How McDonald's Australia makes its millions

 

On 27 April 2010 The Australian reported:

 

THE local arm of fast-food giant McDonald's doubled its profit last year to $364 million, despite reporting modest sales growth.

McDonald's Australia, which oversees almost 800 franchised restaurants around the country, reported a 6 per cent rise in sales revenue to $898m during the 12 months to December 31, on the strength of restaurant refurbishments and introduction of a premium range of products and healthier menu choices.

Overall revenue for the group rose 40 per cent to $1.7 billion, bolstered by a $308m payment for the sale of intellectual property rights to a related entity, McDonald's Asia Pacific.

This is how McDonald's Australia achieves those profits........

From Smart Company on 28 April 2010:

 

Fast-food giant McDonald's has been referred to the Fair Work Ombudsman for allegedly underpaying some of its workers, after the industrial relations commissioner has thrown out an agreement which would cover the company's 80,000 employees.

Commissioner Donna McKenna rejected a deal between the company and the Shop Distributive and Allied Employees Association, saying it fails a no-disadvantage test. The deal would have seen standardised conditions imposed in all states and territories, including rules for rostering, penalty rates and entitlements.

The no-disadvantage test states that employers may remove certain entitlements from work agreements but these must be offset by other benefits.

While McKenna wrote in her ruling that the agreement, which is 111 pages long, contains both advantages and disadvantages, it ultimately poses no net benefit for employees. She also suggested workers could have been underpaid, referring the matter to the Ombudsman.

"I have concluded the agreement would represent an emphatic diminution in overall terms and conditions for the employees who would be subject to its proposed operation," she wrote in the judgement.

"The Agreement not only fails to satisfy the no disadvantage test, on various levels it significantly compromises industrial standards that would be expected for agreement-reliant employees – considering, in particular, that these employees are mostly young and mostly casually employed."

Specifically, the judgement referred to situations that would have seen employees in New South Wales, Victoria and Queensland receive pay rises below minimum pay deals over the three-year period of the proposed agreement.

From News Ltd's Business Smarts on the same day:

This year, McDonald's employees would have received the national minimum wage rise, less between $3.84 and $7.50 a week, depending on their state. McDonald's argued this was to offset other benefits.

From July 2011 and July 2012, the increases would be the minimum wage adjustment plus either $2 or $5, depending on the state.....

employees could be asked to work unlimited shifts without a break.

Saffin and Page stay on track

It's good to see two local politicians from opposite sides of the political spectrum come out in favour of public transport on the NSW North Coast.
Although one has to wonder if a wider regional rail service will ever come to pass given the lack of political will prevailing in the NSW Parliament.

The Northern Star on 24 April 2010:

A NEW train line linking Ballina with the Casino-Murwillumbah branch line will have to be built to help the Northern Rivers cope with its booming population, Ballina MP Don Page has said.
Mr Page said he would like to see a new train line running from Byron Bay to Ballina, taking in Lennox Head along the way, and then from Ballina to Lismore, taking in the plateau communities of Alstonville and Wollongbar, to help the region cope with massive growth expected between now and 2036.
The idea has won the support of Federal Page MP Janelle Saffin, who said she wanted itincluded in the integrated transport plan being developed for the region.
She said regular, affordable public transport, already a sore point in the region, was going to become critical as the region’s population grew and aged over the next 26 years.
“Transport is such a critical issue and I see it as becoming more important with the increasing of our population and of our senior population,” Ms Saffin said.
Government figures predict the Northern Rivers’ population will grow by about 70,000 between now and 2036, mostly between Ballina and the Tweed. At the same time, the population is expected to age dramatically, with the number of people aged 65 and over set to nearly treble in some areas, while the number of children aged 14 or under declines slightly.

Australia's other CPI is not looking too flash

"IF, AS an Australian citizen, you perform an act of bribery offshore, you can be fined $1 million, jailed for 10 years and your company can be fined $10 million, which all sounds very proper except that nobody has ever been prosecuted."

James Kirby is not impressed with the fact that Australia doesn't appear willing to use its own laws to nab corrupt individuals and companies - and neither am I.
According to Transparency International (Australia):
The overwhelming majority of the world's leading exporting nations is failing to fully enforce a ban on foreign bribery, reveals Transparency International's (TI) 2009 OECD Anti-bribery Convention Progress Report.
The fifth edition of the yearly report shows that just four of 36 countries party to the OECD Anti-Bribery Convention are active enforcers. There is moderate enforcement in 11 and little to no enforcement in the 21 remaining countries. Such performance throws into question governments' commitments and threatens to destabilise the definitive legal instrument to fight international bribery.
In 1997, the member states of the OECD adopted the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Hailed as a landmark event in the fight against international corruption, the Convention represented a collective commitment to ban foreign bribery by the governments of the leading industrialised states, which account for the majority of global exports and foreign investment. The Convention entered into force in 1999 and now has 38 parties.

This is what it also said about Australia:
"Australia's slide in its standing as a non-corrupt nation has been halted in the latest international rankings of 180 countries released today by the global anticorruption organisation, Transparency International. Australia has risen to eighth spot from ninth in 2008 in the Corruption Perceptions Index (CPI), halting a slide since 2002 when it was considered the least corrupt country in the world. The Chief Executive of Transparency International Australia, Michael Ahrens, said Australia held top spot in 2002 before the exposure of dealings by the Australian Wheat Board with the Middle East, notably the Iraqi Government of Saddam Hussein. New Zealand has now replaced Denmark at the top of the world list as the country perceived as least likely to allow corruption. In the important regional breakdown of the CPI, Australian ranked third for the Asia- Pacific Region behind New Zealand and Singapore. The CPI is a composite index that draws on 13 expert and business surveys to measure the perceived levels of public sector corruption in a given country. Most of the 180 countries in the 2009 index still scored under five on a zero-to-10 scale, with zero perceived as highly corrupt and 10 to mean low levels of corruption; so the corruption challenge remains undeniable in the region and elsewhere. Highest scorers in the 2009 CPI were New Zealand (9.4) Denmark (9.3) Singapore and Sweden (9.2), Switzerland (9.0), Finland and Netherlands (8.7) and Australia, Canada and Iceland (8.7). Fragile, unstable states that are scarred by war and ongoing conflict scored lowest, notably Somalia (1.1), Afghanistan (1.3) Myanmar (1.4), Sudan (1.5) and Iraq (1.5). Mr Ahrens said the German based headquarters of Transparency International has reported that as the world economy shows a tentative recovery and some nations continue to wrestle with ongoing conflict and insecurity, it is clear that no region is immune to corruption...."

Poll results from Transparency International

Taxation loathing unites us

Death and taxes are considered inevitable and our loathing of the latter appears to jump income levels and political persuasion.

From this week's Essential Report:

61% think Australians pay too much tax and 28% think Australians pay about the right amount.

72% of full‐time workers think we pay too much tax but there were no significant differences by income level.

Labor and Liberal/National voters also gave similar responses.

...those opposed to increasing the GST outnumbered those in favour...

Increasing GST to pay off national debt was strongly rejected (66%).