Archive for May, 2019

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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