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27 July
Comments Off on How to make sauerkraut

How to make sauerkraut

Sauerkraut with heirloom carrots: A crucial first step is to source quality, organic produce thriving with good bacteria. Photo: James Boddington After you have removed the outer tough and dirty leaves of the cabbage, cut it into quarters, remove the core then slice into fine slivers. Photo: James Boddington
Nanjing Night Net

Rinse the carrots gently then cut them into thin strips. Photo: James Boddington

Alternatively, use a food processor or mandolin to get the cabbage and carrots sliced thinly. Photo: James Boddington

Mix the vegetables together using your (clean) hands. Photo: James Boddington

Add salt, spices and herbs to the mixed vegetables. Photo: James Boddington

Toss the vegetables, salt, herbs and spices together thoroughly using your hands. Photo: James Boddington

After the salted mix has rested for 10-20 minutes, pound it to release liquid from vegetables. Photo: James Boddington

Place mixture into a jar or crock and press down firmly as you go. Photo: James Boddington

After pressing down, the vegetables should be completely immersed in the liquid with no air bubbles. Photo: James Boddington

Place some cabbage leaves like a lid over top of the mixture; the vegetables should have no contact with the air. Photo: James Boddington

Use a weight to compress the leaves down onto the mixture and leave for 24 hours. Remove weight then screw on lid (if using a jar, left). Leave at room temperature 36-48 hours then refrigerate. Photo: James Boddington

Arabella Forge’s step-by-step guide to making sauerkraut. Photo: James Boddington

These bacteria are essential to intestinal health; they make nutrients in food more easily available and make the food easier to digest.

This story Administrator ready to work first appeared on Nanjing Night Net.

27 July
Comments Off on The tricky part of AirBnB

The tricky part of AirBnB

There are plenty of ways you could describe Alex, but I’m going to go with “interesting”.
Nanjing Night Net

At least, that’s how his profile made him sound.

Alex was a Beatles fan, you could tell by the Fab Four poster pasted on his kitchen wall. Oh, and the fact that the headline on his Airbnb entry was: “I love the Beatles!”

He was also a keen musician if the guitar in one of the photos and the speaker system in another were anything to go by.

Like I said, interesting. His apartment sounded interesting, too. Most people lead the little description of their place with something about the area of town it’s in or the number of bedrooms it has. Alex’s was a simple one-liner: “Funky in a good way.”

That got me over the line. Well, that and I had few other choices.

I was heading to the Swedish port town of Gothenburg, by all accounts a funky place in its own right, full of record stores and hip cafes.

It wasn’t, however, cheap. Nowhere in Sweden is cheap. The most basic hotel can set you back €100 ($127). So for Gothenburg I’d decided to think outside the box.

See, you don’t have to stay in hostels or hotels when you travel any more. You can go for something cheaper and homier.

Some people opt for couch surfing, dossing on the sofas of generous fellow travellers for the cost of providing interesting conversation. Others use websites such as Airbnb, hiring people’s spare rooms and/or entire apartments or houses around the world. I’d done it plenty of times. I’d already stayed in a top-floor flat in Berlin, in a two-bedder in Seville, in a lovely room in Amsterdam and what was basically a penthouse suite in Barcelona. All had worked out spectacularly – they’d been exactly like the photos on the website and had cost less than a pokey hotel room.

So I was confident in Alex, even though his Airbnb entry was on the quirkier side. According to Alex, I’d have access to the “adventure room” during my stay. I’d be surrounded by “vintage furniture”.

I’d be staying in “an area quickly becoming a haven for Gothenburg’s young, emerging artists”.

And – here’s the clincher – Alex promised I could “SLEEP IN AS LONG AS YOU WANT!”

He added: “Unlike every hotel in the civilised world, we will not wake you up.” Awesome. Also, unlike every hotel in Gothenburg, he was going to charge only €44 a night for me to sleep in his spare room, cook in his kitchen and relax in his adventure room. So I paid my money and signed up.

The arrival is always the trickiest part of an Airbnb stay. Given it’s not a hotel, there’s no 24-hour reception, so an appointment has to be made with the probably-non-English-speaking owner to collect keys and be shown around. This was going to prove a particular problem in Alex’s case, because he was on holiday in the US and had been for the past three months.

Fortunately, one of his previous tenants was still in Gothenburg and still had her key, so she’d be able to do the handover. I met Stephanie on a typically cold, grey Gothenburg afternoon, a light drizzle falling on our faces as we found each other near the central train station.

“How long are you staying with Alex?” Stephanie asked.

“Two nights.”

“Oh,” she said, looking slightly dubious. “That should be enough.”

We said our goodbyes and I jumped on the tram to Alex’s place, alighting in a fairly drab neighbourhood of uniform apartment blocks and quiet streets.

I had a feeling already that this area was becoming a haven for only one of Gothenburg’s young, emerging artists: Alex.

Around a corner and across a small clearing I found the door I was looking for, although as Alex hadn’t specified his apartment number I had to try the key in a few different doors before I found the right one.

I swung it open and discovered that Alex’s place was, as promised, funky. Although not in a good way. More in a dirty, hasn’t-been-aired-since-Stephanie-left way. The beds (or, rather, the mattresses on the floor) were slept in, the kitchen was messy and Alex was showing a real estate agent’s flair with his description of the furniture as “vintage”. I’d say “old”.

The “adventure room”, it turned out, was actually Alex’s bedroom, leading me to question what sort of adventure most of his guests got involved in. As Alex was on another continent, I’d sadly never find out.

Of course I’d paid my money by now, so for better or worse this would be my abode for the next two nights. I cleaned up the kitchen, ran the bed sheets through the wash and tried to enjoy myself as best I could.

On the bright side, I reasoned, with no one else living here, I really could sleep in as long as I wanted.

Have you ever used AirBnB, couch surfed, or otherwise stayed in a stranger’s home while travelling? What was your experience like? Post a comment below.

Join Ben Groundwater on a special 10-day cycling trip to historic Myanmar in November. For more details see smhshop南京夜网.au/adventureholidays.

[email protected]南京夜网

This story Administrator ready to work first appeared on Nanjing Night Net.

27 July
Comments Off on Samsung’s 5G will complement NBN, not replace it

Samsung’s 5G will complement NBN, not replace it

Super-fast wireless will never make fibre obsolete.
Nanjing Night Net

Samsung has reportedly “witnessed” one-gigabit-per-second wireless download speeds over a distance of two kilometres in its 5G trials. In theory such speeds would let you download an entire movie in seconds, on par with the gigabit speeds which the NBN will eventually deliver. So it’s time to scrap Australia’s national broadband network and just go wireless, right? Wrong.

Samsung’s so-called 5G wireless technology is still in the test phase and is at least seven years away from commercial deployment. Even if you could roll out this technology today, you’re not going to get gigabit speeds in real world conditions. The laws of physics dictate that wireless bandwidth is a shared resource and congestion is the enemy. The more people using a wireless network at once, the slower their download speeds and upload speeds. Not to mention the fact that wireless technologies are prone to interference and black spots, unlike a strand of fibre running to your door.

Whether you’re an advocate of Labor’s fibre to the home NBN plan or the Coalition’s fibre to the node alternative, you have to face the fact that a wireless-only solution for all of Australia is impractical. Sorry, but the laws of physics transcend politics and are not open to ideological debate. The only way you’re going to achieve gigabit download speeds from Samsung’s 5G network is if you’re the only person using that wireless tower – which is very unlikely to happen in the city unless you’re the sole survivor of the zombie apocalypse.

To see wireless congestion at work, you only need to look at the demise of Australia’s crowded 3G networks – which crawl to a halt in the CBD during peak times. The move to 4G LTE may have offered a reprieve, but congestion will again take its toll as more Australians upgrade to 4G devices.

Scrapping the NBN and trying to replace it solely with citywide mobile broadband would be a recipe for disaster. To get decent speeds you’d need a wireless tower on every street corner and fibre backbone to link them anyway. The role of wireless networks is to complement the NBN and cater to mobile users, not to take the place of fixed-line connections and shoulder a city’s entire broadband load. Even if you’re only using Wi-Fi enabled gadgets at home or in the office, that Wi-Fi network is probably relying on a fixed-line broadband connection.

This story Administrator ready to work first appeared on Nanjing Night Net.

29 June
Comments Off on RV calls for help on cheats

RV calls for help on cheats

Racing’s rulers have denied suggestions they are losing control following a series of damaging claims about drug use, race fixing and criminal involvement in the industry.

But they accept that racing’s image is taking a hit – unfairly, they insist – as a series of revelations that strike to the core of the sector’s integrity continue to issue from media, insiders and police.

Racing authorities said on Tuesday they wanted to take tougher, swifter action to weed out cheats and any criminal element infiltrating the industry, but their hands were tied unless information uncovered by police in a criminal investigation can be given to racing authorities.

Police are not permitted to pass on such findings – sometimes discovered through phone taps – because a body such as Racing Victoria is a regulatory organisation and not a law enforcement agency, a situation RV chief executive Bernard Saundry described as ”very frustrating”.

Dayle Brown, the head of RV’s integrity operations, said: ”We need the co-operation of the enforcement bodies so we can act, but we have been stymied from getting access to this information.”

Brown said that fostered a public image that racing regulators were ”in a state of paralysis, that we can’t go forward” when authorities had been seeking information sharing for several years.

He explained that for the situation to change there needed to be amendments to the Telecommunications (Interception) Act of 1979 – a policy decision governments needed to take.

”We have not lost control of the image,” Saundry said, but acknowledged it had been tarnished by a series of high-profile headlines. The sport’s $15 million investment on integrity and its improved surveillance procedures were evidence that it was working to stamp out cheats.

RV’s new chairman, Robert Roulston, backed the CEO. ”My view of racing is that 99.9 per cent of this industry is trying to do the right thing and race for prizemoney,” he said. ”I really don’t accept wide-ranging opinions in the media that racing is full of crooks. Our view of racing is that it’s a clean sport, and probably less corrupt than other sports.”

But Saundry said that racing’s integrity services were well ahead of most other sports. There were 14,000 drug tests for the 9000 horses competing in Victoria – an average of 1.5 per competitor and well in excess of other activities.

”I would challenge any other code to have that sort of testing regime,” he said.

‘We continue to invest in people and systems. We can only act on what we have got. But when people break the rules they will be caught.”

Saundry said changing the Telecommunications Act ”has got to be the priority”, adding that Racing Integrity Commissioner Sal Perna had made that a priority in his recommendations.

29 June
Comments Off on Persistence pays off for Saints

Persistence pays off for Saints

St Kilda’s coach Scott Watters says the reward for persisting and winning will be significant for his young group. Photo: Sebastian CostanzoHaving twice played well and fallen short, St Kilda coach Scott Watters says the reward for persisting and winning will be significant for his young group.

”I think you take a lot out of that as a group – that you went through the fire and still got the result, so the boys are pretty happy, and so they should be,” he said after Monday’s win against Carlton at Etihad Stadium.

”It’s reward for the players. Our last two weeks their efforts were very, very good. You go back to Sydney a fortnight ago and last week against Collingwood, so to give the effort and get the reward is a real catalyst for this group.

”For a lot of senior players who have been leading really strongly for us, and younger players, that sort of experience is invaluable.

”I am really proud of them. They were great.”

Watters said youngster Nathan Wright would have scans after a heavy blow to the head which may have broken his jaw, when he clashed with Blues forward Eddie Betts after disposing of the ball.

Watters said it was ”a credit” to Carlton to come back so strongly after being six goals down given it had lost two players to injury before quarter-time.

It was the third successive victory for Watters against the Blues. ”We are having a reasonable run against a side that I really rate and obviously I rate the coach, so to get a result was important for us,” he said.

Watters praised Jack Steven, who had 39 touches, Sam Fisher’s last-quarter composure, Ben McEvoy’s dominant display in the ruck and Nick Dal Santo’s selfless game for the team.

”We challenged [Steven] during the week. In a lot of games this year he has [had] 19-20 possessions in a half and tapered off.

”So that was a focus for him this week to really get the job done. That is the difference between being a B-grade midfielder and elite.”

Nick Riewoldt, with three goals and 13 marks, was the dominant player on the ground.

29 June
Comments Off on Blue sorry for the Waite

Blue sorry for the Waite

St Kilda’s Jack Steven battles Carlton’s Jaryd Cachia at Etihad Stradium on Monday. Photo: Sebastian CostanzoJarrad Waite will return to the Blues’ team this weekend having vowed to remedy his poor disciplinary record, after missing Carlton’s surprise loss to St Kilda due to suspension. But the revolving door continues to turn with small forward Eddie Betts offered a three-match ban for a bump on St Kilda’s Nathan Wright on Monday night.

Blues vice-captain Kade Simpson said Waite could have helped his team’s scoring against the Saints, with only four goals being kicked across the first three quarters before a late comeback reduced the final deficit to nine points.

”He’s an integral part of our team. I think our ball delivery to our forwards (against St Kilda) wasn’t great, but having Jarrad (might have been significant because) everyone knows he’s a great player. He’s obviously going to help every time he’s out there,” Simpson said on Tuesday, as the club held a recovery-based training session at its Visy Park headquarters.

Simpson confirmed he and his fellow leadership group members had approached Waite, who missed the first five matches of the season due to injury, and was then banned for one match after a round six clash with Melbourne’s Tom McDonald.

”We had a chat with Jarrad. He knows he did the wrong thing. When he comes back in this week he’s got a chance to make up for it. I know he’s really wanting to do that,” Simpson said.

”He knows he let the team down. He addressed the group, apologised and said it won’t happen again. We’ve got to take Jarrad at his word. Hopefully this week … he can bounce back and repay the boys.”

Simpson predicted Carlton’s review of Monday’s match at Etihad Stadium would compare its encouraging second half to the first half ”where we went wrong”.

”In the third quarter, we didn’t take our chances and in the last quarter we played some really good footy, but probably left it too late. If you give a team like St Kilda a six-goal break, you’re rarely going to pull them in,” he said.

”Being two guys down pretty early and then to run the game out the way we did was something we’ll take into next week, hopefully continue on that last-quarter form.”

The Blues suffered a double injury blow early in the match, with David Ellard and Chris Yarran sidelined with hamstring injuries. Simpson said the flow-on effect was significant.

”You probably play about another 10 per cent game time, which doesn’t sound like much, but it does take its toll, especially with rotations … being a big part of the game these days.”

With the Blues having to contend with a six-day break before facing Port Adelaide at home on Sunday, Simpson said they were due to have a ”pretty light week anyway”, but agreed other sore players such as Marc Murphy and defender Michael Jamison could be treated more cautiously.

Waite will bolster the Blues’ forward marking capabilities, which were hampered on Monday despite the presence of tall players Shaun Hampson and Matthew Kreuzer. For small forwards, however, they may struggle, with Yarran in doubt and Betts suspended.

Simpson was still optimistic Carlton would boast an effective forward line against Port.

”The reserves didn’t have a game this week, but I know Dylan Buckley has already come in this year and he’s obviously a chance. Jeffy (Garlett) is playing great footy. (Andrew) Carrazzo, Bryce Gibbs, there’s quite a few boys who can come back in, (along with) Jeremy Laidler who’s been playing up forward,” he said.

29 June
Comments Off on Police leaks linked to Fox

Police leaks linked to Fox

ABOVE BOARD: Assistant Commissioner Carlene York, right, leaves the inquiry. Picture: Darren PatemanARCHIVE of Herald reports


SENIOR police were concerned that confidential details about the investigation into alleged cover-ups of sexual abuse within the Catholic Church were being leaked and Detective Chief Inspector Peter Fox was the suspected source of the leaks, the region’s former commander said yesterday.

Assistant Commissioner Carlene York said there was no evidence that Newcastle police did not want to investigate the claims and the investigation that was done was ‘‘thorough’’ and ‘‘extensive’’.

She also said she had never heard the term ‘‘Catholic mafia’’ during her time as Northern Region commander and her decision to assign the investigation to the Newcastle City detectives office was based on a number of factors including the locality of the alleged offences and the resources of that office.

The Special Commission of Inquiry being held in Newcastle is examining claims by Mr Fox that he was ordered to stop investigating claims of concealment of sexual abuse within the Church.

The inquiry was also examining allegations that Church officials hindered such investigations.

The inquiry heard that the electronic files of the strike force charged with investigating the claims were marked ‘‘highly protected’’, which restricted access to those files.

Assistant Commissioner York said there were concerns that confidential information was being leaked to the Newcastle Herald and she was later told by another officer the suspected source of the leaks was Mr Fox.

She said such leaks could hinder an investigation because it could tip off suspects.

Assistant Commissioner York said it was her decision to assign the investigation to Newcastle City detectives after she received a report from Mr Fox in 2010 containing a number of allegations.

She said she never considered Mr Fox to be on the strike force because he was crime manager at Port Stephens, one of the smallest commands in the region, and there were insufficient resources to cover him.

She said every command in the region was under-resourced, but Port Stephens in particular was too small for such an inquiry.

When referred to a comment by another officer that an element of the investigation was being ‘‘abysmally managed’’ she said she didn’t agree.

She admitted that the strike force encountered difficulties when a number of investigators went on sick leave, but an ‘‘excellent’’ brief of evidence was prepared and sent to the Director of Public Prosecutions.

The hearing before Commissioner Margaret Cunneen continues.

29 June
Comments Off on Legal Aid to stop environmental challenges

Legal Aid to stop environmental challenges

LEGAL Aid NSW will stop paying for public legal challenges on environmental matters as part of its efforts to cut costs from July.

Hunter environmental and community groups say without legal aid some of the most significant legal challenges mounted in the region would not have been possible.

These included challenges against Centennial Coal’s Anvil Hill (now Mangoola) mine, near Wybong, the Hunter Environment Lobby against the expansion of the Ulan mine, the Sweetwater Action Group against Huntlee, the Ironstone Community Act Group against what is now Yancoal in the Gloucester area and Barrington-Gloucester Stroud Preservation Alliance against AGL’s Gloucester gas project.

Legal aid, which is means-tested and subject to a merit test, has been available for public interest matters that raise ‘‘substantial’’ public concern about the environment.

In addition to financial support, litigants who have obtained legal aid have been covered by an indemnity against costs that protected them from claims from the corporations they challenged.

A spokesman for Lock the Gate Hunter, Steve Phillips, said the loss of the indemnity was probably more significant than the financial support.

‘‘Only cases that are 100per cent sure of a win will go ahead and that is rare,’’ Mr Phillips said.

Hunter Communities Network spokeswoman Bev Smiles said community challenges were on important issues, such as the health impacts of projects, and against multinational corporations for whom money was no object.

Barrington-Gloucester Stroud Preservation Alliance spokesman Graeme Healy said the cuts would stop all legal challenges from community groups.

Environmental Defender’s Office executive director Jeff Smith said it was unlikely challenges similar to those made in the Hunter in recent years could proceed once the cuts were made.

Legal Aid NSW and Attorney-General Greg Smith’s office did not respond to the Newcastle Herald’s request for comment yesterday.

28 May
Comments Off on Building momentum: reno shows go toe-to-toe

Building momentum: reno shows go toe-to-toe

The teams in House Rules. The teams in The Block Sky High. Photo: Channel Nine

House Rules vs The Block Sky High. Australian TV may not have seen such a highly-anticipated clash of titans since Yasmin’s Getting Married went head-to-head with old episodes of Frasier. As these two shows butt heads like two angry renovating elk, who will emerge victorious from the battle of the power drill? Will Scott Cam’s blokiness triumph over Johanna Grigg’s not-quite-as-blokiness? Only time will tell, but a quick comparison of the first impressions the two shows have made is instructive.

The first point of comparison is the concept. Both shows have tried to bring something fresh and original to their format. The Block Sky High did this by being exactly like the other series of The Block, except in a tall building. House Rules pushes the boundaries even further by putting “Rules” in the show’s title to remind people of how much they enjoyed My Kitchen Rules – they lay this on pretty thick when it’s revealed that the show’s headquarters seems to be the same set as MKR. House Rules’ format also involves the teams renovating each other’s houses rather than their own, a concept reminiscent of the late lamented Changing Rooms, without the benefit of Suzie Wilks in shorts. So when it comes to originality, HR’s method of blending ideas from a couple of other shows seems to take the points over The Block’s method of blending one idea from itself and then making it taller.

It’s also notable that while The Block will be relying for dramatic tension on the numerous nervous breakdowns that its contestants will suffer under the pressure of having to renovate apartments on tight schedules, House Rules goes full throttle by forcing people to allow strangers to renovate their homes, creating the delicious potential for these contestants to literally ruin each others’ lives. The first episode also revealed a major trump card: the ritual of the contestants walking around each others’ houses and laughing at how awful they are. It’s lots of fun to see the owners drive blissfully away, allowing the other five teams to come in and mock the horribleness of their home. When it comes to schadenfreude, House Rules has you covered five ways at once.

However, The Block really does excel at those crying-to-camera moments. It’s uncertain that people working on someone else’s pride and joy can generate the sheer, raw despair that strikes Blockers in the middle of the night when the paint is flaking and your husband has fallen asleep under the toilet.

When it comes to basic annoyingness of contestants, it’s a tough one to call. Both have their fair share of people who seem determined to laugh at nothing far too often, but House Rules seems to win on the sob story/emotional piano riff score. It also features a woman who claims that being a drama teacher means she “understands creativity” and who is married to a man called “Plinio”, so The Block will really need to step up to be more irritating than that. Both shows also feature the endlessly aggravating “state versus state” concept, which reality shows for some reason are bent on trying to make into a thing, defying the mountains of evidence which suggest that there is nobody on earth who feels patriotic pride at someone from the same state building an attractive bathroom.

When it comes to variety, The Block has the advantage of being able to keep mixing things up by cutting between different teams knocking down different walls with different sledgehammers, whereas each episode of House Rules will feature just the one house, although the emotional frisson that comes from knowing they could be wrecking someone’s dreams with every wall they knock down might make up for it. House Rules also scores over The Block with the fact that in each house there are ten people who can all fight with each other, whereas The Block relies on one-on-one fights between sleep-deprived couples.

Of course in many areas the two shows have more similarities than differences. They both, for example, show incredible faith in the entertainment value of watching people going shopping. Both shows are utterly committed to tearing loving families apart. Both shows are, essentially, of interest mainly to car-crash rubberneckers – what we want is bad decisions, and lots of them. And both shows have far too much footage of people on mobile phones talking to tradesmen.

Halfway through the first ep, House Rules pulled a joker out of the hat, bringing in a guest interior designer and a guest builder to provide professional advice to the amateurs. The interior designer does a sterling job, stepping into the house and immediately opening up massive fault lines in Carly and Leighton’s marriage. If she’s a really expert interior designer those two will be divorced by series’ end. The introduction of professional advisers is another echo of Changing Rooms, but though it increases the chances of something halfway decent being made out of the houses, it also increases the impression that these people are sort of cheating. Shouldn’t they have to do it all themselves? I think it’s a bit generous to even let them use tools.

The final ingredient is the host, and licensed knockabout larrikin Scott Cam brings a very different style to that of well-known world’s tallest woman Johanna Griggs. Cam is a hands-on host, always ready to pop up unexpectedly to interfere or make awkward family moments more awkward. Griggs is less focused on interacting with the contestants, and more focused on avoiding them: once they begin their jobs, she’s nowhere to be seen; she clearly would prefer not to associate with this class of people. I doubt anybody blames her.

Overall, The Block Sky High is aiming for the over-enthusiastic-people-about-to-have-their-illusions-crushed vibe, while House Rules is going more for the desperate-people-yelling-at-each-other feel. While House Rules is not as committed to introducing us to obnoxious Australians as its kitchen namesake, it is certainly heavily into trauma and conflict: one has to assume the discovery of inadequate foundations in the opening episode was a metaphor for the teams’ relationships. The Block seems more likely to bond couples more closely together through the torture it subjects them to.

In the end, I would award a narrow points victory to House Rules, due to its slightly fresher concept and greater capacity for more varied drama and all-in brawls: the breadth of its canvas is a little greater. However, whether viewers will latch onto it in preference to The Block’s more familiar and comfortable approach is a whole different matter.

28 May
Comments Off on Wayne Swan puts surplus on hold

Wayne Swan puts surplus on hold

Treasurer Wayne Swan poses for the media with the 2013 budget at Parliament House. Photo: Andrew MearesMiddle income families, parents to be, and even smokers will lose out in Wayne Swan’s sixth budget designed to repair the debt-ridden bottom line and convince voters of Labor’s economic management credentials.

Declaring the budget to be about “consistency”, Mr Swan has eschewed the traditional pre-election spendathon, opting to challenge the opposition to “choose between making motherhood statements about ending the age of entitlement, or putting their words into action” by backing savings initiatives.

Faced with an expected $60 billion shortfall in revenue over four years to 2015/16, the budget confirms billions in new spending on popular disability insurance and education reforms and  sets out $24 billion in infrastructure projects – although not all of that represents new spending.

But it carries the political risk that its tiny projected surplus in year three will not be believed by voters, and that its savings will be seen as harsh on business and on middle-income households.

Families in the middle income bracket stand to lose some family entitlements as well as promised carbon tax compensation, while incurring new costs for higher education when scholarship grants are converted to loans.

Smokers too are to be slugged by higher costs per packet when the federal excise and customs duty is pegged to average weekly ordinary time earnings rather than inflation.

Some older Australians will  benefit from the rapid fiscal consolidation via a new trial program to encourage them to bank the proceeds of downsizing to smaller homes without affecting their aged pension availability.

Outlining a plan to deliver a tiny surplus of less than $1 billion in the third year of the budget cycle, after a larger than expected deficit nearing $20 billion for 2012/13, the Treasurer has revealed the $5000 baby bonus will be scrapped from March 1, 2014, to be replaced by a lower $2000 supplement payable only to recipients of Family Tax Benefit (A).

The Family Tax Benefit upper income cut-offs – which have been traditionally indexed to take account of inflation – have also been frozen until July 1, 2017, meaning fewer families will remain eligible as their incomes grow.

The two measures will save $2.3 billion over four years as part of a claimed aggregate saving total over five years of $43 billion.

In a surprise to markets and economic commentators, even after being softened up with pre-budget warnings of a current $17 billion revenue write-down, Mr Swan has revealed a fiscal shortfall for 2012/13 of $19.4 billion  in place of what was forecast to be a budget surplus of $1.1 billion.

Business, which has made no secret of its antipathy for Labor in recent months, stands to pay more  under a suite of changes headlined “protecting the corporate tax base”.

These include tightening the rules on profit shifting, where multinational companies load up their local arms with debt while shifting profits offshore, usually to low tax jurisdictions. Other changes include removal of immediate deductibility for expenditure on exploration. The measures will secure nearly $4.2 billion for the budget over four years.

Delivering what might well be his last budget, Mr Swan said next year’s balance sheet would show a similar deficit of $18 billion, shrinking to $11 billion in 2014/15, and tipping into the black by just $0.8billion in 2015/16.

The wafer thin surplus is as much a political gesture for Mr Swan, who has been on the back foot since abandoning his iron-clad commitment to a surplus come-what-may in 2012/13, just before Christmas.

“Because of our deep commitment to jobs and growth, we have taken the responsible course to delay the return to surplus, and due to a savage hit to tax receipts, there will be a deficit of $18 billion in 2013/14,” he told Parliament.

“To those who would take us down the European road of savage austerity, I say the social destruction that comes from cutting too much, too hard, too fast, is not the Australian way. Instead we’re making targeted, sustainable savings of $43 billion over the forward estimates.”

The budget forecasts slower economic growth of 2.75 per cent in 2013/14 before recovering to 3 per cent trend growth thereafter.

28 May
Comments Off on Reopening old wounds comes at a price

Reopening old wounds comes at a price

$8.3 billion has been set aside for unapproved projects, including a squadron of Joint Strike Fighter aircraft.The Australian Defence Force’s compensation bill for victims of sexual and other abuse in the military will reach $84 million – more than double the $40 million the government originally forecast.

With many more victims coming forward to the government’s military abuse taskforce than the 1000 initially expected, Defence will be forced to dig deeper to pay each victim up to $50,000 for their pain, the budget papers reveal.

Overall, Defence has bucked this year’s trend towards parsimony and won a small but significant boost in spending, with money for big new hardware such as ships and fighter jets in the second half of the decade.

After deep cuts in recent years, defence spending will rise to $113.1 billion over the next four years, up from the $103.2 billion earmarked in last year’s budget.

The new funding includes $200 million for 12 radar-jamming Growler Super Hornet fighter aircraft, which will cost nearly $3 billion in total, with the costs mostly arising later in the decade.

The government has also given Defence a “funding guidance” figure of $220 billion for the six years from 2017-18 to 2022-23.

Mark Thomson, a defence budget expert from the Australian Strategic Policy Institute, welcomed the budget figures, saying Defence appeared to have been the beneficiary of Wayne Swan’s decision to ditch the surplus pledge, which had freed up the government to restore some of the money lost.

“It’s much better than people expected,” he said.

“In the current environment, when everyone’s talking about a structural deficit stretching from here to eternity, this is a great outcome for Defence.”

The government and Coalition both aspire to set defence spending at 2 per cent of GDP. On Tuesday’s budget figures, spending would hover around 1.6 to 1.7 per cent of GDP for the six years from 2016-17, Mr Thomson said.

The government has earmarked $8.3 billion for unapproved projects, which would include early payments on a squadron of cutting-edge Joint Strike Fighter aircraft – which are as yet not locked in but which are expected to go into operation from 2020. It will also include $214 million in early payments for submarines to replace the six Collins class subs.

The government will spend at least $192 million bringing 1000 troops and equipment back from Afghanistan as it winds down the war in the country.

But the end of the war will deliver huge savings. Defence spent $5.2 billion up until the middle of last year and will spend nearly $1.2 billion this financial year in Afghanistan. That will drop to $217 million by 2014-15 and just $87 million by 2016-17.

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28 May
Comments Off on Predicated on politics, rather than economics

Predicated on politics, rather than economics

If politician Benjamin Disraeli was alive today and reading the 2013 federal budget, he might well have revised the third part of his saying from: “There are three kinds of lies: lies, damned lies, and statistics” to damned budgets – particularly government budgets posted weeks before an election.

The brutal reality is Treasurer Wayne Swan’s “stronger economy, smarter nation, fairer society” 2013 budget is predicated on politics rather than economics and that means the numbers have been bent to fit the spin.

This is clearly demonstrated by its $24 billion infrastructure spending pledge, which Swan pitches as a key to boosting productivity, building capacity, relieving congestion (which will cost the economy $20 billion by 2020 if not addressed) and improving the quality of life.

Swan says: “That’s why we have committed more to urban public transport infrastructure than all our predecessors since Federation combined”. What he doesn’t say is the headline $24 billion emanates from the nation-building program, which has become available since the last one expired this year, and it is a massive 33 per cent lower than the last one.

In addition, the key projects have strings attached. For instance, a promise to allocate $1.8 billion to Sydney’s $8 billion M4 and M5 road extensions project on the condition there are no tolls. This means the project has $8 billion in unfunded conditions that sit on it, which makes the economics of the project tricky, given that the private sector’s interest would rest on its earning revenue through tolls.

Given the state of the NSW budget, this is a big ask, but politically it looks better than the Coalition’s offer of $1.5 billion to build the extensions, with tolls attached.

In Victoria it has allocated $3 billion to build the $8 billion Melbourne metro project, which consists of a nine-kilometre underground railway from west of South Kensington to east of South Yarra. The condition is that Victoria has to match its $3 billion equally, which is in doubt given it is keen to keep its credit rating.

New infrastructure spending in 2013-14 adds up to $559 million, dropping to $467 million in 2014-15.

If this year’s budget was designed to restore some of the government’s diminished credibility, it failed. If it was designed to wedge the Coalition, it fared somewhat better.

Either way, like all Swan’s previous budgets, this one was always going to be taken with a pinch of salt, given the number of times budget estimates and forecasts have changed due to changes in revenue sensitivities.

On Tuesday night the government delivered an $18 billion deficit for 2013-14 as tax receipts fell $17 billion.

Over the four years it forecasts a $60 billion revenue shortfall. According to the papers, company tax was the single biggest contributor to the writedowns. Lower than expected capital gains and mining taxes compounded the fall in company tax receipts.

But if the dollar remains high, the revenue shortfall could rise to more than $150 billion over that period.

If the polls are anything to go by, the chances of this budget or most of its individual announcements being implemented are low.

The government also hasn’t learnt from previous mistakes in terms of using overly optimistic forecasts to help tart up its revenue estimates. For instance, an original forecast carbon price of $29 a tonne came unstuck in this budget and has been revised down to $12 a tonne, cutting $2.5 billion from its revenue. But at $12 a tonne it could be argued it is still too high, given that it recently traded at a third of that price. It is a similar story for its mining tax, which has been revised down from an original revenue estimate of $2 billion in 2013, to $800 million, to the latest revision of $200 million.

In a bid to fill the revenue shortfall caused largely by dwindling tax collections, the government has gone softly in an election year and targeted multinational companies to raise more than $4 billion in extra taxes over the forward estimates period. It intends to do this by changing the “thin capitalisation” rules, clamping down on transfer pricing, closing a loophole to stamp out dividend washing, addressing non-resident CGT arrangements, concessions for mining exploration expenditure and the offshore banking unit regime.

But its actions won’t be enough and it is a matter of time before more significant policies are introduced to tackle the problem. The quickest way to do this is to tackle personal taxes, change capital gains tax or target company taxes. But in an election year, both sides of politics will steer clear of anything meaningful and will instead tinker around the edges.

The most useful thing about this document is the size of the revenue slippage over the forward estimates. It is these figures that will give the investment community an idea of where interest rates and the dollar are heading along with the severity of future policies for raising revenue and reducing costs.

28 May
Comments Off on Medical rebate cut while smokes will go upfaster

Medical rebate cut while smokes will go upfaster

Expect a rise in the Medicare levy. Photo: Rodger CumminsFederal budget at a glanceTreasurer Wayne Swan’s budget speech

Smokers will pay more for cigarettes, a tax offset for medical expenses will be phased out and taxpayers will face a rise in the Medicare levy after changes announced on Tuesday.

In his budget speech, Treasurer Wayne Swan revealed that tobacco taxes will rise with average wages rather than inflation from March next year. This means the increase in tobacco excise will keep pace with income growth rather than the consumer price index, which tends to grow more slowly.

Based on the average difference between wages and inflation,  this change will mean a typical packet of 25 cigarettes will be 7¢ dearer in the first half of 2014. Recently inflation has been around 2.5 per cent but wages have been growing at around 3.5 or 4 per cent. Tobacco excise will  be adjusted in March and September each year.

Mr Swan said the changes would make tobacco indexation ”more consistent with consumers’ purchasing power”.Thousands of households will be affected by the phase-out of the net medical expenses tax offset

This offset, which was claimed by more than 800,000 patients for out of pocket expenses in 2010-11, will be phased out over the next two years, although claims for aged care, disability aids and attendant care will be allowed through until June 30, 2019, as reforms to aged care are implemented and DisabilityCare Australia is rolled out across the country.

This will save the federal budget nearly $1 billion over four years.

Many people with little or no taxable income were unable to  benefit from the scheme – Mr Swan said the medical expenses tax offset was ”poorly targeted” and that phasing it out would improve the ”sustainability of the health budget.”

The government will also realign the indexation of Medicare benefits schedule fees to the financial year in line with many other government programs.

MBS fees, which are  indexed on November 1 each year, will be indexed on July 1 each year.

The next indexation date will be July 1, 2014 – this  measure will result in savings of $664.4 million over four years.

Mr Swan confirmed the government will increase the Medicare levy by half a percentage point from 1.5 to 2 per cent of taxable income to pay for the overhaul of disability services.

The money raised will be set aside  in a special fund for 10 years  and used only for DisabilityCare Australia.

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