Murdoch AGM in New York, Vic public service, women on boards, Senate video, classic Cornwall, Tanner, pokies, Manningham politics, Rich List and much more
October 1, 2010
Dear Mayne Report Readers,
Greetings for the first time since our last missive which, if you missed it, was sent out at 3am on Saturday, September 6.
A trip to New York to tackle Rupert Murdoch
It has been too long since our last encounter with the Sun King so a planned trip to New York for a rumble with Rupert Murdoch at the upcoming News Corp AGM was revealed during this chat with Lindy Burns on 774 ABC Melbourne last Wednesday. The words were as follows:
Lindy Burns: you're heading to New York next month to butt heads with your old mate, Rupert. What are you going to say to him?
Stephen Mayne: I haven't been there for three years. Well the first one is: "Rupert, you are the world's longest serving CEO. You've been in the chair since October 1952, you're turning 80 next March, do you think at some point..."
Lindy Burns: slip away?
Stephen Mayne: ... let someone else be the chairman? He's the executive chairman, he's got both top jobs. Sir Rod Eddington, of course, is the lead independent director, so he's the one who will tap Rupert and say it's time to go. So I will ask Rod a few questions about all that.
"Does Rupert need to be paid $US17 million a year, when you are worth $6 to $7 billion?" A few of those sorts of easy questions.
Lindy Burns: yeah, standard things I think. Can't wait to see if he comes up with a different reply.
Rupert usually attracts barely 50 News Corp shareholders to his AGMs in the Big Apple but this year could be different given the variety of issues which are swirling around the world's most most powerful media mogul.
The AGM will be hold on October 15, less than three weeks before the US mid-term elections where News Corp's Fox News is regarded as having sponsored and given rise to the loopy Tea Party movement which is dragging the Republican Party to the right and simultaneously ruthlessly undermining President Obama and the Democrats.
Similarly, Laura Tingle's recent scathing attack on News Ltd's partisanship in The AFR after the Australian federal election, plus the controversy hurting Briitish Prime Minister David Cameron over his media adviser Andy Coulson are two other issues which deserve to be pursued at the AGM. Coulson was the editor of Murdoch's News of the World when it was allegedly hacking into the voicemail messages of a raft of people, including Cabinet Ministers. The New York Times has given the story a good shake as you can see in this package.
Murdoch has always been an extremely controversial figure but his cheerleading for the disastrous Iraq invasion in Australia, the UK and the US took him to another level. The fourth member of the so-called Coalition of the Willing was Spain and when its Prime Minister, Jose Maria Aznar, was axed, Rupert promptly appointed him to the News Corp board. The Guardian gave that issue a good run when we raised it at the 2007 AGM.
Tony Blair, John Howard and George W Bush have all disappeared off the stage yet rather than toning things down a bit, Rupert has spent the past couple of years being as controversial as ever and these are all issues which should be explored at the October 15 AGM.
* Check out this package detailing our 10 different engagements with Rupert at various shareholder meetings since 1999, including the 2007 shareholder resolution opposing the dual class voting structure which was supported by 60% of the independent shareholders voting $5 billion worth of stock.
Spend $50 for a season's ticket that helps hold Rupert Murdoch to account
The coming three months will be a very interesting time with the Australian AGM season and the Victorian election but things like flying to New York to tackle Rupert don't come cheap.
The Mayne Report shifted to a free model in early 2009 but we are partially returning to a paid model for the rest of 2010.
Sign up for a $50 AGM season ticket and you will get regular exclusive email updates on the various battles as 1600 Australian public companies hold their AGMs and the Victorian election unfolds.
We're hoping to be able to do things such as fly to Perth for another round with billionaire Fortescue Metals boss Andrew "Twiggy" Forrest but the current travel budget has been more than gobbled up by the New York trip to tackle Rupert which in 2007 cost more than $4000.
If you'd like to support robust shareholder activism and get an inside look at what should be a fascinating period, click here to purchase your season ticket that will take you through until the end of 2010.
Lack of discussion about Lindsay Tanner's new gig
It has been amazing to see the lack of criticism of Lindsay Tanner's new investment banking gig. Apart from incoming Greens Senator from NSW Lee Rhiannon, no one else has had a crack. Anyway, have a listen to our burst on ABC Radio's PM program two Friday's back. The transcript reads as follows:
Conor Duffy: Former Finance Minister, Lindsay Tanner hasn't wasted any time finding a new job. Late last month he took up a post as a Vice Chancellor's fellow at Victoria University. Today it's been announced he's been appointed a special advisor to the Australian arm of investment bank, Lazard. Shareholder activist Stephen Mayne is critical of the arrangement.
Stephen Mayne: Well in the era of cleaned up politics and good governance, the indecent haste with which Lindsay Tanner has landed a high paying job with a big investment bank goes against the grain. In America politicians have got to cool off for more than a year before they take a job with a lobbyist or someone who is hoping to do deals with government and Lindsay Tanner has taken the governance low road by doing this.
Conor Duffy: What evidence is there that Lazard is looking at doing deals with governments?
Stephen Mayne: Well, Lazard's already giving some advice over the NBN. They say in their public statements their looking for reforms in the way that bond issues are handled in Australia and how they're regulated and obviously the Federal Government does bond issues and is involved in the regulation. Lazard is involved in the whole debate about Queensland Rail. It's advising the New South Wales Labor Government on multi billion dollar electricity industry asset sails. So it is absolutely, totally involved in government and Labor governments and I just think this is a terrible look for the former federal Labor finance minister to so quickly rush off and take a high paying job with such a firm.
Conor Duffy: Lazard already has a former Labor Prime Minister, Paul Keating on its books acting as Chairman. Stephen Mayne says it would've cost them a significant amount to bring Lindsay Tanner on board.
Stephen Mayne: Well special advisor, I mean obviously well into six figures, maybe, maybe two or three hundred thousand a year and then probably some success fee elements if he, you know, he got a business development role there so if he can develop some lucrative government contracts, there's no doubt there'd be the standard investment banking style success fees for any extra revenue and profits he can generate for the firm.
Conor Duffy: What would make Lindsay Tanner attractive to a firm like Lazard?
Stephen Mayne: Well, he's a very smart guy. He's got lots of great contacts and he understands how government works. I mean John Wylie who's the guy who really drives Lazard in Australia, I mean he was working for Credit Suisse First Boston when they made close to $100 million organising all of the Victorian Governments' energy sector sales, $30 billion worth of sales back in the 1990s. So, you know, Lindsay Tanner would be advising how to deal with Labor Governments, privatisations, NBN or anything else to do with a big business deal involving government which is his area of expertise.
There are some interesting theories as to why no one else has taken exception to this arrangement. Firstly, the Liberals aren't critical because so many of their flock have done the same.
The Crikey stable has been understandably quiet given that John Wylie and Mark Carnegie from Lazard are investors in Business Spectator and Eureka Report. Crikey might also be feeling a bit gun shy after running a damaging anonymous tip at the height of the Federal election campaign baldly stating that Tanner was the campaign leaker.
Then you have Tanner's other media connections. He writes occasional columns for The Australian - including this cracker slamming the media for alleging he was the big campaign leaker - and he wrote a regular blog for Fairfax whilst Finance Minister.
The other point about Tanner is that he is widely respected. And so he should be - but that actually makes the indecent haste of his investment banking gig at Lazard even worse.
I had a second public crack on the Tanner issue during last week's regular chat with Lindy Burns on 774 ABC Melbourne. The point was made that when Steve Bracks landed a gig as an adviser to KPMG 10 weeks after stepping down as Victorian Premier, the accounting firm publically committed that he wouldn't be involved in any government tenders for the first twelve months. There has been no such commitment from Wall Street listed Lazard, which is capitalised at $US3.95 billion.
In other words, there was recognition from KPMG and Bracks about the merits of a cooling off period, yet nothing of the sort from Tanner and Lazard yet.
Former NSW Labor Premier Bob Carr got savaged for his $500,000 a year consultancy gig with Macquarie Bank, yet the same standard doesn't seem to apply to the Federal Finance Minister.
Tanner is set to pocket more than $500,000 a year into the future and given his skills and connections, he's probably worth it. He's also landing plenty of paying gigs on the talk circuit, continuing that well worn path pursued by the likes of Paul Keating, John Howard and Natasha Stott Despoja.
Drawing the line on dismal anti-pokies enate campaign
The Australian Electoral Commission held its declaration of the ballot event for the Victorian senate contest last Friday.
We were running late and missed the 15 minute event but all of the snappy speeches from the various candidates are available in this exclusive full video of the event.
We were particularly interested in the contributions by defeated Liberal Senator Julian McGauran and the incoming DLP Senator John Madigan. Click on the image below to check them out:
Senator McGauran will be no loss to the Parliament and it is great that Australia's only political figure with a direct interest in the pokies industry has been shown the door by voters.
Meanwhile, my final vote crept up above 6000 but we still finished a miserable 13th out of 23 candidates with just 0.19% of the vote as you can see here.
The most remarkable thing about the outcome was that 40% of my vote - 2328 out of 6021 votes - were cast "below the line" where electors successfully filled out all 60 boxes correctly.
The average below the line for the nation was 3% and the major parties were closer to 1%. It seems electors were not prepared to trust my group voting ticket which split the first preference equally between the Greens and Family First senator Steve Fielding on the basis that both had very strong anti-pokies records. This was also what no pokies South Australian senator Nick Xenophon did in 2007.
Given that the Greens and Family First are at opposite ends of the political divide, this massive below the line response shouldn't surprise because the split ticket pleased absolutely no-one. Lesson learnt for future political tilts!
In defence of Australia's best performing public service
It's behind the Crikey pay wall so we can't bring you the full story, but here's the start of today's yarn defending Victoria's high quality public service from yet another unfair Murdoch tabloid attack:
Herald Sun sledges bureaucrats, censors Murdoch pay comparison
Stephen Mayne writes:
The Herald Sun worked up a double-page spread last Friday, which opened up as follows:
Subscribe to Crikey to read full story.
Campaigning for more women on boards
Speaking of the Brumby Government, check out our new list of annual reports from Victorian departments and quangos which we're tracking as part of our on-going campaign to increase female representation on Australian boards.
The Victorian Government, especially deputy premier Rob Hulls, have arguably done more than to advance the cause of women in power than anyone over the past decade. Indeed, Victorian Premier John Brumby is known to return short lists to head hunters if there are no women selected.
Elsewhere in the women on boards campaign, it was also nice to get this passing mention at the recent Ernie Awards for appalling male chauvinism which were held in the NSW Parliament building. Amidst a long list of sexist blunders, the AAP coverage noted our little mention as follows: "On the plus side, crikey.com.au founder Stephen Mayne has a Good Ernie to add to his Walkley Award. Mr Mayne was honoured for calling for legislation to fix the male domination of public company boards."
The on-going campaign to increase female representation is taking us to some unusual places. Last Wednesday I was literally the only bloke in the room with more than 60 female executives for a lunch at Circular Quay in Sydney discussing why board and senior executive ranks of Australian public companies are still 90% male in 2010.
As a Manningham councillor it is disappointing we haven't had a female mayor for 4 years, especially in this year of women in local government. With 2 female and 7 male councillors, we are below the state average of 29%.
Finally on this topic, I'm participating in the Intelligence Squared Debate tomorrow night at the Melbourne Town Hall arguing whether "Feminism has failed".
The statistics don't lie and there will be plenty of discussion about this disgraceful list of 95 ASX200 company boards which remain men only affairs.
The last time I participated in one of these IQ2 debates, Jonathan Holmes, Catherine Lumby and yours truly managed to turn around strong support in the pre-poll to lose on the question of whether the media can be trusted with ABC CEO Mark Scott, Julian Burnside QC and John B Fairfax arguing the case that it can be.
Check out this video of my vote losing contribution.
Manningham councillors notch up 3 straight losses at VCAT
Without wanting to say "I told you so", Manningham's planning department has been proved right on three separate occasions after our council suffered consecutive defeats with the independent planning umpire over the past month.
In each of these cases, the officers recommended a permit be issued, but a majority of councillors went against.
Below is the audio from those debates, plus the voting records in divisions held in the council chamber:
Nursing home on Park Orchards chalet site December 15, 2009.
Only Gough and Mayne voted in favour with Crs Chuah, MacMillan, Pick, Reid, Ellis, Downie and La Vella all voting against an 89 bed nursing home being built opposite the main shopping strip in Park Orchards. VCAT approved it.
Rolling officer recommendation 5-4 on small unit development in Franklin Road Doncaster February 2, 2010.
This one was defeated by the 5-4 factional divide which has characterised much of the council's division. Crs Gough, Ellis, La Vella and Mayne supported the officers on what looked like a fairly ho hum 9 apartment development behind a supermarket in Doncaster, whilst Crs Chuah, Pick, MacMillan, Downie and Reid all voted against. VCAT approved it.
Wonga Park sub-division development September 29, 2009
This was also a 5-4 vote but with a couple of unusual features. Cr Reid, who has opposed the officers more than anyone on planning, supported the sub-division whilst Cr Ellis, the Greens member, was against. The numbers finished with Crs Reid, Mayne, Gough and La Vella supporting and Crs Chuah, Pick, Ellis, Downie and MacMillan opposing. VCAT approved it.
Council's counsel battled valiantly at VCAT and the residents from Park Orchards in particular praised the efforts and arguments that were run. However, at the end of the day, if the officers recommend an application because it complies with the planning rules we've set down, the independent umpire is likely to approve it.
However, this isn't always the case and councillors should listen to their communities. For instance, officers recommended a second detached dwelling on a 1 acre property in Donvale last year and it was defeated by councillors and then defeated again at VCAT. I was wrong on this one although that was an isolated example on the current council which has now got a strongly negative batting average at VCAT.
Councillors saving ratepayers money and running for Parliament
Labor Cr Ivan Reid made this sensible suggestion on his blog early last year:
As a group, this term's councillors are definitely a financially responsible bunch. We've already "saved" money by having a much more modest Inauguration reception this year, and our new Mayor has been very sensible and modest in his choice of car. I've suggested that we start tracking such "relative savings" and ensure that the money that would previously have been budgeted for these items, be visibly re-allocated to tangible benefits for the community e.g. if we spent $5000 less this year than budgeted for civic receptions, there should be $5000 directly attributable to something else of tangible benefit to the community, e.g. increased budget for community grants. By tracking and linking savings in this way, we will all become more aware of unnecessary excesses and most importantly, demonstrate improved outcomes to the community in a tangible way.
Naturally, this philosophy also should apply to the tens of thousands we've been spending on unsucccessful VCAT appeals after rolling our planning department.
Meanwhile, Labor mayor Charles Pick and Cr Reid are now widely tipped to be the Labor candidates for the safe Liberal seats of Doncaster and Bulleen respectively in the coming state election on November 27.
We await their formal announcements and wish them all the very best. Candidates in a democracy should always be encouraged to participate in elections and no doubt they wish to join this long list of local government councillors who have sat in Parliaments across the country.
And happy birthday to the mayor today, too! We'll all be catching up shortly for another lively 5 hour council briefing tonight.
Cornwall on the new political environment
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Independents who have served in Australian parliaments
We've built up a new list tracking politicians who have served as independents in Australian state and federal parliaments. Here are a few examples:
Peter Besseling: a former NSW rugby union player who was elected as an independent member in the NSW lower house representing Port Macquarie at a 2008 by-election following the resignation of Rob Oakeshott.
John Bowler: a former Labor Minister who has represented the district of Murchison-Eyre in WA since 2001. He became embroiled in controversry when the Corruption and Crime Commission alleged he leaked confidential information relating to Fortescue Metals Group to Julian Grill and Brian Burke. Despite calls from then Premier Alan Carpenter for his resignation, Bowler remained in Parliament as an independent and won the seat of Kalgoorlie as an independent at the 2008 state election.
Liz Cunningham: has represented the electorate of Gladstone in Queensland as an independent since 1995. Along with Peter Wellington, she briefly held the balance in power following the 1998 Queensland state election, but her political influence declined when Peter Beattie formed an ALP government.
Paul Filing: a former Canberra flat mate of John Howard, in 1990 he was elected to the House of Representatives as the Liberal member for Moore. In 1995 he lost Liberal endorsement so he resigned from the party and stood as an independent, holding the seat at the 1996 election. In 1998 he was defeated and left politics.
Chris Foley: a former National Party candidate in Queensland who resigned over an unresolved dispute. He was elected at a 2003 by-election for the seat of Maryborough following the resignation due to ill health of another independent, former One Nation MP John Kingston. In 2006 he stood as an independent and romped to victory with nearly 70% of the primary vote, and again held the seat at the 2009 election.
Peter Lewis: first elected as a Liberal member of the South Australian lower house in 1979 and served until 2000 in electorates such as Hammond, Ridley, Murray-Mallee and Mallee. He built at reputation as a maverick by defying party authorities on many occasions which led to his expulsion from the Liberal Party in July 2000. From 2000 until 2006 he served as an independent which included a stint as Speaker when a propped up a minority Labor government led by Mike Rann.
David Oldfield: while working as a senior staffer for Liberal federal MP Tony Abbott, Oldfield secretly founded the One Nation Party with independent MP Pauline Hanson and David Ettridge. Oldfield won a seat in the NSW legislative council at the March 1999 state elections but was expelled from One Nation by Hanson in 2000 and founded the separate One Nation NSW party. In 2004 he left that party and sat as an Independent and in August 2006 he announced that he would not contest the March 2007 election.
Bob Such: was first elected to SA parliament as a Liberal member in 1989. In 1996 he was relegated to the back bench by John Olsen and became disenfranchised. Since 2000 he has been the independent member for the seat of Fisher in the SA lower house.
Peter Wellington: a former police officer and solicitor who defeated the incumbent National Party candidate Neil Turner in the 1998 Queensland state election. He briefly held the balance in power following the 1998 election, and his decision to back the Labor Party led to Peter Beattie becoming premier.
Andrew Wilkie: a famous defence whistleblower against the Iraq war, former army officer and former Green party member for 4 years, Wilkie stood as an independent for the federal seat of Denison in the 2010 federal election and won with a primary vote of just 21%. Wilkie then backed a minority Gillard government.
The Cornwall collection
Former Fairfax and Crikey cartoonist Mark Cornwall has been contributing to The Mayne Report since March 2009. Here is a collection of his best cartoons and there are now also some amusing animations:
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Around the grounds on the pokies
Here are a few relevent links in the ongoing campaign to end Australia's notorious status as the world's biggest per capita gamblers with the majority, approximately $10 billion a year, lost on the pokies:
The Andrew Wilkie and Julia Gillard agreement
The states will howl but greater pokie controls are needed
SMH, Richard Ackland, Sept 10, 2010
Pre-commitment Consultation Paper 2010
Victorian Department of Justice
Check out this audio from The National Interest on ABC Radio National when Senator Nick Xenophon crossed swords with Clubs Australia director Anthony Ball.
Meanwhile, check out the latest from Paul Bendat's Pokieact website and this package of our past pokies coverage.
Finally, have a look a this video commenting on the addiction of pokies. Players dream of winning which motivates their behavior, and then that dream is reinforced and maintained by the operators with promises of riches. The reality is that whilst dreaming they don't realise the goal of riches is, and will always be, just out of reach.
Get on board with the Australian Shareholders Association
I'll be working more closely with the ASA this AGM season, even attending a couple of gatherings as the formal ASA monitor.
There is clearly more impact working in numbers so readers of this newsletter are encouraged to click on the image below and support the ASA.
The big debt issues continue under hung parliament
It was very strange to hear Reserve Bank governor Glenn Stevens make the following statement during the federal election campaign: "There is virtually no net public debt in the country at all in contrast to much of the developed world."
Whilst Rupert Murdoch's flagship newspaper Down Under, The Australian, loves to beat up on Labor governments irrespective of the facts sometimes, this recent splash pointing out that state government debt is projected to top $240 billion was a worthwhile piece of journalism.
On top of that figure, the Federal Government's own debt management website puts the gross debt figure at $152 billion and the bond issues continue to come as follows since our last edition:
Friday, September 17, 2010: $700m tender of 5 year bonds expiring in April 2015 were sold for an average yield of 4.85% and was over-subscribed 3.7 times.
Friday, September 10, 2010: $1.2b tender of 4 year bonds expiring in October 2014 were sold for an average yield of 4.74% and was over-subscribed 2.7 times.
Wednesday, September 8, 2010: $500m tender of 10 year bonds expiring in April 2020 were sold for an average yield of 4.88% and was over-subscribed 3.2 times.
Friday, September 3, 2010: $700m tender of 6 year bonds expiring in June 2016 were sold for an average yield of 4.62% and was over-subscribed 3.7 times.
If anyone needs assistance on the debt questions, this list tracks all bond and treasury note issues by the Labor Government since it was elected in November 2007. However, there are many other variables to measure for a true picture of national solvency. For instance, the massive level of foreign ownership in Australia, as demonstrated by this list, reduces the fiscal flexibility of our public sector.
More gems from Cornwall
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The Mayne Report Rich List
BRW magazine does a great job with its various Australian Rich Lists but we've broadened their efforts to track any Australian who has ever been worth more than $10 million. We began the process of building the list in early 2008 where we had an initial 327 names. Now, after much research, we've got more than 1500 names with those who've fallen back below $10 million italicised. Below are our latest new or updated entries:
Christopher Cheung: has owned Sydney's Coogee Bay Hotel for 20 years and those 12,000 visitors every weekend have generated enough cash for a $150 million retail and residential grand plan on the site.
Neil Cunningham and Paola Toppi: the couple own a $6 million apartment in Potts Point also run the legendary Machiavelli's restaurant in Sydney.
David Deague: Melbourne property developer who came a cropper in the mid-1990s but has bounced back and in 2010 owned the Kings Business Park in Southgate which is thought to be worth about $100 million.
Chris Lucas: made his pile selling The Botanical Hotel in Melbourne for $16 million to the failed Cornerstone Group in 2007 and owns a Toorak mansion in St Georges Road said to be worth close to $20 million.
Deborah McMurtrie: a former Clayton Utz partner who paid $5.5 million for a block of land overlooking Balmoral Beach in 2007 and then built a mansion which she put on the market in 2010.
David Penn: Sydney dental tycoon who reported paid $52 million in 2010 for the Point Piper home of recruitment pioneer Andrew Banks.
Allen Perry: a software entrepreneur whose play time assets included an 8.8ha retreat near Port Douglas which is thought to be worth about $4 million.
Ivan Ritossa: the Barclays Capital boss paid $45 million in 2008 for David Coe's harbour front mansion in Vaucluse.
Robert Skinner: a former Deutsche Bank Australia director who in 2010 listed his waterfront mansion in Mosman for sale with pundits tipping it would fetch more than $13 million.
Michael Yates: a property developer who focuses on apartment developments in Melbourne's ritzy South Yarra.
A mixed time punting the market
Firstly, check out all the trades so far this year. This is how things looked as of August 31, 2010: portfolio of 701 holdings worth $37,806. The overall paper loss is of $7,309 and average holding in the world's biggest small portfolio is now just $54. Below are the latest trades as we further reduced the portfolio:
September 16
AGL Energy: sold 20 at $15.98
Alumina: sold 142 at $1.92
ANZ: sold 15 at $23.76
Breville Group: sold 140 at $2.50
Centerbet: sold 130 at $1.65
Clime Capital: sold 325 at $1
Codan: sold 190 at $1.43
Computershare: sold 30 at $9.87
Crown: sold 30 at $8.49
Eldorado gold: sold 11 at $20.99
Forge Group: sold 77 at $3.93
Heartware: sold 130 at $2.22
IRESS Market Technology: sold 35 at $8.20
IOOF: sold 28 at $6.89
Magellan Financial: sold 185 at $1.22
Melbourne IT: sold 151 at $1.95
Mitchell communications: sold 290 at $1.24
Newcrest Mining: sold 9 at $39.91
Oroton Group: sold 40 at $8.13
Pacific Brands: sold 288 at $1.15
Seven Group: sold 5 at $86.02
Salmat: sold 51 at $4.09
Suncorp: sold 37 at $8.93
Donate to help keep us going
The Mayne Report costs almost $100,000 a year to run so if you fancy giving us a hand to help fund our activism and keep us going on the political and AGM circuit, just click on the image below:
From the press room
Here are a selection of recent media mentions and engagements:
The Age
Red-leather day for the DLP
Melissa Fyfe, September 12, 2010
Manningham Leader
Writing on wall for Westfield sign
Shaun Turton, September 10, 2010
Shipping bodies welcome Albanese reappointment
David Sexton, Lloyd's List DCN, Sept 13, 2010
Radio
774 ABC Melbourne - discussing Malcolm Turnbull, Lindsay Tanner and the Aussie dollar on September 15.
ABC PM Program - discussing Lindsay Tanner's appointment at Lazard on September 10.
774 ABC Melbourne - discussing the wash up of the election on September 8.
666 ABC Canberra - discussing the creative commentary describing the new Gillard government on September 8.
Click the link below to get the latest radio and AGM audio:
International Photography Awards
Our multimedia producer and researcher Shane Marden recently received an honourable mention in the 2010 International Photography Awards competition, with approximately 15,000 submissions from 103 countries across the globe. Photos are below:
More gems from Mark Cornwall
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Ship owners and other tales from the talk circuit
We gave the notoriously inefficient Maritime Union of Australia a bit of a spray in a recent key note address to the Australian Shipowners Association.
The organisers just wanted an overview of the Federal political environment the day after Rob Oakeshott and Tony Windsor declared they were backing Julia Gillard.
However, the more we looked at the industry the more angry we got.
Australian flagged and crewed ships have fallen in number from almost 100 when the Howard Government came to office to barely 30 now.
We have all these vast mineral resources and 99% are shipped offshore by foreign flagged and foreign crewed ships. All up we spend an estimated $9 billion on foreign ships and only about $600 million a year on the 30 remaining Australian ships (average age 18 years) which largely ply their trade between different Australian ports.
The cost differential for Australian work practices on cargo ships are estimated to be more than $2 million a year, but Federal tax policies also hurt the industry.
So here is Australia, the world's biggest island nation with the world's biggest natural resources dowry, and we don't have a shipping industry to speak of. You only have to read the latest newsletter of the MUA to see how nostalgically left wing they are.
One of the delegates at the conference told me MUA members remain the least productive workers in the shipping and stevodoring world. Anthony Albanese has promised a $50 million reform package, as The Australian noted during the election campaign, but it is conditional on the industry and the MUA reaching a new "compact" on productivity issues. That won't be easy.
Peter Daicos comes to Manningham
In other talk circuit news, Collingwood legend Peter Daicos is guest speaker at a Manningham lunch tomorrow called "Kicking goals for road safety".
I'm the MC and it should be a great lead up to the Grand final. The auction includes framed jumpers signed by two time Brownlow medallist Chris Judd and the entire 2010 Collingwood squad.
Given the events of this week, they should prove to be highly valuable items and all for a good cause in improving road safety.
A big thanks to Westpac, Victoria Police and Manningham council for helping get this event together.
Sign up for campaign and governance Tweets
Click on the image above to join more than 2200 followers on Twitter. Here are some of the more recent Tweets:
10.49am September 17: Jeepers, just noticed 40% of our 6021 Victorian Senate votes came from below the line votes. Given national average is 3%, is that a record?
10.43am September 16: Myer just traded at $4 for first time since float after strong profit. Shows debt-funded consumer binge is back & strong $ helps importers.
5.50pm September 15: Regular chat on 774 ABC Melbourne discussing Malcolm Turnbull, Lindsay Tanner and the Aussie dollar. http://urlm.in/fojc
10.53am September 15: Some fascinating presentations on Victorian public sector governance reform at Windsor conference today. Just need ALP to fix donations too.
3.31pm September 14: Was scary being only man in a room with 70 powerful women at Goldfields House lunch overlooking Circular Quay today. Great discussion.
5.14pm September 10: ABC radio's PM program discussing Lindsay Tanner's appointment at Lazard. http://urlm.in/fmym
2.03pm September 10: Have just given some strong quotes to ABC radio's PM program for tonight over Lindsay Tanner's completely inappropriate new job with Lazard.
1.21pm September 10: After 4 day hearing VCAT has approved 91 bed nursing home at the Park Orchards Chalet site which officers supported but was voted down 7-2.
1.11pm September 10: Juggling financial and logistical questions today around a Woolies board tilt and a visit to New York for the News Corp AGM on October 15.
3.17pm September 9: Woolies CEO Michael Luscombe received tiny pay rise to $8.3m in 2009-10. Sure does pay well preying on thousands of pokies addicts.
4.27pm September 6: Sent big email edition out on pollies, Fairfax, capital raisings, pokies etc: http://www.maynereport.com/articles/2010/01/06-1400-7364.html
11.37am September 6: Some excellent new Mark Cornwall cartoons here: http://www.maynereport.com/articles/2009/05/22-1323-4205.html
5.46pm September 3: Just did ABC Brisbane on outrageous Rivercity Motorways bonuses and have pre-recorded chat with ABC's PM program for tonight on pokies.
2.16pm September 3: Check out today's Crikey story on how Gillard is relishing shafting the pokies industry and NSW Labor Right. See http://www.maynereport.com/
5.26pm September 2: Gillard just claimed ACT ALP doesn't take money from problem gamblers at the 4 venues it runs in Canberra. What rubbish. Of course they do.
4.23pm September 2: Gillard promises mandatory pre-commitment on pokies by 2014 to secure Andrew Wilkie's vote. A good outcome for those concerned about pokies.
11.01am September 2: Michael Anderson and Greg Hywood are two excellent appointments to Fairfax board. Hope media, including Crikey, pat chair Corbett on back.
That's all for now.
Do ya best, Stephen Mayne
* The Mayne Report is a multi-media governance website published by shareholder activist, local government councillor and Crikey founder Stephen Mayne with regular email editions. To unsubscribe from the free emails click here.
Greetings for the first time since our last missive which, if you missed it, was sent out at 3am on Saturday, September 6.
A trip to New York to tackle Rupert Murdoch
It has been too long since our last encounter with the Sun King so a planned trip to New York for a rumble with Rupert Murdoch at the upcoming News Corp AGM was revealed during this chat with Lindy Burns on 774 ABC Melbourne last Wednesday. The words were as follows:
Lindy Burns: you're heading to New York next month to butt heads with your old mate, Rupert. What are you going to say to him?
Stephen Mayne: I haven't been there for three years. Well the first one is: "Rupert, you are the world's longest serving CEO. You've been in the chair since October 1952, you're turning 80 next March, do you think at some point..."
Lindy Burns: slip away?
Stephen Mayne: ... let someone else be the chairman? He's the executive chairman, he's got both top jobs. Sir Rod Eddington, of course, is the lead independent director, so he's the one who will tap Rupert and say it's time to go. So I will ask Rod a few questions about all that.
"Does Rupert need to be paid $US17 million a year, when you are worth $6 to $7 billion?" A few of those sorts of easy questions.
Lindy Burns: yeah, standard things I think. Can't wait to see if he comes up with a different reply.
Rupert usually attracts barely 50 News Corp shareholders to his AGMs in the Big Apple but this year could be different given the variety of issues which are swirling around the world's most most powerful media mogul.
The AGM will be hold on October 15, less than three weeks before the US mid-term elections where News Corp's Fox News is regarded as having sponsored and given rise to the loopy Tea Party movement which is dragging the Republican Party to the right and simultaneously ruthlessly undermining President Obama and the Democrats.
Similarly, Laura Tingle's recent scathing attack on News Ltd's partisanship in The AFR after the Australian federal election, plus the controversy hurting Briitish Prime Minister David Cameron over his media adviser Andy Coulson are two other issues which deserve to be pursued at the AGM. Coulson was the editor of Murdoch's News of the World when it was allegedly hacking into the voicemail messages of a raft of people, including Cabinet Ministers. The New York Times has given the story a good shake as you can see in this package.
Murdoch has always been an extremely controversial figure but his cheerleading for the disastrous Iraq invasion in Australia, the UK and the US took him to another level. The fourth member of the so-called Coalition of the Willing was Spain and when its Prime Minister, Jose Maria Aznar, was axed, Rupert promptly appointed him to the News Corp board. The Guardian gave that issue a good run when we raised it at the 2007 AGM.
Tony Blair, John Howard and George W Bush have all disappeared off the stage yet rather than toning things down a bit, Rupert has spent the past couple of years being as controversial as ever and these are all issues which should be explored at the October 15 AGM.
* Check out this package detailing our 10 different engagements with Rupert at various shareholder meetings since 1999, including the 2007 shareholder resolution opposing the dual class voting structure which was supported by 60% of the independent shareholders voting $5 billion worth of stock.
Spend $50 for a season's ticket that helps hold Rupert Murdoch to account
The coming three months will be a very interesting time with the Australian AGM season and the Victorian election but things like flying to New York to tackle Rupert don't come cheap.
The Mayne Report shifted to a free model in early 2009 but we are partially returning to a paid model for the rest of 2010.
Sign up for a $50 AGM season ticket and you will get regular exclusive email updates on the various battles as 1600 Australian public companies hold their AGMs and the Victorian election unfolds.
We're hoping to be able to do things such as fly to Perth for another round with billionaire Fortescue Metals boss Andrew "Twiggy" Forrest but the current travel budget has been more than gobbled up by the New York trip to tackle Rupert which in 2007 cost more than $4000.
If you'd like to support robust shareholder activism and get an inside look at what should be a fascinating period, click here to purchase your season ticket that will take you through until the end of 2010.
Lack of discussion about Lindsay Tanner's new gig
It has been amazing to see the lack of criticism of Lindsay Tanner's new investment banking gig. Apart from incoming Greens Senator from NSW Lee Rhiannon, no one else has had a crack. Anyway, have a listen to our burst on ABC Radio's PM program two Friday's back. The transcript reads as follows:
Conor Duffy: Former Finance Minister, Lindsay Tanner hasn't wasted any time finding a new job. Late last month he took up a post as a Vice Chancellor's fellow at Victoria University. Today it's been announced he's been appointed a special advisor to the Australian arm of investment bank, Lazard. Shareholder activist Stephen Mayne is critical of the arrangement.
Stephen Mayne: Well in the era of cleaned up politics and good governance, the indecent haste with which Lindsay Tanner has landed a high paying job with a big investment bank goes against the grain. In America politicians have got to cool off for more than a year before they take a job with a lobbyist or someone who is hoping to do deals with government and Lindsay Tanner has taken the governance low road by doing this.
Conor Duffy: What evidence is there that Lazard is looking at doing deals with governments?
Stephen Mayne: Well, Lazard's already giving some advice over the NBN. They say in their public statements their looking for reforms in the way that bond issues are handled in Australia and how they're regulated and obviously the Federal Government does bond issues and is involved in the regulation. Lazard is involved in the whole debate about Queensland Rail. It's advising the New South Wales Labor Government on multi billion dollar electricity industry asset sails. So it is absolutely, totally involved in government and Labor governments and I just think this is a terrible look for the former federal Labor finance minister to so quickly rush off and take a high paying job with such a firm.
Conor Duffy: Lazard already has a former Labor Prime Minister, Paul Keating on its books acting as Chairman. Stephen Mayne says it would've cost them a significant amount to bring Lindsay Tanner on board.
Stephen Mayne: Well special advisor, I mean obviously well into six figures, maybe, maybe two or three hundred thousand a year and then probably some success fee elements if he, you know, he got a business development role there so if he can develop some lucrative government contracts, there's no doubt there'd be the standard investment banking style success fees for any extra revenue and profits he can generate for the firm.
Conor Duffy: What would make Lindsay Tanner attractive to a firm like Lazard?
Stephen Mayne: Well, he's a very smart guy. He's got lots of great contacts and he understands how government works. I mean John Wylie who's the guy who really drives Lazard in Australia, I mean he was working for Credit Suisse First Boston when they made close to $100 million organising all of the Victorian Governments' energy sector sales, $30 billion worth of sales back in the 1990s. So, you know, Lindsay Tanner would be advising how to deal with Labor Governments, privatisations, NBN or anything else to do with a big business deal involving government which is his area of expertise.
There are some interesting theories as to why no one else has taken exception to this arrangement. Firstly, the Liberals aren't critical because so many of their flock have done the same.
The Crikey stable has been understandably quiet given that John Wylie and Mark Carnegie from Lazard are investors in Business Spectator and Eureka Report. Crikey might also be feeling a bit gun shy after running a damaging anonymous tip at the height of the Federal election campaign baldly stating that Tanner was the campaign leaker.
Then you have Tanner's other media connections. He writes occasional columns for The Australian - including this cracker slamming the media for alleging he was the big campaign leaker - and he wrote a regular blog for Fairfax whilst Finance Minister.
The other point about Tanner is that he is widely respected. And so he should be - but that actually makes the indecent haste of his investment banking gig at Lazard even worse.
I had a second public crack on the Tanner issue during last week's regular chat with Lindy Burns on 774 ABC Melbourne. The point was made that when Steve Bracks landed a gig as an adviser to KPMG 10 weeks after stepping down as Victorian Premier, the accounting firm publically committed that he wouldn't be involved in any government tenders for the first twelve months. There has been no such commitment from Wall Street listed Lazard, which is capitalised at $US3.95 billion.
In other words, there was recognition from KPMG and Bracks about the merits of a cooling off period, yet nothing of the sort from Tanner and Lazard yet.
Former NSW Labor Premier Bob Carr got savaged for his $500,000 a year consultancy gig with Macquarie Bank, yet the same standard doesn't seem to apply to the Federal Finance Minister.
Tanner is set to pocket more than $500,000 a year into the future and given his skills and connections, he's probably worth it. He's also landing plenty of paying gigs on the talk circuit, continuing that well worn path pursued by the likes of Paul Keating, John Howard and Natasha Stott Despoja.
Drawing the line on dismal anti-pokies enate campaign
The Australian Electoral Commission held its declaration of the ballot event for the Victorian senate contest last Friday.
We were running late and missed the 15 minute event but all of the snappy speeches from the various candidates are available in this exclusive full video of the event.
We were particularly interested in the contributions by defeated Liberal Senator Julian McGauran and the incoming DLP Senator John Madigan. Click on the image below to check them out:
Senator McGauran will be no loss to the Parliament and it is great that Australia's only political figure with a direct interest in the pokies industry has been shown the door by voters.
Meanwhile, my final vote crept up above 6000 but we still finished a miserable 13th out of 23 candidates with just 0.19% of the vote as you can see here.
The most remarkable thing about the outcome was that 40% of my vote - 2328 out of 6021 votes - were cast "below the line" where electors successfully filled out all 60 boxes correctly.
The average below the line for the nation was 3% and the major parties were closer to 1%. It seems electors were not prepared to trust my group voting ticket which split the first preference equally between the Greens and Family First senator Steve Fielding on the basis that both had very strong anti-pokies records. This was also what no pokies South Australian senator Nick Xenophon did in 2007.
Given that the Greens and Family First are at opposite ends of the political divide, this massive below the line response shouldn't surprise because the split ticket pleased absolutely no-one. Lesson learnt for future political tilts!
In defence of Australia's best performing public service
It's behind the Crikey pay wall so we can't bring you the full story, but here's the start of today's yarn defending Victoria's high quality public service from yet another unfair Murdoch tabloid attack:
Herald Sun sledges bureaucrats, censors Murdoch pay comparison
Stephen Mayne writes:
The Herald Sun worked up a double-page spread last Friday, which opened up as follows:
Huge bonuses for bureaucrats, a $50 million Grand Prix blowout and worsening ambulance delays were contained in hundreds of reports dumped in Parliament yesterday. About 20,000 pages of documents were tabled, including reports on stressed teachers getting more compensation and accusations of police cover-ups. Annual reports from Government departments showed bureaucrats swimming in millions of dollars of bonuses.While the timing issue was a legitimate criticism, the decision to lead off with an attack on public service pay left the paper wide open to charges of hypocrisy. Indeed, I submitted the following comment to the paper's website in response to the story:
It is a bit rich of the Herald Sun to attack "huge bonuses for bureaucrats" when the paper is published by News Corp whose executive chairman Rupert Murdoch was paid $US16.8m in 2009-10. And News Corp CEO Chase Carey received a $US10 million sign-on fee just for starting the job. These things need to be kept in perspective and I trust this comment won't be censored.Sadly, the comment was never posted...
Subscribe to Crikey to read full story.
Campaigning for more women on boards
Speaking of the Brumby Government, check out our new list of annual reports from Victorian departments and quangos which we're tracking as part of our on-going campaign to increase female representation on Australian boards.
The Victorian Government, especially deputy premier Rob Hulls, have arguably done more than to advance the cause of women in power than anyone over the past decade. Indeed, Victorian Premier John Brumby is known to return short lists to head hunters if there are no women selected.
Elsewhere in the women on boards campaign, it was also nice to get this passing mention at the recent Ernie Awards for appalling male chauvinism which were held in the NSW Parliament building. Amidst a long list of sexist blunders, the AAP coverage noted our little mention as follows: "On the plus side, crikey.com.au founder Stephen Mayne has a Good Ernie to add to his Walkley Award. Mr Mayne was honoured for calling for legislation to fix the male domination of public company boards."
The on-going campaign to increase female representation is taking us to some unusual places. Last Wednesday I was literally the only bloke in the room with more than 60 female executives for a lunch at Circular Quay in Sydney discussing why board and senior executive ranks of Australian public companies are still 90% male in 2010.
As a Manningham councillor it is disappointing we haven't had a female mayor for 4 years, especially in this year of women in local government. With 2 female and 7 male councillors, we are below the state average of 29%.
Finally on this topic, I'm participating in the Intelligence Squared Debate tomorrow night at the Melbourne Town Hall arguing whether "Feminism has failed".
The statistics don't lie and there will be plenty of discussion about this disgraceful list of 95 ASX200 company boards which remain men only affairs.
The last time I participated in one of these IQ2 debates, Jonathan Holmes, Catherine Lumby and yours truly managed to turn around strong support in the pre-poll to lose on the question of whether the media can be trusted with ABC CEO Mark Scott, Julian Burnside QC and John B Fairfax arguing the case that it can be.
Check out this video of my vote losing contribution.
Manningham councillors notch up 3 straight losses at VCAT
Without wanting to say "I told you so", Manningham's planning department has been proved right on three separate occasions after our council suffered consecutive defeats with the independent planning umpire over the past month.
In each of these cases, the officers recommended a permit be issued, but a majority of councillors went against.
Below is the audio from those debates, plus the voting records in divisions held in the council chamber:
Nursing home on Park Orchards chalet site December 15, 2009.
Only Gough and Mayne voted in favour with Crs Chuah, MacMillan, Pick, Reid, Ellis, Downie and La Vella all voting against an 89 bed nursing home being built opposite the main shopping strip in Park Orchards. VCAT approved it.
Rolling officer recommendation 5-4 on small unit development in Franklin Road Doncaster February 2, 2010.
This one was defeated by the 5-4 factional divide which has characterised much of the council's division. Crs Gough, Ellis, La Vella and Mayne supported the officers on what looked like a fairly ho hum 9 apartment development behind a supermarket in Doncaster, whilst Crs Chuah, Pick, MacMillan, Downie and Reid all voted against. VCAT approved it.
Wonga Park sub-division development September 29, 2009
This was also a 5-4 vote but with a couple of unusual features. Cr Reid, who has opposed the officers more than anyone on planning, supported the sub-division whilst Cr Ellis, the Greens member, was against. The numbers finished with Crs Reid, Mayne, Gough and La Vella supporting and Crs Chuah, Pick, Ellis, Downie and MacMillan opposing. VCAT approved it.
Council's counsel battled valiantly at VCAT and the residents from Park Orchards in particular praised the efforts and arguments that were run. However, at the end of the day, if the officers recommend an application because it complies with the planning rules we've set down, the independent umpire is likely to approve it.
However, this isn't always the case and councillors should listen to their communities. For instance, officers recommended a second detached dwelling on a 1 acre property in Donvale last year and it was defeated by councillors and then defeated again at VCAT. I was wrong on this one although that was an isolated example on the current council which has now got a strongly negative batting average at VCAT.
Councillors saving ratepayers money and running for Parliament
Labor Cr Ivan Reid made this sensible suggestion on his blog early last year:
As a group, this term's councillors are definitely a financially responsible bunch. We've already "saved" money by having a much more modest Inauguration reception this year, and our new Mayor has been very sensible and modest in his choice of car. I've suggested that we start tracking such "relative savings" and ensure that the money that would previously have been budgeted for these items, be visibly re-allocated to tangible benefits for the community e.g. if we spent $5000 less this year than budgeted for civic receptions, there should be $5000 directly attributable to something else of tangible benefit to the community, e.g. increased budget for community grants. By tracking and linking savings in this way, we will all become more aware of unnecessary excesses and most importantly, demonstrate improved outcomes to the community in a tangible way.
Naturally, this philosophy also should apply to the tens of thousands we've been spending on unsucccessful VCAT appeals after rolling our planning department.
Meanwhile, Labor mayor Charles Pick and Cr Reid are now widely tipped to be the Labor candidates for the safe Liberal seats of Doncaster and Bulleen respectively in the coming state election on November 27.
We await their formal announcements and wish them all the very best. Candidates in a democracy should always be encouraged to participate in elections and no doubt they wish to join this long list of local government councillors who have sat in Parliaments across the country.
And happy birthday to the mayor today, too! We'll all be catching up shortly for another lively 5 hour council briefing tonight.
Cornwall on the new political environment
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Independents who have served in Australian parliaments
We've built up a new list tracking politicians who have served as independents in Australian state and federal parliaments. Here are a few examples:
Peter Besseling: a former NSW rugby union player who was elected as an independent member in the NSW lower house representing Port Macquarie at a 2008 by-election following the resignation of Rob Oakeshott.
John Bowler: a former Labor Minister who has represented the district of Murchison-Eyre in WA since 2001. He became embroiled in controversry when the Corruption and Crime Commission alleged he leaked confidential information relating to Fortescue Metals Group to Julian Grill and Brian Burke. Despite calls from then Premier Alan Carpenter for his resignation, Bowler remained in Parliament as an independent and won the seat of Kalgoorlie as an independent at the 2008 state election.
Liz Cunningham: has represented the electorate of Gladstone in Queensland as an independent since 1995. Along with Peter Wellington, she briefly held the balance in power following the 1998 Queensland state election, but her political influence declined when Peter Beattie formed an ALP government.
Paul Filing: a former Canberra flat mate of John Howard, in 1990 he was elected to the House of Representatives as the Liberal member for Moore. In 1995 he lost Liberal endorsement so he resigned from the party and stood as an independent, holding the seat at the 1996 election. In 1998 he was defeated and left politics.
Chris Foley: a former National Party candidate in Queensland who resigned over an unresolved dispute. He was elected at a 2003 by-election for the seat of Maryborough following the resignation due to ill health of another independent, former One Nation MP John Kingston. In 2006 he stood as an independent and romped to victory with nearly 70% of the primary vote, and again held the seat at the 2009 election.
Peter Lewis: first elected as a Liberal member of the South Australian lower house in 1979 and served until 2000 in electorates such as Hammond, Ridley, Murray-Mallee and Mallee. He built at reputation as a maverick by defying party authorities on many occasions which led to his expulsion from the Liberal Party in July 2000. From 2000 until 2006 he served as an independent which included a stint as Speaker when a propped up a minority Labor government led by Mike Rann.
David Oldfield: while working as a senior staffer for Liberal federal MP Tony Abbott, Oldfield secretly founded the One Nation Party with independent MP Pauline Hanson and David Ettridge. Oldfield won a seat in the NSW legislative council at the March 1999 state elections but was expelled from One Nation by Hanson in 2000 and founded the separate One Nation NSW party. In 2004 he left that party and sat as an Independent and in August 2006 he announced that he would not contest the March 2007 election.
Bob Such: was first elected to SA parliament as a Liberal member in 1989. In 1996 he was relegated to the back bench by John Olsen and became disenfranchised. Since 2000 he has been the independent member for the seat of Fisher in the SA lower house.
Peter Wellington: a former police officer and solicitor who defeated the incumbent National Party candidate Neil Turner in the 1998 Queensland state election. He briefly held the balance in power following the 1998 election, and his decision to back the Labor Party led to Peter Beattie becoming premier.
Andrew Wilkie: a famous defence whistleblower against the Iraq war, former army officer and former Green party member for 4 years, Wilkie stood as an independent for the federal seat of Denison in the 2010 federal election and won with a primary vote of just 21%. Wilkie then backed a minority Gillard government.
The Cornwall collection
Former Fairfax and Crikey cartoonist Mark Cornwall has been contributing to The Mayne Report since March 2009. Here is a collection of his best cartoons and there are now also some amusing animations:
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Around the grounds on the pokies
Here are a few relevent links in the ongoing campaign to end Australia's notorious status as the world's biggest per capita gamblers with the majority, approximately $10 billion a year, lost on the pokies:
The Andrew Wilkie and Julia Gillard agreement
The states will howl but greater pokie controls are needed
SMH, Richard Ackland, Sept 10, 2010
Pre-commitment Consultation Paper 2010
Victorian Department of Justice
Check out this audio from The National Interest on ABC Radio National when Senator Nick Xenophon crossed swords with Clubs Australia director Anthony Ball.
Meanwhile, check out the latest from Paul Bendat's Pokieact website and this package of our past pokies coverage.
Finally, have a look a this video commenting on the addiction of pokies. Players dream of winning which motivates their behavior, and then that dream is reinforced and maintained by the operators with promises of riches. The reality is that whilst dreaming they don't realise the goal of riches is, and will always be, just out of reach.
Get on board with the Australian Shareholders Association
I'll be working more closely with the ASA this AGM season, even attending a couple of gatherings as the formal ASA monitor.
There is clearly more impact working in numbers so readers of this newsletter are encouraged to click on the image below and support the ASA.
The big debt issues continue under hung parliament
It was very strange to hear Reserve Bank governor Glenn Stevens make the following statement during the federal election campaign: "There is virtually no net public debt in the country at all in contrast to much of the developed world."
Whilst Rupert Murdoch's flagship newspaper Down Under, The Australian, loves to beat up on Labor governments irrespective of the facts sometimes, this recent splash pointing out that state government debt is projected to top $240 billion was a worthwhile piece of journalism.
On top of that figure, the Federal Government's own debt management website puts the gross debt figure at $152 billion and the bond issues continue to come as follows since our last edition:
Friday, September 17, 2010: $700m tender of 5 year bonds expiring in April 2015 were sold for an average yield of 4.85% and was over-subscribed 3.7 times.
Friday, September 10, 2010: $1.2b tender of 4 year bonds expiring in October 2014 were sold for an average yield of 4.74% and was over-subscribed 2.7 times.
Wednesday, September 8, 2010: $500m tender of 10 year bonds expiring in April 2020 were sold for an average yield of 4.88% and was over-subscribed 3.2 times.
Friday, September 3, 2010: $700m tender of 6 year bonds expiring in June 2016 were sold for an average yield of 4.62% and was over-subscribed 3.7 times.
If anyone needs assistance on the debt questions, this list tracks all bond and treasury note issues by the Labor Government since it was elected in November 2007. However, there are many other variables to measure for a true picture of national solvency. For instance, the massive level of foreign ownership in Australia, as demonstrated by this list, reduces the fiscal flexibility of our public sector.
More gems from Cornwall
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The Mayne Report Rich List
BRW magazine does a great job with its various Australian Rich Lists but we've broadened their efforts to track any Australian who has ever been worth more than $10 million. We began the process of building the list in early 2008 where we had an initial 327 names. Now, after much research, we've got more than 1500 names with those who've fallen back below $10 million italicised. Below are our latest new or updated entries:
Christopher Cheung: has owned Sydney's Coogee Bay Hotel for 20 years and those 12,000 visitors every weekend have generated enough cash for a $150 million retail and residential grand plan on the site.
Neil Cunningham and Paola Toppi: the couple own a $6 million apartment in Potts Point also run the legendary Machiavelli's restaurant in Sydney.
David Deague: Melbourne property developer who came a cropper in the mid-1990s but has bounced back and in 2010 owned the Kings Business Park in Southgate which is thought to be worth about $100 million.
Chris Lucas: made his pile selling The Botanical Hotel in Melbourne for $16 million to the failed Cornerstone Group in 2007 and owns a Toorak mansion in St Georges Road said to be worth close to $20 million.
Deborah McMurtrie: a former Clayton Utz partner who paid $5.5 million for a block of land overlooking Balmoral Beach in 2007 and then built a mansion which she put on the market in 2010.
David Penn: Sydney dental tycoon who reported paid $52 million in 2010 for the Point Piper home of recruitment pioneer Andrew Banks.
Allen Perry: a software entrepreneur whose play time assets included an 8.8ha retreat near Port Douglas which is thought to be worth about $4 million.
Ivan Ritossa: the Barclays Capital boss paid $45 million in 2008 for David Coe's harbour front mansion in Vaucluse.
Robert Skinner: a former Deutsche Bank Australia director who in 2010 listed his waterfront mansion in Mosman for sale with pundits tipping it would fetch more than $13 million.
Michael Yates: a property developer who focuses on apartment developments in Melbourne's ritzy South Yarra.
A mixed time punting the market
Firstly, check out all the trades so far this year. This is how things looked as of August 31, 2010: portfolio of 701 holdings worth $37,806. The overall paper loss is of $7,309 and average holding in the world's biggest small portfolio is now just $54. Below are the latest trades as we further reduced the portfolio:
September 16
AGL Energy: sold 20 at $15.98
Alumina: sold 142 at $1.92
ANZ: sold 15 at $23.76
Breville Group: sold 140 at $2.50
Centerbet: sold 130 at $1.65
Clime Capital: sold 325 at $1
Codan: sold 190 at $1.43
Computershare: sold 30 at $9.87
Crown: sold 30 at $8.49
Eldorado gold: sold 11 at $20.99
Forge Group: sold 77 at $3.93
Heartware: sold 130 at $2.22
IRESS Market Technology: sold 35 at $8.20
IOOF: sold 28 at $6.89
Magellan Financial: sold 185 at $1.22
Melbourne IT: sold 151 at $1.95
Mitchell communications: sold 290 at $1.24
Newcrest Mining: sold 9 at $39.91
Oroton Group: sold 40 at $8.13
Pacific Brands: sold 288 at $1.15
Seven Group: sold 5 at $86.02
Salmat: sold 51 at $4.09
Suncorp: sold 37 at $8.93
Donate to help keep us going
The Mayne Report costs almost $100,000 a year to run so if you fancy giving us a hand to help fund our activism and keep us going on the political and AGM circuit, just click on the image below:
From the press room
Here are a selection of recent media mentions and engagements:
The Age
Red-leather day for the DLP
Melissa Fyfe, September 12, 2010
Manningham Leader
Writing on wall for Westfield sign
Shaun Turton, September 10, 2010
Shipping bodies welcome Albanese reappointment
David Sexton, Lloyd's List DCN, Sept 13, 2010
Radio
774 ABC Melbourne - discussing Malcolm Turnbull, Lindsay Tanner and the Aussie dollar on September 15.
ABC PM Program - discussing Lindsay Tanner's appointment at Lazard on September 10.
774 ABC Melbourne - discussing the wash up of the election on September 8.
666 ABC Canberra - discussing the creative commentary describing the new Gillard government on September 8.
Click the link below to get the latest radio and AGM audio:
International Photography Awards
Our multimedia producer and researcher Shane Marden recently received an honourable mention in the 2010 International Photography Awards competition, with approximately 15,000 submissions from 103 countries across the globe. Photos are below: More gems from Mark Cornwall
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Ship owners and other tales from the talk circuit
We gave the notoriously inefficient Maritime Union of Australia a bit of a spray in a recent key note address to the Australian Shipowners Association.
The organisers just wanted an overview of the Federal political environment the day after Rob Oakeshott and Tony Windsor declared they were backing Julia Gillard.
However, the more we looked at the industry the more angry we got.
Australian flagged and crewed ships have fallen in number from almost 100 when the Howard Government came to office to barely 30 now.
We have all these vast mineral resources and 99% are shipped offshore by foreign flagged and foreign crewed ships. All up we spend an estimated $9 billion on foreign ships and only about $600 million a year on the 30 remaining Australian ships (average age 18 years) which largely ply their trade between different Australian ports.
The cost differential for Australian work practices on cargo ships are estimated to be more than $2 million a year, but Federal tax policies also hurt the industry.
So here is Australia, the world's biggest island nation with the world's biggest natural resources dowry, and we don't have a shipping industry to speak of. You only have to read the latest newsletter of the MUA to see how nostalgically left wing they are.
One of the delegates at the conference told me MUA members remain the least productive workers in the shipping and stevodoring world. Anthony Albanese has promised a $50 million reform package, as The Australian noted during the election campaign, but it is conditional on the industry and the MUA reaching a new "compact" on productivity issues. That won't be easy.
Peter Daicos comes to Manningham
In other talk circuit news, Collingwood legend Peter Daicos is guest speaker at a Manningham lunch tomorrow called "Kicking goals for road safety".
I'm the MC and it should be a great lead up to the Grand final. The auction includes framed jumpers signed by two time Brownlow medallist Chris Judd and the entire 2010 Collingwood squad.
Given the events of this week, they should prove to be highly valuable items and all for a good cause in improving road safety.
A big thanks to Westpac, Victoria Police and Manningham council for helping get this event together.
Sign up for campaign and governance Tweets
Click on the image above to join more than 2200 followers on Twitter. Here are some of the more recent Tweets:
10.49am September 17: Jeepers, just noticed 40% of our 6021 Victorian Senate votes came from below the line votes. Given national average is 3%, is that a record?
10.43am September 16: Myer just traded at $4 for first time since float after strong profit. Shows debt-funded consumer binge is back & strong $ helps importers.
5.50pm September 15: Regular chat on 774 ABC Melbourne discussing Malcolm Turnbull, Lindsay Tanner and the Aussie dollar. http://urlm.in/fojc
10.53am September 15: Some fascinating presentations on Victorian public sector governance reform at Windsor conference today. Just need ALP to fix donations too.
3.31pm September 14: Was scary being only man in a room with 70 powerful women at Goldfields House lunch overlooking Circular Quay today. Great discussion.
5.14pm September 10: ABC radio's PM program discussing Lindsay Tanner's appointment at Lazard. http://urlm.in/fmym
2.03pm September 10: Have just given some strong quotes to ABC radio's PM program for tonight over Lindsay Tanner's completely inappropriate new job with Lazard.
1.21pm September 10: After 4 day hearing VCAT has approved 91 bed nursing home at the Park Orchards Chalet site which officers supported but was voted down 7-2.
1.11pm September 10: Juggling financial and logistical questions today around a Woolies board tilt and a visit to New York for the News Corp AGM on October 15.
3.17pm September 9: Woolies CEO Michael Luscombe received tiny pay rise to $8.3m in 2009-10. Sure does pay well preying on thousands of pokies addicts.
4.27pm September 6: Sent big email edition out on pollies, Fairfax, capital raisings, pokies etc: http://www.maynereport.com/articles/2010/01/06-1400-7364.html
11.37am September 6: Some excellent new Mark Cornwall cartoons here: http://www.maynereport.com/articles/2009/05/22-1323-4205.html
5.46pm September 3: Just did ABC Brisbane on outrageous Rivercity Motorways bonuses and have pre-recorded chat with ABC's PM program for tonight on pokies.
2.16pm September 3: Check out today's Crikey story on how Gillard is relishing shafting the pokies industry and NSW Labor Right. See http://www.maynereport.com/
5.26pm September 2: Gillard just claimed ACT ALP doesn't take money from problem gamblers at the 4 venues it runs in Canberra. What rubbish. Of course they do.
4.23pm September 2: Gillard promises mandatory pre-commitment on pokies by 2014 to secure Andrew Wilkie's vote. A good outcome for those concerned about pokies.
11.01am September 2: Michael Anderson and Greg Hywood are two excellent appointments to Fairfax board. Hope media, including Crikey, pat chair Corbett on back.
That's all for now.
Do ya best, Stephen Mayne
* The Mayne Report is a multi-media governance website published by shareholder activist, local government councillor and Crikey founder Stephen Mayne with regular email editions. To unsubscribe from the free emails click here.