September 29 Edition.
Parliament has now risen and won’t be back for a good few weeks. (Back October 10, 2016).
On the global stage things are now clear – we are in for low interest rates all over the world for as far as you can see.
Even in the US, that is slowly recovering it is expected interest rates will reach 0.625% by the end of 2016 and about 1.125% by the end of 2017. (2 years ago the figures were 2.5% and 3.25%). Something seems not to be working.
Here is one view of what is wrong.
UN fears third leg of the global financial crisis - with prospect of epic debt defaults
22 September 2016 • 7:22am
The third leg of the world's intractable depression is yet to come. If trade economists at the United Nations are right, the next traumatic episode may entail the greatest debt jubilee in history.
It may also prove to be the definitive crisis of globalized capitalism, the demise of the liberal free-market orthodoxies promoted for almost forty years by the Bretton Woods institutions, the OECD, and the Davos fraternity.
"Alarm bells have been ringing over the explosion of corporate debt levels in emerging economies, which now exceed $25 trillion. Damaging deflationary spirals cannot be ruled out," said the annual report of the UN Conference on Trade and Development (UNCTAD).
We know already that the poisonous side-effect of zero rates and quantitative easing in the US, Europe, and Japan was to flood developing nations with cheap credit, upsetting their internal chemistry and drawing them into a snare. What is less understood is just how destructive this has been.
Much of the money was wasted, skewed towards "highly cyclical and rent-based sectors of limited strategic importance for catching up," it said.
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There is also some concern back home!
Fix budget before the crunch hits, urges Ken Henry
- The Australian
- 12:00AM September 24, 2016
Paul Kelly
National Australia Bank chairman and former Treasury chief Ken Henry warns that Australia faces an unacceptable risk with its budget deficit and fears the nation will wait for a painful economic crunch before confronting true financial repair.
In an exclusive interview, Dr Henry issued his most powerful warning about the failure of politicians and the national parliament, saying responsible fiscal policy had become a “pretence”, the economic reform narrative “no longer exists” and politicians are fixated by “appeals to populism”.
Dr Henry said Australia was now running the risk that its AAA sovereign credit rating might be downgraded, coinciding with another global financial disturbance, and in this situation the consequences for Australia “would be truly catastrophic”.
He said this was a “small risk” in relative terms but “the consequences are so large you cannot take the risk”.
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Thursday Update:
Global markets have behaved this week - especially in the last 48 hours with OPEC suggesting they might slow down oil production a little
Our markets liked this news and seem to be liking the $5-10 Billion dollars of dividends that are being paid in the next week or so - some money of which will be re-invested!
Politically it is all about same sex marriage, the slowing down of pathology cuts, backpackers, the SA blackout and the slipping polls for MT.
Here are a few other things I have noticed.
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Global markets have behaved this week - especially in the last 48 hours with OPEC suggesting they might slow down oil production a little
Our markets liked this news and seem to be liking the $5-10 Billion dollars of dividends that are being paid in the next week or so - some money of which will be re-invested!
Politically it is all about same sex marriage, the slowing down of pathology cuts, backpackers, the SA blackout and the slipping polls for MT.
Here are a few other things I have noticed.
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Budget Issues.
BIS flashes red alert for a banking crisis in China
18 September 2016 • 11:00am
China has failed to curb excesses in its credit system and faces mounting risks of a full-blown banking crisis, according to early warning indicators released by the world’s top financial watchdog.
A key gauge of credit vulnerability is now three times over the danger threshold and has continued to deteriorate, despite pledges by Chinese premier Li Keqiang to wean the economy off debt-driven growth before it is too late.
The Bank for International Settlements warned in its quarterly report that China’s "credit to GDP gap" has reached 30.1, the highest to date and in a different league altogether from any other major country tracked by the institution. It is also significantly higher than the scores in East Asia's speculative boom on 1997 or in the US subprime bubble before the Lehman crisis.
Studies of earlier banking crises around the world over the last sixty years suggest that any score above ten requires careful monitoring. The credit to GDP gap measures deviations from normal patterns within any one country and therefore strips out cultural differences.
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Lawrence Summers says regulators fail to make banks safer
- The Australian
- 12:00AM September 19, 2016
Adam Creighton
One of the world’s most influential economists, and a former US Treasury secretary, has delivered an unexpected, formative message to regulators who think they have made the financial system safer — you haven’t.
In the presence of former Federal Reserve chairman Ben Bernanke, George Akerlof, the serving chairwoman’s husband and a Nobel prize-winning economist, and former Fed vice-chairmen Donald Kohn and Alan Blinder, Lawrence Summers last week presented overwhelming evidence that the world’s biggest banks — including three of Australia’s — were no less likely to become insolvent than before the crisis.
In remarks given to The Australian afterwards, Mr Summers took aim at the Federal Reserve’s annual stress testing of large financial institutions — considered the world’s toughest.
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Focus on inflation, not growth, the right path for RBA: Morrison
- DAVID UREN
- The Australian
- 12:00AM September 20, 2016
Scott Morrison has declared now is not the time for experimenting with monetary policy and has stuck to the Reserve Bank’s long-established inflation-targeting formula in a new agreement with governor Philip Lowe.
The Treasurer and Dr Lowe, who took over as governor yesterday, have rejected a push for more radical reform, with a number of economists, including former Reserve Bank board member Warwick McKibbin, arguing central banks should target growth rather than inflation.
“The governor and I agree that now is not the time to be making any major changes in the composition of this statement, nor is it the time to be engaging in any monetary policy setting experiments,” Mr Morrison said yesterday.
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Backpacker tax: Agriculture sector grows impatient for prompt resolution
By political reporters Stephen Dziedzic and Anna Vidot
Regional Coalition backbenchers who have been agitating against the controversial backpacker tax are increasingly confident the Prime Minister and Treasurer will give ground on the issue.
Key points:
- The Government delayed the 32.5pc tax for six months after outcry from the tourism and agricultural industries
- The ABC has been told the most likely compromise would be a 19pc tax
- Industry says there has already been an identifiable fall in job inquiries
The Government delayed the controversial 32.5 per cent tax for six months following an outcry from tourism and agricultural industry representatives, and launched a review.
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Australian debt level raising eyebrows globally
- The Australian
- 12:00AM September 21, 2016
Adam Creighton
Australia’s ballooning public debt, which has more than quadrupled to 40 per cent as a share of GDP since 2007 with little sign of abatement, is raising eyebrows globally.
Canberra’s debt binge is putting at risk a AAA rating from Kroll Bond Rating Agency, an emerging competitor to ratings giants Moody’s and Standard & Poor’s, founded by legendary US businessman Jules Kroll in the wake of the global financial crisis to restore trust in credit ratings.
“If Australia’s government continues to accumulate debt the way they have been, it is certainly going to affect their credit rating,” said Christopher Whalen, senior managing director at Kroll, speaking to The Australian in New York.
“As long as the government keeps its eye on the ball as far as fiscal balance is concerned … I think it will be OK,” he said of Australia, striking an optimistic tone. The Treasury’s debt and deficit forecasts have undershot expectations every year since the GFC, with the federal budget not expected to return to surplus until 2021 at best.
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Bank of Japan spree ‘distorts’ Reserve Bank rate
- The Australian
- 12:00AM September 21, 2016
David Uren
The Bank of Japan’s trillion-dollar determination to kickstart the Asian nation’s economy is disrupting Australia’s short-term money market, according to the Reserve Bank, with economists concerned that today’s meeting of Japan’s central bank could make things worse.
Japanese investors are using Australia’s short-term secured lending market in a hedging strategy that effectively swaps Australian government bonds for Japanese government bonds, which are in strong demand under the Bank of Japan’s massive quantitative easing program.
In the process, they are distorting rates in the “repo” market, which is the market used by the Reserve Bank to set the cash rate and is also the key market that provides liquidity to trade in government bonds. Traders describe the repo market as “ground zero” for the Australian financial system, given that it is critical way that banks manage their vast balance sheets.
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New RBA chief Philip Lowe: I agree, banks have a big trust gap
- The Australian
- 12:00AM September 23, 2016
David Uren
The commercial banks have forgotten that the essence of their industry is trust, the new Reserve Bank governor Philip Lowe says, adding that bank leaders should place their duty of care to their customers above making sales.
Remuneration structures with rich incentives for bankers to make sales are at the heart of the problem, Mr Lowe said in his first appearance as governor before the House of Representatives economics committee in Sydney.
With Labor pressing for a royal commission to investigate the banks, Dr Lowe said there clearly was an issue with bank culture.
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RBA’s Philip Lowe: era of banks shielding investor returns over
- The Australian
- 12:00AM September 23, 2016
Michael Bennet
New Reserve Bank governor Philip Lowe has indicated that the era of big banks shielding shareholder returns is coming to an end, claiming material cost-cutting had run its course and more competition would dent their loan repricing power.
In his first appearance as governor before the House of Representatives committee on economics, Dr Lowe told politicians they should quiz the bank chiefs on whether the “spread” between the cash rate and small business lending rates had widened too far since the global financial crisis.
As the chiefs of Commonwealth Bank, ANZ, Westpac and National Australia Bank prepare to appear before the committee early next month, Dr Lowe said: “(The banks) moved quite early on during the financial crisis to reprice the credit spreads they charge over the indicator rates on many small business loans.
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- September 22 2016 - 7:08PM
Reserve Bank governor Philip Lowe urges government to invest in infrastructure
Peter Martin
Incoming Reserve Bank chief Philip Lowe has appealed to the Turnbull government to help him out with economic management by borrowing big for infrastructure, saying there's only so much that further cuts in interest rates can do.
In what amounted to a plea to the Prime Minister and Treasurer to take advantage of near-record low interest rates and borrow now that the Reserve Bank's cash rate was close to zero at 1.5 per cent, he told a parliamentary hearing that monetary policy is "not working as effectively as it might have".
"One response is to keep doing more of it in the hope that it finally works, he said. "My judgment is that that has not been particularly useful.
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COMMENT
- September 22 2016 - 9:04PM
How can Australian households get away with the biggest debts in the world?
Jessica Irvine
It is an extraordinary fact that Australian households shoulder the biggest debts in the world, relative to our incomes.
The latest global update on household debt released this week by the Bank for International Settlements reveals Australia once again taking the dubious crown of most-indebted.
Sydney house price growth jumps again
It's likely that house prices will continue rising in 2016, as improved affordability stimulates a surge in market confidence for both buyers and sellers.
Of the 44 countries surveyed, Australia is home to the highest ratio of household debt to GDP of all, at 125 per cent.
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COMMENT
- September 23 2016 - 2:02PM
Forget the wealth effect: You're not as rich as you think you are
· Satyajit Das
The idea that the world is awash in savings - one factor seen behind the stalling growth in developed countries - is, on the surface, a persuasive one. Too bad it may not be true.
Yes, the postwar generation is wealthier than any before it. But the ultimate value of any investment depends upon being able to convert it into cash and thus generate purchasing power. In fact, the world's accumulated wealth - around $US250 trillion ($327 trillion), according to Credit Suisse's Global Wealth Report - is almost certainly incapable of realisation at its paper value. The headline number thus vastly overstates the supposed savings glut.
Most of these savings are held in two forms: real estate, primarily homes, and retirement portfolios that are invested in shares and bonds.
Both are rising in value. A combination of population growth, higher incomes, increased access to credit, lower rates and, in some cases, limited housing stock have driven up home prices in key markets including Australia; those who got in early have done especially well.
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Budget balance: Are our leaders asking the wrong questions?
Analysis
By business reporter Andrew Robertson
Ever since the global financial crisis hit our shores in 2008 there has been no more discussed issue in federal politics than the need to balance the budget.
In the last few weeks Australia's top three economic leaders have all been singing from the same song sheet.
In London earlier this month, Treasury secretary John Fraser flagged the Government is "very much alive to do something about our fiscal situation", indicating it could do that by cutting spending.
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Politicians fiddle while our fiscal crisis awaits
- The Australian
- 12:00AM September 24, 2016
Although there are other reasons, avoiding catastrophe seems like a reasonably compelling imperative to undertake budget repair. Former Treasury secretary Ken Henry, who oversaw the Rudd government’s emergency response to the global financial crisis, has warned about the ongoing risks of our national fiscal reform ineptitude. He has outlined a scenario whereby international markets might lose faith in Australia and downgrade our triple-A credit rating at the same time the global economic system endured another shock. “The currency would depreciate a long way,” Dr Henry told editor-at-large Paul Kelly in an exclusive interview. “Unemployment would obviously go into double-digit figures, businesses would fail, banks would be unable to continue to provide credit to homeowners, to businesses small and large, infrastructure financing would stop dead in its tracks — it sounds catastrophic but actually it would be.” Dr Henry says the risk is small but it is a risk we cannot run.
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Health Budget Issues.
Coalition cut deal to silence pathologists before poll
- The Australian
- 12:00AM September 19, 2016
Sean Parnell
Malcolm Turnbull and Sussan Ley struck a mid-campaign deal with pathology companies to halt their criticism of the Coalition in exchange for a rent review the Health Department could not show was justified.
Documents obtained by The Australian under Freedom of Information laws suggest Coalition promises in relation to rental costs for pathology collection centres were premature and impractical, with at least one of the key measures dropped after the election.
Pathology companies had long complained about the rent charged by medical centres but although the department had no evidence it was excessive, the government convened a roundtable meeting of stakeholders in April.
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Inside Sussan Ley’s billion-dollar health battle
- The Australian
- 12:00AM September 19, 2016
Pamela Williams
A large group of powerful health industry players met at the Hellenic Club in the Canberra suburb of Woden on March 29.
It was their fourth meeting for the year, with medical experts, lobby groups, health fund executives, consultants and numerous federal health bureaucrats arguing over an estimated $800 million in savings for consumers.
On one side was the lobby group for manufacturers of devices such as artificial knees and hips and pacemakers — including the giant US corporation Johnson & Johnson — that cost privately insured Australians up to five times more than those in public hospitals and overseas.
In addition, private hospital chains such as Ramsay Health Care were fighting to protect the prices they can charge private patients for these devices.
Ranged against the manufacturers and private hospitals were the big private health insurers, pleading for a cut to the high regulated price of implant devices.
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Health overhaul after policy review
- The Australian
- 12:00AM September 23, 2016
Sean Parnell
The federal Health Department has ramped up its policymaking capability after the Coalition government endured a tumultuous first term of reviews and industry stoushes.
The quiet overhaul comes as pressure mounts on Health Minister Sussan Ley to convert more reviews into reforms, particularly in relation to private health costs, including the inflated Prostheses List.
Ms Ley is understood to have initially proposed price cuts for the list of surgical implants available in the private system, but the government instead opted for more committee talks, after fierce lobbying from manufacturers and major hospital operators who benefit from the status quo.
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COMMENT
- September 22 2016 - 4:34PM
Mediscare claims one more victim as Tony Nutt's 'complete lie' claims backfire
James Massola
It was the lie that defined the 2016 election campaign, slashed Malcolm Turnbull's majority by 14 seats and almost propelled Bill Shorten to victory.
And on Thursday, "Mediscare" claimed one more victim - Liberal Party federal director Tony Nutt.
Lies, damn lies and politics
Liberal Party Director Tony Nutt calls for an end of mediscare-type campaign 'lies', but finds himself called out over past coalition transgressions. Courtesy ABC.
In the traditional post-election address to the National Press Club, Mr Nutt attempted to take the moral high ground over lies in politics and take a stick to Labor over its claim the Coalition would privatise Australia's universal healthcare provider.
But all he did was shoot himself in the foot, facing a barrage of questions on the Coalition's own history of stretching the truth during election campaigns.
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- September 23 2016 - 5:41PM
Consumer watchdog ACCC urged to investigate cartel claims against surgeons
Julia Medew
Concerns that Australian surgeons may be running cartels to protect their lucrative private markets will be discussed at a national meeting of health ministers next month.
The Australian Competition and Consumer Commission is also under pressure to investigate potentially anti-competitive behaviour by the Royal Australasian College of Surgeons after Fairfax Media revealed fresh concerns about its secretive practices.
The Royal Australasian College of Surgeons is 'controlling the borders' to keep out highly-trained surgeons from abroad, says London-trained surgeon Patrick Tansley.
Following claims of bullying, professional mobbing and improper examinations for overseas-trained surgeons, NSW Health Minister Jillian Skinner and her Victorian counterpart, Jill Hennessy, said they both planned to raise the issue at the Council of Australian Governments' meeting of health ministers on October 7.
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Health Insurance Issues.
- Sep 19 2016 at 12:00 AM
- Updated Sep 19 2016 at 12:00 AM
Medibank starts long climb back with $40m carrot to cranky customers
by Simon Evans
An exodus of policyholders which threatens to slowly undermine the long-term profits of Australia's largest health insurer, Medibank Private, has prompted the firm to roll out the first of several new carrots to try to rebuild faith in its products and service and win back customers.
Medibank will invest $40 million over the next three years to enable 2.7 million of its customers who have Medibank Extras cover to receive 100 per cent back on the cost of an annual dental check-up.
Medibank executive David Koczkar was last week handed the title of chief customer officer in a management shake-up under chief executive Craig Drummond's new mantra of putting the customer first. This comes after rising levels of annoyance over value, technology issues and the fine print of some policies, as 225,000 customers let their coverage lapse in 2015-16, and total policy-holder growth went backwards by 2.5 per cent.
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Medibank moves to stop customer dropouts with more benefits
- The Australian
- 12:00AM September 19, 2016
Andrew White
Medibank Private plans to spend more on providing benefits to policy holders in a move that will increase costs and could reduce returns, as it looks to arrest a rise in customers who are allowing policies to lapse or downgrading to cheaper cover.
Newly promoted chief customer officer David Koczkar said Medibank was examining a number of proposals to add services or benefits to policies amid a consumer backlash against steep rises in annual premiums.
“They have been saying to us that they want to see more value in their healthcare products,’’ Mr Koczkar said.
Last financial year, Medibank Private saw 225,500 policies lapse while the number of new policies fell 18 per cent to 180,000. That was before the federal government approved an average 5.59 per cent rise in premiums, the latest in a line of mid-to-high single- digit rises in costs, at a time when wages growth has stalled and amid a growing debate about the cost of health cover and fees paid to medical service providers.
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- September 19 2016 - 12:15AM
Teeth new battle ground for embattled private health insurers
Madeleine Heffernan
Australia's biggest private health insurer Medibank Private has joined many of its peers in offering free annual dental checkups for its 2.7 million "extras" policyholders.
Fresh from an executive shake-up, legal action from the consumer watchdog, and troubles sending out tax statements to members, Medibank on Sunday said its new policy would cost $40 million over three years and save a family of four up to $400 a year.
"Our customers tell us they want to get more value from their health insurance, and we're listening," said Medibank chief customer officer David Koczkar.
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Jostling too late to spare prosthetic cost pain
- The Australian
- 12:00AM September 20, 2016
Pamela Williams
Sarah-Jane Tasker
Interest groups are jostling for position on a committee that will decide the cost of medical prostheses, amid claims some companies are profiting from inflated prices set for private hospitals for items such as hip replacements.
Attempts to cut the price of prostheses are unlikely to make any ground before private health funds set their fees for next year — meaning another round of premium increases due partly to the high cost of the items.
In a shock move yesterday, the peak lobby group for the medical device industry announced that chief executive Susi Tegen was stepping down immediately, citing health reasons. Ms Tegen had spearheaded the Medical Technology Association of Australia’s efforts to prevent the federal government from lowering prices on a mandated fixed-price list for surgical implants — known as the prostheses list. These high fixed prices mean that private patients in Australia can pay up to five times more than public patients and those overseas.
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Inquiry call by Nick Xenophon over implant price row
- The Australian
- 12:00AM September 21, 2016
Pamela Williams
Independent senator Nick Xenophon will push for a Senate inquiry into price differences for medical implants such as knees, hips and pacemakers that mean privately insured patients pay up to five times more than public hospital patients.
Senator Xenophon said yesterday the situation had all the hallmarks of a multi-million-dollar public scandal.
“It seems that over the years, consumers with private health cover have paid upwards of $800 million a year more than they should have. Predominant amongst these are our senior citizens,” he said.
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Stalling on health to ‘lock in high costs’
- The Australian
- 12:00AM September 21, 2016
Sarah-Jane Tasker
Sean Parnell
Government indecision over reforms to the prostheses list does not bode well for more difficult work to reduce costs in the private sector and stop people dropping their health insurance, according to key stakeholders.
Health Minister Sussan Ley is understood to have initially proposed price cuts for the list of surgical implants available in the private system, but, amid fierce lobbying from manufacturers, the Turnbull government instead opted for further committee talks.
Private health insurers have long argued the prices on the prostheses list are well in excess of prices paid in the public sector and overseas. They estimate up to $800 million, currently directed to manufacturers and some hospitals, could be saved through government intervention.
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- September 21 2016 - 1:31PM
Australians pay thousands more for private health cover
Heath Aston
Australian families are paying up to $400 more a month for private health insurance than consumers in comparable countries like Britain and New Zealand.
The Turnbull government acknowledged during the election that a majority of the 13 million people with private health cover feel they are "not getting value for money from their policy".
The private health industry blames this on a range of factors, including the much higher cost of medical devices like pacemakers and hip replacements compared to other countries and the public health system.
An international comparison of premiums confirms Australia's place among the highest cost markets in the world for private health cover.
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Dual-attack lobbyists target Sussan Ley over PBS and prostheses
- The Australian
- 12:00AM September 22, 2016
Sean Parnell
Lobbyists pushing for medical device manufacturers to maintain their lucrative deals on the government’s prostheses list also represent pharmaceutical companies fighting a landmark cost-saving measure proposed for the Pharmaceutical Benefits Scheme.
Health Minister Sussan Ley is understood to have initially proposed price cuts for the list of surgical implants available in the private system, but, amid fierce lobbying from manufacturers, the Turnbull government instead opted for further committee talks.
Independent senator Nick Xenophon has called for a police investigation into an apparent cabinet committee leak of Ms Ley’s original proposal to the Medical Technology Association of Australia and a broader Senate inquiry into issues with the prostheses list.
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Cost of private health insurance tipped to rise
EXCLUSIVE Renee Viellaris, Herald Sun
September 25, 2016 12:00am
STRUGGLING families are facing another rise in the cost of health insurance as the Federal Government considers whacking customers with even higher premiums.
Health insurers, demanding an increase that will cost some customers an extra $200 a year, are lobbying the Government to allow them to pass on their medical inflation costs.
But major health funds, acknowledging the public’s intolerance for and inability to pay too many increases, have taken a swipe at the Government, saying Health Minister Sussan Ley could almost immediately save customers $800 million if she dramatically reduced how much insurers paid for internal medical devices.
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Medicare changes to cause long payment delays for cash claims
SAMANTHA MAIDEN, National Political Editor, The Sunday Telegraph
September 25, 2016 5:00am
LEAKED Medicare documents have revealed patients face long delays for cash claims after the Turnbull government outsourced processing to new centres and closed Medicare shopfronts.
The changes could leave patients undergoing expensive treatment, including IVF thousands of dollars out of pocket for weeks and will also impact big claims for breast prosthetics that previously had a three-day turnaround.
But the government insists only 20 per cent of claims not lodged online face longer wait periods with the overwhelming majority of patients now claiming online.
Whistleblower public servants have come forward to warn patients can expect an end to face-to-face claims and claim they have been banned from telling patients that their Medicare claims will be sent off-site for processing.
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Aged Care Issues.
Home care providers face fresh criticism over admin costs
Andrew Wilkie told Parliament clients had complained of ‘ridiculous administrative costs’
Tasmanian independent MP Andrew Wilkie has accused community care providers of charging their clients excessive administration fees on a scale that amounts to “systemic rorting” of government subsidies.
Mr Wilkie told Federal Parliament last week he had received many complaints from older people and their families about “ridiculous administrative costs” being levied on consumers.
In one example described to Parliament, Mr Wilkie said a home care package client was being charged $165 per hour for basic house cleaning and showering services once non-direct care costs were added to their individual statement.
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David Tune to Lead Major Review of Aged Care Reforms
Assistant Minister for Health and Aged Care, Ken Wyatt AM, MP announced the appointment of David Tune AO PSM to lead the Aged Care Legislated Review.
Page last updated: 22 September 2016
22 September 2016
Assistant Minister for Health and Aged Care, Ken Wyatt AM, MP has today announced the appointment of David Tune AO PSM to lead the Aged Care Legislated Review.
The changes announced to aged care in 2012 included a comprehensive review of the aged care sector in 2016-17. This review will inform ongoing reforms to aged care.
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Pharmacy Issues.
Profits from unproven supplements ‘a conflict for pharmacists’
- The Australian
- 12:00AM September 24, 2016
Sean Parnell
Pharmacists who sell unproven vitamins and supplements have a conflict of interest, the doctors’ lobby has warned, saying they should not be distracted by a need to profit from other retail offerings.
The Weekend Australian revealed in July that the federal government’s Review of Pharmacy Remuneration and Regulation had heard concerns that pharmacists’ professional responsibilities clashed with their role as shopkeepers.
Nielsen research last year suggested vitamins and supplements made up one fifth of total over-the-counter pharmacy sales, a figure which is said to be growing at a rate of 20 per cent a year.
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Superannuation Issues.
- Sep 19 2016 at 11:45 PM
- Updated Sep 20 2016 at 12:21 AM
Defining super's purpose could spark new crackdown on tax perks
by Sally Rose
A new law to define the purpose of superannuation could foreshadow the end of tax perks for anyone better off than an age pensioner.
The government last week confirmed its plans to enshrine in legislation that the objective of the superannuation system is "to provide income in retirement that substitutes or supplements the age pension".
Lobbyists from the warring retail and industry fund sectors are campaigning in concert to pressure the government to change the wording of the planned legislation.
Super groups are pushing for the the new policy framework to also include reference to concepts such as "a comfortable standard of living", "dignity", or "an adequate retirement income".
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- Updated Sep 20 2016 at 11:30 PM
Super industry wants provision for 'comfortable' lifestyle written into law
The powerful superannuation lobby is pressuring the government to lock in higher spending on retirement savings by passing laws referring to the provision of a "comfortable" lifestyle, which in today's dollars means a lump sum of $545,000 for singles and $640,000 for couples.
Forming an unusually cogent front, industry groups have put forward an objective for super that would push the government's spending commitment beyond helping to replace or supplement the age pension to something more costly for the federal budget.
While the maximum full-rate pension provides about $19,200 a year for singles (or $30,900 for a couple), the Association of Australian Superannuation Funds (ASFA) says singles seeking a comfortable retirement require a lump sum of $545,000, which is sufficient to provide an annual income stream of $43,062 a year. Couples require a lump sum of $640,000, which yields $59,000.
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EXCLUSIVE
- September 20 2016 - 10:08PM
Turnbull government considering national default superannuation scheme to save $1.5 billion
Peter Martin
The Turnbull government is considering a radical shake-up of Australia's superannuation system that would pit banks and industry funds against each other for the right to manage the deposits of every new entrant for at least two years.
The shift, detailed in an issues paper released by the Productivity Commission on Tuesday, would centralise the decision about which default fund new employees were placed into, taking it out of the hands of employers and making it the result of a national tender.
The great superannuation auction
A radical proposal being considered by government could see all Australian default super contributions flow into one super fund. Peter Martin explains.
Calculations by the Grattan Institute suggest it could slice $1.5 billion per year from the fees charged by default funds and put downward pressure on the fees charged by other funds.
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I look forward to comments on all this!
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David.
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