National Audit Office has criticised the federal government’s poor processes in Murray-Darling water buybacks

The Australian, 17 July 2020:

The National Audit Office has criticised the federal government’s Murray-Darling water buybacks, saying the Department of Agriculture “did not ­develop a framework designed to maximise value for money”. 

In an audit of the department’s water procurement practices, the ANAO found that there was “limited evidence of app­ropriate assessment” to justify the price paid by the federal government to private owners for water to be set aside for environmental purposes. 

Additionally, “the department did not negotiate the price for the water entitlements it purchased in all but one instance”, the audit report found. 

The audit office looked at water purchases worth a total of $190m across nine catchment areas between 2016 and 2019. 

Water for the environment is used to improve the health of ­rivers, wetlands and flood plains. ANU Centre for Water Economics, Environment and Policy director Quentin Grafton said the “most damning indictment” from the ANAO report was the finding that the government, as a result of poor processes, paid too much for the water. 

“Taxpayers’ money has been wasted,” Professor Grafton said. 

The ANAO said that “probity management arrangements were different to those applied to open tenders, and conflict of interest declarations were not clearly documented”. 

Professor Grafton blamed the lack of value for money on the government’s decision to run the buybacks on a limited tender basis, despite the fact it “already had an open tender process that had been working highly effectively for a number of years”. 

The report noted that the ­government had spent $21.5m on ­purchasing water rights from the Warrego River in southwest Queensland and the Lowbidgee flood plain in the Murrum­bidgee wetlands, despite the Commonwealth Environmental Water Office having assessed the water as being of questionable en­vironmental benefit, or as being unreliable.....

Looking back at Scott Morrison in 2019:

In light of the 'Water' findings released this week, it's interesting to revisit one of Morrison's pre-election pressers.#auspol pic.twitter.com/RJ92ZlhzZa

— 💧Teresa Randal (@RandaltsRandal) July 18, 2020

COVID-19 restrictions to be tightened in NSW from Friday 24 July 2020

NSW Government, media release, 17 March 2020:

The NSW Government will tighten COVID-19 restrictions around “higher risk” activities as the pandemic enters a new phase of community transmission.
 

From 12:01am Friday, 24 July 2020 the following rules will be in force as NSW enters a state of ‘COVID normal’. 

• Compliance measures introduced to pubs will be extended to restaurants, bars cafés and clubs. This includes:
  1. limiting group bookings to a maximum of 10 people
  2. mandatory COVID-Safe plans and registration as a COVID-Safe business
  3. a digital record must be created within 24 hours.
• Weddings and corporate events will be limited to 150 people subject to the four square metre rule and registration as a COVID-Safe business. Strict COVID-Safe plans must be in place and high-risk activities including choirs and dancing must not occur.
• Funerals and places of worship will be limited to 100 people, subject to the one person per four square metre rule and a COVID-Safe business registration.

The rules on gatherings remain the same: 20 guests inside the home and 20 for gatherings in a public place. However, as the home is a high transmission area, the NSW Chief Health Officer strongly recommends a COVID-Safe precautionary approach of limiting visitors to the home to 10 people as a general principle. 

Premier Gladys Berejiklian said this tightening was to reduce the risk of uncontrollable break-outs and ensure NSW stays open for business. 

“Unfortunately we must live with COVID-19 and the way it has changed our lives,” Ms Berejiklian said.

“These rules will give businesses and the community a degree of certainty into the foreseeable future, and help NSW avoid uncontrolled virus spread.”

Deputy Premier John Barilaro said the NSW Government continues to work with business and industry to ensure they operate in a COVID-Safe way.

“These measures apply across the state and will also work to protect residents in rural and regional NSW,” Mr Barilaro said.

Health Minister Brad Hazzard said the changes are based on advice received from the Chief Health Officer Dr Kerry Chant.

“We do not want to see community transmission getting to a stage where it is out of control. These restrictions target large gatherings which are high risk settings for transmission of the virus,” Mr Hazzard said.

“We need people to do the right thing: follow the rules; stay home if unwell and get tested, even with the most minimal of symptoms; always maintain physical distancing when out and about; and ensure good hand hygiene.”

Minister for Customer Service Victor Dominello said the new rules will be strictly enforced to protect the wider community.

“Venues should be on notice – NSW Police, Liquor & Gaming inspectors and NSW Health officials are carrying out inspections across the state to ensure COVID-Safe plans are being followed,” Mr Dominello said.

Chief Health Officer Dr Kerry Chant said with a heightened risk of COVID-19 outbreaks, the people of NSW need to be on high alert.

“This is the time to be vigilant – we need people to come forward and be tested even if they have the mildest of symptoms, we need businesses to follow and enforce their COVID-Safe plans and we need people to follow the rules,” Dr Chant said.

United Australia Party founder & former MP for Fairfax Clive Palmer facing charges which might lead to 12 years imprisonment

Australian Securities and Investments Commission (ASIC), media release, 17 July 2020:

20-163MR Clive Palmer charged over breaches of directors’ duties and fraud 

Following an ASIC investigation, Mr Clive Frederick Palmer, 66 of Broadbeach Waters in Queensland, has been charged with two counts of contravening section 184(2)(a) of the Corporations Act 2001 (Act) - dishonest use of position as a director and two counts of contravening section 408C(1)(d) of the Criminal Code Act 1899 (Qld) – fraud by dishonestly gaining a benefit or advantage. 

ASIC alleges that between 5 August 2013 and 5 September 2013, Mr Palmer dishonestly obtained a benefit or advantage for Cosmo Developments Pty Ltd and/or the Palmer United Party (PUP) and others by authorising the transfer of $10,000,000 contrary to the purpose for which the funds were being held. It is alleged that he dishonestly used his position as a director of Mineralogy Pty Ltd (Mineralogy), a mining company owned by him, in obtaining that advantage. 

ASIC also alleges that, between 31 August 2013 and 3 September 2013, Mr Palmer dishonestly obtained a benefit or advantage for Media Circus Network Pty Ltd and/or PUP by authorising the transfer of $2,167,065.60 contrary to the purpose for which the funds were being held. It is alleged that Mr Palmer dishonestly used his position as a director of Mineralogy in obtaining that advantage. 

The maximum penalty for an offence under section 184(2) of the Act is $340,000 or imprisonment for five years, or both. 

The maximum penalty for an offence under section 408C of the Code is five years’ imprisonment. However, if circumstances of aggravation are established the maximum penalty at the time the offences are alleged to have occurred is increased to 12 years’ imprisonment. 

The matter was first mentioned in the Brisbane Magistrates Court on 20 March 2020, at which time the matter was adjourned for further mention on 17 July 2020. On 17 July 2020 the matter was adjourned until 28 August 2020. 

The matter is being prosecuted by the Commonwealth Director of Public Prosecutions.

A new economic theory may yet cut the ground from under Australian Prime Minister Scott Morrison's feet

ABC News, 17 July 2020:

We may be on the cusp of a revolution. What if everything we thought we knew about public finance over the past 40 years has been wrong? 

A new economic theory has emerged that could rewrite our understanding of how governments create and spend money and what type of society we can afford to build. 

And if it is correct, people may be furious. 

Because it could show that Australia's political elite can afford to spend far more than they are on public health and education, social housing, scientific research and green energy schemes, while eliminating unemployment. 

And yet they're not — either from a misunderstanding of government finances or because they don't want to. 

However, to embrace this radical economic theory you will have to forget what you've learned about budget deficits (that they're bad) and government debt (that it burdens future generations). 

Why? Because proponents of the theory say that far from being a problem, budget deficits are often a good thing — they can be the source of healthy economic growth. 

They argue a country like Australia that controls its own currency doesn't need to tax or borrow before its national government can spend money — the government can create all the money it needs to fund itself … within limits. 

It all sounds too good to be true, which is why critics warn the theory is naive, simplistic and potentially dangerous. 

But supporters of the theory — who are growing in number — say many of the world's problems today (extreme wealth inequality, poorly funded public hospitals and schools, chronic underemployment, stagnant wages) are a consequence of misunderstanding government financing. 

They say macroeconomic theory — which looks at the bigger picture of how the national economy works — has got too many major questions wrong. 

So what are we talking about? Let's take a closer look.... 

The theory is called Modern Monetary Theory (MMT). It is challenging the neoliberal economic orthodoxy that has dominated policymaking in Australia, the United States, the United Kingdom and many other countries since the mid-1970s. 

The reigning orthodoxy assumes a couple of things. 

Firstly, it assumes every country has a "natural rate" of unemployment and it's unwise to try to force the jobless rate below the natural level because inflation (and wages) will rise too quickly. Therefore, it assumes it's better to accept a certain amount of unemployment to keep prices stable (and to keep wage demands weak).

At the moment, Australia's natural rate of unemployment is assumed to be somewhere between 4 and 5 per cent. 

Secondly, the economic orthodoxy holds that the national government needs to collect taxes, or borrow from savers, before it can spend money. 

Politicians repeat this point incessantly. 

When you hear a politician saying the government must "live within its means," what they're really saying is the government mustn't spend more than it collects in taxes or borrowings.

However, MMT economists want to turn these orthodoxies on their head, among others...... 

The people who developed it have been working on the body of theory for decades, quietly, in countries such as Australia and the United States, but their ideas have recently burst out into the open as global leaders search for fresh ideas to deal with the unprecedented economic crisis of 2020, and the lingering effects of the global financial crisis in 2008-09.

 MMT economists make several claims: 

Firstly, they say we've been thinking about budget deficits incorrectly. 

They say budget deficits are not always bad. In fact, deficits are often necessary and beneficial. A budget deficit is merely evidence of extra government spending, and government spending boosts the wealth of private sector businesses and households.  

They say it depends what deficit spending is used for. Increasing the deficit to finance a war is not the same thing as increasing the deficit to build more hospitals and schools. 

They argue investments that will enhance productivity through better health, greater knowledge and skills, improved transport and the like are worth funding, even if it results in a budget deficit. 

Secondly, MMT economists say we've been thinking about government spending incorrectly. 

They say the argument (promoted famously by British prime minister Margaret Thatcher) that national governments must tax or borrow before they can spend is wrong. 

MMT argues it's the other way around — national governments have to spend money into the economy before they can tax or borrow. Government spending actually precedes taxation. Accepting this proposition is key to embracing MMT. 

Thirdly, they say taxes are necessary, but not for the reasons you may think. 

They say government taxes can be used to keep inflation under control, to control our behaviour (via fees and levies and rates), and to get us to produce things the government needs. 

MMT economists draw on the ideas of chartalism to make this last point. They say governments use taxes to create demand for their own currency — that is, if a citizen has to pay tax then they're going to have to work to earn the currency to pay the tax in that currency. 

Essentially, governments use taxes to put everyone to work. 

"At the end of the day, a currency-issuing government wants something real, not something monetary," writes Professor Stephanie Kelton, one of the highest-profile MMT economists and a senior adviser to Bernie Sanders in both his 2016 and 2020 Democratic presidential primary campaigns. 

"It's not our tax money the government wants. It's our time. 

"To get us to produce things for the state, the government invents taxes or other kinds of payment obligations." 

Fourthly, MMT economists say countries that issue their own fiat currency can afford to buy anything that's available for sale in their own currency, and they can never go bankrupt in their own currency. 

"Fiat" money is government-issued currency that isn't backed by any commodity, such as gold. It's paper or digital money that has no intrinsic value. We'll return to this point later too. 

Fifthly, MMT economists say "full employment" is not only possible, it's a moral imperative. Anyone who wants a job should have one. 

They say we must prioritise genuine full employment and governments should spend whatever is necessary to achieve it — no matter the debt or deficit. 

Sixthly, MMT economists say the national government should run a permanent "Job Guarantee" (JG) program to provide a job to everyone who wants one. 

They say it could be linked to other economic and social programs, such as a "Green New Deal" — a policy advocated by MMT proponents linked to the US Democratic senator Bernie Sanders, to create jobs by shifting to zero-emissions technologies.......

Read the full article here.

Unemployment in Australia is at a 22 year high, however NSW is faring a little better

Australian Bureau of Statistics, Labour Force June 2020, 16 July 2020:

NATIONAL SEASONALLY ADJUSTED ESTIMATES 

• Employment increased 210,800 to 12,328,500 people. 
• Full-time employment decreased 38,100 to 8,489,100 people and part-time employment increased 249,000 to 3,839,400 people. 
• Unemployment increased 69,300 to 992,300 people. 
• Unemployment rate increased 0.4 pts to 7.4%. 
• Underemployment rate decreased 1.4 pts to 11.7%. 
• Underutilisation rate decreased 1.0 pts to 19.1%. 
• Participation rate increased by 1.3 pts to 64.0%. 
• Monthly hours worked in all jobs increased 64.3 million hours to 1,664.7 million hours.

NATIONAL YOUTH UNEMPLOYMENT

• Employment for 15-24 year olds increased by 101,500 people (6.3%). 
• Unemployment rate for this group increased 0.4 pts to 16.4%.
• Participation Rate for 15-24 year olds increased 3.9 pts to 63.5%. 
• Around 30% of the people moving into employment in June were aged 15 to 24 years.

New South Wales in June 2020 :

• Number of Employed Persons rose by est. 81,000 to total 3,949,500 individuals. This still leaves a gap of est.124,200 persons who lost the job they held in January 2020 and have not yet found other employment (original data);
• Full-time Employment rose by est. 8,200 positions (original data);
• Part-time Employment rose by est. 72,800 positions (original data);
• the Employment to Population Ratio was Persons 59.5, Males 64.4, Females 54.8 (original data);
• the Unemployment Rate was Persons 6.7%, Males 6.7%, Females 6.8% (original data);
• Underemployed Persons totalled est. 473,900 individuals (original data); and
• the Workforce Participation Rate was Persons 63.8% - up 1.6 percentage points, Males 69.0% - up 2 percentage points, Females 58.7% - up 1.6 percentage points (original data).

Menzies Research Centre evidence before parliamentary joint inquiry appears to be built on shifting sands

Liberal-National Party drone, the Menzies Research Centre, was the 66^th individual or organisation to make a submission to the Parliamentary Joint Committee on Corporations and Financial Services’ Inquiry into the Litigation funding and the regulation of the class action industry.

 This submission was written by twenty-five year-old James Mathias (shown left), Chief of Staff at the Menzies Institute and unsuccessful Liberal candidate for the seat of Holt at the 2016 feferal election.

It would appear from the evidence Mathias gave to the Inquiry that he shares an office with the Liberal Party in Canberra.

Young James is definitely not a scholar and, typical of that peculiar breed of young Liberals, he made a a mess of the submission right from the opening lines.

On 13 July 2020 The Guardian report his appearance at the first public hearing of the Inquiry:

Mathias appeared on Monday before a parliamentary committee investigating whether Australia’s class action industry needs tighter regulation…

The first line of the submission from the MRC – the Liberal party thinktank – quoted the federal court justice Michael Lee as saying in a judgment on 5 June: “The phrase ‘access to justice’ is often misused by litigation funders to justify what at bottom is a commercial endeavour to make money out of the conduct of litigation.”

It was purportedly from a judgment on class actions stemming from allegations that the Australian defence department negligently allowed toxic chemicals known as Pfas to escape from defence bases and contaminate local environments.

But Mathias, who was just 21 when he ran as a federal candidate for the Victorian seat of Holt in 2016, confirmed under questioning he had “not read the full judgment” cited in the submission as “judgments are very long – some hundreds of pages”.

O’Neill said the judgment was actually 37 pages long and “the words you quote in the very first line of your submission are nowhere, nowhere to be found in his honour’s judgment”.

The NSW senator said the only place that quote could be found was in an article in the legal journal Lawyerly on 9 June, titled “‘A significant inequality of arms’: Funding led to better outcomes in PFAS class action, judge says”…..

In Lee’s judgment of 5 June, the judge made a more qualified statement that “the term ‘access to justice’ is commonly misused, most often by some funders who fasten upon it as an inapt rhetorical device”.

He then cautioned against generalisations. While noting “litigation funding is about putting in place a joint commercial enterprise aimed at making money”, Lee went on to say that recognising that reality “does not diminish the importance of litigation funding in allowing these class members to vindicate their claims against the commonwealth”.

Referring to the alleged victims in the Pfas class actions, Lee continued: “Without litigation funding, the claims of these group members would not have been litigated in an adversarial way but, rather, they would likely have been placed in the position of being supplicants requesting compensation, in circumstances where they would have been the subject of a significant inequality of arms….

When contacted for a response to the criticism of his submission, Mathias said it was “astonishing that the Guardian would be siding with foreign backed, super-profitable litigation funders just because it does not like the politics of the MRC”.

The 5 June 2020 judgement in question GAVIN SMITH et al v COMMONWEALTH OF AUSTRALIA (DEPARTMENT OF DEFENCE) can be found at https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2020/2020fca0837

*James Mathias Snapshot found on Twitter

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