Economics

  • Nissan Chairman arrested for financial misconduct

    Nissan Chairman and Renault CEO Carlos Ghosn faces being fired this week after being arrested in Japan over allegations of financial misconduct, the firm said on Monday, in a stunning fall from grace for one of the world’s best-known businessmen. Mr Ghosn’s arrest and his likely dismissal from Nissan, as well as possibly from Mitsubishi and Renault, sent shockwaves through the auto industry, where he is a towering figure, credited with turning around several major ... ► Read more

  • PM says permanent migration must be cut to reduce congestion

    The Federal Government is likely to cut Australia’s permanent migration cap, in a move it says will ease congestion in the major cities. Prime Minister Scott Morrison, in a speech on the future of Australia’s cities, said Sydney and Melbourne had been overwhelmed with population growth. “The roads are clogged, the buses and trains are full, the schools are taking no more enrolments,” he said. “I hear what you are saying, I hear you loud ... ► Read more

  • TurkStream: Putin, Erdogan mark completion of offshore stage

    Russian President Vladimir Putin and Turkish President Recep Tayyip Erdogan have marked the completion of the offshore phase of a gas pipeline underneath the Black Sea, the latest sign of growing cooperation between Moscow and Ankara. Speaking at the November 19 ceremony in Istanbul, Mr Erdogan said the TurkStream pipeline will carry 31.5 billion cubic meters of gas from Russia to Turkey each year when operational, and will send at least half of the amount ... ► Read more

  • Fairfax shareholders give Nine takeover green light

    Fairfax shareholders have overwhelmingly backed a takeover by Nine Entertainment, paving the way for both companies to merge by the end of this year. At the Fairfax annual general meeting today, more than 80% of votes were in favour of the deal. Antony Catalano, the former head of real estate website Domain, tried to block the deal by submitting a last-minute bid for 19.9% of the newspaper publisher’s shares on Sunday evening. In a letter, ... ► Read more

  • Banking Royal Commission: Commonwealth Bank CEO defends variable remuneration

    Commonwealth Bank CEO Matt Comyn defended his bank’s use of “variable remuneration” to reward employees for signing customers up to more services, despite the Banking Royal Commission hearing this has led to serious misconduct. Mr Comyn told the Royal Commission that short-term variable remuneration is necessary to motivate staff — to encourage what the Commonwealth Bank calls “discretionary effort.” When asked by Rowena Orr QC why “paying an adequate and appropriate level of fixed remuneration” ... ► Read more

  • Macron, Merkel pledge to build “truly sovereign Europe”

    German Chancellor Angela Merkel and French President Emmanuel Macron met in Berlin on Sunday (local time) to discuss defence, the eurozone and more, pledging to continue Franco-German collaboration on strengthening the “foundation” of Europe. President Macron spoke of a “Franco-German responsibility in preparing for the future and the re-founding of Europe.” “This responsibility means building something, building a truly sovereign Europe and building a strong European Union on this sovereignty,” the Mr Macron said alongside ... ► Read more

  • Cabinet divided over Israel embassy policy

    Defence Minister Christopher Pyne has said that keeping the Australian embassy in Tel Aviv is “like Israel saying that they intend to put their embassy in Sydney and pretend that Canberra isn’t our capital”, as Cabinet remains publicly divided on the issue. Last month Prime Minister Scott Morrison suggested that his government is considering relocating the Australian embassy in Israel to Jerusalem, which has been claimed by Israel as its capital since its occupation in ... ► Read more

  • APEC 2018: US-China divisions deepen worrying world leaders

    Deep divisions between the United States and China have derailed the APEC meeting in Port Moresby, with regional leaders failing to agree on a final communique for the first time in the summit’s history. The two superpowers clashed repeatedly over the language on trade in the final document, with Beijing angrily rejecting paragraphs that called for an overhaul of the World Trade Organisation (WTO) and warned against unfair trade tactics. The Trump Administration has repeatedly ... ► Read more

  • Theresa May warns that Brexit will be delayed if she is ousted

    British Prime Minister Theresa May has warned detractors that a successful leadership challenge would delay negotiations for the United Kingdom’s withdrawal agreement with the European Union. “It’s not going to make the negotiations any easier and it won’t change the parliamentary arithmetic,” Ms May told Sky News on Sunday. Several Tory MPs have written letters expressing their lack of confidence in the Prime Minister after Ms May unveiled a 585-page draft agreement negotiated with the ... ► Read more

  • Week in Brief: 10 November – 18 November 2018

    UK, EU agree on draft Brexit deal In a diplomatic breakthrough, UK and European Union officials have agreed the draft text of a Brexit agreement after months of negotiations. See OPMG’s coverage of this story here. Morrison reverses “foolish” decision to cut Foodbank funding Prime Minister Scott Morrison has intervened to boost the Government’s food relief budget to ensure a charity that feeds 710,000 people a month retains its funding. See OPMG’s coverage of this ... ► Read more

  • Moving Australian embassy to Jerusalem could increase terror attacks, warn Indonesia and Malaysia

    Indonesian and Malaysian politicians have warned that moving the Australian embassy in Israel from Tel Aviv to Jerusalem could result in increased Islamist terror attacks against Australians. Prime Minister Scott Morrison indicated in October 2018 that the Australian Government is considering relocating its embassy from Tel Aviv to the de facto capital Jerusalem, although Jerusalem is not recognised by the United Nations. The potential policy change has caused concern regarding Australia’s relationship with Muslim-majority nations, ... ► Read more

  • US bill sanctions Saudi military over Khashoggi killing, Yemen

    A bipartisan group of US senators introduced legislation on Thursday (local time) seeking to strike back at Saudi Arabia over the death of a Saudi journalist at a consulate in Turkey and for its role in the devastating war in Yemen. If the bill were to be passed, it would suspend weapon sales to Saudi Arabia and prohibit US refueling of Saudi coalition aircraft for Riyadh’s campaign in Yemen against the Houthi rebels. It also ... ► Read more

  • EU chief Brexit negotiator: draft agreement a “crucial step in concluding these negotiations”

    The EU’s chief Brexit negotiator Michel Barnier says “decisive” progress has been made in reaching a final agreement on the UK’s departure from the bloc. Mr Barnier said a 585-page draft withdrawal agreement published on Wednesday represented a “crucial step in concluding these negotiations”. He also said provisions were included to avoid a hard border with Ireland. His comments came after UK Prime Minister Theresa May said her cabinet had backed the draft agreement. While ... ► Read more

  • Cyber security chief: Austal hacking “attribution can take months, even years”

    The head of the Australian Cyber Security Centre (ACSC) said on Tuesday an investigation into the hacking of defense contractor Austal could take years, rejecting a report by the ABC that his agency had concluded the attack originated from Iran. Austal said earlier this month hackers had breached its defences to gain access to ship designs and that some staff email addresses and mobile phone numbers were accessed. The attack triggered an investigation by the ... ► Read more

  • Queensland woman to face court over strawberry contamination

    A Queensland woman has been charged over the strawberry needle crisis that forced supermarkets to pull fruit from shelves and farmers to dump it by the truckload. The woman, from Caboolture in Brisbane’s north, was charged on Sunday evening with seven counts of goods contamination. Police say one occasion of aggravation contamination will be alleged, meaning the 50-year-old woman will face a maximum of 10 years in prison if convicted. She was arrested amid a ... ► Read more

  • Australian Government announces $2 billion Pacific development fund to counter Chinese investment

    The Australian Government has announced it will establish a $2 billion fund for infrastructure development in the Pacific in response to increased Chinese investment in the region. The announcement comes ahead of the Asia-Pacific Economic Cooperation conference in Port Moresby next weekend. The Australian Infrastructure Financing Facility will assist the Pacific in developing energy, communications and transport projects. Speaking in Townsville on Thursday, Prime Minister Scott Morrison said his Government would make sure Australia is ... ► Read more

  • Europe to continue trading with Iran despite US re-imposition of sanctions

    United States Secretary of State Mike Pompeo has warned that the US will exert “relentless” pressure on Iran unless it changes its “revolutionary course”. His comments came hours after the Trump Administration restored all pre-2015 nuclear deal sanctions targeting core parts of Iran’s economy. Speaking to reporters, Mr Pompeo said: “The Iranian regime has a choice: it can either do a 180-degree turn from its outlaw course of action and act like a normal country, ... ► Read more

  • Google employees walk out in protest of sexual harassment policies

    Google employees worldwide have walked out in protest of the tech giant’s sexual harassment policies. Employees gathered in major cities around the world — including Silicon Valley, New York, London, Berlin, Hyderabad, Singapore and Sydney — in response to a report in The New York Times last week that Google had paid millions of dollars in exit packages to executives accused of misconduct, while staying silent about the complaints. “I am here because what you ... ► Read more

  • US Department of Justice charges Chinese and Taiwanese companies with economic espionage

    The United States Department of Justice (DoJ) has charged a Chinese state-owned company, its Taiwanese partner, and three individuals for “economic espionage” related to American trade secrets. The charges come amid the ongoing trade war between the US and China, which is due in part to the Trump administration’s accusations that China has engaged in unfair trade practices, including the widespread infringement of American intellectual property. The DoJ has charged Chinese state-owned company Fujian Jinhua ... ► Read more

  • Tourism Australia rollout another Hemsworth as US tourist numbers dwindle

    Tourism Australia is spending an extra $5.8 million on a new Dundee campaign featuring Luke Hemsworth, as it tries to drive up the number of American tourists visiting Down Under. New figures from Tourism Australia reveal spending from US tourists in Australia fell approximately $100 million in 2017/18 compared with the year before, marking its lowest point since the height of the global financial crisis. Total US spending was $3.7 billion, down from $3.8 billion ... ► Read more

  • Report: demand for Australian coal to plummet in future

    Economists are predicting Australia’s thermal coal exports to plummet faster than expected, due to falling demand across Asia that appears permanent and irreversible. A study by the Institute for Energy Economics and Financial Analysis (IEEFA) found Australia’s top four export markets — China, Japan, Taiwan and South Korea — were shifting rapidly to renewables. The study found New South Wales, the source of nearly 70% of thermal coal exports, should brace for disruption in energy markets. IEEFA ... ► Read more

  • Australia ratifies CPTPP membership

    Australia has officially joined a massive trade deal that the Federal Government says will deliver a windfall to farmers and businesses. Prime Minister Scott Morrison has confirmed Australia ratified the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) on Wednesday, making it the sixth country to come on board. The step means the CPTPP will come into effect on December 30. The deal strips 98% of tariffs for 11 countries with a combined GDP of more than ... ► Read more

  • “Australian Alcatraz”: business group lobbies for private terrorist prison in NT

    Central Australia could be the location for an “Australian Alcatraz” that houses high-level terrorists, if an Alice Springs business group proposal goes ahead. The Alice Springs Major Business Group (ASMBG) is currently lobbying for a privately-run detention centre to be built in the middle of the Red Centre, with the facility purposely designed to detain criminals who have broken federal terrorism laws. It hopes the project will garner private investment and create a new industry ... ► Read more

  • Berejiklian to set up migration panel to reduce NSW intake

    The New South Wales Government has set up an expert panel to build a case for less immigration amid growing population pressure. Premier Gladys Berejiklian on Wednesday appointed the three-member panel to develop a NSW population policy to take to the Federal Government next year. The group, consisting of Western Sydney University Chancellor Peter Shergold, Infrastructure NSW CEO Jim Betts and NSW Department of Planning Secretary Carolyn McNally, will be given two months to advise ... ► Read more

  • Week In Brief: 21 – 27 October 2018

    Dow Jones drops 608 points, loses all 2018 gains The industrial-skewed Dow Jones index has wiped out all its gains for this year after it dropped 608 points, or 2.4%, to 24,583. See OPMG’s coverage of this story here. Obamas, Clintons among suspected bomb targets Former US President Barack Obama and former US Secretary of State Hillary Clinton were reportedly among those targeted in a suspected bombing attempt. See OPMG’s coverage of this story here. ... ► Read more

  • PM announces $5bn drought fund

    Prime Minister Scott Morrison will unveil the first federal drought fund of its kind in Canberra on Friday. The $5 billion Future Drought Fund aims to provide relief to farmers, help them recover from the so-called ‘green drought’ on the east coast, and assist with their long-term resilience. “There are people in trouble,” Mr Morrison told SBS in an exclusive interview. “They need help. It’s the Commonwealth Government’s responsibility to look after the people.” The ... ► Read more

  • Saudi Crown Prince calls Khashoggi killing “heinous”, vows “justice”

    Saudi Crown Prince Mohammed bin Salman vowed to bring Washington Post columnist Jamal Khashoggi’s killers to justice during an address to international investors at a major conference in Riyadh on Wednesday (local time). Prince Mohammed assured investors Mr Khashoggi’s killing at the Saudi consulate in Istanbul would not derail the kingdom’s reform agenda. “We will prove to the world that the two governments (Saudi and Turkish) are cooperating to punish any criminal, any culprit and at the ... ► Read more

  • Dow Jones drops 608 points, loses all 2018 gains

    The industrial-skewed Dow Jones index has wiped out all its gains for this year after it dropped 608 points, or 2.4%, to 24,583. The benchmark S&P 500 lost 3.1%, marking its sixth straight day of losses. The S&P technology sector (-3pc) was hit the hardest, after the share prices of Apple (-3.4pc), Facebook (-5.4pc), Google (-5.2pc) and Netflix (-9.4pc) fell sharply. This caused the tech-heavy Nasdaq index to plummet by 4.4%. Several factors dampened investor ... ► Read more

  • AMP to sell insurance arm to Britain’s Resolution Life for $3.3bn

    Financial services company AMP has announced it will sell its Australian and New Zealand wealth protection and mature businesses to London-based insurance firm Resolution Life for $3.3 billion. The company, which came under intense scrutiny after the banking Royal Commission uncovered it had regularly engaged in misconduct, said it was also contemplating an initial public offering for its New Zealand wealth management and advice businesses in 2019. The sale value of its Australia and New ... ► Read more

  • Jamal Khashoggi’s son shakes hands with Crown Prince in photo op

    Saudi Arabia’s King Salman and Crown Prince Mohammed bin Salman met with family members of slain Washington Post columnist Jamal Khashoggi in Riyadh on Tuesday. The Saudi rulers met with Mr Khashoggi’s son Salah and brother Sahel at the royal palace as part of a high-profile economic forum which was boycotted by many Western powers, including Australia. According to Saudi state news agency SPA, King Salman and Prince Mohammed offered their condolences to the family of the Saudi journalist. ... ► Read more

  • Government moves to set default power prices

    The Government has announced it will follow a recommendation made by the Australian Competition and Consumer Commission (ACCC) to set a default price for electricity in an effort to reduce the burden of energy costs. The Australian Energy Regulator (AER) will act on Tuesday to require power retailers to set their prices against a default market price. This could help households save hundreds of dollars, and businesses thousands. “The default offer will ensure customers are ... ► Read more

  • Banks slow to respond to misconduct, says corporate regulator

    The chair of the Australian Securities and Investments Commission (ASIC) has criticised banks for failing to swiftly address misconduct. Despite assurances from bankers that they would address revelations of the Banking Royal Commission, ASIC says they are taking too long to respond. ASIC chairperson James Shipton told the Parliamentary Joint Committee on Corporations and Financial Services on Friday that he accepted the Royal Commission’s criticism of ASIC, but said banks need to take urgent action ... ► Read more

  • Week In Brief: 7 – 13 October 2018

    Government promises to fast track company tax cuts ahead of federal election The Morrison Government has promised to fast track company tax cuts ahead of the next federal election, with legislation to be introduced to Parliament in the next fortnight. See OPMG’s coverage of this story here. AFP raids Home Affairs Dept over au pair scandal leaks Federal Police are raiding the Department of Home Affairs over suspected leaks in relation to the au pair ... ► Read more

  • Government promises to fast track company tax cuts ahead of federal election

    The Morrison Government has promised to fast track company tax cuts ahead of the next federal election, with legislation to be introduced to Parliament in the next fortnight. The tax rate for companies with a turnover under $50 million was reduced from 30% to 27.5% for the 2018–19 financial year, and is scheduled to drop to 25% for the 2026–27 financial year. On Thursday, Treasurer Josh Frydenberg announced the Liberal-National Coalition Government intends to expedite ... ► Read more

  • Controversy over planned use of Opera House as billboard to promote horse race

    The New South Wales Government’s plan to use the Sydney Opera House as a digital billboard to promote the $13 million Everest Cup horse race has proved controversial, despite being backed by NSW Premier Gladys Berejiklian and Prime Minister Scott Morrison. Late last week the Premier intervened after broadcaster Alan Jones publicly criticised Opera House executive Louise Herron, who said that words or branding promoting the Everest Cup should not be projected onto the Opera ... ► Read more

  • Prison sentences proposed for breaching director identification laws

    Directors of Australian companies will be required to register for a lifetime identification number or face imprisonment under draft legislation released this week. Under the exposure draft of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2018, directors will face up to a year in prison if they fail to register. A registrar will verify the identities of the directors and create a unique identification number that stays with the director for life, ... ► Read more

  • Labor pledges $1.7 billion in early childcare subsidies

    Three-year-old children will have access to 15 hours of fully-subsidised preschool care if Labor wins the next election, opposition leader Bill Shorten announced on Thursday. In pledging $1.7 billion to cover the cost over four years, Mr Shorten said it was about “reimagining childcare” as “early childhood education”. “We need to give all three-year-olds and four-year-olds the best jump start to going into school,” he said. “All the educational experts have made it clear that ... ► Read more

  • States and territories agree to scrap “tampon tax”

    The 10% tax on tampons and pads will be removed after states and territories agreed to make sanitary products exempt from the GST, bringing an end to an 18-year campaign calling for the tax to be scrapped. Treasurers met on Wednesday morning to discuss the matter and unanimously agreed to pass the Federal Government’s proposal. The products to be made exempt are expected to include tampons, pads, menstrual cups, maternity pads and leak-proof underwear, but ... ► Read more

  • Tesla battery delivers impressive dispatchable power, says Energy Market Operator, despite critics

    The huge lithium-ion battery constructed by tech giant Tesla in South Australia has proven it can dispatch power more rapidly and precisely than conventional thermal power stations, according to data from the Australian Energy Market Operator (AEMO). The battery is located on a wind farm some three hours’ drive north of Adelaide and, despite criticism and derision, has helped stabilise South Australia’s electricity supply while reducing costs. “It’s ability to respond very, very quickly to ... ► Read more

  • US, Mexico and Canada agree to new trade deal

    On Monday (local time), the leaders of the United States, Mexico and Canada formally agreed to replace the North American Free Trade Agreement (NAFTA) with a new trade deal. NAFTA, which has been in force since 1994, will be superseded by the United States-Mexico-Canada Agreement (USMCA) to govern the more than US $1.2 trillion in trade between the three countries. Most of the key provisions of USMCA will not come into effect until 2020, to ... ► Read more

  • Government issues deadline for states to sign off on 2019 education funding plan

    State governments have until 7 December to agree to the Federal Government’s proposed private school funding changes or face education funding cuts, Federal Education Minister Dan Tehan says. Victorian Education Minister James Merlino publicly released a letter he received from Mr Tehan on Wednesday, which reads: Should a bilateral agreement not be in place by [7 December], the Commonwealth will be unable to make the first 2019 payment to the relevant state or territory, including ... ► Read more

  • Elon Musk charged with securities fraud over tweets

    On Thursday (local time), the United States Securities and Exchange Commission (SEC) announced it had charged Tesla Inc CEO and Chairman Elon Musk with securities fraud. The charge relates to a series of false and misleading tweets made by Mr Musk about a potential transaction to transform Tesla from a public to a private company. Mr Musk tweeted to his 22 million Twitter followers that he was considering taking Tesla private at US $420 per ... ► Read more

  • Business group says Indigenous public holiday could cost $3 billion

    The creation of a public holiday to recognise Indigenous Australians could cost the economy $3 billion, according to Australian Chamber of Commerce and Industry chief executive James Pearson. On Tuesday Prime Minister Scott Morrison responded to growing calls that Australia Day be moved from 26 January by suggesting the creation of a separate holiday to recognise and celebrate Indigenous Australians. But Mr Pearson says that the potential cost in foregone economic activity must be taken ... ► Read more

  • China blames United States for escalating trade war with “contradictory behaviour”

    The Chinese Government has accused the United States of bullying following the imposition of US $200 billion of punitive tariffs on Chinese goods, and Beijing has retaliated with US $60 billion in tariffs on American imports. China’s State Council released a white paper entitled “Facts about the China-US trade dispute and China’s stance” within hours of the tariffs coming into force, in which it blames the White House for escalating the trade war between the ... ► Read more

  • Poll shows Sydney residents believe urban migration should be restricted

    A ReachTEL poll conducted on Thursday has revealed nearly two thirds of Sydney residents want less migration to the city as the population figures climb. Over 63% of the 1627 participants surveyed favoured restricting migration influx, while 50% are against further infrastructure development to accomodate the rising population. Concerns about living costs in urban Sydney — especially housing affordability and energy costs — are the primary driver of residents’ belief in re-directing migration. The Sydney ... ► Read more

  • Federal Government giving Catholic schools 10 times what they need, claims Grattan Institute

    The Federal Government’s controversial plan to give independent schools a funding boost of $4.5 billion would give Catholic schools more than 10 times what they need to remain an “affordable choice” for parents, the Grattan Institute claims. Under the proposal championed by Prime Minister Scott Morrison and Federal Education Minister Dan Tehan, $1.2 billion of the funding injection will form a “choice and affordability” fund to help prevent an escalation of fees in the private ... ► Read more

  • Week in Brief: 16 – 22 September 2018

    Government, aged-care sector to establish royal commission scope The Government will work with aged-care providers to determine the terms of reference for the newly announced royal commission into the sector, Prime Minister Scott Morrison told reporters on Sunday. See OPMG’s coverage of this story here. China levies new tariffs in response to US tariff hike China has announced it will levy tariffs on about US $60 billion worth of American imports in response to the ... ► Read more

  • US imposes sanctions on Chinese military for purchasing Russian weapons

    The United States has imposed sanctions on China’s military for buying 10 Russian Sukhoi Su-35 fighter jets and S-400 surface-to-air missiles because the purchases contravenes US sanctions on Moscow, the US State Department has announced. Under the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA), the US is required to penalise anyone undertaking significant transactions with certain people affiliated with Russian intelligence and military services, including arms manufacturers. “Today’s actions are not intended to undermine ... ► Read more

  • Federal and NSW Governments clash over private school funding boost

    The New South Wales Government has rejected Canberra’s proposed education funding model, under which independent schools would receive a funding boost of $4.5 billion. In saying that the NSW Government would not accept “special deals” for independent schools, NSW Education Minister Rob Stokes said the extra $4.5 billion over 10 years was “not fair”. “We welcome additional money into NSW schools — our simple message is, it’s got to be distributed fairly,” Mr Stokes said. ... ► Read more

  • China levies new tariffs in response to US tariff hike

    China has announced it will levy tariffs on about US $60 billion worth of American imports in response to the United States imposing tariffs on US $200 billion worth of Chinese goods. Currently, the Trump Administration has imposed tariffs of 25% on US $50 billion worth of Chinese imports, with a 10% tariff on US $200 billion worth of Chinese imports to begin on 24 September and set to rise to 25% by the end ... ► Read more

  • Australia considers sanctions against Myanmar over Rohingya atrocities

    The Australian Government is considering targeted sanctions against Myanmar (Burma) in response to atrocities committed against the Rohingya people. The United Nations has recommended that several of Myanmar’s senior military officials be investigated for genocide, crimes against humanity and war crimes, after a UN fact-finding mission documented atrocities committed against ethnic minorities in the country, including the Rohingya people. “The full report of the fact-finding mission adds to a large body of evidence indicating the ... ► Read more

  • Labor promises $400 million superannuation boost for women

    Women on maternity or holding several low-paid jobs would receive superannuation payments under a plan unveiled by Labor deputy leader Tanya Plibersek on Wednesday. On average, women retire with $113,000 less superannuation than men, a gulf of 40% that means older single women are more dependent than men on the age pension, and are the fastest growing homeless age group in Australia. This disparity is due to many factors, including women taking time out of ... ► Read more

  • US imposes further $200 billion tariffs on Chinese imports

    United States President Donald Trump has followed through on his threat to impose a second tranche of tariffs on Chinese imports, this time applying 10% tariffs on about US $200 billion worth of products. In announcing the new tariffs, President Trump warned China against taking retaliatory action against US industry, threatening that the US “will immediately pursue phase three, which is tariffs on approximately US $267 billion of additional imports.” Collection of the 10% tariffs ... ► Read more

  • Death no barrier to charging life insurance premiums, AMP tells Royal Commission

    AMP continued to charge life insurance premiums after being notified customers had died, executive Paul Sainsbury told the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry on Monday. Mr Sainsbury confirmed that in some cases AMP did not stop insurance premiums even when there was no longer a life to insure. He explained that AMP’s system “was coded to refund [premiums] when the claim was admitted”, rather than “stop the premiums ... ► Read more

  • Week in Brief: 9 – 15 September 2018

    Malcolm Turnbull urges Liberal colleagues to refer Dutton to High Court Former prime minister Malcolm Turnbull has confirmed he is urging Prime Minister Scott Morrison and other Liberal Party colleagues to refer Home Affairs Minister Peter Dutton to the High Court to clear up questions about his eligibility. See OPMG’s coverage of this story here. Roman Quaedvlieg demands Dutton withdraw “disgusting” grooming comment Former Australian Border Force Commission Roman Quaedvlieg has demanded that Home Affairs ... ► Read more

  • CommInsure negotiated penalty for misleading heart attack cover advertising

    CommInsure, a subsidiary of the Commonwealth Bank, made a voluntary $300,000 “community benefit payment” as part of a deal with the corporate regulator to avoid a multi-million-dollar fine for misleading advertising. The insurer failed to adequately disclose in its advertising that its heart attack cover was limited to severe heart attacks, as defined by CommInsure using an out-of-date definition. Instead, customers would have to access and read the product disclosure statement. CommInsure’s managing director Helen ... ► Read more

  • Australian Special Forces deployed to PNG for APEC meeting

    Australia has deployed special forces soldiers to Papua New Guinea (PNG) as part of the effort to secure Port Moresby ahead of the Asia-Pacific Economic Cooperation (APEC) summit scheduled for November. Concerns that local military and police personnel are inadequate are behind the deployment. World leaders including United States Vice President Mike Pence, Russian President Vladimir Putin, Chinese President Xi Jinping, and Australian Prime Minister Scott Morrison are expected to attend the two-day summit. “We ... ► Read more

  • Leaders agree to closer ties between China and Russia

    Chinese President Xi Jinping and Russian President Vladimir Putin met on the sidelines of the Eastern Economic Forum in Vladivostok on Tuesday, agreeing to bolster ties between their countries to counterbalance the United States’ economic power. The leaders have now met three times in 2018, which President Xi told President Putin reflects the “uniqueness and distinction” of the countries’ relationship, according to Chinese state broadcaster CCTV. “Both nations have to oppose unilateralism and trade protectionism, ... ► Read more

  • Freedom Insurance staff wouldn’t take no for an answer, Royal Commission hears

    Freedom Insurance retention officers made it “far too difficult for customers to cancel” insurance policies, the insurer’s Chief Operating Officer Craig Orton told the The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry on Wednesday. Between 1 July 2017 and 30 June 2018, Freedom Insurance received 37,500 calls from customers wanting to cancel their life insurance policies, but only 28.5% of those were successful in cancelling their policies. Instead, almost half ... ► Read more

  • Freedom Insurance pushed accidental death policy on man with Down syndrome

    Freedom Insurance staff pressured a 26-year-old man with Down syndrome into signing up for an accidental death policy, despite no indication that the man understood what he was agreeing to, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard on Tuesday. Grant Stewart’s son was sold an accidental death insurance policy by Freedom Insurance in 2016. Mr Stewart told the Royal Commission that while his son has “reasonable” literacy and ... ► Read more

  • Banking Royal Commission reveals ClearView’s abusive sales tactics

    The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard further details of ClearView Direct’s abusive sales tactics on Tuesday. ClearView Direct call centre training materials from 2014 show that its sales staff were encouraged to continue signing up reluctant customers by telling them they could read the policy documents after signing up for life insurance. The insurer’s chief actuary, Gregory Martin, conceded that this was wholly inappropriate. Senior counsel assisting ... ► Read more

  • Massive class action suit launched against Australian banks

    Millions of workers could receive a payout in what is expected to be the largest class action suit in Australian legal history. Law firm Slater and Gordon are preparing for legal action against Australia’s largest banks on behalf of the third of Australian workers believed to have their superannuation invested with the banks. Slater and Gordon “will allege the big bank-backed super funds failed to obtain for members competitive cash interest rates on cash option ... ► Read more

  • ClearView under fire for junk life insurance policies

    A cleaner with a heart problem was sold an inferior insurance product by ClearView after she was told she was not eligible for life insurance, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard on Monday. A recording of a phone call was played before the Royal Commission, in which the customer was “downgraded” to an accidental death policy as a “backup” option because her pre-existing heart problem made her ... ► Read more

  • Banking Royal Commission: insurers admit substantial misconduct

    On Monday the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry started a round of hearings on life insurance, general insurance, and disaster insurance. This week the Royal Commission will focus on life insurance, including sales, claims, dispute resolution, and superannuation arrangements. Rowena Orr QC, counsel assisting the Royal Commission, raised concerns that insurance claims handling does not come within the Corporations Act 2001, and so the Australian Securities and Investment ... ► Read more

  • NAB puts mortgage rates on hold to ‘re-build trust’

    National Australia Bank (NAB) has announced it will keep its standard variable mortgage rates at 5.24% despite Westpac, ANZ and the Commonwealth Bank (CBA) lifting their rates over last few weeks. In a statement, NAB said if home loan rates had increased by 15 points — approximately the same as the other three big banks — a customer on a $500,000 mortgage would have had to pay an extra $47 per month. “We are listening and acting differently,” NAB ... ► Read more

  • Government drops policy to raise pension age to 70

    Prime Minister Scott Morrison announced on Wednesday that the Government will abandon its long-standing policy to raise the pension age to 70. Instead, the pension qualifying age will increase to 67 in 2023 as scheduled, and stay there. “I don’t think we need that measure any longer when it comes to raising the pension age, and it is one of the things I will be changing pretty quickly,” Mr Morrison told the Nine Network on ... ► Read more

  • Westpac to pay $35 million settlement in irresponsible home loan case

    Westpac has agreed to settle a case with the Australian Securities and Investments Commission (ASIC) involving more than 10,000 loans that allegedly breached responsible lending laws. As part of the settlement, the bank will pay a $35 million civil penalty for irresponsible lending. ASIC commenced proceedings in March 2017, alleging that Westpac’s use of the Household Expenditure Measure (HEM) to calculate loan applicants’ living costs led to customers being approved for loans that they would ... ► Read more

  • EU and UK clash over Brexit negotiations

    Michel Barnier, the European Union’s chief Brexit negotiator, “strongly” opposes key parts of the British Government’s proposals for a future trade deal between the United Kingdom and the EU. Mr Barnier’s comments follow an article penned by British Prime Minister Theresa May and published in The Sunday Telegraph, in which the Prime Minister insisted she will not make compromises on the Government’s plan to leave the EU that are against the “national interest”. Included in ... ► Read more

  • Scott Morrison to finalise Indonesia free trade deal

    Prime Minister Scott Morrison will leave for Indonesia on Thursday to conclude free trade talks with President Joko Widodo. Mr Morrison said the talks in Jakarta will focus on enhancing economic and security ties between the two G20 nations. “Our close collaboration across economic, security and strategic domains makes both countries stronger, safer and more prosperous,” Prime Minister Morrison said. “I look forward to working with Indonesia’s President to lay the foundation for the next ... ► Read more

  • Week in Brief: 19 August – 25 August 2018

    Scott Morrison wins leadership spill Scott Morrison has won Friday’s Liberal leadership spill, clearing the way for him to become Australia’s 30th Prime Minister. See OPMG’s coverage of this story here. Government instability in the wake of leadership challenge Malcolm Turnbull’s coalition government was rocked by turmoil following Tuesday’s unsuccessful leadership challenge by former Minister for Home Affairs Peter Dutton. See OPMG’s coverage of this story here. Trump warns American economy would crash if he ... ► Read more

  • Trump warns American economy would crash if he was impeached

    United States President Donald Trump has warned that any attempt to impeach him could result in the crash of the American economy. The President made the claim as the White House struggles to manage the fallout after Mr Trump’s longtime personal lawyer, Michael Cohen, entered into a plea deal on behalf of Mr Trump’s former campaign chairperson, Paul Manafort, who was convicted of financial offences this week. The President, who is incensed at Michael Cohen’s ... ► Read more

  • Kalashnikov takes on Tesla with new electric concept car

    Russian arms manufacturer Kalashnikov unveiled on Thursday (local time) a new electric concept “supercar” it says will rival Elon Musk’s Tesla. Based on the body of the Soviet-era Izh hatchback, Kalshnikov’s CV-1 has a 90 kilowatt hour battery which offers a range of 350 kilometers. The vehicle can accelerate from 0 kph to 100 kph in six seconds, according to the arms company. Kalashnikov spokesperson Sofia Ivanova told Russia’s RBC that the CV-1 would compete directly “with ... ► Read more

  • ‘If they have their dollars, we have our God’: Erdogan doubles down on rift with US

    Turkish President Recep Tayyip Erdogan has doubled down on the detention of an American pastor which sparked diplomatic fallout with the US, saying Ankara will not bow before those who set up their “own order by exploiting the world” and make Turkey their “strategic target”. “They were not able to make us collapse and they will never be,” Mr Erdogan told supporters on Saturday (local time). “If they have their dollars, we have our God.” While ... ► Read more

  • AMP to refund super customers

    Financial services company AMP will refund superannuation customers whose cash investments were eroded by fees and charges, the banking royal commission has heard. AMP’s superannuation trustees will cut fees and refund $5 million to approximately 12,500 customers who have $43 million invested in AMP super accounts and who chose cash as their investment option. The firm will also refund around $27 million to AMP Capital superannuation members who were wrongly charged fees. AMP Superannuation chairman Rick ... ► Read more

  • Restrictions on foreign ownership of housing would be welcomed in Australia

    Australians have long been enthusiastic about property ownership. By 1945, with a population of 7.39 million, 50% of Australians owned their own homes. The end of World War II saw Australian ex-servicemen, who had previously been living through the Depression, finally have a substantial bank balance due to receiving their accumulated military pay. Many turned that bank balance into their own part of the Great Australian Dream by purchasing a property. Following the Baby Boom ... ► Read more

  • Dutton reportedly urged to challenge Turnbull for Prime Ministership

    The Daily Telegraph has reported that some anonymous government backbenchers are urging Minister for Home Affairs Peter Dutton to challenge Prime Minister Malcolm Turnbull for leadership of the Liberal Party and the country. A small group of government MPs are opposed to the National Energy Guarantee (NEG), a policy to address electricity affordability, reliability, and emissions, that was adopted by the Coalition party room on Tuesday. Those MPs opposed want more done to cut prices ... ► Read more

  • New Zealand passes law banning foreign non-residents from buying houses

    The New Zealand Parliament yesterday passed the Overseas Investment Amendment Bill 2018, which bans many non-resident foreigners from buying existing housing, as part of the Labour Government’s election promise to tackle housing affordability. During the election campaign last September, now-Prime Minister Jacinda Ardern pledged to stem rising house prices and reduce growing homelessness, partly by banning foreign buyers. Associate Finance Minister David Parker, who introduced the bill in December last year, described the bill’s passing ... ► Read more

  • China matches US tariff hike

    China will respond in kind to the United States’ decision to impose 25% tariffs on USD $16 billion (AUD $22 billion) worth of Chinese imports, the Chinese Ministry of Commerce announced on Wednesday. The new tariffs will take effect from 23 August — the same day the US’ tariffs take effect — and will target products including fuel, steel, cars, bicycles, medical equipment, fish meal, wood waste, paper, and scrap metal. Both the US and ... ► Read more

  • Former ACCC chief calls for consumer watchdog to take over ASIC banking powers

    Former chairman of the Australian Competition and Consumer Commission (ACCC) Professor Allan Fels has called for the Australian Securities and Investments Commission (ASIC) to be stripped of its regulatory powers over banks, and those powers handed to the ACCC. Criticising ASIC for being ineffectual in dealing with banking misconduct, Professor Fels told ABC’s AM programme that “ASIC is not feared, unlike the ACCC.” According to Professor Fels, transferring bank supervisory powers from ASIC to the ... ► Read more

  • Commonwealth Bank cash profit drops 4.8% to $9.2 billion

    The Commonwealth Bank of Australia (CBA) posted annual cash profits of $9.23 billion for the last financial year, a drop of 4.8% compared to the previous financial year. The drop was mostly a consequence of the record $700 million penalty paid to Australian Transaction Reports and Analysis Centre, after the bank admitted to 53,700 violations of anti-money laundering and counter-terrorism funding legislation. CBA also paid $155 million in costs relating to the Royal Commission into ... ► Read more

  • Homeopathy all but eradicated from National Health Service in England

    Publicly-funded homeopathy is all but over in England, after Bristol’s Clinical Commissioning Group decided to cease providing homeopathic treatments under the National Health Service (NHS). Bristol was the last place in England to offer NHS-funded homeopathic treatment, and it will now be provided only in exceptional circumstances. Homeopathy uses treatments based on the idea that “like cures like” — that minute doses of natural substances that produce similar symptoms as an illness can be used ... ► Read more

  • AMP first half profits plummet following Royal Commission revelations

    Embattled financial service company AMP has reported a 74% drop in first half profits to $115 million after it set aside $290 million to compensate customers it overcharged or charged for no services. The company’s revenue for the past six months also dropped by 6% to $7.17 billion. AMP’s underwhelming results are the first since it was revealed through the banking Royal Commission that the company engaged in widespread misconduct including charging fees for no ... ► Read more

  • Global trade war escalates as US threatens sanctions against trading with Iran and increases Chinese tariffs

    United States President Donald Trump has threatened to impose trade sanctions on countries that continue to trade with Iran, after the US reimposed sanctions on the Middle Eastern country this week. “Anyone doing business with Iran will NOT be doing business with the United States,” President Trump said in a tweet on Tuesday (local time). “I am asking for WORLD PEACE, nothing less!” The Iran sanctions have officially been cast. These are the most biting sanctions ... ► Read more

  • Australia’s population will hit 25 million tonight, claims Bureau of Statistics

    According to projections from the Australian Bureau of Statistics, Australia’s population will reach 25 million tonight, with net migration continuing to increase faster than births. Australia’s population currently increases at about one person every minute and 23 seconds, and the new record is expected to be set at about 11:00 pm. Author and political commentator George Megalogenis said that the 25 millionth person will most likely be a young female Chinese student or skilled worker, ... ► Read more

  • Canadian ambassador expelled as relations with Saudi Arabia rapidly deteriorate

    Canadian ambassador Denis Horak has been expelled from Saudi Arabia after Canada called for the release of human rights activists. Canada is gravely concerned about additional arrests of civil society and women’s rights activists in #SaudiArabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful #humanrights activists. — Foreign Policy CAN (@CanadaFP) August 3, 2018 Saudi Arabia has also frozen all trade with Canada and its state airline ... ► Read more

  • Rouhani on new sanctions: US ‘psychological warfare’ illogical

    On Monday (local time), Iranian President Hassan Rouhani called the United States’ plan to re-impose sanctions an attempt at “psychological warfare” that “doesn’t make sense”. During an interview on state television Mr Rouhani said: “If you’re an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife.” It is Mr Rouhani’s first response to US President Donald Trump’s ... ► Read more

  • Australian industry groups urge governments to support the National Energy Guarantee

    Seven groups that represent Australian industry have urged the federal, state, and territory governments to get behind the National Energy Guarantee (NEG). In a joint statement issued on Monday the Business Council of Australia, Australian Industry Group, Australian Chamber of Commerce and Industry, Council of Small Business Organisations, National Farmers’ Federation, Australian Petroleum Production & Exploration Association, and Australian Energy Council called on Australian leaders to “put aside politics and support the implementation of the ... ► Read more

  • Apple now the first US company to reach $1 trillion in market value

    Apple is now the first US company in history to reach $US1 trillion ($1.4 trillion) in market value despite slowing sales, heavy regulation, and tariffs. The tech company hit the milestone early this morning when its stock crossed $207.05 per share at 11.48am (ET). While reaching the $1 trillion mark is an achievement that will not soon be forgotten, the tech market is volatile, according to OPMG’s Chief Editor, meaning that Apple may not stay ... ► Read more

  • Bernie Sanders’ Medicare for All Bill would cost $32.6 trillion, working paper claims

    A working paper published by the Mercatus Center at George Mason University claims that US Senator Bernie Sanders’ proposed Medicare for All Bill (“M4A Bill”) would cost approximately USD $32.6 trillion over the first decade of implementation (2022–2031). According to the paper’s author, Charles Blahous, the “projected increase in federal healthcare commitments would equal approximately 10.7% of GDP in 2022, rising to nearly 12.7% of GDP in 2031 and further thereafter.” The increased costs would ... ► Read more

  • Australia and Japan join US Indo-Pacific infrastructure initiative

    Australia and Japan have formed a trilateral partnership with the United States to invest in infrastructure and development projects in the Indo-Pacific region, it was announced on Tuesday. The announcement follows months of talks regarding a joint scheme to respond to China’s Belt and Road Programme. Initiated by Chinese President Xi Jinping, Belt and Road is a massive infrastructure investment programme across Eurasia and the Indo-Pacific, but has been criticised for spreading Chinese political influence ... ► Read more

  • Qatar bid team accused of sabotaging rival bids for 2022 FIFA World Cup

    Allegations of a “black-ops” campaign by Qatar’s bid team for the 2022 FIFA World Cup have sparked controversy as accusations of extensive sabotage emerge. The Qatar bid team is accused of using ex-CIA connections and public relations firms to run a fabricated propaganda campaign against rival US and Australian bid teams. The scandal emerged after a confidential source provided documents to The Times (UK), detailing how the Qatar bid team undermined support for hosting the ... ► Read more

  • Julie Bishop arrives in East Timor after five year diplomatic drought

    Australian Foreign Minister Julie Bishop arrived in East Timor on Sunday marking the first visit by an Australian government minister to the country in five years. Tensions between Australia and East Timor have now eased after a five year diplomatic drought. The rift between Canberra and Dili, East Timor’s capital, mostly resided in a bitter dispute over maritime boundaries. East Timor accused Australia of trying to steal a large supply of oil and gas that lies between the two ... ► Read more

  • Week in Brief: 22 – 28 July 2018

    Nine Network to takeover Fairfax Media The Nine Network will takeover Fairfax Media in a deal rumoured to be worth around $4 billion, Fairfax CEO Greg Hywood announced on Thursday morning. See OPMG’s coverage of this story here. Greece declares state of emergency as lethal wildfires rage near Athens Greece has declared a state of emergency after two separate wildfires raged through towns near its capital Athens, killing at least 20 people, injuring over 100 ... ► Read more

  • Facebook loses AUD$162 billion in historic market value plunge

    Social media giant Facebook has experienced a 19% drop in market value wiping out around USD$120 billion (AUD$162 billion), following a disappointing second-quarter earnings report. Investors reportedly took issue with sales and subscriber numbers, which was not helped by the company warning of a growth slowdown on Wednesday (local time). The plummet is Facebook’s largest single-day drop since it started trading publicly in 2012, and marks the worst drop in US stock-market history. Facebook’s market ... ► Read more

  • BREAKING: Nine Network to takeover Fairfax Media

    The Nine Network will takeover Fairfax Media in a deal rumoured to be worth around $4 billion, Fairfax CEO Greg Hywood announced on Thursday morning. In a statement, Mr Hywood said over the past eight years his company “has gone from being at the mercy of the non-stop global media revolution to being the best of its breed”, and that “there will be plenty of Fairfax Media DNA in the merged company and the board.” ... ► Read more

  • US Government will provide $12 billion in financial assistance to farmers affected by trade disputes

    United States Secretary of Agriculture Sunny Perdue announced in a press release on Tuesday (local time) that the Department of Agriculture will “authorise up to $12 billion in programs [to] assist agricultural producers to meet the costs of disrupted markets.” Mr Perdue said that the department “will take several actions to assist farmers in response to trade damage from unjustified retaliation”, referring to tariffs imposed by China and other markets. US President Donald Trump directed ... ► Read more

  • Ivanka Trump shuts down her namesake clothing brand

    Ivanka Trump is officially closing down her namesake clothing brand due to her work in Washington. Ms Trump, daughter of US President Donald Trump, made the announcement on Tuesday along with a senior White House advisor, saying her “focus for the foreseeable future will be the work I am doing here in Washington” and called the company’s closure “the only fair outcome for my team and partners”. The company, which was based in New York’s Trump ... ► Read more

  • NAB will cease charging penalty interest rates for drought-affected farmers

    National Australia Bank (NAB) Chief Executive Andrew Thorburn announced on Monday evening that the bank will cease charging drought-affected farmers penalty interest rates for missed repayments, bowing to pressure from the public, Federal Government, and the banking Royal Commission. “The royal commission and other inquiries reveal that in some cases we have lost touch,” Mr Thorburn said in a public address to 120 customers at the International Hotel in Wagga Wagga. “Such customers go through ... ► Read more

  • G20 summit: no consensus over resolving trade disputes

    Despite calling for increased dialogue to resolve trade tensions, financial officials ended a two-day G20 summit without agreement as to how to handle the ongoing disputes over the United States’ tariff actions. Meeting in Buenos Aires at the weekend, finance ministers and central bankers from the world’s 20 largest economies warned that growth will be hampered due to the waves of recent tariffs, and was already becoming less synchronised, with downside risks increasing over the ... ► Read more

  • Comcast drops bid for 21st Century Fox assets paving the way for Disney

    American telecom giant Comcast has dropped out of its pursuit to attain 21st Century Fox’s film and television assets, leaving Disney as the sole bidder to acquire content such as Avatar and X-Men. Comcast says it will now focus on its bid for Sky, a pan-European satellite broadcaster which, like Fox, is also owned by billionaire media mogul, Rupert Murdoch. Disney has recently raised its offer for Fox’s entertainment assets to $71 billion, surpassing Comcast’s ... ► Read more