Showing posts with label cost of living. Show all posts
Showing posts with label cost of living. Show all posts

Sunday, 8 September 2019

Scott Morrison delivers - but it is not good economic news


This was then Australian Treasurer Scott Morrison in 2016 with blunt warning about a future recession and dip in living standards..... 

The Sydney Morning Herald, 25 August 2016: 

A generation of Australians has never known a recession or high unemployment but unless hard decisions are taken soon, there is a "terrible risk" complacency could end Australia's 25 consecutive years of economic growth, Treasurer Scott Morrison has warned. 


In the first of three "economic headland" speeches the Treasurer will deliver in the coming weeks, designed to set out the budgetary challenges facing the nation - and the government's vision for how to tackle them - Mr Morrison will argue that it should not take an economic crisis to trigger a wake-up call, or restart the economic reform process, so that Australia enjoys a prosperous future. 


In extracts of the speech seen by Fairfax Media, which will be delivered in Sydney on Thursday, Mr Morrison made a simple plea. 


"I do not want my kids to know what a recession is and everything that goes along with that," he will say. 


"I recognise that in the absence of a 'recession we have to have', or the threat of 'becoming a banana republic', achieving necessary change will be more frustrating and more difficult. 


But it is no less necessary, and achieving it this way is far better than the alternative."  


In addition, Mr Morrison will say that on the current settings, a generation of Australians are likely to never pay tax, setting up a new divide - the "taxed and taxed-nots", prompting the Treasurer to ask: "Are we still up to the challenge of doing what we need to do to ensure another 25 years of consecutive economic growth? 

"Do we really appreciate how quickly our economic success can turn, and are we as prepared as we can be to deal with it ... my greatest concern is that we end up answering these questions the hard way." 


This is Australian Prime Minister Scott Morrison in 2019 delivering 
a fall in living standards and what looks like the beginning of that recession.....

The Australian, 4 September 2019:

The Prime Minister said on Tuesday that the GDP figures would show that Australia is still doing better than many other developed economies.....

“Today’s growth figures will show over the year a softness … what we will see is that in a tough climate we are actually battling away quite well.

The Guardian, 4 September 2019:


Today the government has been madly attempting to spin the GDP figures as good. So let’s cut straight to the point – the figures are terrible and are among the worst we have seen this century. 


But what makes it worse is this government would have us believe they saw them coming. 


How bad are things? Today’s figures show the worst annual economic growth for 18 years. GDP per capita is now lower than it was a year ago, productivity is plunging and the economy is pretty much staying above water purely because of government spending and a drop in imports due to weak investment and household spending. 


And yet these are the figures the treasurer, Josh Frydenberg, would have us believe are evidence of the “resilience of the Australian economy” and which the prime minister, Scott Morrison, said would “come as no surprise to me”. 


If this is how bad things get when the government says it is not being surprised, God help us if they ever get a shock. 


 That trend growth figure is the worst since March 2001. 


We have now had four consecutive quarters of trend growth below 0.5% – that hasn’t happened since the 1990s recession nearly 30 years ago. It is also the first time since the GFC that GDP per capita is lower than it was a year ago.... 


It was little wonder, in his press conference announcing the figures, that the treasurer quickly turned to talking about employment growth compared with the rest of the OECD, because there is not much to boast about on the whole economy side of things. 


Current growth has us in the bottom half of the OECD..... 


The figures also showed, despite the treasurer’s protestations, that living standards are continuing to decline. 


The treasurer suggested that “living standards continue to increase with real net national disposable income per capita rising 1% to be 2.7% higher through the year”. 


But that figure includes all income – both profits and wages. As such, when profits grow strongly due to big increases in export prices, then national income rises. But unless that flows through to households via wages growth, it is pretty meaningless to use it when talking about living standards. 


And we know that the big increase in income is coming from profits – primarily from the mining sector – and it is not flowing through to households. 


When we look at household disposable income we see that it fell not just in the June quarter but over the past year – down more than 1%. Household incomes per capita are currently at the same level they were in real terms in 2010. 


Today’s figures released by the ABS show the economy grew by 0.5% in the June quarter in seasonally adjusted terms and 0.4% in trend terms. Through the year the growth was a truly pathetic 1.4% seasonally adjusted and 1.5% in trend terms. 


Households of course know their living standards are falling, because they are showing it in how they spend their money. In the past year household consumption grew just 1.5% – again the worst result since the GFC..... 


But the treasurer, despite his talking up the figures, knows just how bad they actually are. He even noted that while profits in the mining sector rose 10.6% in the June quarter, in the non-mining sector they “actually fell 0.6%”. 


Because profits in the mining sector have grown so strongly and compensation to employees is growing so weakly, the share of national income going to workers has plunged. 


The last time the share of national income going to workers was this low, the Beatles had just toured Australia.....


Read the full article here.


The Sydney Morning Herald, 6 September 2019: 

“The crisis,” the [Reserve Bank] governor announced at a conference in 2017, “is really in real wage growth.”......

Instead of wages rising at more than 3 per cent a year, as they had in the five years to 2013, the average pay rise since has fallen to 2.2 per cent annually. 

After inflation, the average pay rise has been a scant 0.5 per cent.....

...without higher wages to pay for people’s groceries, medical care, homes and holidays, spending is weak and the economy enfeebled. 

Lowe has urged governments, state and federal, to lead the way, breaking their 2.5 per cent annual limits and paying workers more.

Then there is this headline demonstrating the folly of Liberal-National ideology......

Former failed advertising executive and Institute of Public Affairs adherent Scott Morrison clearly missing the point entirely.

Morrison, McCormack, Frydenberg & Co are hugging their projected budget surplus so tightly they are strangling the national economy.

Monday, 2 September 2019

NSW Berejiklian Coalition Government will no longer offer $250 pa council rates rebate to new pensioners from 2020?


It has been on the NSW Government agenda for some years now, but it is looking highly likely that the Berejiklian Liberal-Nationals Government is going to scrap the annual $250 rates rebate for homeowners holding a Commonwealth Pensioner Concession Card for all but existing Age, Veterans Affairs TPI/EDA, War Widow and Disability Support pensioners.

All future homeowning pensioners will instead be able to defer the first $1,000 of their annual rate payments (CPI indexed), with full payment of the debt (plus interest) on sale of the house/unit/flat.

The Daily Examiner, 30 August 2019, p.4: 

Council has expressed disappointment at being unable to provide feedback on a critical pensioner concession. 

After the Office of Local Government invited feedback on the Independent Pricing and Regulatory Tribunal’s report into the review of the Local Government Rating System, Deputy Mayor Jason Kingsley moved a motion to have council express disappointment there was no further consultation on the pensioner concession. 

Clarence Valley Council was able to provide feedback on a raft of recommendations by IPART but could not comment on a proposal to introduce a scheme to allow eligible pensioners to defer up to $1000 of their rates. 


Cr Kingsley was scathing in his assessment of the scheme which he said appeared “has been decided” and involved indexing the rates to CPI to be paid when the house was sold. 

“Not only is the recommendation to remove the current $250 concession in lieu of the deferral... but it will also be charged interest until the full amount is recovered,” he said. 

“So the financial legacy the pensioner was hoping to leave to their families may be eaten up in deferred rate charges as well as interest.” 

Cr Karen Toms as “devil’s advocate” said while she agreed with the motion on the principle that they had not been able to provide feedback, she was “a little bit torn” as the council spends about $1 million on pensioner subsidies each year. 

“I actually quite liked the idea of perhaps deferring it. I know it sounds mercenary perhaps but the reality is that house is going to be sold one day. I am torn a little bit,” she said. 

Clarence MP Chris Gulaptis said since 2011 the NSW Government had invested $694 million to help pensioners make ends meet and IPART’s recommendation to create a rate deferral scheme had been ruled out. 

“It is important to strike a balance between providing rebates and continuing to fund the services that local communities need – services such as hospitals, roads, education and child care.” he said. 

In 2017 when the issue was last raised, council did not support the recommendation to introduce rate deferrals and said it was “council’s strong view pensioner concession must be fully funded by the State Government”. 

“A rate deferral scheme is problematic in local government areas with a high proportion of pensioners and low property values as it may result in less than full recovery of deferred debts from sale of properties and create cash flow issues for the council” the resolution from the October 18 meeting stated.....

Saturday, 20 July 2019

Quote of the Week


High rents are a major contributor to household insecurity, personal stress and the risk of people, including children, slipping into real poverty and even homelessness. The North Coast rental market disadvantages many people because the competition for decent and affordable housing greatly outstrips supply. The reasons for this crisis are varied, including a general lack of rental stock, many houses in coastal towns becoming holiday rentals and the need to accommodate workers on the road projects, which results in inflated rents that stay that way after the workers move on.”  [St Vincent de Paul regional executive officer Michael Timbrell quoted in The Daily Examiner, 18 July 2019]

Tuesday, 16 July 2019

Housing affordability for NSW North Coast renters is beyond the reach of many


On 1 May 2019 The Financial Review reported on the top twenty federal electorates with the highest level of rental stress in Australia.

The Northern Rivers federal electorates of Richmond and Page were placed in 3rd & 8th positions respectively, with a total of 13,937 household experiencing rental stress .

While the mid-North Coast federal electorates of Lyne and Cowper came in 6th & 10th place, with a total of 13,283 households under rental stress.

Anglicare Australia's 2018 Rental Affordability Snapshot demonstrates that this stress is an ongoing problem with housing affordability for those on low incomes on the NSW North Coast.

In 2018 five of the six NSW local government areas with the most unaffordable rentals were on the Far and Mid North Coast.

A St Vincent de Paul Society spokesperson is reported in The Daily Examiner this week highlighting the fact that people on the North Coast are going without food in order to keep their rental accommodation.

The Abbott-Turnbull-Morrison Government spends literally billions supporting property speculators and investors in their aspirations to become personally wealthy, but is ignoring the plight of low income renters trying to keep a roof over their heads.

If it will no longer invest in affordable housing through adequate targeted federal funding tied to the states increasing social/community housing stocks, the least it can do is raise the Commonwealth Rental Assistance Payment available to eligible low-income individuals and families.

Tuesday, 11 June 2019

So how is Australian wage growth faring so far in 2019?


If one looks at national averages for wage growth or compensation of employees (COE) in March Quarter 2019 it looks as though no-one has been left behind.

However, first glances can be deceptive. 

COE increased 1.2% and average compensation per employee rose 0.4%.
Private COE grew 1.4%, while public COE increased 0.7%.



In the March Quarter 2019 there was negative wages growth in Tasmania, Northern Territory and the Australian Capital Territory (ACT). 

With a seasonally adjusted  -0.4% total change to pre-tax wages in Tasmania, a -0.3% total change to pre-tax wages in the Northern Territory and -0.4% total change to pre-tax wages in the ACT.

While March Quarter 2019 total percentage changes in pre-tax wages growth for the remaining states was:

Victoria 0.7%
Queensland 0.8%
New South Wales 1.6%
West Australia 1.7%
South Australia 2.0%.

Note: Compensation of Employees (COE) represents total gross (pre-tax) wages paid by employers to employees for work done in March Quarter 2019 accounting period.

Seasonally adjusted there was a 0.5% change in total hourly rates of pay excluding bonuses in Australia between December Quarter 2018 and March Quarter 2019.

Other factors to consider alongside wages……..

According to the ABS the Cost Price Index (CPI) rose 1.3 per cent per cent through the year to the March quarter 2019, after increasing 1.8 per cent through the year to the December quarter 2018.

In March Quarter 2019 CPI remained flat due to reduced costs in automotive fuel and domestic/international holiday travel & accommodation. Although over the last twelve months, food and non-alcoholic beverages group costs rose 2.3% and, in seasonally adjusted terms food and non-alcoholic beverages group rose 1.2% this quarter. While in seasonally adjusted terms this quarter education group costs rose 0.3% and health group rose 0.7%.


Sunday, 7 April 2019

The Morrison Government's well thumbed federal election campaign playbook needs updating


With another federal election a little over four weeks away the Morrison Government - a party without a genuine climate change policy - has obviously included a version of the 'hundred dollar lamb roast' in its talking points for the troops as allegation surface here and there that climate change policies held by The Greens or Labor will increase food prices.

Especially any part of these policies which might in the future seek to have industry limit its greenhouse gas emissions by placing a price on carbon.

Here is a rebuttal of those allegations.....
The Gillard Labor Government’s Clean Energy Act 2011 was assented to on 18 November 2011, came into effect on 1 July 2012 and was repealed by the Abbott Coalition Government on 17 July 2014, coming into post-dated effect on 1 July 2014 .

Tuesday, 26 February 2019

On the subject of income, welfare support and spending


Will negative wage growth, the acute poverty of jobless people combined with the avarice of employers and punitive federal government policy intesect to create a perect storm which will see household spending fall this year?   

Current state of play......

ABC News, 23 February 2019:

Rather, Dr Lowe saw stagnant household incomes is a much bigger threat to consumer spending, and thus to the 60 per cent of the economy based on it.
"Aggregate household income used to grow at 6 per cent, it's growing sub-3," he told the MPs on the committee.

"That's a big difference, and you accumulate that over three or four years and income is 8, 10 or 12 per cent lower than it otherwise would have been.

"Many people borrowed assuming their incomes would grow at the old rate and they haven't.

"They're having more difficulty, they've got less free cash and so they can't spend, so this is why I've put so much emphasis on the need for a pick-up in wage growth."
Dr Lowe told the committee he has been using speeches to try and lift wage expectations, while the RBA has been keeping interest rates low and stable for an extended period of time to relieve the pressure on households.

The RBA governor said, while the strategy seems to be working — with unemployment down at 5 per cent and wage growth starting to pick up from recent lows — he could use a bit more help from the Fair Work Commission and employers.
Fair Work last year awarded a 3.5 per cent pay rise for those on the minimum wage and linked awards, and Dr Lowe said that was a "sensible and right policy" and a similar increase this year "makes a lot of sense".

"If workers get their normal long-run share of that [productivity increase] then their real wages should rise by 1 per cent a year," he said.

Financial Review,  7 February 2019:

Consumer anxiety has reached its highest level in three years, with households spending less on discretionary items as they worry about their finances and the future.

The National Australia Bank consumer anxiety index rose to 62 points in the December quarter, and close to 40 per cent of those surveyed said they had experienced financial hardship during the quarter – the highest level in two years.

Households said they had pulled back their spending on things like travel, eating out and entertainment due to heightened anxiety about their financial conditions.

The primary causes of anxiety through the December quarter were how to finance one's retirement and how to provide for one's family's future....

"What's happening here is you haven't got much wages growth, you're paying off utilities, you're paying off debt, and you're doing things that you have to do."

Mr Oster said after doing all those things, there wasn't much money left for households.

Anxiety about job security reached its highest level since 2016, and 50 per cent of homes in hardship found their financial position impacted by high utility bills.

The Guardian, 17 September 2018:

A proposal to increase Newstart allowance by $75 a week would lead to a boost in consumer spending, creating more than 10,000 jobs and lifting wages, a new report shows.

The report by Deloitte Access Economics, released on Monday morning, said the policy to increase the incomes of more than 700,000 people by $10.71 a day would cost the federal budget $3.3bn a year.

But a “prosperity dividend” would see the government collect an extra $1bn in taxes as a result of a stronger economy, and the proposal was also projected to create 12,000 extra jobs in 2020-21 and increase wages by 0.2%.

It comes amid debate about the rate of Newstart, which at $272.90 for a single person has not risen in real terms in more than two decades. It will increase by $2.20 this week as a result of indexation.

The Australian Council of Social Service (Acoss), business groups, unions and a former prime minister, John Howard, have all argued for an increase, but the government has so far dismissed those calls….

The bulk of the economic benefits from increasing the payment would go to the bottom 5% of Australian income earners, who would receive “six times the dollars going to the highest income quintile”. The “poorest of the poor” would receive 28 times the relative boost to their disposable incomes, than the top income quintile.

Regional areas “most in need of help” would be key winners from increased spending….

The current rate is the equivalent to living on $38.99 a day. The report said a single person who also receives the maximum rent assistance and the energy supplement would be living on about $49.24 a day.

Previous research has shown that those on Newstart live on as little as $17 a day after their housing expenses and bills.

ABC NEWS, 9 September 2018:

It may not have garnered the same attention as the surprisingly strong second-quarter GDP growth, but an equally striking fact in last week's national accounts was household savings had just hit a post-GFC low.

It is not a new phenomenon. The household saving ratio — or the ratio of households' net saving to disposable income — has been shrinking since 2014.
What makes the latest figure uncomfortable is that there is now little fat left to trim, and on current trends households will be spending more they earn.

The ability of the Australian economy to keep growing in the face of a number of challenges in recent years owes a fair bit to the savings so prudently built up after the sobering experience of the GFC.

As JP Morgan's Tom Kennedy points out, the persistent decline in savings since 2014 has been an important part of Australia's real GDP growth performance, helping offset some of the spending drag associated with record low wages growth and an unemployment rate that has yet to fire up wages.

While the correlation between savings and spending is far from perfect, Mr Kennedy has drilled down into the figures, and is worried.

Monday, 10 December 2018

Australia 2018: Is long-term rental destroying the wellbeing of low income households?



Across the nation, people who rent are living on insecure tenancies. Almost 9 in 10 Australians who rent (88%) are on leases of a year or less, and are not certain of where they will be living in a year’s time. This impacts a person’s ability to feel part of the local community and establish roots.







The Land, 1 May 2018:

AFFORDABLE rentals on the state’s North Coast are increasingly few and far between, but the continued rise of the Airbnb-model now sees 3000-plus homes sit empty while low-income and government-assisted tenants are shut out. 

Anglicare’s latest Housing Affordability Snapshot says the region’s rental crisis has worsened as property owners in Ballina, Byron Bay, and the Tweed are incentivised to target short-term holidaymakers through web-based booking companies instead of potential long-term renters. 

The Anglicare report, released on Sunday, showed available North Coast rental properties were in steep decline (down from 795 in 2017 to 660 in 2018) with all family groups on income support, and single households on minimum wage, likely to struggle to find housing for themselves and their children.

Clair, A. et al, 24 May 2016, The impact of housing payment problems on health status during economic recession: A comparative analysis of longitudinal EU SILC data of 27 European states, 2008–2010, excerpt:

Transitioning into housing arrears was associated with a significant deterioration in the health of renters…..

Housing arrears is one of the so-called ‘soft’ ways in which housing influences health (Shaw, 2004), especially mental health, alongside the ‘hard’, physical impacts of the infrastructure itself, such as damp, mould, and cold. A growing body of scholarship indicates that people who experience housing insecurity, independent of other financial difficulties, experience declines in mental health (Gili et al., 2012Keene et al., 2015Meltzer et al., 2013Meltzer et al., 2011Nettleton and Burrows, 1998). 

In Australia, analysis of the longitudinal HILDA dataset found that those in lower income households who had moved into unaffordable housing experienced a worsening in mental health (Bentley, Baker, Mason, Subramanian, & Kavanagh, 2011), with male renters faring worse (Bentley et al., 2012Mason et al., 2013).

One has to wonder if being a long-term renter affects quality of life to such a degree that on average renters die earlier than home-owners.

Thursday, 1 November 2018

Australian Politics 2018: This Federal Government Can’t Do Anything Right


Reared with a sense of righteous self-importance, fed on a diet of IPA ideology with a side dish of entitlement, brought to Canberra by the Old Boy’s Network, then fattened into self-complacency by the political perks of office, this particular Coalition Government (which took the reins of government in 2013 and kept them in 2016) was always a puny failure.

Faced on a daily basis with its own failings this clueless federal government scrabbled about for years before turning bitter, vindictive and intent on destruction.

Here is yet another example of the Morrison Government’s inability to do more than spin its wheels…..

Financial Review, 26 October 2018:

Federal energy minister Angus Taylor's roundtable aimed at forcing big energy companies to lower their standing offers for retail power by January 1 is under a cloud because of real fears this could amount to an illegal cartel.

Energy industry sources say the legal risks of breaching cartel laws - jail terms and massive fines for individual executives - are too great for them to risk at a roundtable at which issues of pricing will be hanging in the air even if not explicitly discussed.

Mr Taylor dismissed suggestions that the round table could breach competition laws.

"Of course we're not going to breach the Australian laws; we don't do that," he told reporters after the COAG Energy Council meeting in Sydney.

But he signalled that all the invited retailers may not attend the round table, at which the government would outline its policies and expectations that the sector will deliver price cuts for consumers.

"We're looking forward to as many electricity providers coming to the round table as want to come along," Mr Taylor said.

The energy companies' fears of breaching the cartel laws are heightened because they have been under permanent surveillance on pricing by the Australian Competition and Consumer Commission for the last 18 months and the government recently extended that monitoring until 2025.

As well, cartel laws have been widened to include so called "signalling" and other forms of tacit agreement falling short of explicit price fixing agreements during the last decade because offences were too difficult to prove in court under the previous, much stricter definition.

Mr Taylor wrote to energy companies on Tuesday inviting them to a "roundtable" to discuss the reductions in their standing offers they will be required to make for January 1, 2019 - before the July 1 scrapping of standing offers which are to be replaced by the "default" tariff to be set by the Australian Energy Regulator by April 30.

 Read the full article here.

Thursday, 12 July 2018

Don't expect your residential electricity costs to come down anytime soon


In three years time the amount of revenue electricity network companies can charge customers will be reduced, which according to the Australian Energy Regulator in its Draft Rate of Return Guideline "could [not would] result in household customers’ bills decreasing by around $30 to $40 per year".

Remembering all the other failed assurances that the cost of residentail electricity would come down, it is a brave individual who takes this latest prediction at face value.


The Australian Energy Regulator has moved to significantly cut the amount of revenue electricity network companies can charge customers in a bid to take the pressure off households and businesses enduring high power prices.
AER chair Paula Conboy said it would reduce average household electricity bills by about $30 to $40 a year….

But energy network companies claim the new guidelines will strip about $2 billion in revenue over the next five years and threaten future investment in the energy sector.
Morgan Stanley said the rule, if confirmed, would cut valuations of listed grid owners such as Spark Infrastructure and Ausnet Services, while adding it "could have been worse".

Energy users welcomed the move as a sign the regulator is prioritising the interests of consumers although Energy Consumers of Australia acting head Lynne Gallagher said the proposed reduction in the rate of return able to be earned on capital could have been bigger.

"There is no doubt that there could be some disappointment from some consumer groups with this decision, but it is a much better outcome than we've seen in previous years on this issue," Ms Gallagher said....

AusNet said that if the rule is confirmed, the reductions would apply to its power distribution network from the beginning of 2021, in transmission from April 1 2022 and in gas from January 1 2023. Spark said the rule would apply to its various assets in 2020, 2021 and 2023….

Mr Turnbull is also expected to use his speech in Brisbane to talk on the long-awaited Australian Competition and Consumer Commission into electricity prices which is expected to be released this week. The ACCC report is expected to be used as a reason not to call a royal commission into electricity prices as being pushed by the Greens. 

Australian Competition and Consumer Commission, Restoring electricity affordability & Australia's competitive advantage, 11 July 2018, excerpts:

Australia is facing its most challenging time in electricity markets. High prices and bills have placed enormous strain on household budgets and business viability. The current situation is unacceptable and unsustainable. The approach to policy, regulatory design and promotion of competition in this sector has not worked well for consumers. Indeed, the National Energy Market (NEM) needs to be reset, and this report sets out a plan for doing this…….

There are many causes of the current problems in the electricity market. At all stages of the supply chain decisions have been made over many years by many governments that set the NEM on the wrong course.

In networks, the framework that governs regulation of monopoly infrastructure was loosened, leaving the regulator with limited ability to constrain excess spending by network owners. The limited merits review (LMR) regime allowed network owners to appeal regulatory decisions and recover billions of additional dollars from consumers. It led to significant increases in prices, has drawn out the length of time taken for revenue determinations, and has created significant uncertainty around network pricing. In addition, increased expenditure on networks was driven by reliability standards for some networks that were set too high, without due regard for consumers’ willingness to pay for marginal increases in reliability.

In generation, against ACCC advice, the Queensland and New South Wales (NSW) governments made decisions regarding the operation and ownership of generation assets giving rise to concentrated markets. In Queensland, the government consolidated the generation assets of three businesses into two. In NSW, as one example, both generators owned by Macquarie Generation were sold to AGL, missing an opportunity to deliver a competitive market structure by selling them to separate buyers.

Most state governments put in place excessively generous solar feed-in tariff schemes with a view to encouraging consumers to install solar photovoltaic (PV) systems. Under these schemes, the subsidy paid to consumers for the energy produced by their systems outweighed, by many multiples, the value of that energy. Take up of the schemes exceeded all expectations, in part due to dramatic declines in solar PV installation costs. The substantial cost of the schemes continues to be spread across all electricity users.

The main enduring policy instrument for encouraging low-emissions electricity generation is the Renewable Energy Target. While it has been effective at encouraging wind and solar generation capacity installation, it has also distorted the investment that has occurred in the transition from higher carbon technologies to lower ones. The subsidies received for installing wind and solar made the business case for doing so compelling but did so in a way that was indifferent to the ability to provide energy to the market when demand requires it.

At a time when gas-powered generation has become more important with the exit of large coal-fired plants, the extent of LNG exports from the East Coast and government moratoria on on-shore gas exploration and development have stifled the availability of gas at a low price.

Electricity retailers have also played a major role in poor outcomes for consumers. Retailers have made pricing structures confusing and have developed a practice of discounting which is opaque and not comparable across the market. Standing offers are priced excessively to facilitate this practice, leaving inactive customers paying far more than they need to for electricity. Pay on time discounts, which have emerged as a response to attempts to constrain late payment fees, are excessive and punitive for those customers who fail to pay bills on time. [my yellow highlighting]

Tuesday, 13 March 2018

FAIR GO 101: It's Time To Change The Rules



Tuesday, 12 December 2017

"What alternate universe does the Australian Treasurer inhabit?


According to AMP chief economist Shane Oliver “consumer spending is being dragged down by low wages growth, slowing wealth accumulation, poor sentiment, high debt levels and rising energy costs."

In the 2017 September quarter households were spending less on clothing, footware, health, furnishings, household equipment, entertainment, dining out and alcohol - as the pressure on disposable income bites.

Yet this is the Australian Treasurer in December 2017……………
The Sydney Morning Herald, 6 December 2017