North Korea has warned Australia it is “suicidal” to conduct military drills with the United States after a handful of Australian troops began an annual war game with the US and South Korea on Monday.
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Tens of thousands of military personnel are involved in the Ulchi Freedom Guardian drills, a 10-day exercise in South Korea that simulates war on the Korean Peninsula.

About 25 Australian troops join 17,500 from the US and 50,000 from South Korea, as well as a small number from Canada, Colombia, Denmark, New Zealand, the Netherlands and the United Kingdom.

On Saturday, a spokesman for North Korea’s Ministry of Foreign Affairs told state news agency KCNA that Australia’s participation is aggravating the situation in the region.

The North Korean spokesman referred to the ANZUS military treaty between Australia, the United States and New Zealand, saying if Australia follows the US into war it will feel the “counter-measures of justice”.

“Not long after the Australian Prime Minister had stated that they would join in the aggressive moves of the US, even referring to ANZUS which exists in name only, the Australian military announced that they would dispatch their troops to the aggressive nuclear exercises of the US,” the spokesman said.

“This is a suicidal act of inviting disaster, as it is an illustration of political immaturity unaware of the seriousness of the current situation.

“Australia followed the US to the Korean War, the Vietnamese War and the ‘war on terrorism’, but heavy loss of lives and assets were all that it got in return.

“The Australian government had better devote time and energy to maintaining peace of its own country, instead of forgetting the lessons learned in the past and joining the US in the moves for nuclear war.

“Countries like Australia that join the military adventure against the DPRK [Democratic Peoples Republic of Korea], blindly following the US, will never avoid the counter-measures of justice by the DPRK.”

On Monday evening, Malcolm Turnbull said North Korea needed to be brought to its senses.

“North Korea has shown it has no regard for the welfare of its own population, no regard for the security and good relations with its neighbours and no regard for international law,” Mr Turnbull told the ABC.

“We call on all countries to redouble their efforts, including through implementation of agreed UN Security Council resolutions, to bring North Korea to its senses and end its reckless and dangerous threats to the peace of our region and the world.”

The comments come at a time of tension between the US and North Korea, after US President Donald Trump promised to answer North Korean aggression with “fire and fury”.

Last month, North Korea launched two intercontinental ballistic missiles (ICBMs) and threatened to launch a third toward the American territory of Guam.

Despite this, the Ulchi Freedom Guardian drills are proceeding as planned.

The exercises are the world’s largest computerised war-simulated drills. They involve no field training like live-fire exercises or tank manoeuvring but instead feature alliance officers sitting at computers to practise how they engage in battles and hone their decision-making capabilities.

The allies have said the drills are defensive in nature.

South Korea’s President, Moon Jae-in, said on Monday that North Korea must not use the drills as a pretext to launch fresh provocation, saying the training is held regularly because of repeated provocations by Pyongyang.

North Korea typically responds to South Korea-US military exercises with weapons tests and a string of belligerent rhetoric.

During last year’s Ulchi drills, North Korea test-fired a submarine-launched ballistic missile that flew about 500 kilometres in the longest flight by that type of weapon. Days after the drills, the North carried out its fifth and biggest nuclear test to date.

with agencies

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After years of massive investment, Andrew Forrest’s Fortescue is about to harvest dividends.
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It will be a huge reward for many of its loyal shareholders who have ignored the company’s critics and religiously followed the dream of being the third force in iron ore. They lapped it up on Monday, pushing the share price up 6.5 per cent.

Fortescue’s previously parsimonious strategy on paying dividends came to an end as it declared on Monday that up to 80 per cent of profits will be earmarked for paying shareholders going forward.

Forrest himself could be counting on a yearly pay cheque of more than half a billion US dollars from 2018 if current profit levels are maintained and more if profits improve.

Fortescue’s generosity to shareholders marks the final stage in its evolution from a highly speculative, entrepreneurial upstart to a mature company with reliable positive cash flow – albeit volatile thanks to movements in the iron ore price.

Until now, the company had been squirrelling profits to pay down the billions in debt it had taken on to develop the West Australian mines and infrastructure.

The other leg of its strategy had been to cut its operational costs – at which it has been so successful that it is ahead of its larger rivals in iron ore – Rio Tinto and BHP.

The release of Fortescue’s full-year results on Monday coincided with yet another strong gain in the price of iron ore – which if sustained – would improve profits in 2018.

It told investors that net direct (C1) cash costs should fall again in 2018 to between $US11-12 per wet metric tonne and that the company would continue to work to get below even these levels.

But there is always the caveat that this will depend on fluctuations in the Australian dollar exchange rate (which is now stubbornly higher than Fortescue’s assumptions of US75??) and fuel prices of $US53 a barrel.

The 2017 result of a $US2.1 billion net profit was more than double that which was inked in 2016, primarily due to the better iron ore prices from its Chinese customers.

The result would have been better but for the price discount Fortescue wears because its iron ore grades are lower than its major competitors’.

And with debt now down to near optimal levels and no major repayments due until 2022, the familiar mantra of Fortescue pumping its cash into debt repayments has given way to a new emphasis on shareholder returns.

In 2017 alone, net debt was cut in half, to $US2.63 billion from $US5.19 billion a year earlier.

Indeed, it now boasts a very healthy looking balance sheet, having avoided (unlike BHP and Rio) the pitfalls of blowing up capital on poor acquisitions.

There was no talk of any large capital outlays from Fortescue nor of increasing the production of ore beyond its current 170 million tonnes a year, although it will need to replace some reserves over the coming years.

Fortescue is almost starting to look like a yield stock.

It’s a formidable achievement for a company that only a few years back was battered by lower ore prices and too much debt, and being read last rites by some commentators.

If one assumed a steady-state for Fortescue, investors should be feeling pretty comfortable with the reduced risk level complete with net gearing of around 21 per cent.

But this is a company that is probably unable to shed its entrepreneurial culture, which is dominated by Forrest. He will not be content with sitting back and enjoying the fruits of the past 15 years of hard slug and just harvesting dividends.

Analysts are now bracing themselves for Fortescue 2.0 – a company which, armed with enormous cash flow, is looking for new opportunities, new commodities and new ways to get bigger.

The company’s chief executive, Nev Power, has to balance the branding of the company as one with growth options beyond West Australian iron ore but at the same time not willing to take on too much risk.

At this stage, Fortescue has barely dipped its toe into potential new developments and Power insists it won’t grow for growth’s sake. Time will tell.

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Goodman Group will use a potential windfall of $2 billion from looming asset sales to develop highly automated logistics centres where artificial intelligence will boost efficiency for tenants.
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Despite not commenting directly on strong speculation that online giant Amazon will lease a site at Goodman’s Eastern Creek estate in Sydney, Goodman chief executive Greg Goodman said the retail “disrupters are here and the followers are on their way”.

“With $8 billion of asset sales over the last three years, we’ve positioned our business in line with structural changes. We’re now looking to the future. We are seeing and we are planning for rapid technology and behavioural changes for both business and consumers as the use of automation and artificial intelligence increases,” Mr Goodman said.

“AI in warehouses is accelerating with not just robotics, but data collection where trucks can be sent out at the right traffic times, bar coding to ensure the customer can track the parcels and a more efficient layout internally.”

He said although the evolution of e-commerce and supply chain transformation was still at an early stage, “we are seeing increased demand for our expertise in providing high-quality logistics facilities in prime locations. This is a trend we expect to accelerate over the next five to 10 years”.

“We are recalibrating the business and see that AI and technology have raised consumer expectations around price, product availability and delivery,” Mr Goodman said.

The group has also inked a deal with NSW Ports, the custodian of Port Botany and Port Kembla, to develop NSW Ports’ industrial estate at Enfield Intermodal Logistics Centre. It is set on 60 hectares of industrial zoned land on Mainline Road, Strathfield South, Sydney.

“Now while disruptive for some businesses, the early stages of the evolution of e-commerce and supply chain transformations are providing us with opportunities.”

The assets sales and a focus on costs has seen Goodman report an operating profit of $776 million, up 8.6 per cent on the 2016 year and operating earnings per share of 43.1??, up 7.5 per cent on the previous corresponding period. The interim dividend of 13.2?? will be paid on August 28.

The results included $1.6 billion of revaluation gains and 14.4 per cent total return from its partnerships and joint ventures. Since 2014, assets under management have grown to $35 billion despite $8 billion in asset sales.

Mr Goodman said he would continue to look at recyling older, non-core land and buildings to apartment developers.

He said the results are supported by the development-led strategy that leverages growing online consumerism in key global gateway cities through Goodman’s $3.5 billion workbook. The group has also agreed terms with a partner in Brazil.

“We’ve taken advantage of the property cycle to make $3.5 billion of asset sales across the platform this financial year, redeployed this capital into strategic developments and reduced group leverage to 5.9 per cent,” he said.

“This has provided us with greater financial flexibility and enabled us to improve the quality of our global portfolio by focusing on strategic locations in gateway cities, placing our customers close to their customers.”

Analysts said the results were in line with expectations.

According to Peter Zuk from Shaw & Partners, it was another strong result for Goodman, which again benefited from high development margins as well as performance fees in the development and management businesses, offsetting the loss of income from investment property sales.

“Goodman is incredibly well capitalised, with significant reinvestment potential, including $2.1 billion of cash, that should help keep its earnings growth ticking along nice over the medium to long term,” Mr Zuk said.

But JP Morgan’s Richard Jones said while Goodman is in “good shape”, its medium-term challenge is maintaining its earnings growth when yield compression no longer underpins above-trend development margins.

“Goodman has look-through gearing of about 20 per cent and heading lower, plus it has $10 billion of available capacity to fund acquisitions to maintain growth,” Mr Jones said.

The share price was down 11?? to $8.43 a security.

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AFL commission chairman Richard Goyder says he “hates” pokies, and will seek to use his personal authority to wean clubs off them.
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“We’re going to have a good look and see whether there’s the opportunity to at least lessen the reliance,” Goyder told journalist Alan Kohler in an interview for his website The Constant Investor. “Some clubs have got a high dependency on them at the moment, and it’s not a matter saying, ‘Well let’s just stop it’. You’ve actually got to work through a way of doing it. It’s something we and the clubs are looking at, at the moment.”

Goyder admits it will not be easy. “That would be an outcome that I’d seek,” he said. “Whether that’s attainable, time will tell, but certainly we’ll work with the clubs to see if there’s ways we can, as I said, at least lessen the reliance.” Kohler said he hated pokies. “Yeah, so do I,” said Goyder.

Goyder’s remarks follow last week’s revelation that the AFL had formed a task force to find ways to reduce the reliance of clubs on poker machines, which account for up to 30 per cent of revenue of some clubs. The context is that Victorians lost about $94million last year on pokies owned by football clubs at 17 venues around Melbourne.

Called Project Fruit, the task force is chaired by former Tattersalls boss Ray Gunston and includes Richard Garvey and Mark LoGuidice, respectively presidents of Hawthorn and Carlton, two of the bigger pokie operators among clubs.

On pokies, Goyder is consistent. In his previous role as chief executive of Wesfarmers, he agitated for manufacturers to incorporate a $1 spin limit on machines owned by Coles, a Wesfarmers subsidiary.

Asked in ABC interview last February while still wearing his Wesfarmers cap if the company would get out of pokies, he replied: “We should be allowed to trial $1 spin limits, which we think would reduce the harm that comes from one end of the pokie industry. That would be our preferred course.”

But his plea fell on deaf ears.

Pokies are becoming a growing thorn in the AFL’s side. “It’s something we’ve talked about a lot,” chief executive Gillon McLachlan said last year. “We looked at one stage as an industry, could we exit them, but it’s challenging.”

All Victorian clubs except North Melbourne operate machines, and revenue from them grew by 3.3 per cent last financial year. Publicly, the clubs defend themselves on the grounds that they reinvest some of the profit into the community, and that they would would struggle to make ends without pokie money. Privately, most are uneasy.

Unsurprisingly, when it comes to pokies, left and right hand are not always in sync. The Victorian government noted recently that losses to pokies had fallen overall in the last year. But last month, it announced an expansion of the pokies footprint, doubling the number machines and the validity of licences to 20 years from 2022. Anti-gambling bodies fear this will tempt AFL clubs to increase rather than reduce their investment in pokies.

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It’s hard to believe now, but there was a time when the only sexy thing about outdoor advertising was what appeared on the billboards.
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All that changed when the rest of the traditional media business started going backwards, and billboard vendors like APN Outdoor discovered digital.

The result is that APN’s share price has still doubled since its ASX debut in 2014, despite the proposed merger with Ooh! Media falling over in May. APN boss Richard Herring gets to walk away from the business next month with just under $10 million worth of shares. That’s rock star CEO territory.

When asked what the future holds, Herring said he played music, “badly”, and would work on that.

But what about a different gig, like comedy? Given he shares a name with British comedian-blogger, Richard Herring.

“I was sadly likened to him during his tour of Australia, which is entitled something like tour of the penis ??? anyway.”

And with a delivery like that, maybe our retiring CEO should stick to the directorship circuit instead.

Speaking of moving on.

BlueScope boss, Paul O’Malley, has also decided to retire after presiding over a result that could best be described as a meltdown – through no fault of his own.

All O’Malley’s good work on the cost cutting and productivity front were undone by the massive rise in BlueScope’s power bill, which we can all sympathise with.

It sent the company’s earnings, dividend, and share price into a ditch on Monday.

So, what is O’Malley planning to do next after a decade at the helm of the steelmaker?

“I’m hoping to be a failed professional bike rider,” said O’Malley, who has a young son who is happy to keep the old man company. Weiss guy

The Gary Weiss-led corporate raider, Ariadne, found something to do besides rubbish the Ardent Leisure board on Monday when it released its full-year results.

Weiss has plenty to crow about after the company’s share price nearly doubled in November after selling its stake in Secure Parking for a $67 million profit.

Other investments are a work in progress, it told investors. Which brings us back to Ardent.

“We consider that Ardent has some valuable assets, with good potential under the right board and leadership team,” said an unusually measured Ariadne.

The Kiwi group also found plenty to cheer about from the sporting success being enjoyed on the other side of the ditch.

“Following the winning of the America’s Cup by Team New Zealand in June 2017, there is a clear recognition of the urgent need to develop the necessary infrastructure to support the next competition for the cup in four years’ time and to capture the significant opportunities for New Zealand’s internationally recognised marine industry which will flow as a result. The Ariadne consortium remains uniquely positioned to respond to this challenge,” crowed Ariadne.

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Australian coach Darren Lehmann concedes his team faces a challenge in its preparation for the first Test against Bangladesh starting on Sunday in Dhaka after its only tour match was washed out.
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The Australians were due to play a two-day match against a Bangladesh Cricket Board XI in Fatullah on Tuesday and Wednesday but following an inspection on Monday, the venue was deemed unplayable after contaminated water flooded the ground in recent weeks.

The BCB are understood to have proposed alternative venues for the match, however Cricket Australia’s carefully planned security operations in the subcontinent made late rearrangement a difficult proposition.

Lehmann said it was a shame the tour match would not eventuate.

“The Bangladesh Cricket Board have been fantastic in trying to get us a game, and obviously the amount of rain they’ve had, that can’t be helped,” Lehmann said on Monday.

“[The] BCB and CA worked as hard as they could to try to get the game up.

“You’d love to have it, but at the end of the day, we just can’t play on the ground.

“[It’s] obviously a shame for both sides.

“That’s the challenge for us to get ready.”

Lehmann also said his thoughts were with members of the Bangladeshi public who had been affected by the monsoonal weather.

Captain Steve Smith had played down the importance of the tour match before the squad’s departure last week, which had followed a pre-tour camp in Darwin which included a three-day intra-squad match.

Lehmann said that despite the lack of match practice, the tourists were prepared to take on the Tigers, who have never beaten Australia in Test cricket. “You can’t control the weather,” he said.

“We’re ready to go, it’s just a case of fine-tuning our skills in the nets available and what we can get out of that.

“Fingers crossed we can get the ground up here and play a great Test series against a quality side at home.

“We’re pretty settled in where we want to go.”

The tourists had a lengthy net session on Sunday but their plans were halted by rain on Monday. Wet weather is forecast for all five days of the first Test.

Meanwhile Lehmann reiterated that Australia were likely to play two spinners in the first Test, although noted he hadn’t yet seen the pitch.

In the event Australia select two spinners, it is expected off-spinner Nathan Lyon will be accompanied by left-armer Ashton Agar, who got the nod for the tour ahead of Steve O’Keefe and Jon Holland. Uncapped leg-spinner Mitchell Swepson is another option.

The second Test in Chittagong begins on September 4. The series marks Australia’s first international matches since the resolution of the pay dispute between CA and the Australian Cricketers Association.

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SYDNEY, AUSTRALIA – JUNE 14: It’s a dark for Channel Ten as the network announces it is entering voluntary administration on June 14, 2017 in Sydney, Australia. (Photo by Jessica Hromas/Fairfax Media)Oh the irony – the Murdochs wanting Australian media ownership laws changed has become the biggest hurdle to changing Australian media ownership laws.
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In a decade of grubby politics, there’s something particularly tawdry about the Turnbull government being so keen to curry favour with the Murdoch empire that it was willing to acquiesce to demands from Pauline Hanson’s One Nation to whip, embarrass and damage the ABC.

It’s a sad and desperate day when Australia’s government is prepared to share a tinfoil hat with the One Nation flat earthers in forcing the national broadcaster to provide “balanced” coverage of anti-vaxers and give equal weight to the small minority of climate change denialists.

And for what? To grant the Murdoch family clearer title to what they’ve already had – control of radio stations, subscription television, most of the nation’s newspapers and a television network, albeit by the backdoor and around various corners in the case of Ten.

If the government was interested in media ownership reform on its own merits, it could unbundle the two legs of the legislation that just failed to get up and one would pass without too much difficulty – scrapping the current 75 per cent cap on a television network’s national audience reach.

With free-to-air television under attack from streaming services, allowing a national network to be national is a no-brainer. That wouldn’t be seen as doing the Murdochs a particular favour and, therefore, could win agreement from Labor, never mind the Senate cross bench. The ultimate goal

But that’s not the leg most dear to the Murdochs, or the other major media companies, including Fairfax Media. They want the two-out-of-three rule abolished, allowing a single entity to own print, radio and television assets in a capital city market.

There are allegations that Labor types concede behind closed doors that the two-out-of-three rule is out of date and irrelevant when multinational internet giants are destroying traditional media’s revenue faster than the legacy operators can cut costs. But because Murdoch so clearly wants the change and is the main force in pushing it, Labor can’t agree to it. The Murdoch media’s consistent attacks on the Labor Party have come at a price.

It’s no surprise that the Murdoch national paper billed the failure of the media laws as a disaster for Ten.

“Senate deadlock cuts Ten Network’s rescue hopes” headlined the Australian.

“Hundreds of staff and thousands of shareholders are hoping for a series of competitive bids from local companies and foreign investors to help the company trade its way out of debt.”

Which is pure poppycock. The shareholders have done their dough regardless. The best hope for staff is that someone doesn’t pay too much for it and therefore will be able to run the thing at a profit.

There will always be a certain lingering interest about the timing of the Ten receivership, precipitated by Lachlan Murdoch and Bruce Gordon, coinciding with the Senate considering the media ownership laws.

For the Murdochs, being allowed open ownership slather appears more about the exercise of power than money. For the other media companies that have formed a cheer squad, the motives are less obvious.

Dropping the 75 per cent television reach rule would result in a flurry of consolidation in the sector, to the joy of the owners selling out and the investment bankers and lawyers who getting a slice of it. Takeover talk overblown

Contrary to plenty of speculation, dropping the two-out-of-three rule is much less likely to promote a takeover frenzy.

Oh the investment bankers will talk it up but, quite simply, there’s little to be financially gained by putting together a newspaper and a television station.

Their “content” is not easily shared. As someone who has worked in newspapers, radio and television, I can assure you they are very different beasts.

The golden era of Kerry Packer’s media empire saw successful cross-promotion of television and magazines, but the world has moved on from getting much out of having your own TV personality on the front page of the Women’s Weekly.

Offering a package for advertisers “across multiple channels” is a clich?? that offers marginal benefit by adding one more medium in a bundle. Semi-competent media buyers should be capable of tailoring and targeting their clients’ spend more precisely in a buyers’ market.

The executive talent required to run print or television successfully is rare; to run both of them, non-existent.

The unceasingly drive to cut costs could achieve more across the same medium – the ACCC allowing – than across different media.

Murdoch aside, the legacy operators live in hope that “something” might turn up, that some good might evolve from an unimpeded media market. With Google and Facebook eating their lunch – and breakfast and dinner – it’s fair for them to so hope.

For some, there could be the short-term hope of achieving a little “shareholder value” by being taken over. Take the money and run.

The last media ownership law overhaul saw that happen with the three commercial television networks all changing hands as Bond, Skase and Lowy blew fortunes. And they were the good old days. There’s no sign of them returning.

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An image from the federal government’s anti-tax avoidance advertising campaign.The Turnbull government has conceded average Australians and small business operators think the tax system is stacked against them, revealing it has spent $8.1 million on a new advertising campaign.
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Labor has criticised the tax integrity advertising push, which has seen national TV, radio, newspaper and online marketing about moves to penalise large multinational corporations that move undeclared profits overseas, the creation of a new tax avoidance taskforce and anti-avoidance measures.

It comes after research showed punters had no idea what the government was doing to fix the problems.

Shadow assistant treasurer Andrew Leigh labelled the campaign budget wasteful and called on the Coalition to back Labor’s plans to close tax loopholes being used by big businesses today.

Information provided to a Senate estimates committee shows the advertising campaign cost $4.2 million in the 2016-17 financial year, and $3.9 million in 2017-18.

Under slogans including “Earned here, taxed here – new corporate tax laws”, the campaigns are linked to the government’s stand alone website.

Department of Finance officials told the committee the purpose of the campaign was to communicate to the Australian community and small businesses the extent of the Turnbull government’s tax integrity and multinational tax avoidance measures.

“Research has shown the general population and small businesses indicated that the tax system was seen to be structured so that multinationals and big businesses were not contributing their fair share, meaning that the population and small business were taking on an unfair burden,” officials told the committee.

“The research also indicated there was little or no knowledge of the government’s tax integrity measures.”

Officials said the advertising spending complied with government guidances designed to prevent taxpayers footing the bill for political content and special measures were in place to communicate with culturally and linguistically diverse Australians and Aboriginal and Torres Strait Islander audiences.

Supplementing the advertising spend are federal government media releases on the passage of multinational anti-avoidance laws and the penalty 40 per cent diverted profits tax.

Dr Leigh said action was needed to address rising inequality and growing government debt, not more government advertising.

“These results are unsurprising – for too long, dodgy multinationals have been exploiting the loopholes in Australia’s tax system and getting away with not paying their fair share,” he said.

“Instead of wasting millions of dollars trying to buy credibility for its tax reforms, the Turnbull government should get on board with Labor’s plans to close these loopholes and make big business toe the line.

“We want public reporting of country-by-country reports and protection for whistleblowers who uncover tax dodging by multinationals.”

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Urgent action is needed to fix the nation’s energy market “catastrophe” or the economy risked blackouts, business closures and job losses, the boss of manufacturing heavyweight BlueScope has warned.

“Six months ago, at our half-year results presentation, I warned of an imminent energy supply catastrophe. This catastrophe is now happening,” BlueScope chief executive Paul O’Malley said on Monday.

A predicted near doubling in BlueScope’s energy costs was one of the key reasons for a softer-than-expected outlook, which prompted investors to tear 21.76 per cent from the steel maker’s share price on Monday.

BlueScope predicted its underlying earnings would drop 20 per cent in the current half compared to the second half of the 2017 financial year as its energy bill increased to an estimated $145 million, or 75 per cent, between 2016 and 2018.

Mr O’Malley said the solutions to the crisis were “simple” – the existing baseload fleet, especially coal-fired stations, needed to be kept running until there was a renewable energy equivalent and more gas needed to be made available for domestic use.

“We have a very fragile baseload mix, We must maintain that baseload energy that we have today or we will have more blackouts, more businesses will fold because of higher energy costs, jobs will go with it,” said Mr O’Malley whose retirement at the end of this year was also announced on Monday.

The problem was that there was no incentive for coal-fired power station owners to invest in their plants when policy could change quickly that would see that investment wiped out, he said.

“Every bit of energy policy over the past 10 years has been aimed at penalising our baseload plants. Incentivising baseload to shut is just plain stupid, incentivising baseload to stay open is absolutely essential.”

He said prices in the wholesale electricity market had spiked sharply since the closure of the Hazelwood coal-fired station in Victoria.

“The economic cost to the country of getting our baseload incentives wrong has been awful and getting higher,” he said.

Mr O’Malley said payments needed to be put in place to keep baseload plants operating until renewable energy alternatives were available for at least the next 10 years.

In a statement federal Energy Minister Josh Frydenberg said the government understood that baseload power “anchors our electricity system”.

“That is why we have tasked the Australian Energy Market Operator to identify the future baseload power needs of the grid, particularly in light of the scheduled closure of Liddell [power station\ in 2022.”

Mr O’Malley said there also needed to be more done to boost production of local gas and failing that then interventions should be made to divert gas from export towards domestic uses.

“Australia and its consumers must come first,” Mr O’Malley said.

The company also revealed that it is under investigation by the Australian Competition and Consumer Commission for potential cartel conduct.

The investigation relates to the supply of steel products in Australia and “involved a small number of BlueScope employees” and Mr O’Malley said the company was co-operating with the ACCC.

“BlueScope is committed to competing fairly and complying with all laws that apply to our operations but in the view that we need to be absolutely transparent with the market we have called this issue out,” he said.

Mr O’Malley declined to comment when asked if BlueScope had immunity as part of the investigation or whether it had self-reported to the ACCC.

Underlying profit rose 112 per cent to $650.8 million, based mainly on cost cutting. However, the result was below market forecasts of $682 million.

Its final dividend of 5?? a share was also below market forecasts for 7??.

However, BlueScope said it would return a further $150 million to shareholders through an on-market share buyback.

Mr O’Malley will be replaced by the head of the company’s Australian arm, Mark Vassella.

with Reuters

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Schools are moving away from paper and pen NAPLAN tests. Students in NSW will not sit NAPLAN tests online until schools are confident they are ready to move from pen and paper, according to the Education Minister Rob Stokes, who said he supported the use of handwriting in exams and was “very aware” of the concerns of teachers.
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Mr Stokes’ comments come as the NSW Teachers Federation began collecting feedback from teachers and principals about the school readiness tests, which are under way in thousands of schools across NSW to assess whether schools will be in a position to move to online NAPLAN testing from next year.

The federation’s vice president, Denis Fitzgerald, said the organisation had been receiving complaints since the practice tests began last week. They run until September 22.

The responses, which cannot be anonymous to ensure they can be verified, include complaints of schools not having enough computers, unreliable Wi-Fi and the disruption to classes.

“In an academic class not one student preferred the online method to the paper method of NAPLAN delivery, which I found very surprising,” one response said.

Another said: “We do not have enough computers to allow all students to sit the test simultaneously. This will increase the already considerable disruption to the school and calls into question the legitimacy of the test if students can talk to others who have yet to complete the tests.”

Mr Fitzgerald said the public school system was not in a position to replace pen and paper tests with an online version.

“NAPLAN online is not a feasible proposition for many years, if at all,” Mr Fitzgerald said.

“There is no doubt that NSW is not yet ready to run NAPLAN online and it has the clear prospect of exacerbating inequality in NSW schools.”

But data collected by the NSW Department of Education show that the students who sat the school readiness test last week reported that they liked doing it on a computer. Of the 12,500 responses from students, more than 77 per cent were positive.

A spokeswoman for the department said there had been “no major issues” so far.

“The point of a readiness test is to flush out any problems before we make the move to formal online assessment of our students. We anticipate that in the readiness test, problems will occur. We want problems to happen now so that we can prevent them happening when the real testing begins,” the spokeswoman said.

Mr Stokes said NSW would not be moving to NAPLAN online until all problems and issues had been dealt with.

“All states and territories are committed to participating in proceeding with NAPLAN online as a condition of Commonwealth funding,” Mr Stokes said.

“However, I am very aware of the concerns of teachers regarding the practicalities of participation in this online program. I am also very supportive of the role of handwriting in undertaking tests.

“Effectively, we won’t be proceeding to online testing until all concerns expressed by teachers and schools are resolved and all risks are addressed.”

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