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April 3, 2017
 
Independent Media. Independent Minds.
 
Dear Wesley,
 

The Coalition has wasted $100 billion of your money since coming into office (plus: seven more reasons Scott Morrison might be Australia's worst ever treasurer). Which billionaire septuagenarian should really call it a day? The sneaky new anti-union legislation that could further hobble workers' rights. And is Four Corners gagging disgruntled One Nation candidates?

 
 
Federal
How the deficit was blown: the Coalition's $100 billion bill
 
 
FEDERAL
Seven new terrible economic records ScoMo set in March
 
 
TIPS AND RUMOURS
 
 
BUSINESS
Mayne: it's time for Gerry Harvey to go (and for News Corp to show some spine)
 
 
MEDIA BRIEF
Dispatches from the (culture war) front: student journo spits dummy, gets national broadsheet attention
 
 
FEDERAL
The sneaky new legislation that could hobble trade unions (and seriously hurt workers)
 
 
MEDIA BRIEF
Everyone loves it until they're on it: Media Watch earns Press Council ire
 
 
MEDIA BRIEF
Sexual harassment is getting very expensive at Fox
 
 
EDUCATION
How a Labor powerbroker stopped a Co-op coup
 
 
MEDIA BRIEF
Big brands follow the leader on YouTube ad boycott, but it won't last long
 
 
TV RATINGS
Glenn Dyer's TV Ratings
 
 
COMMENTS, CORRECTIONS, CLARIFICATIONS AND COCK UPS
 
 
 
Blog Roll
   
THE URBANIST
Have the Premiers finally 'gotten' New Urbanism?
   
THE POLL BLUDGER
Newspoll: 53-47 to Labor
   
PLANE TALKING
New Planes, Tighter seats for CX but roomier ones for Virgin Australia cabins
   

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How the deficit was blown: the Coalition's $100 billion bill
 
Bernard Keane
Crikey politics editor
 
 

Since its election in 2013, the Coalition has given away $46 billion in political decisions, and signed the Commonwealth up to $50-60 billion in long-term spending that will hammer the federal budget for decades to come.

The 2013 Pre-Election Fiscal Outlook, produced independently by Treasury and Finance, forecast a return to surplus this financial year and net debt peaking last year at $219 billion. The Coalition’s first budget forecast a return to surplus in 2018-19 and net debt peaking at $264 billion. In MYEFO at the end of 2016, however, the budget was forecast to be still in $10 billion deficit in 2019-20, when net debt would be $364 billion.

And while much of the dramatic deterioration of the budget under the Coalition is due to constant revenue writedowns (in spite of the government insisting it had “drawn a line in the sand” under any further writedowns), the government has dramatically worsened its own position through a series of political and ideological decisions that give the lie to its claims to be the victim of an irresponsible Senate:

  • an $8.8 billion gift to the Reserve Bank to make the 2013-14 budget deficit look worse and earn future dividends for the government
  • Repeal of the carbon price cost the Commonwealth around $12.5 billion in lost revenue over forward estimates and at least $1.8 billion per annum beyond that (based on a conservative estimate by the Climate Institute, lower than the government’s own estimate)
  • The government’s company tax cuts agreed last week will cost $5.2 billion over forward estimates
  • Repeal of the mining tax — despite the government’s claims that it raised no money — cost it $3.5 billion over forward estimates, according to budget papers.
  • The reversal of Labor’s changes to Fringe Benefits Tax reporting requirements to end the rorting of novated leases cost, by its own admission, $1.8 billion over forward estimates
  • Income tax cuts for middle- and high-income earners cost $3.8 billion
  • The ineffective Emissions Reduction Fund, is costing $2.55 billion, although the government has decided no further funding will be wasted on it
  • A Northern Australia Infrastructure Fund, established with no effective oversight, assessment or evaluation mechanisms and flagged as a funding source for unviable coal mining projects, will cost $5 billion.
  • A National Water Infrastructure Development Fund established as a funding source for Barnaby Joyce’s obsession with building more dams, is costing $0.5 billion.
  • A scheme to prop up dairy farmers threatening to desert the National Party, via the discredited means of concessional loans, is costing $0.55 billion.
  • Australia’s continuing participation in Middle East military ventures has so far cost $0.72 billion since Tony Abbott sent Australian forces back to Iraq in the name of fighting the “existential threat” of ISIS.
  • The government is spending $0.24 billion on a school chaplains program, although further funding has been halted for now.
  • Nick Xenophon extracted an additional $0.37 billion worth of conditions as price for his support for company tax cuts last week.

However, there are significant costs beyond forward estimates from a number of other government measures.

  • The disastrous F-35 joint strike fighter program will cost taxpayers at least $17 billion over the period to 2023, as new information emerges about problems with the aircraft that are not being addressed or are worsening, and with no guarantees the cost will not escalate further.
  • The government’s decision to reverse the Abbott government’s approach and construct the new generation of Royal Australian Navy submarines in Australia is expected to add up to 30% to the $50 billion cost of the program in order to provide less than 3000 jobs in South Australia.
  • The company tax cuts agreed last week will cost $25 billion over ten years, although the government remains hopeful it can increase that cost to $50 billion. There remains no evidence from anywhere in the world of any economic benefit from company tax cuts.
  • The continuing fiscal impact of some of the above measures beyond forward estimates will cost the budget, on a conservative estimate, $6 billion per annum (unindexed).

Some of the decisions were backed by Labor — the submarines decision, which will cost the taxpayers of the future many billions of dollars, the F-35 purchase, and income tax cuts. But the theme of all of these decisions is that they are in defiance of evidence, represent the triumph of ideology over reason and in many cases were rankly political. Worse, some of them are likely to generate new waves of spending: the removal of an effective, cheap carbon price in 2014 created an energy policy vacuum that led directly to the current energy crisis and proposals from the government to spend billions of dollars re-entering the power generation industry. Our military involvement in the Middle East looks set to increase, not decrease, in coming years. The cost of poor decision-making will be borne by taxpayers for years, even decades, to come.

 
       
 
 
Seven new terrible economic records ScoMo set in March
 
Alan Austin
Economics reporter
 
 

With reports of Prime Minister Malcolm Turnbull taking control of the 2017 budget and rumours that Scott Morrison will be demoted from the senior portfolio in the next ministerial reshuffle, the March news on the economy was disastrous for the Treasurer.

At least seven new records were set. None are to his credit.

Labor’s debt doubled

The Office of Financial Management released figures on Friday showing gross borrowings at $484.6 billion. Of this, $58 billion is residue from the Howard government or its predecessors. Labor increased it by $212 billion. Another $214.6 billion has been added since the 2013 election.

Hence the Coalition has now more than doubled Labor’s gross debt, in three years and six months. It doubled Labor’s net debt in January.

Rate of debt increase

Gross debt added in March was $18.7 billion, the highest monthly increment in Australia’s history. The most Labor treasurer Wayne Swan added was $13.2 billion in May 2009, at the depths of the global financial crisis. Former treasurer Joe Hockey’s highest was $12.7 billion in November 2013.

Nine months into this financial year, the total gross debt added so far has been a staggering $64.2 billion. That’s an extra $7.13 billion each month on average — the highest for the first nine months of any financial year in history.

It belts Hockey’s first nine months in 2013-14, when he added $53.6 billion — the second greatest ever. Labor’s highest was $44.7 billion in 2011-12.

People unemployed

Since the restructure of Australia’s economy in the late 1980s, the jobless number has steadily declined. It dropped below 720,000 in 1998, where it stayed for the next 15 years. Until Joe Hockey.

Within months of the hapless Hockey becoming treasurer, it was back above 720,000 again. Levels have remained high ever since, despite changing prime minister and treasurer. The jobless number has been above 720,000 for 31 of the last 34 months. In February it was 748,123.

Jobs for women

Women’s unemployment is now back above 6%. It has been 5.7% or higher for the last 39 months. The last time that occurred was 2001 to 2004. For most of Labor’s period, including the GFC, female unemployment ranged between 4.6% and 5.6%.

The ratio of full-time to total jobs

This ratio fell in March 2016 to the lowest in history — 68.6%. It tumbled further for the next two months and then fell below 68% for the first time last September. The January number was a new record low of 67.7%. February’s is the third lowest ever at 67.99%.

Ratio of men’s employment to population

This ratio has been at 62.2% for the last two months and for three of the last six. The last time it was this low was in the early 1990s recession.

Underemployment

As Crikey showed last week, the number of workers who need to work more hours has exploded. It clicked over 1 million after Joe Hockey’s first budget and last month reached a new record 1,114,558 workers. That’s up as a percentage of the labour force from 7.8% when the Coalition took office to an all-time high 8.7%.

Youth underemployment

For young people aged 15 to 24, underutilisation is now 31.5%, a new Australian high. This breaks all Joe Hockey’s previous records. The Labor period’s highest was 27.4%, and in the Howard years 27.9%.

Engineering construction

Total engineering construction activity for the year to December 2016, announced by the ABS on Wednesday, showed the worst annual decline ever.

Activity in 2016 fell 19.7% on 2015, which was down 13.0% on the year before. Even 2014 was 9.6% below 2013, which was down 1.7% on 2012. That makes four consecutive annual declines — for the first time. The last three were all the worst on record.

Trade surplus slashed

One positive for the Turnbull government in recent months has been the trade balance, which appeared as a surplus in November for the first time in 32 months. December’s trade surplus was even better at $3.33 billion, a record high.

That was followed, however, by the second worst collapse in Australia’s history. Figures released last month show the January balance is suddenly $2 billion lower at just $1.30 billion.

So, Scott, as the soothsayer said to Julius Caesar: “Beware the ides of March.”

 
       
 
 
Tips and rumours
 
 
 

From the Crikey grapevine, the latest tips and rumours …

Treasury modelling capital gains tax changes. It seems increasingly likely that the government will be making changes to capital gains tax as part of a housing affordability package to be announced in the budget in mid-May. Earlier this year Crikey filed a freedom of information request for modelling being done by Treasury on changes to capital gains tax since the July 2 election. In response last week, the department said it had 459 pages of final modelling being done on the proposed changes.

The FOI is still being processed, but alongside comments made by Treasurer Scott Morrison last month, the existence of those 459 pages indicates the government has changed its thinking on capital gains tax since the last election. Morrison doesn’t like playing rule-in-rule-out games before the budget, saying Australians would find out what was in the budget on the second Tuesday in May: “They are matters for the Commonwealth government, and the budget will be in May, and it will address our housing affordability package. We haven’t been engaging in any speculation on these issues. Others have in the public realm, which is fairly par for the course in Canberra at this time of the year, but the government will be outlining its measures in May.”

Four Corners gags sources. The ABC is gearing up to reveal all about One Nation’s internal issues on Four Corners tonight, with party faithful in Western Australia set to spill the beans on how they feel they have been wronged by party leader Pauline Hanson. While there has been reporting on the internal issues surrounding the party over the past few months in many media outlets, Ms Tips understands that the ABC has gone to extreme measures to protect any exclusives in tonight’s programs. Sources interviewed have told other journalists that they were told by the ABC not to speak to any other journos before the program goes to air.

IPA funds ensured. The Institute of Public Affairs is one of the country’s most powerful think tanks (this wishlist shows just how many of their policies the Abbott government promised or delivered), but just how it is funded has long been a mystery. Member for Goldstein Tim Wilson and Senator James Paterson are ex-IPA employees now elected to Parliament, and they probably won’t be the last. While the IPA’s annual report shows the think tank had revenue of $4.96 million in the last financial year, 91% of which is from individual donations, details about those individuals are rarely released. An email from IPA boss John Roskam to members late last week sheds some light, revealing a “generous bequest” from former board member Hilton Nicholas is helping to top up coffers after he passed away in January. Nicholas, who was an heir to the Nicholas Aspro company, was also a former chair of the Victoria Racing Club.

Roskam emphasised that the IPA received no government funding, which helped ensure its work was “relevant, important, and makes a difference to creating a better country”.

So it turns out people who advocate for the abolition of the minimum wage, and the removal of the paid parental leave, the baby bonus and the first-home buyers’ grant (handily captured here) are the kind of people who can afford to make private donations to promote those messages. Who would’ve thought?

Abetz’s latest rainbow flag outrage. Senator Eric Abetz really has a fixation with rainbow flags and participation in Mardi Gras by public servants, tabling questions to the Treasurer and Minister for Foreign Affairs last week asking just how much the Australian Prudential Regulation Authority (APRA), the Reserve Bank of Australia, ASIC and the Department of Foreign Affairs and Trade spent on organsing their floats, and if staff costs in travelling to Sydney were also covered by the respective departments and agencies.

He also asked: “is the Department aware that the organisers of the parade have made political statements criticising the Prime Minister and banned him from the parade”? Mardi Gras organisers did not actually “ban” Turnbull from attending, so we imagine the department was not aware. Turnbull did not attend the parade, as he had to wash his hair that night, but Opposition Leader Bill Shorten and deputy Tanya Plibersek were there.

Fairfax’s CBD column has the costs for ASIC, which was proud of its “rainbow regulators”‘ participation. The organisation spent a whopping $511 — for T-shirts.

*Heard anything that might interest Crikey? Send your tips to boss@crikey.com.au or use our guaranteed anonymous form

 
       
 
 
Mayne: it's time for Gerry Harvey to go (and for News Corp to show some spine)
 
Stephen Mayne
Crikey founder and shareholder activist
 
 

Which elderly billionaire chairman of an ASX-listed company should most readily retire?

You could certainly make a case for Rupert Murdoch, Solly Lew, Frank Lowy or Kerry Stokes, but right now it is impossible to go past 77-year-old Gerry Harvey as the man who really should bow out of public company life.

Look no further than this recent story on ABC television’s The Business, featuring a doorstop interview with Harvey by reporter Andrew Robertson. Asked if his friendly franchisees would be able to pay back the $1 billion they owe Harvey Norman, the feisty billionaire boldly declared: “I’ll repay it.”

Jeepers, here you have the controlling shareholder and executive chairman of Harvey Norman going on television to effectively personally guarantee loans owed by hundreds of battling franchisees.

With comments like that, is it any wonder the short position at Harvey Norman is now up to 8% of issued capital, which is worth about $350 million based on Friday’s closing price of $4.53?

The AFR’s Neil Chenoweth has led the charge against Harvey Norman’s accounting practices over the past few months, but he has received very little back-up from News Corp newspapers.

Indeed, AFR Rear Window columnist Joe Aston today accused The Australian of providing “stenography services” to its biggest advertiser, presumably a reference to this recent storyquoting Harvey ranting at length but not ventilating the case against him.

Gerry Harvey has personally known Rupert Murdoch for decades and was a guest at Catalina in Sydney when the entire News Corp board hosted a power-packed lunch in August 2015.

Like Rupert, Gerry Harvey doesn’t take well to criticism.

A mildly critical AAP story didn’t last very long on The Australian’s website last month, suggesting that a successful complaint might have been lodged with News Corp management at the time.

The Australian Shareholders’ Association has also faced a swingeing attack from Harvey, and even analysts are now suffering, as he cancelled the traditional half-yearly conference call with investors in February.

Substantial governance reform is clearly long overdue at Harvey Norman.

An independent chairman needs to be appointed, along with at least three new qualified and respected independent directors. No other ASX200 company has gone more than a decade without appointing a new director.

ASIC and auditor Ernst & Young, with a new signing audit partner on board this year, should also be insisting on meaningful accounting reforms in the 2016-17 Harvey Norman accounts, particularly consolidation of all franchise operations and some visibility into the property portfolio, which the directors claim is worth $2.6 billion.

The 2016 annual report discloses that Harvey Norman has 14,045 shareholders. Their executive chairman has personally profited from their passivity in the past when he under-wrote a heavily discounted entitlement offer in December 2014 and scooped up a $3 million windfall from non-participants.

Whilst many institutions have abandoned Harvey Norman, it remains a popular stock with retail investors because it pays a healthy fully franked dividend. The stock goes ex a 14c dividend on Wednesday, which will be paid on May 2, when Harvey will personally receive a payment worth about $47 million.

However, it remains to be seen how long such healthy dividends can be paid, especially with JB Hi-Fi winning out in the field and Amazon now coming to Australia.

Gerry Harvey has spent $28 million supporting the shares in recent weeks as he stares down short sellers and offsets the negative sentiment around selling by other executive directors.

However, unless he is prepared to embrace modern accounting and governance standards, perhaps he should really put his money where his mouth is and privatise Harvey Norman with a bid pitched at $5 a share.

Then he really would effectively be standing behind the $1 billion owed by his franchisees to Harvey Norman.

Unfortunately, Harvey might not have the $3 billion-plus required to fund such a bid, so the saga of his appallingly governed listed vehicle will just roll on.

With his compliant directors remaining silent, reform will need to be driven by ASIC, auditor Ernst & Young, independent shareholders, proxy advisors and the media.

This is shaping up as the most significant governance battle of 2017 and just as it did with Coles Myer and Yannon 20 years ago, the News Corp newspapers needs to property join the debate.

Terry McCrann wrote more than 50 columns about Yannon. He’s yet to write anything about Harvey Norman. Over to you, Terry.

* Stephen Mayne is a Harvey Norman shareholder and a director of the Australian Shareholders’ Association. These views are his own.

 
       
 
 
 
Dispatches from the (culture war) front: student journo spits dummy, gets national broadsheet attention
 

There really is no culture war too small for The Australian. The self-appointed defender of free speech and common sense threw its support behind a uni newspaper editor over the weekend with a front-page exclusive about his “ousting” from the role because of left-wing ideology.

News editor of Australian National University student paper Woroni Alex Joske quit the role after four months, saying he had been “disillusioned and disheartened” by Woroni‘s “poor decisions and dictatorial managerial practices”.

The “hard-news aficionado” Joske had hoped to see more news-breaking at the paper, but he had no allies “in trying to promote professional journalism”, The Weekend Australian reported.

According to the Oz, the tipping point for Joske was an upcoming ethno-cultural issue, which would only publish contributions from “ethnocultural self-identifying students”. Not to lose an opportunity to bring up The Australian‘s favourite topic, the story says there are “some parallels with the storm raging in federal politics about the Coalition’s attempt to change section 18C of the Racial Discrimination Act”.

The paper wrote: “Joske quit; he was not going to start selecting reporters on the basis of race designated by the editorial board as acceptable.”

In a post to Facebook, Joske said the politics of the role had curtailed his own investigative work.

“Entering the editorial board, I had high hopes that the reforms I was passionate about would be considered and implemented. But after many incidents, particularly a case where I was told by the editor-in-chief that she would rather not publish a set of articles than publish articles written by white men, it quickly became clear that my understanding of journalism and diversity was fundamentally different from theirs. Although I’m not sure whether their understanding of journalism is shared by any professional journalists.”

Predictably, Andrew Bolt blogged his support on Saturday morning for the “brave students fighting the new racism of the identity-politics Left”. — Emily Watkins

 
       
 
 
The sneaky new legislation that could hobble trade unions (and seriously hurt workers)
 
Charlie Lewis
Crikey journalist
 
 

The Fair Work Amendment (Corrupting Benefits) Bill 2017 quietly received its first reading in Parliament last month. Aimed at what the government calls “sweetheart deals” between business and unions and introduced to coincide with a blistering attack on Opposition Leader Bill Shorten’s integrity, the bill creates two new offences.

The first makes it an offence to give, receive or solicit a “corrupting benefit,” while the second makes giving cash or an in-kind payment to unions, apart from certain exceptions detailed in the legislation.

The legislation contains a great of subjective terminology; for example, it is an offence if someone:

(a) (i) requests (whether or not expressly and whether or not by threats); or
(ii) receives or obtains; or
(iii) agrees to receive or obtain;
a benefit from a person (the provider) for the defendant or another person; and
(b) the defendant does so with the intention that, or the intention that the provider believes that, the receipt, or expectation of the receipt, of the benefit will tend to influence a registered organisations officer or employee (who may be the defendant). (emphasis added)

Australian Council of Trade Unions secretary Sally McManus believes there is a real risk that these provisions, subjective as they are, could be used to target and criminalise legitimate union business.

“We have very real concerns with this bill which has clearly been hastily cobbled together to divert attention from the Turnbull government’s support for cutting penalty rates for 700,000 workers,” McManus told Crikey.

“In their zeal to mount further politically motivated attacks on unions, the government has drafted a bill that appears to make it a crime for unions to pursue unpaid wages for workers.”

The Department of Employment denies this is the case.

“The bill very clearly provides exemptions for a range of legitimate dealings between unions and employers,” a department spokesperson told Crikey. “Arrangements that are exempted will not be prohibited.”

The level of proof regarding both new offences is the criminal standard. The prosecution (in this case, the Fair Work Ombudsman, the government body that investigates and enforces breaches of the Fair Work Act) has to establish beyond reasonable doubt an employer’s intention to to give, or a union officials intention to receive or solicit, a corrupting benefit. If an accused employer tries to claim a payment to a union falls under one of the exceptions, it then falls to the prosecution to establish — again, beyond a reasonable doubt — that the exception does not apply.

This raises the question; just how do you establish beyond a reasonable doubt a belief or an intention?

University of Sydney law school associate professor Shae McCrystal told Crikey the bill in its current form would be difficult to enforce.

“I can see litigation under these clauses being very hard to prove — how do you establish a belief that a benefit would tend to influence someone to not discharge their duties properly?” she said. “What do all those terms actually mean in this context?”

“It’s one of the difficulties that comes about when you try to legislate for complex human behaviour.”

McCrystal compared it to the adverse action provisions of the Fair Work Act. Adverse action provisions prohibit an employer from “disadvantaging” workers (by threatening them, terminating their employment, reducing their shifts, etc) for “prohibited reasons” — this could be discriminatory, or the exercising of a workplace right (for example, you can’t be fired if you take lawful sick leave, and you can’t have your hours reduced for engaging in a protected strike).

Under these provisions, there is a reverse onus of proof; an accused employer has to prove they haven’t breached the legislation.

For the broad “corrupting benefits” offence the bill creates, the burden of proof is on the ombudsman. If an employer is accused of breaching the prohibition of illegitimate payments from employers to unions, the burden is on the employer to point to evidence that one of the legitimate payment exceptions applies. If that happens, again, the ombudsman has to establish, beyond a reasonable doubt, that this isn’t the case.

McManus argues further that laws around improper influence should not just apply to unions and employers, and that all forms of corruption should be dealt with by an independent body.

“The ability to influence politicians, government officials in tender processes and subcontractors seeking corporate work are all issues that need to be addressed — this is why we must have an independent body to deal with corruption wherever it may occur,” McManus said.

“There cannot be one law for some and another law for the rest of us.”

 
       
 
 
 
Everyone loves it until they're on it: Media Watch earns Press Council ire
 

The Australian Press Council says a Media Watch program contained a significant factual error, which it has not adequately addressed.

Media Watch ran a story on March 27 about a Press Council adjudication that found the Daily Mail had breached TV host Osher Gunsberg’s privacy by publishing pictures of him in Bali under a headline referring to his “Bali belly”.

In a statement, Press Council executive director John Pender said Media Watch had stated the only punishment for the Mail was a requirement to link to the Press Council judgement on its website. In fact, the requirement is to publish a link to the adjudication in full in a prominent place for 24 hours, and keep the judgement permanently on the website.

The Press Council said the ABC program had not mentioned that Gunsberg was happy with the adjudication, and that aside from adding a note to its website, Media Watch refused to take any further remedial steps.

In the statement, Pender said:

“I believe it is appropriate to issue this statement because the incorrect impressions created by the program have not been adequately remedied by Media Watch itself, and could lead the public into a mistaken understanding of what occurs during and after the Press Council’s complaints-handling process. It is of the utmost concern that this segment could potentially deter bona fide complainants from availing themselves of the Press Council’s complaint-handling process.”

— Emily Watkins

 
       
 
 
 
Sexual harassment is getting very expensive at Fox
 

Double standards remain the currency of choice at the Murdoch family’s pet companies, News Corp and 21st Century Fox. There’s one rule for Fox News on-air stars and another for everybody else, including former Fox News boss, Roger Ailes. A year ago this July, the Murdoch sons, Lachlan and James, forced Roger Ailes, the long time head of Fox News Channel, out of the company with US$40 million “go away money”. At the weekend it was reported that Bill O’Reilly, Fox’s News’ biggest star, has just been re-signed by Fox management, despite a long New York Times report detailing five instances of sexual harassment claims against O’Reilly by former staffers and associates, which resulted in multimillion-dollar payouts. Ailes must be spewing because O’Reilly has settled some of the claims against him personally, and remained employed by the Murdochs. Ailes was deemed to be a liability and paid to walk.

All up Fox News and 21st Century Fox look like they have paid out close to US$100 million to settle sexual harassment and other allegations against Ailes, O’Reilly and other senior Fox News staff. There’s US$40 million to Ailes, US$13 million in five cases detailed by the Times, US$20 million paid to Gretchen Carlson, the original complainant against Ailes, and between US$10 and US$20 million to settle a number of other cases. Many of these cases have not been disclosed to shareholders by Fox or the Murdoch dominated management and remain the focus of regulatory investigations in the US.

The variable treatment of O’Reilly and Ailes compared to the how the management at the News Corp-owned Sky News in Australia handled Mark Latham. Nothing was done as Latham insulted … well, just about everyone. And even when he bagged ABC radio host Wendy Harmer, nothing was done for days. Then he insulted a teenage Sydney school boy, accusing him of being “gay” becasue he supported feminism. That generated an outcry on top of Harmer’s request for an apology. Sky News did nothing until CEO Angelos Frangopoulos returned from holiday, and Latham was then sacked, with an unreserved apologies to Harmer and Sky colleague Kristina Keneally broadcast last week.

The New York Times pointed out: “This is a sensitive time for Fox News as it continues to deal with the fallout of the Ailes scandal. The network is facing an investigation by the United States attorney’s office in Manhattan, which is looking into how the company structured settlements. Fox News has said that neither it nor 21st Century Fox has received a subpoena but that they have ‘been in communication with the U.S. attorney’s office for months’.” The Times story has increased the risks for Fox, 21st Century Fox and the Murdochs. They might need a mate in the White House to make it all go away. — Glenn Dyer

 
       
 
 
How a Labor powerbroker stopped a Co-op coup
 
Jeremy Nadel
Freelance journalist
 
 

Last Friday, 27 students, mostly from the University of Sydney Students’ Representative Council (SRC), attended the Co-op Bookshop’s Annual General Meeting and attempted to expel the board of directors. But a Labor powerbroker declared dozens of proxy votes “invalid”, without giving any reason for this, and the attempted coup was thwarted.

Originally set up by students in the late 1950s — it initially operated out of a garage — the leading textbook seller has grown into the largest retail co-operative nationally, with more than 2 million members and an almost $150 million turnover. The Co-op is a chain with stores in most university campuses, its governance and business model involves students paying $25 dollars to become a lifetime member and a shareholder in the company, which they are enticed to do by promised discounts on textbooks. However students have accused senior management of alienating their main member base and barring them from any control over the Co-op.

Students were given no notice of the AGM, which was held in Kooindah Waters, Wyong, more than 100 kilometres from the Co-op’s head office in Surry Hills. Co-op national secretary and emerging NSW Labor powerbroker Talal Yassine greeted students at the door. It’s not the first time a Co-op AGM has been held in an unusual location, in 2004 students attempted to travel to Hobart to influence the running of the organisation.

The Co-op’s annual financial records show the Co-op ran a loss of $1.4 million in 2016 and $3.7 million in 2015. The “Take Back Our Co-op” campaign argues the Co-op’s consistently poor financial performance highlights the inappropriateness of directors receiving a total remuneration of $330,000 per annum. Before the AGM, Daniel Ergas, University of Sydney SRC general secretary, submitted resolutions to vacate directors and reduce their salaries to zero. More than two dozen students who were unable to attend the AGM submitted proxies in support of Ergas’ motions.

The AGM was attended by managers and other staff from Queensland, Western Australia and other states. There were three more students than attendees who backed the board, but all the board’s motions were passed. Yassine explained that the proxies submitted in support of Ergas’ resolutions were “invalid”, though he refused to specify which requirements of co-operative national law or the Co-op’s constitution these proxies failed to meet. “You’re not here to ask questions. This isn’t QandA … I’ll ask you to have a Diet Coke and settle down please.”

University of Sydney women’s officer Katie Thorburn asked Yassine “how can you know the needs of your members, when you don’t have a typical member on the board? This isn’t a for-profit, this is for students!” According to the Co-op’s rules, to be eligible for election to the board of directors one must have “participated in the management and/or direction of a medium to large size business over not less than five years,” and have a completed tertiary degree, which effectively locks out students from the board. Yassine defended these policies, asserting that it was not in members’ interests to appoint individuals who “lacked experience to manage the organisation”.

Despite the current board’s extensive background in accounting, marketing and banking, the Co-op’s has been accused of branch-stacking, factionalism and legal disputes.

Graeme Orr, a professor of political law at the University of Queensland who was part of a faction that lost a bid for power over the Co-op to Yassine in the late ’90s, speculated that “the board is always going to be prey to the same kind of problems as student union politics … the risk of running a model where it’s one member, one vote, but most of the members don’t care about who’s running the organisation”. During Yassine’s tenure as national secretary, the board has included individuals employed by his investment bank, Crescent Wealth, and connected to him through the Labor Party.

“Holding the AGM in Wyong and declaring students’ proxies invalid without justification is astonishingly telling of the lengths that … [people] running the Co-op will go to in order to avoid scrutiny and protect their $330 000 pay package,” Ergas said. He added: “Their refusal to accept our proxies means we have an avenue to pursue legal action.”

Although the students did not expel the directors many are confident the AGM will raise the awareness the campaign needs to build momentum and eventually “reorient it to its main mission: helping students save money”.

 
       
 
 
 
Big brands follow the leader on YouTube ad boycott, but it won't last long
 

The Australian government has joined the hoards of advertisers dumping YouTube over concerns about ad placement alongside inappropriate content.

Australia Post, Tourism Australia, Telstra, Foxtel, Bunnings, and many more Australian and international advertisers have pulled advertising from automated placement on YouTube after a UK news report in The Times detailed how the UK government and respected brands were advertising alongside extremist and offensive content. Advertisements would appear as banners, or before videos, and had been reportedly seen on videos for Islamic extremists and white supremacists. YouTube passes a cut of revenue made from advertising on its videos onto the original uploaders of the videos — meaning the big brands’ ad spends were going towards these organisations.

Charles Sturt University lecturer in communications and digital media Travis Holland told Crikey brands had already been aware of the risks of automated advertising, but had felt they couldn’t pull out while all other advertisers were still using it.

“People previously knew what the problems were, but they weren’t willing to pull out because everyone else was there,” Holland said. “It’s been an interesting pile-on.”

Google, which owns YouTube, has indicated it is working on a solution to address the brand-safety concerns, but Holland said regardless of what Google does, advertisers will always go back to YouTube.

“Often what happens with boycotts is people will make a show of cutting a product for a period of time, and then they’ll faze it back in, and I’d say that’s likely to happen in this case,” he said.

Google Australia managing director Jason Pellegrino told AdNews last week that concerns about brand safety had been exaggerated.

And in a tough advertising environment, New Corp Australia has taken the boycott as an opportunity to spruik its own products. A full story in today’s Media section in The Australian was dedicated to the campaign, which News Digital managing director Nicole Sheffield told them was about “reassuring our customers that protecting and enhancing their brands is our number one priority”. — Emily Watkins

 
       
 
 
 
Glenn Dyer's TV Ratings
 

Seven won overall, even though the Melba-like finale of Married at First Sight (part 1) topped the night nationally and in the metros. My Kitchen Rules hung in there and Seven finished the night well in front thanks to another true crime repeat story at 9.30pm which dominated the last hour of the main prime time ratings period. Ten was again very weak, which is understandable given it has nothing but bits and bobs. The ABC did OK, even though it wasn’t as solid as the four previous Sundays when it was screening Vera.

Married at First Sight had its season high figures — both nationally (1.90 million) and in the metros (1.37 million). Some of the “relationships” look very fraught last night. Tonight’s ep is a tidy up and ‘assessment’ by counsellors and others. Expect finger pointing and tutting. From tomorrow night, MKR has a open three nights and Seven will win the week, again.

In the mornings, Insiders (549,000) was pushed back to second behind Weekend Sunrise with 590,000 national viewers. Weekend Today had 490,000 – so the national audience for those three programs was an impressive 1.62 million people, which is not to be sneezed at.

In regional markets: Seven News was tops with 637,000 viewers MKR was second with 576,000, Married With Children was 3rd with 527,000, Nine/NBN News 6.30 500,000, Nine/NBN News, 456,000.

An easy win to Seven last week, with Nine comprehensively beaten while the ABC was third and Ten struggled to keep up in 4th spot. Ten’s main channel share again left a lot to be desired – under 10% all week, ending with an average for the week of 9.3%. The Biggest Loser: Transformed was moved to week days at 1pm; buried, in other words. Ten is pitching anything into the 7.30pm slot to hold the fort until it can start Masterchef. Ten’s main channel share last night was just 7.3% — not the best way to start what will be a tough week. SBS’s main channel share last night was 6.9% for the metros – that’s uncomfortably close (for Ten) to Ten’s share.

This evening SBS ventures into the local cheffing shows market with The Chef’s Line hosted by Maeve O’Mara at 6pm. But why? — Read the rest on the Crikey website

 
       
 
 
Disappearing words and phrases
 
 
 

On 18C and disappearing phrases

Patrick Bowman writes: The death of the 18C debate (and why this is all Andrew Bolt’s fault)” (Friday) The one I’ve noticed (the lack of) is “labour saving device” (ok, phrasal noun then). Now that everyone’s terrified of losing their job to automation, the saving of one’s labour is no longer so appealing.

Alastair McConnachie writes: The death of the 18C debate (and why this is all Andrew Bolt’s fault)” (Friday) Guy Rundle’s assertion that the term “rhythm guitarist” has disappeared from modern useage grieved me deeply. He may be right, but we survive still, quietly and unobtrusively plying our humble trade in venues all over the country. One day we will rise again and claim the glory and adulation that is rightfully ours – but until then we will most likely continue to keep a low profile.

On the closure of Hazelwood

John Richardson writes: On the closure of Hazelwood” Friday.

I apologise if I’ve managed to confuse John Kotsopoulos but I think he is drawing a long bow by suggesting that we are “both aiming for the same outcome.”

I do agree that our nation is in desperate need of a coherent national energy policy, but while John seems concerned with championing Labor’s position, I was actually talking to an entirely different aspect of the issue, which was all about reducing energy demand in response to the immediate crisis & some of the foolish ideas being touted as “solutions”, by killing-off the mistletoe that is the aluminium smelting sector, which might just buy the time necessary for the policy debate to brought to a rational conclusion.

I’m also delighted to learn that David Edmunds believes that he & I are in “furious agreement”.

Phew!!

 

 
       
 
 
 
 
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