Weekly Wrap Up

21 June 2024

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Highlights

  • The Reserve Bank of Australia held the cash rate unchanged at 4.35 per cent.
  • The latest Freshwater Strategy Poll recorded Prime Minister Anthony Albanese’s approval rating dropping behind Opposition Leader Petter Dutton at 34 to 35 per cent, respectively. Labor and the Coalition remain tied at 50 per cent on two-party preferred.
  • The Federal Government declared an offshore wind zone of the coast of the Illawarra, the fourth zone in Australia.
  • Treasurer Jim Chalmers released a Sustainable Finance Roadmap, which aims to mobilise private capital into projects related to Australia’s transition to net zero.
  • Ahead of its final report due by 9 September, the Royal Commission into Defence and Veteran Suicide delivered its publication “Shining a Light: Stories of Trauma & Tragedy, Hope & Healing” to the Government.

Chinese Premier’s visit

Chinese Premier Li Qiang arrived in Australia this week for a state visit and bilateral discussions with senior Australian officials. The visit was the first by a Chinese Premier in seven years, ahead of an expected visit by President Xi Jinping later this year. Premier Li began with a stop by Adelaide Zoo, where he signed a memorandum of understanding (MoU) with South Australian Premier Peter Malinauskas to lease two additional pandas. Premier Li also visited a winery in Adelaide Hills in the wake of China lifting trade restrictions on Australian wine exports – a destination worth over $1 billion to Australian vintners.

In Canberra, Premier Li and Prime Minister Anthony Albanese held the Australia-China Annual Leader’s Meeting, where in a joint statement both countries “acknowledged the importance of regular engagement between leaders, ministers, and officials”. The Chinese delegation were also treated to a state lunch in the Great Hall at Parliament House. Mr Albanese confirmed he raised concerns over China’s military action in the South China Sea and the imprisonment of Australian citizen Yan Hengjun, though he stated that Premier Li’s visit represents an “important step in stabilising our relationship with China”. In Perth, Premier Li visited Tianqi Lithium Energy Australia’s lithium hydroxide facility in Kwinana. He also attended the 7th Australia-China CEO roundtable to strengthen trade and investment cooperation, particularly in the private sector and resources sector.

The visit was somewhat overshadowed by reports that Australian journalist Cheng Lei was intimidated by Chinese officials during a Canberra press event, which the Prime Minister labelled “unacceptable”.

Coalition announces nuclear sites

Opposition Leader Peter Dutton unveiled seven sites across Australia where nuclear power plants would be established under the Coalition’s proposed nuclear energy policy. The sites, which are all current or former coal-fired power stations, include Lidell and Mount Piper in NSW, Tarong and Callide in QLD, Loy Yang in VIC, Port Augusta in SA, and Collie in WA. “We have a vision for our country to deliver cleaner electricity, cheaper electricity, and consistent electricity”, Mr Dutton said. the Coalition’s plan aims to deliver two initial plants by the late 2030s and to establish a government-owned enterprise to operate them.

Prime Minister Anthony Albanese responded to the announcement by calling the Coalition’s plan  an “economic catastrophe”, suggesting it would not be attractive to investors. While Mr Dutton acknowledged that nuclear energy is banned in numerous states, he has committed to working with the premiers in a constructive way if elected to Government. However, multiple premiers, have so far rejected [paywall] the proposal.

NSW Budget

NSW Treasurer Daniel Mookhey handed down the 2024-25 State Budget. The Budget papers reveal a $9.7 billion budget deficit this financial year and $3.6 billion deficit forecast for 2024-25, with further deficits over the forward estimates. Mr Mookhey attributed the state’s worsening fiscal position on the Commonwealth Grant Commission’s decision to reduce NSW’s share of the goods and services (GST) tax revenue.

Notwithstanding the bleak economic outlook, the Treasurer outlined a number of spending measures, including $80 billion over four years to enhance transport and roads infrastructure, $13.4 billion over four years to develop health infrastructure under the state’s Essential Infrastructure Plan, $5.1 billion over four years to construct 8,400 new social homes, and $3.1 billion over four years to develop renewable energy zones in regional NSW.

On cost of living, the NSW Treasurer revealed general practitioners would receive complete payroll tax rebates if they meet bulk-billing rates of 80 per cent in metropolitan Sydney and 70 per cent elsewhere in the state. Opposition Leader Mark Speakman delivered the Budget Reply address on Thursday.

Read GRACosway’s detailed overview of the NSW Budget here.

Looking Ahead

The Federal Parliament will sit next week while Budget estimates will be held in SA and WA.


FINANCE

Federal Developments

Treasurer Jim Chalmers  announced reforms to the banking sector and its products, aiming to help Australians secure better rates on mortgage deals and savings accounts. The announcement follows two inquiries by the Australian Competition and Consumer Commission into retail deposit products and home loan pricing. Additionally, a review was announced to address the challenges faced by small and medium-sized banks.

The Federal Government unveiled changes to the Commonwealth Procurement Rules to further encourage sourcing from Small and Medium Enterprises (SMEs) and to increase opportunities for businesses. The Government is increasing the SME exemption threshold to $500,000 to make it easier for entities to procure from small and medium-sized businesses.

The RBA’s Head of Payments Policy Ellis Connoly addressed the Merchant Risk Council Conference on the upcoming update to the Payment Systems (Regulation) Act 1998 (PSRA) and the RBA review of retail payments regulation. The Government plans to revise the definitions of ‘payment system’ and ‘participant’, impacting systems such as payment gateways, payment facilitators, digital wallet providers, and buy now pay later products.

Consumer group CHOICE released its first quarterly report on supermarket prices, revealing ALDI as the most affordable supermarket. Assistant Minister for Competition, Charities and Employment Andrew Leigh welcomed the report and reaffirmed the Federal Government’s commitment to addressing competition in the supermarket sector.


FOREIGN AFFAIRS, DEFENCE AND TRADE

Federal Developments

Several Australian Ministers travelled to Papua New Guinea (PNG) to attend the 30th Australian-PNG Ministerial Forum and take part in the Australia-PNG Business Dialogue. Ministers revealed a new support package designed to assist PNG with its national security, law, and justice priorities. The initiatives are a continuation of the Bilateral Security Agreement announced by Prime Ministers Anthony Albanese and James Marape last December.

Minister for Defence Industry Pat Conroy confirmed the Government’s new Defence Industry Development Grant (DIDG) program will soon commence, providing $150 million over four years to businesses in priority industrial, export, skilling and security areas. The Minister also revealed the final nine recipients of funding from the programs DIDG will replace, providing a total of $2.9 million to companies involved in defence research, manufacturing, and maintenance.

The Joint Standing Committee on Treaties held a public hearing as part of its inquiry into the UK’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), with the goal of assessing the the trade benefits for Australia. The UK’s involvement in the CPTPP follows the recent Australia-United Kingdom Free Trade Agreement, and represents the expansion of the partnership beyond the Pacific region.


ENVIRONMENT, RESOURCES AND ENERGY

Federal Developments

The Federal Government nominated the Cape York Peninsula for inclusion on Australia’s UNESCO World Heritage Tentative List. If successful, the Cape York Peninsula would join locations including K’gari (Fraser Island), Uluru-Kata Tjuta National Park, and the Great Barrier Reef. The decision will be made through a year long evaluation process.

Oceanex and Equinor have been preliminarily granted a feasibility licence from the Federal Government for the Novocastrian Wind Pty Ltd project in the Hunter Offshore Wind Zone. The project will undergo further consultations and environmental studies before a final decision is made.

Minister for Climate Change and Energy Chris Bowen announced a $100 million investment into the Australian Solar ScaleUp Challenge. Administered by the Australian Renewable Energy Agency the program will look to enable ultra low-cost solar across the economy. The challenge is open for eight weeks and expected to complement the Solar Sunshot program.

State Developments

The WA Government approved its first project through the Green Energy Approvals Initiative. The Yindjibarndi Energy Corporation (YEC) received approval to build 150 megawatts of solar in the Yindjibarndi Native Title Determination Area, in the Pilbara. The YEC is partnering with ACEN Australia to deliver the project and is the first of several proposals to build 3 gigawatts of power in the region.


INFRASTRUCTURE, TRANSPORT AND WATER

Federal Developments

The Joint Select Committee on Social Media and Australian Society held its first public hearing to examine the influence and impact of social media on Australian society. Witnesses scheduled to appear include Nine Entertainment’s CEO Mike Sneesby and News Corp Australia’s Executive Chairman Michael Miller. The first hearing focused on the intersection between news and social media, including the implications of Meta’s decision to abandon deals under the News Media Bargaining Code.

The Federal Government launched the Regional Telecommunications Review Survey, calling on those living in regional, rural, and remote parts of Australia to provide feedback on local telecommunication services. The Survey seeks to understand the effectiveness of telecommunications in emergency situations and ways to better support those in regional areas. The Review takes place every three years and is open until 31 July.

State Developments

The Federal Government announced a $155 million loan to Cairns and Mackay Airports in Queensland. Delivered under the North Australia Infrastructure Facility, the funding aims to improve airport infrastructure including, runways, taxiways, and refurbishment of lounges to the airports. The investment is expected to deliver up to $1.4 billion worth of economic benefits to Queensland.


HEALTH AND EDUCATION

Federal Developments

Minister for Health and Aged Care Mark Butler announced the launch of Ternarx, a biotechnology company dedicated to developing new treatments for hard to treat cancers using Targeted Protein Degradation technology. Initially, the company will target neuroblastoma and prostate cancers, with plans to expand to other cancer types if successful.

The Federal Government committed $200 million in infrastructure grants under the Aged Care Capital Assistance Program to support residential aged care services in regional, rural and remote areas. The initiative aims to improve access to quality aged care by supporting eligible applicants to build new facilities and upgrade existing infrastructure.

State Developments

The NSW Government activated its emergency biosecurity incident plan following the detection of bird flu at a poultry and egg farm in the Hawkesbury district. The farm is now under quarantine, with new regulations extending biosecurity measures to a 1-2 kilometre radius to guide poultry removal, farm decontamination and prevent the spread of the disease.

NSW Health Minister Ryan Park announced $6.5 million in funding, matched by the Paul Ramsay Foundation, towards upgrading the Karitane site at Carramar to create the Karitane Fairfield Integrated Child and Family Hub. The hub will provide perinatal mental health services, toddler behaviour clinics, and digital health services, supporting families during the critical early years of their children’s lives.

The Victorian Government allocated an additional $21.2 million to expand the National Disability Insurance Scheme (NDIS) Navigators initiative. More than 65 schools now have funding to hire a NDIS Navigator to provide support to families and carers navigating the NDIS, assisting with access, plan reviews, and accessing appropriate supports.

 

 

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