PRICES LEAP, AS BUDGET DEFICIT FALLS
Soaring house construction, food costs driving inflation
Australia’s inflation rate remains persistently above the six per cent mark, according to latest data from the Australian Bureau of Statistics (ABS). The monthly CPI indicator reveals that inflation was 6.8 per cent in the 12 months to the end of August, driven by annual increases of 20.7 per cent for dwelling construction, 18.6 per cent for fruit and vegetables and 15 per cent for automotive fuel.
Labor lifts penalties for competition breaches
Penalties for corporations engaging in anti-competitive behaviour will be increased from $10 million to $50 million under legislation introduced into Federal Parliament. The Albanese Government said the changes to the law were necessary to ensure a level playing field and stop big companies from using their size to dominate markets. Assistant Treasurer Stephen Jones and Assistant Minister Andrew Leigh said the current turnover‑based penalty would also be increased from 10 per cent of annual turnover to 30 per cent of turnover for the period the breach took place, and penalties for individuals would increase from $500,000 to $2.5 million.
Surging company taxes boost budget outcome
Corporate Australia’s fortunes have helped to slash the Federal Budget deficit for 2021-22, with a higher company tax take contributing to an almost $48 billion improvement in the budget bottom line. The Final Budget Outcome released by Treasury revealed that higher-than-expected company taxes accounted for most of the $27.7 billion boost to receipts, complemented by a lower take-up of Covid-19 business support. Payments were $20.1 billion lower than expected, due to delayed spending in areas such as Covid-19 and infrastructure projects. The budget deficit for 2021-22 was $32 billion, down from the $79.9 billion predicted in March this year.
Marles in US, Japan defence talks
Defence Minister Richard Marles has met in Hawaii with his US and Japan defence counterparts Lloyd Austin III and Hamada Yasukazu. Secretary Austin said the ministers had discussed deepening trilateral defence cooperation on enhanced information-sharing, exercises, and science and technology initiatives. He said the ministers committed to taking “concrete, practical steps together in order to anchor stability and prosperity” in the Indo-Pacific region. In a separate meeting, Mr Austin and Mr Marles also exchanged views on how to accelerate and deepen bilateral defence cooperation on force posture and defence technology collaboration.
Wholesale markets, network investment powering higher energy bills
Rooftop solar systems now account for about one-fifth (15 gigawatts) of the national electricity market’s total generation capacity, according to the Australian Energy Regulator (AER). But the AER’s State of the Energy Market 2022 report says that energy prices are continuing to push up, with record wholesale prices fuelled by high international coal and gas prices. AER Chair Clare Savage said network costs were also likely to increase as inflation and rising cost of capital impacted the cost of network investments in a transitioning energy market. Meanwhile, the Australian Government has signed a Heads of Agreement with East Coast LNG exporters in a bid to avert a domestic gas supply shortage. Resources Minister Madeleine King said that LNG exporters would be required to first offer uncontracted gas to the domestic market, on competitive terms, before exporting.
Defence sector a $9 billion contributor
Australia’s defence industry contributed $8.9 billion to the national economy in 2020-21, according to official estimates. The first figures presented by the Australian Bureau of Statistics show that the defence sector’s (gross value added) contribution to the economy grew 5.7 per cent from the previous year, with purchases from the professional, scientific and technical services industry comprising $3.7 billion, or 41 per cent of the total defence industry contribution. New South Wales contributed 30 per cent, or $2.7 billion, from Defence expenditure, ahead of Victoria, the Australian Capital Territory and South Australia.
National Cabinet ends mandatory isolation
Federal, State and Territory First Ministers have agreed to end mandatory isolation requirements for Covid-19 from Friday, October 14. National Cabinet also agreed to end the pandemic leave disaster payment from the same date, but special isolation requirements and financial support will still apply in the aged, disability and health care sectors. The provisions will be reviewed by the December meeting of National Cabinet.