” said Mr Beer.
The Field Day program includes speaker sessions from SunRice and the International Rice Research Institute (IRRI), and the choice of attending either a Field Site walking tour or Business and Innovation session at the Old Coree Homestead.
Rice Extension Coordinator, Gae Plunkett said the Field Day program further cements the ITRC theme, Tradition, Technology, Productivity – A Balancing Act.
“For growers, the Field Day is a fantastic opportunity to discuss the latest issues and trends in rice growing, as well as network with growers, industry professionals and researchers on a local and international level,” said Ms Plunkett.
“We are expecting strong interest from local industry and growers, particularly in the practical sessions focused on improving on farm production and profit. The Business and Innovation session is an exciting and thought provoking addition to the program that will explore new trends and challenge traditional thinking when it comes to agricultural business practices.”
Event details:
2017 Rice Industry Field Day (free event)
9:00am, Thursday 9 March 2017
‘Old Coree’, Conargo Rd, 18.5km west of Jerilderie
Program: http://www.rga.org.au/events/rice-industry-field-day-2017.aspx
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AUSTRALIAN Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell said she remains committed to eliminating non-financial covenants in small business loans under $5 million despite NAB executives today re-stating their opposition to the reform.
Speaking after the House Economics Committee concluded the first of its latest round of bank hearings with executives from NAB, Ms Carnell said the bank’s unwillingness to make changes to the way they treat small businesses who are consistently making their loan repayments, is unacceptable.
“As I reiterated during Senate Estimates yesterday, for the banks to be able to default small business loans when people are compliant financially, is simply not a reasonable approach,” Ms Carnell said.
“NAB pushed back on that today, indicating there are risks associated with removing such clauses, and that doing so would put up the costs of the loans. That’s not the feedback we’ve had from experts. Remember the banks already put a premium on top of small business loans to take into account a higher level of risk, so you can’t have it both ways; you can’t have a contract that allows the banks to move all the risk to the borrower, while also having a higher interest rate.
“Our recommendations in this area – indeed all of our recommendations – are not unreasonable; these are not new issues, these are not unrealistic expectations. In fact, many of our recommendations have been supported by various other inquiries and reviews.
“NAB today indicated that they supported the ‘vast majority’ of our recommendations, including giving consideration to implementing 90 day notice periods, as well as providing simple plain English contracts. I certainly welcome this response, but so far it’s only lip-service; I want to see these changes in place sooner rather than later.
“Our recommendations are do-able and do-able quickly; most importantly, the recommendations we’ve come up with will make a significant difference in the lives of small business borrowers, so we really need to see action now,” she said.
Ms Carnell also restated the importance of amending the definition of a small business loan facility to $5 million; a move also backed by David Murray and Phil Khoury in their respective inquiries.
“Small businesses are the engine room of the Australian economy; these businesses are growing all the time, with more and more now falling outside the existing $1 million definition, so reform in this area is vital if we’re to support growth in this sector,” Ms Carnell said.
“The banks say they’re ‘making banking better’, but I’m afraid there’s still a lot more work to be done to prove there’s any real substance behind the PR slogan,” she said.
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AUSTRALIAN Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell has used an Estimates hearing to once again call on the banks to implement the changes outlined in the ASBFEO bank loans inquiry report as quickly as possible, in order to establish balance in the relationship between financial lenders and their small business customers.
“(There have been) 17 inquiries from various perspectives since the GFC; 40 recommendations that have been repeated in various forms over that period of time, and very, very little movement from the banks in a range of things from really important issues, down to things you would have thought the banks would have picked up on by now,” Ms Carnell told the hearing.
“It shows the level of the lack of action by the banks on these things, that have been brought up time and time again,” she said.
When asked about the impact of current banking practices on the small businesses examined as part of the ASBFEO inquiry, Ms Carnell said that many were now bankrupt.
“There are people who used to be running successful businesses living in garages; we got a pretty good view of what actually happened in a range of these cases and the impact is huge.” Ms Carnell said.
“In a good number of the cases these were people who hadn’t missed a payment on their loan; so they weren’t in financial default, the default came as a result of non-financial default.
“The community believes – and small businesses believe – that if you pay the amount you’re supposed to pay every month and you don’t break any of the standard rules, that should be all you’re required to do, so for the banks to be able to default small businesses when people are compliant financially, we don’t think that’s a reasonable approach.
“Remember small businesses don’t have in-house lawyers and have little-to-no capacity to negotiate these contracts, so we believe that getting rid of non-financial covenants for loans under $5 million is really important for small businesses to be able to get on with the job of growing their businesses.
“We tried to come up with a group of recommendations that would make a difference to small business.
“We’ve tried hard to make them do-able and do-able quickly, because we haven’t come up with any hugely new recommendations.
“I want them (the banks) to go with all of them,” she said.
Ms Carnell also reinforced her commitment to providing six monthly updates on the banks’ progress in implementing the ASBFEO recommendations.
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