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GRACosway Weekly Wrap Up
17 March 2017
Prime Minister Turnbull announced a $2 billion expansion of the Snowy Hydro Scheme this week in order to boost national renewable energy storage capacity. The four-year expansion is expected to increase the Scheme’s capacity by up to 50 per cent, with a feasibility study due by the end of this year. Mr Turnbull indicated the “unprecedented expansion” is capable of providing power to an additional 500,000 homes and will “enable greater energy efficiency and help stabilise electricity supply into the future”. In responding to the announcement, however, South Australian Premier Jay Weatherill described the expansion as “a $2 billion admission that the national energy market has broken and there needs to be public investments to actually fix it up”.
Mr Weatherill unveiled his own government’s response to boosting the State’s power supply and increase energy security via a new six-point plan. The “dramatic intervention” will involve the construction of “Australia’s largest battery” used to store wind and solar energy along with a $360 million gas-fired power plant to provide back-up power during peak demand periods. In responding to the announcement, Mr Frydenberg indicated he will seek legal advice on whether the plan breaches the National Electricity Rules (NER), as it proposes to incorporate increased state powers that will supersede the Australian Energy Market Operator (AEMO) to support South Australian energy security, if necessary. In contrast, Federal Opposition Leader Bill Shorten praised Mr Weatherill’s plan, stating that “It is time for Mr Turnbull to stop playing political games and work with Labor… for the interests of the nation.”
Pressure on the Federal and state governments to improve housing affordability has intensified, with new data revealing 11 per cent of NSW houses and units were purchased by foreign owners last year. Federal Assistant Treasurer Michael Sukkar refused to comment on whether changes to negative gearing and capital gains tax will feature in the upcoming May Budget, however, has indicated support for first home buyers to access superannuation if implemented as part of wider reform to increase supply in the market, despite a push-back from the superannuation industry. See the media coverage here.
In a landslide win last weekend, Labor declared victory at the Western Australian election with a 15.7 per cent primary vote swing against the Liberal Party. Requiring 10 additional seats to form government, Labor gained an extra 31 seats to hold a current total of 41, with the Liberal Party securing just 17. Incoming Premier Mark McGowan has announced a 17-member Cabinet, with Ben Wyatt expected to be named Australia’s first Indigenous Treasurer. Nationals Leader Barnaby Joyce described the WA Liberal ‘preference swap’ deal with One Nation ahead of the election as a mistake: “It's in the Liberal Party's interests to be close to the National Party, and it's in the National Party's interests to be close to the Liberal Party.” See the media coverage here and GRACosway’s briefing note here.
Sally McManus has been appointed Secretary of the Australian Council of Trade Unions (ACTU), becoming the first female leader of the national union organisation. A day after her official appointment, Ms McManus confirmed the ACTU’s support of the Construction, Forestry, Mining and Energy Union (CFMEU), which is currently facing charges of illegal striking. Her controversial comments around the issue have been regarded by Coalition figures as “a disgrace” and “extraordinary”. See the media coverage here.
The United Kingdom’s decision to leave the European Union has progressed this week, with key legislation passing both houses of parliament after six weeks’ debate. The legislation is expected to receive royal assent on Thursday before UK Prime Minister Theresa May triggers Article 50 of the Lisbon Treaty later in the month. Prime Minister May has described Brexit as “a defining moment for our whole country.” See the media coverage here.
The Federal, Victorian, ACT and NT parliaments sit next week.


Federal Developments
Small Business Minister Michael McCormack has announced an independent review into the operations of the Australian Small Business and Family Enterprise Ombudsman. The Federal Government established the Ombudsman last year to provide assistance and advocacy for Australian small businesses. A report will be provided to the Minister by 30 June 2017. See the media release: Independent review of the Australian Small Business and Family Enterprise Ombudsman.
The Australian Bureau of Statistics (ABS) has released the latest monthly labour force figures, revealing the February 2017 trend unemployment rate remained at 5.8 per cent. The data also shows employment increased by 11,600 jobs last month; the quarterly underemployment rate however, remained at a historical high of 8.6 per cent. See the media release: Trend unemployment rate at 5.8 per cent.
State Developments
Victorian Treasurer Tim Pallas released the Government’s 2016-17 Mid-Year Financial Report, which provided an update on the State’s finances for the six month period to 31 December 2016. The report shows Victoria recorded an operating surplus of $1.4 billion during this period, with net debt decreasing by $8.3 billion largely driven by the long-term lease of the Port of Melbourne. See the media release: Victoria: Creating Jobs, Growing Economy, Reducing Debt.


Federal Developments
McKinsey & Company released a report on the gas market in Australia’s east, which reveals that as current supply sources follow an expected decline, fresh supply is needed to compensate. The report indicates that greater supply investments will be required, as the $40 billion of planned supply measures over the next 15 years may not suffice to meet national demand by 2030. Read the full report here: Meeting east Australia’s gas supply challenge.
State Developments
Victorian Premier Daniel Andrews and Minister for Energy and Environment Lily D’Ambrosio announced an additional $20 million investment to support large-scale energy storage initiatives, increasing the Government’s total investment in energy storage to $25 million. This funding will assist energy storage companies partner with network businesses, with the aim of increasing energy storage capacity in Victoria to 100 megawatts by the end of 2018. See the media release: Large Scale Energy Storage: An Investment In Jobs, Reliability And Affordability.
Tasmanian Minister for Resources Guy Barnett and Minister for Health Michael Ferguson announced the State Government’s intention to introduce legislation into Parliament that will end subsidies to Forestry Tasmania. In doing so, the legislation will make available around $25 million per year to reinvest in other state services. See the media release: Ending the subsidies to the forest industry.
AGL Energy Limited’s Virtual Power Plant begun operations in South Australia. Federal Minister for the Environment and Energy Josh Frydenberg announced the project will operate as a 5 megawatt solar power plant to connect 1,000 residential and business premises via a cloud-based network. See the media release: Australian’s First Virtual Power Plant Goes Live in South Australia.
Queensland Premier Annastacia Palaszczuk travelled to India this week to encourage greater investment in the State. She will be meeting with a number of key businesses, including the Adani Group to discuss the $21 billion Carmichael Coal project. Ms Palaszczuk hopes to increase Queensland trade with India, which is the third most valuable export market for the State behind China and Japan. See the media release: India rise spurs Queensland export growth: Palaszczuk.


State Developments

NSW Premier Gladys Berejiklian and Minister for Roads Melinda Pavey announced the route, drilling plans and property notification processes for the Beaches Link and Western Harbour Tunnel. The Premier indicated the State Government will commit $77 million for geotechnical work along the length of the route, which will commence after Easter. The next stage of the work is expected to be complete in mid-2018. See the media release: Action at last on Beaches Link Tunnel.
Victorian Minister for Public Transport Jacinta Allan announced that construction has begun on the $395 million Hurstbridge Line Upgrade. Minister Allan indicated the project will provide 1,000 jobs at the height of construction and is scheduled for completion by 2019. See the media release: Construction Begins On Massive Hurstbridge Line Upgrade.
South Australian Minister for Water Ian Hunter has called for full implementation of the Murray Darling Basin Package as agreed in 2012. Minister Hunter stated that the most important element was the full 450 gigalitres of water, which will be returned to the river system to ensure appropriate environmental management. See the media release: SA Water Minister calls for full implementation of Murray Darling Basin package.


Federal Developments

Federal Health Minister Greg Hunt has commissioned a report on the cost of medical prostheses in public hospitals from the Independent Hospital Pricing Authority in order to address the high cost of prostheses in the private sector. The announcement came as a Senate Committee held its first public hearing on issues surrounding the private sector’s regulated Prostheses List. The Prostheses Listing Advisory Committee is expected to recommend reforms mid-year. See coverage here: Push to cut costs of medical devices.

State Developments

Queensland Minister for Health Cameron Dick announced the opening of the State’s first public mother-and-baby mental health unit at the Gold Coast University Hospital, at a cost of $3.5 million in 2016-2017. The ‘Lavender Parent and Infant Unit’ will provide a new service that will allow mothers suffering from acute postnatal disorders to receive treatment and support with their infants. See the media release: New unit to support mums experiencing postnatal disorders.
South Australian Minister for Health Jack Snelling announced the ‘Technical Completion’ of the new Royal Adelaide Hospital, marking the end of six years of construction. A testing and training period will follow over 90 days to ensure the hospital is fit for purpose. See the announcement here: New RAH reaches significant milestone.
The Northern Territory Government has committed to address the cost of alcohol abuse, with Health Minister Natasha Fyles releasing draft terms of reference for a comprehensive review of the Territory’s alcohol policy. An expert panel will undertake broad public consultation and report to government on various aspects of alcohol policy, including alcohol-fuelled crime, entertainment precincts, remote communities and licensing, in September this year. See the media release: Responsible alcohol policy = a safer community.
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
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