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GRACosway Weekly Wrap Up
21 October 2016
 
Prime Minister Malcolm Turnbull placed industrial relations firmly on the agenda early in the week, saying the case for restoring the Australian Building and Construction Commission (ABCC) is “overwhelming and growing”. The PM’s focus on illegal union activity was, however, overshadowed by a debate on gun control which emerged when crossbench Senator David Leyonhjelm said he would consider supporting the Government’s industrial relations legislation in return for an end to the import ban on the Adler lever-action shotgun. Labor accused the Coalition of “trading away John Howard’s gun laws” in order to pass legislation, while former Prime Minister Tony Abbott rejected allegations he authorised a deal on gun laws during his time as PM. The controversy continued throughout the week, highlighting the ongoing tension between Mr Turnbull and his predecessor and detracting from the Government’s agenda. State police ministers are meeting today to finalise the review of the National Firearms Agreement and discuss the classification of the Adler shotgun.  
 
South Australian Family First Senator Bob Day announced his resignation from the Senate after his home building business went into liquidation. Family First will nominate a replacement candidate to fill the vacancy caused by Senator Day’s departure, with Family First’s South Australian Legislative Council member Robert Brokenshire, Senator Day’s adviser Rikki Lambert and Kenyan-born lawyer Lucy Gichuhi putting themselves forward as candidates.
 
The Government’s ABCC and same-sex marriage plebiscite bills passed the House of Representatives this week, while its company tax cuts are likely to stall in the Senate after the Nick Xenophon Team (NXT) confirmed it will not support a reduction in the company tax rate for any firm with an annual turnover of more than $10 million. Treasurer Scott Morrison told Radio National the Government is continuing to discuss the matter with Senator Xenophon while acknowledging the Parliament is “sovereign” and will decide which of the Government’s measures to support. The NXT has also confirmed it will block two welfare savings measures relating to unemployment benefits for young jobseekers and the age pension, while signalling it is willing to negotiate on industrial relations legislation.
 
The NSW Government has announced the $16.2 billion sale of a 50 per cent share in the State’s electricity network Ausgrid to Australian super funds IFM Investors and AustralianSuper, with Premier Mike Baird dubbing the sale an “outstanding result”. The deal follows Federal Treasurer Scott Morrison’s August decision to block Chinese and Hong Kong bidders from acquiring the asset on national security grounds and will not require Foreign Investment Review Board (FIRB) approval. The NSW Opposition has criticised the Government’s decision to accept an unsolicited proposal as “scandalously inappropriate”, arguing the sale price is $1 billion lower than it may have been if the Government had run a second open process. See coverage by The Australian here (subscription service).
 
Senator Nick Xenophon has called for changes to the nation’s foreign investment framework to give precedence to Australian bids for agricultural land. Speaking at the Canberra launch of an all-Australian bid for the S. Kidman and Co stations, Senator Xenophon argued that the FIRB should support Australian companies by advising the Treasurer against foreign bids where there is a “commercially equivalent comparable Australian-based bid”. The BBHO syndicate – comprised of well-known Australian cattle industry families – has confirmed it will lodge a bid for the Kidman business over coming days to rival the $365 million joint bid put forward by Gina Rinehart’s company Hancock Prospecting and Chinese company Shanghai CRED. See coverage by the AFR here (subscription service).
 
Labor will retain government for a fifth term in the Australian Capital Territory (ACT) following Saturday’s Legislative Assembly election, which saw a swing of 0.5 per cent away from the Party. ACT Labor is expected to secure 12 seats in the expanded 25 seat Legislative Assembly, while the Liberals are on track to win 11 and the Greens two. Labor Chief Minister Andrew Barr said his Party will negotiate with the Greens to “form a new progressive government in the ACT”, foreshadowing a continuation of the Labor-Greens coalition government first formed in 2012.
 
The Victorian and Tasmanian parliaments sit next week.


FINANCE

Federal Developments
 
The Australian Prudential Regulation Authority (APRA) released an information paper providing an overview of the risk culture in banking, insurance and superannuation organisations. The Paper noted while there has been increased focus on risk culture, further improvement and ongoing focus is required to ensure it is effective. See media release: APRA releases snapshot of industry practice in risk culture.
 
Minister for Revenue and Financial Services Kelly O'Dwyer released revised life insurance remuneration regulations for consultation, in support of the Government’s legislative reforms to remuneration practices introduced into Parliament earlier this month. The revised regulations will apply to all advisers and both advised and direct sales of life risk insurance products. Submissions close 4 November 2016. See media release: Government releases revised life insurance remuneration regulations for consultation.
 
Minister O'Dwyer also announced the membership and terms of reference for the ASIC Enforcement Review Taskforce, which will assess the suitability of the regulatory tools available to ASIC. The taskforce will be led by a panel chaired by Treasury, with members from ASIC, the Attorney-General’s Department and the Commonwealth Director of Public Prosecution. It will examine legislation dealing with corporations, financial services, credit and insurance organisations. See media release: ASIC Enforcement Review Taskforce.
 
Lastly, Minister O'Dwyer this week announced the Government will introduce legislation to Parliament later this year mandating the professional standards of financial advisers. Reforms included in the legislation will mandate compulsory education requirements, supervision for new advisers, an industry code of ethics, a benchmarking exam and ongoing professional development. See media release: Professional standards for financial advisers to benefit consumers.
 


RESOURCES AND ENERGY

Federal Developments

The Clean Energy Finance Corporation (CEFC) has announced that Oliver Yates will be stepping down as CEO of the body. A recruitment process is underway for Mr Yates’ replacement, to be appointed by the CEFC Board, following consultation with the responsible Ministers. Mr Yates will continue as interim CEO until his successor is appointed. See media release: CEFC Board commences search for new CEO.

State Developments

The Australian Energy Market Operator (AEMO) has published an update to its preliminary report on the power outage in South Australia last month. The AEMO’s report confirmed that five system faults occurred within 88 seconds, leading to six voltage disturbances which nine of the 13 wind farms online at the time of the event did not ride through. See the AEMO report here: Update to the preliminary operating incident report into the South Australian state-wide power outage.
 
The litigation funding firm IMF Bentham has told The Australian that it is monitoring the inquiries into last month’s power outages in South Australia, as talk gathers of a possible class action lawsuit by the businesses left without power. IMF Bentham’s Investment Manager Justin McLernon said his firm is “always interested in assisting claimants who have suffered a loss in these types of cases if there is wrongful conduct or someone to blame”. See coverage by The Australian: Lawsuit looms over South Australia wind shutdown (subscription service).
 


INFRASTRUCTURE, TRANSPORT AND WATER

Federal Developments

The National Transport Commission has called for submissions on measures to improve Australia’s Heavy Vehicle National Law and also the Chain of Responsibility Laws. Chief Executive of the National Transport Commission Paul Retter said the review followed feedback from enforcement agencies, including police forces, that the current system is too complex. The Discussion Paper is available here. See media release: NTC calling for input on potential reforms to investigative and enforcement powers.
 
State Developments

NSW Minister for Transport Andrew Constance has written an opinion piece calling for changes to the cap at Sydney Airport which will mean smaller planes would be able to access the airport outside the usual hours of airport operation. Minister Constance, also the Member for Bega in southern NSW, argues the change is essential to support the needs of the regions, particularly with regard to accessing medical care, and has called on the Federal Government to make the changes. See article: Scrap the cap at Sydney Airport so regional NSW towns aren't cut off.
 
Still in NSW, Minister for Water Niall Blair has announced that Sydney Water will undertake a $2.2 billion infrastructure investment program to run from 2016-2020. The Minister made the announcement during the construction launch of the $27 million Oran Park wastewater pumping station, saying the investment is needed to support Sydney’s growing population. See media release: Sydney's future secured with $2.2 billion in water infrastructure.

Victorian Minister for Water Lisa Neville has released Water for Victoria – a plan to improve water management and sustainability and support Victorian population growth. The plan outlines a $537 million investment over four years in a number of projects to improve water security, support agriculture and improve environmental outcomes across Victoria. See media release: Water for Victoria: a blueprint for the future.
 
The NSW Parliament’s Transport and Infrastructure Committee has released its report Workplace arrangements in the Point to Point Transport Industry, which found the point to point industry – including hire cars, ride-sharing services and taxis – suffers from over-regulation. The Committee has called for the abolition of bailment contracts in order to allow the industry to adapt to changed circumstances. See coverage by the AFR: Uber and out: Inquiry says axe IR laws for taxis, rideshare drivers (subscription service).
 
Victorian Minister for Transport Jacina Allan announced the Government has now finalised real-time travel information for all modes of public transport across almost all metropolitan stations. The system provides up-to-date information about departure times, platform numbers and cancellations through the PTV App. See media release: Real-time travel information for trains, trams and buses.
 


HEALTH

Federal Developments

Minister for Health and Aged Care Sussan Ley has announced reforms designed to reduce the cost of medical devices accessed through private health insurers, such as prosthetics, pacemakers and lenses. The reforms include reducing the cost of devices as set by the Prostheses List and reconstituting the new Prostheses List Advisory Committee (PLAC). The Minister said the reforms are based on recommendations by the Industry Working Group on Prostheses Reform and will seek to combat the inflated cost of some medical devices. See media release: Turnbull Government to ease pressure on private health insurance premiums.
 
Minister Ley and Minister for Human Services Alan Tudge have announced that the Federal Government will replace the health and aged care payments system used to deliver digital payments, in order to deliver more reliable and accurate management of Medicare, PBS, aged care and veterans payments. The new payments system will be based on existing technology but will modernise the 30-year old IT system currently in place. A consultation with health care providers and other stakeholders will be finalised in January 2017. See media release: Digital payments IT system replacement.

State Developments

West Australian Health Minister John Day has announced a further expansion of the Emergency Telehealth Service (ETS), creating a virtual emergency room for patients and staff and improving medical access in rural and remote areas. The Yalgoo Health Centre has become the 76th site to gain access to the telehealth initiative, which began as a pilot program in 2012 under the Southern Inland Health Initiative. The service allows patients to remotely access medical advice. See media release: Virtual emergency department now in Yalgoo.
 
Queensland Premier Annastacia Palaszczuk has announced the launch of a $7 million Stem Cell Ageing and Regenerative Engineering centre at the University of Queensland (UQ-StemCARE). The Premier said the centre will examine the decline in stem cell numbers and function over the human lifespan in a bid to support research into age-related illnesses such as osteoporosis and Parkinson’s disease. See media release: New UQ research centre to tackle ageing stem cells.
 
About GRACosway
GRACosway is Australia's leading public affairs and corporate and financial communications counsel. We provide a full suite of integrated services to a range of domestic and international clients across all industry sectors, including public policy, communications, regulatory, issues management and media relations advice. From offices in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Perth (GRA Everingham), GRACosway’s clients benefit from the combined experience, expertise and strategic perspective of our team of professionals in addressing complex and commercially sensitive projects. For more information, visit www.gracosway.com.au.
 
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