The Centrelink debacle has only just begun…

centrelink-4

Image by The Pen

We hear Artificial Intelligence (AI) bandied about a lot in recent times as well as innovation and agility and more recently we have been hearing terms such as robo-debt recovery, algorithms and malware. The Income Security Integrated System (ISIS) ISIS was set up in 1983 and oversaw welfare payment deliveries, customer service, support and compliance activities for Centrelink. In 2015 Marise Payne, former Human Services Minister (and now Defence Minister) called for an overhaul of the system: ‘To deal with the increased demands over the years the original system has literally had another 350 systems bolted on. To put it simply, we are running a turbo-charged Commodore 64 with a spoiler in the age of the iPhone.’

In the 2015-16 budget, the Welfare Payment Infrastructure Transformation (WPIT) program was announced as the replacement for ISIS. The 2015-16, budget measure worth $60.5m is part of a $1.5 billion, seven-year program. The program was described by the government as one of the world’s largest social welfare ICT transformations.

In September 2015, the Department of Human Services (DHS) asked for expressions of interest (EOI) for the first tranche of WPIT for a core software provider. As part of tranche one a panel of members was also to be formed to compete for the other tranches. In a statement, Ms Payne said that: “Finding innovative and expert industry partners is the first step in providing a modern platform that will make interacting with government services easier for our customers,” the Minister added. “Over the next year, the department will commence two major procurement activities to secure a Core Software Vendor and Systems Integrators.”’ 

“The new system will reduce red tape for customers, lower the costs of administering welfare payments and save taxpayers money,” Payne said. “Customers can expect to see improvements to our payment systems by the end of 2016 with enhancements that will make online interactions quicker and easier.”

On March 2nd 2016, legislation was introduced to parliament to assist the government in chasing welfare debt by Social Services Minister Christian Porter. The changes allow interest to be charged on debts, ends the six-year limit on when debt can be pursued and stops debtors from being able to travel overseas. The new interest charge is around nine-percent and applies to social security, family assistance, child care, paid parental leave and student assistance debt. It won’t be imposed on those that have an approved repayment plan. The six-year limit brings it in line with tax debt and the travel ban brings it in line with child support debtors.

And by March 20th it was reported in the media that the DHS had partnered with the Australian Federal Police (AFP) in a venture called Taskforce Integrity. Welfare recipients in areas identified as high-risk, received letters with the AFP logo alongside the Centrelink logo. This is a first, using a police logo on a welfare letter. The first batch of letters was sent to South Queensland and will be rolled out to other geographical areas around Australia considered high risk or noncompliant. The letters warn that the taskforce was “currently working in your community” and that providing the wrong information could constitute welfare fraud, resulting in a “criminal record or a prison sentence”.

The government’s new automated compliance system to detect overpayments began on the 13th of July last year. The system compares Centrelink information with records such as tax records, saving the government money on employing staff. The first error to come to light was it not computing the difference between 52 weeks in a year and 26 fortnights. And in December last year stories from the public began trickling through to the media.

In early August 2016, German software company SAP was selected to be the government software provider and tranche two was opened up for bidding. In the MYEFO published in December 2016 it was revealed that tranche two of the WPIT will cost $313.5 million over four years. The panel is to consist of IBM, HP, Capgemini, and Accenture; with the latter two currently competing for tranche two below:

  • Tranche 2 – Student payments
  • Tranche 3 – Job seeker payments
  • Tranche 4 – Family payments, including disability and carer payments
  • Tranche 5 – Seniors, pensioners and any remaining payments.

It is of note that IBM was also awarded a five-year contract by the DHS in March 2016 worth $484 million. DHS CIO Gary Sterrenberg said: “This innovative and flexible agreement allows the Department to use products, services and expertise through an on- demand model. It ensures value for money for government in maintaining the Department’s existing spend with IBM, with the opportunity to realign technology and services to areas which provide better outcomes for our customers over the five-year term.” And that: “This will also ensure the Government is prepared to transition to new infrastructure with more dynamic capability to support future programmes.”

This week Centrelink’s new robo-public servant was introduced in the media, and it is being tested on the public next month in February. Two robo-assistants will answer questions from the public, one will focus on the National Disability Insurance Scheme, (NDIS) and the other one on student payments. The plan is that if the trials are successful, they will be rolled out to replace traditional public servant roles behind the desk and on the phone in the DHS. Human Service’s Chief Technology officer Charles McHardie, also believes that virtual assistance will have a central role in the future of claims processing at the DHS or in WPIT.

Concerns about the right use of AI are real and there are many examples of it helping to increase inequality in many areas of our lives. Sexism, racism and other forms of discrimination are being built into the machine-learning or predictive algorithms, either intentionally or unintentionally. Machines are taught by humans and this includes any bias that may have. An example of predictive algorithms is Pro Publica’s study of an algorithm, built by a private company, it incorrectly flagged black defendants as “future criminals” more than twice that of white defendants. “The reason those predictions are so skewed is still unknown, because the company responsible for these algorithms keeps its formulas secret,” wrote Microsoft Research principal researcher Kate Crawford in “Artificial Intelligence’s White Guy Problem.”

Australian businesses spend an average of $6 million a year on AI technologies according to recent research by Infosys. Algorithms are being developed for more and more things such as predicting investor responses to market shocks and offering financial advice. The research also found that: “Happily, Australia was the most ethically conscious country of the seven surveyed, with 69% [of businesses surveyed] saying ethical concerns were a major barrier to their organisation’s AI deployment plans, compared to just 33% in the US.”

To date 230,000 debt recovery letters have been sent out to Australians. There’s been countless articles written about it and there are 350 individual stories shared on the Not My Debt web site and a false debt tally of $2,124, 501. Thousands of Indigenous Australians have been sent letters with some just paying it off despite knowing it is wrong. Daniel Hayes told NITV News he was repaying the debt but when he started seeing news articles he stopped paying Centrelink. He said in early January that: “I’m in the middle of repaying them $3350 for apparently not declaring correctly in periods where I didn’t even have a job. When I asked for proof, they told me I had to go through my bank records, so I’ve paid it for a year down to $1600,” he said.

In early January, independent MP Andrew Wilkie, said: “I have had at least four people now approach me in my office who I would describe as presenting suicidal and in all those cases we’ve taken what action we thought was appropriate.”

Mr Wilkie requested an investigation into Centrelink by the Commonwealth Ombudsman before Christmas, they agreed on January 9th. Deputy ombudsman, Richard Glenn told the Guardian that the matter was “of significant interest to this office”.

“I can certainly say the ombudsman has approved an own-motion investigation into the matter… this one will be self-initiated because we have a number of complaints and there is significant public controversy about the issue. So, it is an inquiry into the issue at large, rather than into a specific complaint,” Mr Glenn said.

“Certainly, there’s enough information from complaints we’ve received and … that it’s an issue of significant interest to this office, and we’ll be pursuing it.”

The focus will be on three areas: the data-matching process used to compare Centrelink records with those of the tax departments; how Centrelink communicated with clients and how the agency managed the fallout.

Centrelink has been referring distraught people to Lifeline and several current and ex-Centrelink employees have told Mr Wilkie that there was little to no training for the recovery program. Mr Wilkie has written to the Ombudsman this week sharing what he has been told. It all reads badly but what jumps out at me, is that it has been alleged that senior departmental staff have been encouraging officers to compete with themselves over who can achieve the highest debt recovery quotas.

While all of this has been going on for weeks, the government denies that there is a problem, although they have agreed to soften some wording in the letters. And they’ve agreed to start sending letters by registered mail so that Centrelink can track if letters are being received. Many people have been unaware of any alleged debts until a debt collector was knocking on their door.

So far only The Australian has reported that there will be a senate inquiry into Centrelink. Perhaps last year’s failed Census inquiry report can assist them with it. The Turnbull and the Abbott governments don’t have a great record with technology. News about Australia’s biggest infrastructure, the National Broadband Network (NBN) is reduced to tiny PR pieces talking up their rollout but neglecting to tell the rest of the story. The census fallout may not be felt now but it will, that data has been compromised and is vital for planning things like infrastructure. Seeing this play out and knowing that the government is nowhere finished with their five-seven year WTIP plan, sends a shiver down my spine. We can take comfort in the fact that it has united us, so many are fighting for those affected but it is bittersweet, because it feels intentional and a government at war with its own people will never end well.

 

 

 

 

 

 

 

 

Australia has lost its identity

united-corporations-states-of-america-map

The Australian cultural mindset has been eroded and is becoming predominately American. The size of the American population and its dominance in movies, television and music meant that influence was inevitable and it’s reflected in our fashion and in language with words such as “like”, “bro” and phrases along the lines of “you go girl”. American cultural imperialism has only exacerbated since Australia signed the American free-trade-agreement (AUSFTA) in 2004. Australia is losing its cultural identity. The Indigenous Australian culture actually has more in common with Australian culture than many may realise. The love and affection for Australian land is evident when so many Australians spend their time off from work and on holidays to do such things as swimming, sun baking, surfing, yoga, meditating, mountain climbing and hiking.

Australia’s history with Indigenous Australians is also not what many may realise with slave labour, stolen wages and stolen federally paid maternity allowances and child endowments from their trusts. Indigenous Australians not only built the pastoral industry for Australia but they also helped build it in other ways with wage, labour, allowance and endowment theft. They also worked in a wide range of occupations: interpreters, concubines, trackers, troopers, servants, nursemaids, labourers, stock workers and pearl divers. What is also overlooked is that they are the oldest living culture on earth with many achievements starting to come to light such as, superfoods knowledge, being the world’s first bakers and perhaps even being responsible for the world’s oldest astronomical map.

Australian television in the eighties and nineties is markedly different today with the likes of comedy shows such as The Comedy Company, Fast Forward and Full Frontal now fond memories. The reality television show Big Brother, began on Australian screens in 2001, along with a plethora of American shows such as Sex in the City, Law and Order and CSI. Many Australians including Indigenous have been raised subconsciously or subliminally with an American belief or values system. Calls get made to the American emergency number 911 rather than our own national emergency number 000 and “product dumping” is the norm with American businesses selling their television shows in the Australian market for below local cost or production prices. With an American population of around 325 million, it’s a lot easier to recoup your production and overall costs and it means that sales to other countries are essentially pure profit for America. This makes it harder for local industry to compete and it takes away any incentive to innovate or foster local production and talent. It also creates a deficit in our creative knowledge economy preventing innovation at a local level. More funding and tax breaks are needed to bolster confidence and to transition our creative knowledge economy for the future.

Between 1996 and 2000 Australia’s royalty trade deficit (including Information and technology) with America, increased by 84 per cent. In the book How to Kill a Country by Linda Weiss, Elizabeth Thurbon and John Mathews, they suggest an Intellectual Property Right (IPR) tax. They argue that governments have always taxed property as a principal source of avenue, so why not tax royalty flows? This book was written twelve years ago so it would be even easier for the government to look at royalty flows data and to put even a modest tax on it. For example, if Australian businesses paid royalties of AU$1 billion, the government could collect say 10 per cent or AU$100 million and use the revenue to reinvest locally.

Forced control over Indigenous Australian’s wages and savings (bank books) only ended in 1972 and they didn’t receive equal wages until 1986. Despite stolen wages, slave labour and stolen benefits they have fought wars for Australia without recognition and thanked only with discrimination when they got home. They have been portrayed as nomadic, hunter-gatherers but evidence shows that they were actually Australia’s first farmers.

Grindstones that are 36,000-years-old have been discovered in New South Wales (NSW), they were used to turn seeds into flours for baking. The Gurandgi Munjie collective is made up of a number other Indigenous Australians living along the NSW south coast and in east Gippsland in Victoria. They’ve been trialling native millet, kangaroo grass and murnong crops to increase harvests and begin selling bread soon. “One of our aims is to make sure our people earn a living out of it, as well as helping Australia learn about a natural Australian diet.” Murnong – is also known as yam daisy and is a tuber that can be eaten like a vegetable, the seeds of millet and kangaroo grass make up the healthy, gluten-free flours. Pascoe of Gurandgi Munjie’s baking experiments, says: “Kangaroo grass flour has got a really beautiful smell and a nutty flavour. We love making the breads simply because it tastes so good, but also because it makes the kitchen smell good as well.” And that “Environmentally it’s a pretty good deal,” says Pascoe. “They’re perennials, so once you get your crop established you don’t have to plough the land again or add fertiliser or pesticide. Your CO2 emission levels are going to drop dramatically because you’re not turning the soil over and releasing carbon into the atmosphere.”

Marnybi, Gugbinge, Kakadu plum, bush or billygoat plums have the highest natural vitamin C content in the world and can be found in abundance in Wadeye, the Northern Territory (NT). For Indigenous Australians it’s known as traditional Indigenous medicine. A local Wadeye woman explains: “It’s good for your headache. If we have headache at bush, we eat plum and it makes us feel good.” It is considered as a gift from the Dreamtime. It has taken off commercially as a powder for smoothies and to be sprinkled on to breakfasts as well as a good source of folic acid, iron and may even protect against Alzheimer’s disease. With this success comes bio piracy which locks up intellectual property around bush foods. Bush foods’ intellectual property is already being largely exploited by companies and individuals that are patenting intellectual property of native plant knowledge. Multinationals can come in and patent the use of products with little consideration for knowledge or history. The Northern Land Council is calling for a blanket moratorium on all patents over native foods and plants until a legal framework protecting Indigenous interests can be enforced. Andrew Forrest has been making noise again recently about a “premium” Australian brand to woo China, wouldn’t it be prudent for Indigenous Australians to have their own?

Australia may be home to an ancient astronomical stone formation that could be older than Stonehenge. The Wurdi Youang stone arrangement 45km west of Melbourne was formed using 90 blocks of basalt and clearly depicts the equinox, the winter solstice and the summer solstice. The Wathaurong people are the traditional owners. Geologists and experts have estimated it to be around 10,000 years-old, or 3,000 years older than the 7,000 year-old Stonehenge. They used the sky to help them work out weather patterns too and shared this knowledge with one another through song and dance, for example, if stars are twinkling rapidly it’s because of high-altitude trade winds. Another example is if the stars are twinkling fast and are bright blue, storms are on the way. They use dreaming and songlines as memory techniques to retain vast amounts of knowledge.

Indigenous are being included and recognised as such a lot more with Acknowledgement of Country becoming the norm as well as “Welcome to Country” ceremonies. Just about daily more stories and discoveries like the ones above can be found if you look, you won’t find them often in main-stream-media, but you will find cartoonists like Bill Leak. The social media campaign that followed with #IndigenousDads to counteract the latter’s cartoon was heart warming and shows that there is good will out there for each other. The ABC television show Cleverman also helped to educate and give insight into Indigenous Australian’s culture. Personally, I still can’t get Jesse William’s speech at the Black Entertainment Awards about racism in America out of my mind. In particular the last paragraph: “We’ve been floating this country on credit for centuries, yo, and we’re done watching and waiting while this invention called whiteness uses and abuses us, burying black people out of sight and out of mind while extracting our culture, our dollars, our entertainment like oil – black gold, ghettoizing and demeaning our creations then stealing them, gentrifying our genius and then trying us on like costumes before discarding our bodies like rinds of strange fruit. The thing is though… the thing is that just because we’re magic doesn’t mean we’re not real.”

So much of the Australia that many grew up with and know is gone, owning your own home and endless summers at the beach have been replaced with longer working hours. That is if you can get work and aren’t dealing with underemployment. Now that America and other multinationals are snapping up Indigenous bush foods and medicine patents, I think it’s time that we united and fought for our countries independence from America Inc, it’s a corporation not a country. Call out the main-stream-media misinformation, ignorance and racism when we see it and hear it. Acknowledge the ugly side of Australian history as well as all that we have in common and share this knowledge with others.

We can not allow Free-Trade-Agreements without any transparency

Updated: 18/08/2016

The Trans-Pacific Partnership (TPP) was conceived in 2003 as the Trans-Pacific Strategic Partnership Agreement TPSEP as a path to trade liberalisation in the Asia-Pacific. The original participating countries were Chile, New Zealand and Singapore with Brunei joining in 2005. In 2008 the United States of America (USA), Australia, Peru and Vietnam joined, followed on by Malaysia, Mexico, Canada and Japan. Free Trade Agreements (FTA) deal mostly with goods being imported at a certain price with certain environmental and labour standards met. What’s different about the TPP is that the treaty has 29 chapters, dealing with the whole scope of tariff and agricultural quota removal and market access on sensitive products, but in particular agricultural goods. It also includes provisions over non-tariff issues such as intellectual property rights, the environment, state-owned enterprises, and investment.

Japan was the last to join in 2013, as agriculture as well as the auto industry have long been a sticking point in Japanese trade liberalisation and had held up the TPP negotiations with the USA. However agricultural reforms made by Japan’s Prime Minister Shinzo Abe, has tipped the power of balance back into the governments favour and away from Japan’s most powerful farm lobby, the Japan Agriculture Cooperative. Japan offered to import more rice from the USA while keeping existing tariffs in place, and the USA agreed to stop demanding that Japan ease its car safety standards. Progress was also made on issues such as state-owned enterprises, environmental protection, and investment. This not only paves the way for greater market liberalisation and deregulation in Japanese agriculture but was meant to enable Mr Obama’s plan to “fast track” push for Congress approval to conclude the TPP before the end of his Presidency.

What is of the most concern is the provisions over not only the aforementioned non-tariff issues of intellectual property rights, the environment, state-owned enterprises, and investment but the Investor State Dispute Settlements provisions (ISDS). ISDS allows multinational corporations to sue governments if they’re deemed not to be acting in their best “interests”. It can potentially place limits on governments being able to develop their domestic laws and policies in areas such as public health, patents on medicine, the environment, food labeling, Internet use and privacy and even local media content. Australia had a long-running investor-state dispute with Philip Morris Asia, due to the introduction of the ‘Tobacco Plain Packaging Act 2011′ in 2011. The laws were introduced by the former Prime Minister Julia Gillard’s Australian Labor Party (ALP) government as a health measure but Philip Morris Asia amongst the many breaches, believes that it infringes their intellectual property. Previous ALP and Liberal National Party governments had in the past only included ISDS in trade agreements with developing countries that didn’t have any investments in Australia and they were not included in the US-Australia FTA. American corporations are the most frequent users of ISDS and the safeguard clauses that countries employ to protect themselves in FTA’s can and have been re-interpreted and over-turned through the arbitration process. Philip Morris International Inc in an Australian case for example, challenged the tobacco plain packaging legislation under a 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments.

Even where corporations do lose they have dragged governments through lengthy and expensive legal processes with dispute settlement cases that are heard by tribunals of three private-sector lawyers. The tribunals tend to be more concerned with assessing potential damage to corporate investments rather than the protection of the government’s or public’s interest. In December 2015 Australia won its four year international legal battle with Phillip Morris Asia and there are now currently 608 ISDS cases globally. More than $3bn has been paid by out governments, or taxpayers, to corporations under existing US trade and investment agreements alone. African countries are increasingly becoming involved in ISDS cases with the majority of these in the gas, oil and mining sectors. According to the International Centre for Settlement of Investment Disputes (ICSID), out of the ISDS cases registered with them until 2014, 26% were concentrated in the oil, gas and mining sectors. It was 35% for the year 2014 alone, compared to 2000 when there were only three pending cases. Investors have challenged many government measures such as: licenses that are revoked in mining, telecommunications and tourism; alleged breaches of investment contracts; the withdrawl of previously granted subsidies and changes to domestic regulatory frameworks in gas, nuclear energy, the marketing of gold and currency regulations.

An examples of an ISDS case against a government is one from Canada by Lone Pine Resources which filed a $250m lawsuit against the Canadian government when Quebec placed a moratorium on it and banned drilling and fracking processes for oil and gas underneath the St. Lawrence River for an environmental evaluation. “Based on the principle of precaution, the Quebec government’s response to the concerns of its population is appropriate and legitimate,” said Martine Châtelain, president of Eau secours! (The Quebec based Coalition for the responsible management of water). “No companies should be allowed to sue a State when it implements sovereign measures to protect water and the common goods for the sake of our ecosystems and the health of our peoples” Ms Châtelain added.

And there is the case of Eli Lilly and Company when an American global pharmaceutical company (and it’s fifth biggest), filed a $500m law suit against Canada. It was for allegedly violating its obligations to foreign investors under the North American FTA for allowing its domestic courts to invalidate patents for two of its drugs. Canadian courts had found that there was a lack of evidence supporting the drug’s alleged benefits.

According to Forbes in 2013 the biggest profit margins produced be USA corporations are in the pharmaceuticals. In 2013, US pharmaceutical Pfizer, the world’s largest drug company, made a 42% profit margin. As one industry veteran put it: “I wouldn’t be able to justify [those kinds of margins].” In the UK that year, there was widespread anger when the industry regulator predicted energy companies’ profit margins would grow from 4% to 8% for the year. In 2014, five pharmaceutical companies made a profit margin of 20% or more, these were – Pfizer, Hoffmann-La Roche, AbbVie, GlaxoSmithKline (GSK) and Eli Lilly. And in 2015 Johnson & Johnson was named the world’s largest drug and biotech company, edging out Pfizer and Swiss company Novartis once again. In 2015 Johnson & Johnson made $16.3bn in profits, held $131bn in assets and it’s market value was $276bn.

The problem isn’t just with the massive amounts of profiteering but the fact that the drug companies spend far more on marketing drugs than on developing them. Johnson & Johnson’s total revenue for 2013 for example was $71.3bn with a profit of 13.8%, it spent 8.2% on research and development and 17.5% was spent on sales and marketing.  Drug patents in the US are usually awarded for 20 years, but 10-12 of those years are spent developing it at a cost of up to $2.5bn, leaving eight to ten years to make money before the formula can be taken up by generic drug companies. Once this happens, sales fall by over 90%. Joshua Owide, director of healthcare industry dynamics at research company GlobalData, explains, “Unlike other sectors, brand loyalty goes out the window when patents expire.” This is why pharmaceutical companies go to such extraordinary lengths to extend their patents, a process known as “evergreening”, employing “floors full of lawyers” for this express purpose, one industry insider has said. And with a drug raking in $3bn a quarter, even a one month extension can be worth a lot of money. Some drug companies, including the UK’s GSK, have been accused of more underhand tactics, such as paying generics to delay the release of their cheaper alternatives. This is a win for both industries, as it has been said that the loss of the big pharmaceuticals far outweighs the generic industries revenue.

The source of contention between Australia and the US to seal the TPP deal now in 2016, is the difference in the monopoly period (the time-frame that it can’t be taken up by generic companies) for medicines or biologics between the two countries. Biologics are “next generation” drugs and Australia’s time-frame to protect medical intellectual property is five years whereas the US had been bargaining for eight years. Meaning that no generic or cheaper drugs could come onto the market for nearly a decade. Last month TPP supporter, US Senator Orrin Hatch, accused Australia of trying to steal American medicine patents and said that he wants it to be changed to twelve years.

The former Abbott government and the current Turnbull government have an appetite for signing FTA’s with their eyes on more with India, Indonesia and an Asian trade deal to rival the TPP called the Regional Comprehensive Economic Partnership. The TPP has been many years in the making and has been fraught with difficult negotiations that could impact on us really hard in an already uncertain economic environment. The secrecy in our Australian political environment in particular around FTA’s and the public’s growing unease with them needs to be heeded. If the government won’t listen we need the opposition, independents and the senate to come together and put the countries future and needs first, no matter how big the opportunities are for for a few investors in this country. Can you imagine what could be in store for us if we allow multinational corporations and trade ministers to ultimately decide our economies, laws and policies? With the global spend on medicines projected to be worth up to $1.2 trillion for 2017, low global growth and profit hungry corporations, the stakes are too high.

An example of media disunity

The sunset is seen through smog in Zhengzhou in the Henan province of China.

Image by: Reuters: Stringer

I surfed the ABC news website this afternoon and clicked onto this headline“China fights pollution: New environmental police squad to battle heavy smog”

The article seemed a little threadbare. When this occurs I search further and ideally for an article in the country relevant to the article, I like to get more details this way. I decided to try something different today and scanned the headline blurbs on the first Google page, and I noticed that all of the articles, bar two, started the same: “Officials in Beijing create a new environmental police squad in the latest effort to fight China’s persistent…”

The first one that differed was from The Indian Express, and it began with: ‘Beijing and dozens of cities in China spend many winter days under a thick, gray haze, with air pollution levels that…’

The second one was further down via the Deccan Chronicle and it began withBeijing will set up environmental police force to crackdown on erring factories and step up its supervision and enforce accountability in 16 districts to tackle the recurring pollution problem, officials said on Saturday.’ 

There was a bit more to the story than the basic Associated Press (AP) summaries that the media was reporting pretty much everywhere else in the news. In particular there was no mention of several other measures that were also announced at the same meeting, they included: ‘A target of cutting the use of coal by 30 percent in 2017 to shutting down 500 higher-polluting factories and upgrading 2,500 more. And about 300,000 high-pollution vehicles will also be restricted from entering the city starting next month.’ 

I also found an ABC news analysis that was posted around three hours later than the AP article, with the headline“China’s air pollution crisis shows no sign of ending as nation fails to lower coal use” It goes on to say:

“People are frustrated because air quality was improving in 2016 until coal production ramped up in September to service a mini stimulus package for heavy industries. Cheap coal has powered China’s economic miracle and still provides 70 per cent of the country’s energy. The Government is reluctant to wean itself off coal, fearing unemployment and unrest. In a rare display of anger, China’s rising middle class took to the Chinese social media website “wechat”, demanding the Government take action and protect the children of China.”

There is nothing in the analysis above to back this up in the article in the way of links, or footnotes unfortunately. The writer says further that:

“China’s addiction to coal shows no signs of slowing. China produces and consumes more coal that the rest of the world combined. In the winter its citizens use the most. Like many in northern China, Li Yuan said he had no choice but to burn coal to keep warm. He cannot afford electricity or gas — coal is a quarter of the price. “Using coal is not good. It’s dirty. You touch it and your hands get black,” he said.” 

What also isn’t included in any of the above articles is that China is also investing 2.5 trillion yuan, the equivalent of $US361 billion in renewable power generation by 2020. Fortune reports:

“The investment will create over 13 million jobs in the sector, the National Energy Administration (NEA) said in a blueprint document that lays out its plan to develop the nation’s energy sector during the five-year 2016 to 2020 period. The announcement comes only days after Beijing, the Chinese capital, and other cities in China’s industrial north-east were again engulfed in hazardous smog, caused largely by coal-fired power generation. The NEA said installed renewable power capacity including wind, hydro, solar and nuclear power will account for about half of new electricity generation by 2020.” 

Personally, I was aware of China’s five-year-planning but not of the lofty renewable energy target above until I started to write this. The current Australian government’s energy policies look dismal when compared to this news and it’s not right that the media has missed this, when so many Australians, especially Indigenous Australians care and value nature and worry about the repercussions of our climate changing. China is the world’s biggest investor not just in energy but in renewable energy. It’s citizens need to be able to breathe, just like the developed countries and the rest of the developing countries will follow too, naturally.

We can’t keep ignoring the ginormous elephant that is renewable energy in Australian politics and our economy, this is harming not just investment hopes within our country and overseas investors, but it’s also within our communities. The uncertainty and lack of long-term planning only opens us up to further exploitation by multinational corporations and or foreign countries. China is the world’s biggest producer and investor in solar energy now. Australia still has a chance, together, not on an elitist path, but closer to an egalitarianism one. One that questions authority and those that seek executive powers over us. If journalists can’t or won’t do it, we will just have to. It’s the pioneering Aussie way.

We can learn from the asbestos scandal

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Image is from comparethemarket.com.au

Last week asbestos was found again in imported Chinese building materials, this time it was found at Perth Children’s Hospital (PCH) in the roof panels. In February this year news broke that more than 50 sites across Australia are suspected of illegal asbestos contamination. Asbestos Safety and Eradication Agency CEO Peter Tighe, said that he was aware of 64 sites where asbestos-tainted materials have been used in construction.  “It’s an emerging problem and it seems to be growing exponentially, as more and more products are brought into Australia, because of the wind-down of manufacturing in this country,” he said. “What we’ve really got now is really an indication which could be the tip of the iceberg.” Because importing asbestos has been banned since 2003, Mr Tighe is also concerned about younger tradespeople and said “Our young tradespeople haven’t been trained to deal with these products. They think they’re asbestos free,” and that “It’s really a risk to these individuals, to their clients and to members of the public who might be in the vicinity when there’s cutting, drilling or manipulation of asbestos cement products.”

Independent Senator Nick Xenophon is calling for not just more scrutiny of overseas building products but greater penalties. “This needs a comprehensive approach [which] needs to include Customs doing their job, not just having random searches,” he said. “It needs certification of the supply chain so that if you’re an importer and your product has asbestos in it, unless you’ve done everything possible to check and double check, you should face a potential jail term.”

The panels used at the PHC were supplied by Chinese company Yuanda which also had another scandal to contend with last week, involving asbestos-laden gasket material in Brisbane’s new government tower. In February, Federal Border Protection Minister Peter Dutton, ordered an independent review of asbestos border control management, by KGH Border Services. The review has been completed, but kept confidential. A Senate inquiry [PDF] into non-conforming building products released an interim report in May with illuminating submissions about the Lacrosse apartment fire in Melbourne. The fire was caused by imported Chinese cladding with Mr Adam Dalrymple, Director of Fire Safety, Metropolitan Fire Brigade, describing the incident to the committee as one that alone could have ‘claimed hundreds of lives if things had turned out a little differently’.

“We were probably really lucky that did not happen on that occasion. What we are saying here is that fire safety really should not be a matter of good luck. The fire started on a balcony from an unextinguished cigarette — an innocuous type of thing, you would think. This set fire to the cladding, and the panelling itself allowed the fire to travel the full extent of the building — 23 levels in 11 minutes. That is something we have never, really, seen before. We would say this should not have been allowed to happen.

In 31 years as a fire-fighter and 20 years as a fire safety specialist I have never seen a fire like this — in my lifetime — and I have made it my business to study fires of this nature, so we can get a better outcome for fire-fighters in the community. We have grave concerns about the use of non-compliant product and that it may result in disastrous loss of life, and we cannot tell you when the next event is going to happen. This is a modern building, constructed within the last five years. It has been a valid assumption, up until now, that newer buildings are relatively safe and probably safer than old ones. From a fire services perspective, right now, I cannot guarantee that and I cannot, categorically, state that that is a true fact.”

The Senate interim report said that strengthening enforcement should be a high priority for the Federal Government. “The importation of banned materials, such as asbestos, raises very serious concerns about the capacity of Australian authorities to deal with this issue, particularly in light of our open and dynamic trade environment,” the report stated. The Asbestos Industry Association last year shared concerns that the Australian Border Force (ABF) officials were checking less than 5% of all products coming into Australia. It’s also worth noting that building products are not the only imports tainted with asbestos – children’s crayons and car parts have also come under scrutiny.

The Asbestos Safety and Eradication Agency (ASEA) has stated that regulations on prohibited imports allowed for fines of up to $170,000, but that “such penalties have not been commonly used as a deterrent”. Since 2009, only $64,000 in fines and costs have been collected from asbestos importation offences. ASEA also said: “The agency considers that an increased willingness to enforce the penalties available under the regulations would assist in reducing the incidence of non-conforming building products being imported into Australia,” and they also called for: “increased surveillance and screening of imported building products, with particular attention to those products previously found to contain asbestos.”

The Master Builders Association (MBA) WA said: “In WA, owner-builders are about 10% of the (house building) market,” and MBA executive director Michael McLean said. “That’s a couple of thousand new homes every year. What qualifications do a lot of these owner- builders have in accessing products for their homes? At least a builder has some experience or qualifications to make some assessment in these things. And that: “Because of the internet, builders and members of the public are accessing products from all over the world,” he said.

The Asbestos Diseases Foundation of Australia (ADFA) has asked the Federal government to urgently boost monitoring of imported building products. They say a greater sense of urgency is required in the wake of the asbestos exposure at PCH. ADFA president Barry Robson said “The Customs people used to come down and physically unpack the containers if they were suspicious of anything. Or they would come down and crawl all over that ship and inspect it from top to bottom, you don’t see that anymore, you haven’t seen that for decades. It’s just the lack of controls of imports into this country.” Mr Robson also said that construction companies and governments put too much faith in overseas certification, suggesting it would be better to source locally made products. “These importers should go to the manufacturer in China and make sure that there is no asbestos, if they’re not sure then don’t bring it into this country — have it manufactured in this country where we know there will be no asbestos in these building products.”

The Australian building and construction industry accounts for ~8% of Gross Domestic Profit (GDP) and employs 9% of the workforce. The industry contributed $108.4bn to the Australian economy in the 2013-14 financial year. At the end of the 2014 financial year it had generated $359bn in total income and employed 1,073,000 people. Questions need to be asked as to what is happening with registration fees paid by importers to ensure that their products are safe. They also need to be asked about why only $64,000 has been collected in fines since 2009, considering asbestos has been banned since 2003 and that we are now over half way through 2016.

The Turnbull government wants to reinstate the Australian Building and Construction Commission (ABCC) because it believes the building and construction industry is riven with “militarism and illegality”. The problem is that the ABCC has power in civil matters not criminal matters [PDF], the police do this work. And we already have the Fair Work Building Commission (FWBC) to do this work. Scrolling through the FWBC’s News and Media page on their web site they’ve not been idle with ~$300,000 worth of penalties issued for this month alone. The government relying on old modelling from 2007 stating that productivity grew by 9% under the ABCC, has also been discredited. The Hon. Murray Wilcox QC described the 2007 report as “deeply flawed” and concluded that ‘it ought to be totally disregarded.’ It is from this discredited report that the 9.4 per cent figure of lost productivity is derived [and] it should not be relied upon…”

I agree that we need a tough new cop on the beat just not what for the Turnbull government is claiming it needs to be for. There is illegality going on (including an increase in asbestos dumping) right under everybody’s noses and if left unchecked great tragedies could occur. Profits are not more important than people and for all the talk of “jobs and growth” this could be achieved if we manufactured and procured building products from Australia. Australia is trusted by countries like China for our safety procedures, in particular when it comes to handling food. In 2008 China had a contaminated milk disaster that saw children die and hundreds of thousands of children poisoned by melamine, an industrial chemical used in fertilisers and plastics, that was intentionally used to boost it’s ‘protein’ content. We’ve already had our own Chinese food scare with Nanna’s hepatitis A laced, frozen berries last year. With China’s middle class growing and wanting to improve their lifestyle, we have seen not just our high quality products like powdered baby formula become white gold but honey and vitamins too.

If we can be premium food suppliers, with trusted first class health and safety standards to China, we can become globally renowned for this and our quality control in other industries too. Our future would be much better if we became a nation of creators rather than outsourcing and profiting from the likes of turning a blind eye to health and safety.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Gentrification Creep

The City of Sydney Council is concerned about the NSW government plans for a 20 and 30-storey tower precinct at the Waterloo housing redevelopment site in Sydney. The Chief Executive Officer, Monica Barone said Urban Growth NSW seemed to be acting as a government planner, as well as property developer. Urban Growth NSW was formerly Landcom but with greater powers and it still has former Liberal leader John Brogden as its chairman. It is a government agency in charge of big new property projects including Rozelle, The Fish Markets, Glebe, The Powerhouse Museum, White Bay and North Parramatta. Urban Growth NSW pushed for the Waterloo station to be built rather than the Sydney University station as a justification to build 10,000 new dwellings while replacing 2,000 social housing units. The reasoning being that the new private dwellings will pay for the social housing dwellings in the area.

The first major public forum for the development was held in February a couple of months after residents were told that their homes were to be destroyed, to make way for a “vibrant new community”. Leaflets were handed out to the crowd but Mr Hazzard didn’t have many answers for them just that: “Everybody here in Waterloo will have the entitlement to come back into their housing, and it will be done progressively over 20 years” to which the room laughed not just once but twice after he was translated in Mandarin and Russia. “Twenty years! We’ll all be dead!” someone yelled from the crowd.

Also in February this year the NSW government issued a tender for Hong Kong style high rises at the new Sydney Metro train stations including Waterloo. Hong Kong’s railway was built by private company MTR in exchange for property development rights in the air space above each station. MTR is part of a consortium that will operate Sydney’s first private railway, the Metro Northwest this contract doesn’t involve air space rights though. MTR has also lobbied the Baird government to adopt its “value capture” modelling for future projects. This involves evaluating the additional land value around urban rail, with the added value paying for the new infrastructure. Or at the very least lowering the construction costs of new infrastructure. The Baird government hasn’t said if property development rights above stations will be awarded in a separate contract to the station  construction. An industry briefing last December however found that there was “significant interest” in property development above stations, especially in the CBD.

RedWATCH is a Waterloo community group meeting and last week Urban Growth NSW attended its first one. Convener of the group Geoff Turnbull said: “People don’t really have a sense of what is being talked about other than they are going to be upset and dislocated.” He also said: “So far people really know nothing more than when it was announced,” and that the entire process was, “callous.” One resident labelled the project as a, “social experiment,” and, “disrespectful to the community.” The master plan is expected by the middle of the year but with an election on July the 2nd, perhaps this will be put on hold until after it. Residents are to start being relocated as of the middle of next year, to where nobody knows yet.

The Greater Sydney Commission officially launched on January 27th this year and is being chaired by Prime Minister Malcolm Turnbulls’ wife Lucy Turnbull, a former Sydney Mayor. Mrs Turnbull is joined by three other “Greater Sydney commissioners”, Environmental commissioner, Rod Simpson, Social commissioner, Heather Nesbitt and Economics commissioner, Geoff Roberts. Mrs Turnbull will essentially have the power to remove local councils as a “relevant planning authority” if needs be and has basically received the formal powers of the Planning Minister. There will be six districts and a district commissioner for each one, four have been appointed with two more to go. “Sydney Planning Panels” (SPP’s) don’t exist yet but there has been much conjecture about them and they’re slated to begin at the end of this year or when the district plans become effective. Not much details as to how much power they may wield as yet or even if they will be put in place.

In Western Australia (WA) though they have something similar called “Development Assessment Panels” (DAP’s). State-appointed DAP’s instead of councils have the power over any Perth development worth over $10 million. SPP’s are slated to be responsible for any capital investment proposals with value over $20 million and proposals between $10-$20 million that have been delayed by more than three months. We can only wait and see further details when or if they are ready but councils in WA are lobbying for DAP’s to be scrapped. Cottesloe Councillor, Sally Pyvis is concerned about communities losing their voice and called on new Planning Minister, Donna Faragher to “clearly outline the true cost to the community, local government and industry of this additional administrative layer”.

The City of Sydney Council managed to survive the NSW government amalgamations as a stand alone Council. If it was merged with Woollahra or Woollahra, Waverley and Randwick, the Super Council would’ve most likely been in control of the Liberal Party. It is financially stable as is the Randwick Council but it was found not to have met the “scale and capacity test for a global city”. Lord mayor, Clover Moore has past experience with a prior amalgamation taking 3-5 years to complete and not wanting a distraction from the current $40 billion building boom in the CBD.

And what of small businesses inconvenienced after being on a property in Waterloo for 100 years like Bragg Printing? It’s being compulsorily acquired and there is nothing they can do about it. The owner Arthur Habib says “The government has watertight legislation, they tell us there is nothing we can do. They have told us we have to be out in six or seven months. We are now in limbo and in the hands of the costly legal system with conflicting information in regard to the valuation of our building and relocation costs, which will be considerable as we have six offset presses, some historical letterpress presses and various finishing equipment. We are not able to make any move until such time that we have some firm figures to work with for a building and relocation.” Mr Habib also said “At first we were delighted when Waterloo was chosen as the site for the station and we all assumed it would be built on the 18 hectares of government land that sits across the road from us in Cope Street. But it turns out the government is doing a land grab from small business at the bottom end of town to on-sell the air space together with its public housing estate to developers in the big end of town.”

The Waterloo redevelopment has had countless studies and reviews over the last 10-15 years, they should be available for the public to view. The lack of community consultation for it as well as forced council amalgamations is troubling in a democratic society. I also question why a Liberal state and Federal government appear to be adding red tape and more powers to the Greater Sydney Commission. We are in disruptive times as it is, now more than ever the public deserves to not only be consulted but to be a part of the decision process otherwise it is not democracy. Decisions in the hands of a few with power, coupled with land grabs and negative gearing gone wild is taking us backwards to a type of feudal system.

 

 

 

Manufacturing is transitioning not dead

In recent days there has been much conjecture as to who let Arrium get into over $4bn worth of debt and the usual blame games & misinformation that is the state of our modern media. Our four largest banks have unsecured loans worth $1bn that are included in this total. Last week the Industry minister & member for Sturt in South Australia Chris Pyne, did the media rounds explaining that the government was doing everything in its power to help Arrium. This included bringing forward a Victorian rail contract worth $80m and a government inquiry into Asian steel dumping in February this year.

SPC Ardmona recently won its anti-dumping case against cheap dumped Italian tomatoes, the Anti-Dumping Commission (ADC) and the Federal Government ruled that two major Italian exporters, La Doria and Feger, had indeed been dumping their produce in Australia. The case was decided on appeal with SPC arguing the ADC had not looked into the huge subsidies the European Union (EU) pays to Italian growers and manufacturers. As a result duties on Feger products 8.4% of the product price, with a duty of 4.5% applied to La Doria products.

Countries in Asia-Pacific produce billions of tonnes of steel and often have excess that they can sell cheaper than what their local domestic markets sell it for. As in the EU some companies engaging in dumping get subsidised via loans and tax concessions giving them extra incentives to continue the practise. While Mr Pyne mentioned protection from steel dumping from countries such as China, Taiwan, Malaysia and South Korea during his rounds he didn’t mention Japan or India. They also dump excess steel and this is of interest because we have recently signed free trade agreements (FTAs) with China and Japan and the government is looking to sign one with India in the very near future.

A senate inquiry about The future of Australian steel this month was told by the ADC commissioner Dale Seymour, that during the last few years the number of steel investigations has increased and represents 75-80% of their case loads. You can see for yourself the current cases before the ADC and what they comprise of here. Mr Seymour also confirmed that 75% of Arrium products were tied up in dumping.

In America last month the government imposed tariffs of 226% on imports of steel from China, with goods from Brazil, India, South Korea, Russia, Japan and the UK subject to duties too. UK steel industry’s largest trade union Community said: “We are drowning in this flood of Chinese imports and the US action will only serve to divert more Chinese steel towards Europe. “Unless the Secretary of State [for Business, Innovation and Skills, Sajid Javid] is prepared to join others in Europe and stand up for our industry soon, the debate will be over as we will have no industry left to save.”

Mr Pyne has backed the Australian Labor Party (ALP) call to mandate the use of Australian steel on government infrastructure projects but South Australian senator Ann Ruston doesn’t agree saying: “I think we need to be mindful of the fact that we are an exporting nation, we have a very small population, we’re not going to get rich selling to ourselves, so we must be very careful that we don’t put in jeopardy our trade arrangements overseas.” Mr Pyne also alluded to future submarine work for Arrium but they make “long steel” products which is mainly steel reinforcing bars and beams for homes and buildings whereas “flat steel” is used for submarine hulls. We have produced our own steel for submarines before with Australian company Bissalloy Steel Pty Ltd producing 8,000 tonnes of it in the 1980s-90s for the Collins submarines with research and development provided by BHP.

International investors are showing a keen interest in Arrium with Flinders University Professor John Spoehr saying he wouldn’t be surprised if a Chinese company was investigating taking it over and that: “We will see various different possibilities unfold over the next few weeks and months as various different global players either look to genuinely invest or they are interested in asset stripping, which is really the last thing we want to see occur in relation to Arrium’s future.”

The New South Wales government procured 6,500 tonnes of steel for $8.3bn from Spain for the Sydney NorthWest rail project a couple of years ago. AWU National Secretary Scott McDine said the decision was a ‘disgrace’ and that: “Australian steel should be used on taxpayer-funded infrastructure projects — that must be the the default position,” “Victoria is building its multi-billion dollar level crossing project with Australian steel, and the South Australian government mandates the use of Australian steel on taxpayer-funded projects.” 

“The NSW Government should hang its head in shame for rejecting Australian workers in Whyalla in favour of Spanish steel.”

AWU Acting SA Branch Secretary Peter Lamps said: “The Federal Government created 3000 Spanish jobs that could have gone to South Australia when it handed the contract for two replacement supply ships to Europe this month.” And that: “Every other steel-producing nation in the world has measures in place to ensure local steel is given preference.”

Australia Institute chief economist Richard Denniss has said that a real FTA would be one sentence: “there will be no trade barriers between countries”. This is a fair point to make and with recent events the public is right to question what exactly are in these FTA’s signed in such secrecy and in our names.

The ADC has said it has been laden with steel investigations for the last few years and Arrium and its financial woes have also been known for some time. The big four banks should answer as to why they provided $1bn between them in unsecured loans. And the government needs to explain why it hasn’t acted sooner and whether it was the same reasoning as applied to the near death of SPC Ardmona and the demise of Holden manufacturing in Australia. Manufacturing isn’t dead it’s transitioning and deserves local governments support as well as federal government and some of the profits from our infrastructure and property boom in New South Wales in particular. Australia and its manufacturing infrastructure as well as the jobs that go with them need protecting if we are to make it through the digital disruption unscathed. And lastly a nation surrounded by water that continually sends its manufacturing offshore is not a smart one but a dumb one with all of the knowledge that leaves with it.                  

 

The NBN is on the wrong path…

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Image from smh.com.au

After the coalition won government in 2013, the then Communications Minister and now current Prime Minister of Australia, Malcolm Turnbull promised that every Australian would have access to the National Broadband Network (NBN) by the end of 2016. This clearly won’t be happening and it’s understandable with such a large piece of infrastructure to get your cost projections wrong (including old Australian Labor Party (ALP) figures). Tasmania was to be the first state to have the NBN rolled out by the end of 2015, this has now been pushed out to September 2018. The coalition’s NBN main points of difference with their plan compared to the ALP plan was to roll it out sooner, with faster download speeds and cheaper.

The original budget for the government’s version of the NBN, which is a mixture of technologies and favours FTTN (fibre to the node) over FTTH (fibre to the house) was $29.5 billion this has blown out to $56 billion and counting. Now news is coming out from the less than 15% of Australian’s that do have the NBN, that it’s providing speeds less than the days of dial up or their ADSL2+.

Mr Bell, of Belmont North near Lake Macquarie, New South Wales lays the blame squarely at the feet of Malcolm Turnbull. He says:“My children are becoming cynical about promises made by…the Prime Minister about the fast FTTN NBN roll out. Could you please make enquiries of the appropriate officers or Ministers, as to whether the FTTN NBN will provide a worse service compared to the ADSL+2 it is replacing? At the moment that seems to be the case.”

Mr Alderton also lives in Belmont and is suffering the same challenges, He says:“What a joke, peak times download speeds around 4 Mbps, that’s less than my old ADSL2.”

Mr Wallace of Valentine, near Newcastle, thinks that the problem might be widespread. He says:“There are serious problems with the rollout across Newcastle due to the Fibre to the Node model used here…thinking about switching back to ADSL2+.”

There has been much talk about the copper wire network and how much of it needs replacing to achieve Mr Turnbull’s MTM (multi-technology mix) version of the NBN instead of the ALP version with optic fibre cable. Let’s not forget either that the ALP government had already paid Telstra $11.2 billion to essentially decommission the copper and HFC (hybrid-fibre-coaxial) networks. A figure of $55 million was given by the Turnbull government to replace the copper however a leaked document from late last year suggests a 1000% blowout with the cost being more like $641 million. The figure is so large because it’s for 8.5 million metres of copper of which is enough to lay down between Perth and Pakistan and back again. There has also been Optus HFC network documents leak revealing that the government will need to replace it to achieve it’s MTM at a cost of up to $375 million.   

So far the government and Mr Turnbull have failed in their promises with their alternative NBN. One of the reasons that Mr Turnbull has used in the past for favouring FTTN, is that AT&T also favour it yet they now offer GigaPower which is a complete FTTH network. It previously offered FTTN but it also already had mainly fibre optic cables running for most of the network, with just the last mile or so with copper cables.

It’s pretty clear that a simple roll out of fibre optic cabling replacing the old copper and pay TV networks as you went, would be easier than not only resurrecting old technology but attempting to mix it together. Fair enough if it achieves higher speeds, a cheaper budget and is delivered in a timely manner but it hasn’t to date. It’s bleeding money, yet creating profit for the likes of Telstra and Optus while Australian’s that do have the NBN are now worse off than what they were to begin with. A truly connected Australia would surely inspire further innovation and instead of the focus being on the cost it’s about time that it was looked at as an investment. An investment in the future of the people of Australia.