Mediaportal Report. Newspaper Headlines... TUE 04 DECEMBER 2018

Transcription

1 TUE 04 DECEMBER 2018 Mediaportal Report Newspaper Headlines... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 7:20 AM Duration: 2 mins 7 secs ASR AUD 24,581 National Australia Industry Super Australia - Radio & TV ID: X Newspaper Headlines The Daily Telegraph - The Liberal Party has introduced changes to stop the knifing of sitting prime ministers. The West Australian - Scott Morrison is seeking to pacify voters with an overhaul of party rules that would make it harder to oust Liberal leaders. The Guardian - Sitting Liberal prime ministers can only be removed by a two-thirds party room majority in the future. ABC News - Scott Morrison and Liberal MPs held an unscheduled meeting last night to pass changes that would make it harder to change leaders. The Australian - Changes to protect the Liberal leadership is seen as a move by Scott Morrison to preserve his position from potential rivals like Julie Bishop. The Sydney Morning Herald - Sydney's property downturn is set to overtake the recession of the early 1990s. The Financial Review - The temporary ceasefire between the US and China has seen a surge in Australian shares. The Herald Sun - Police recruited a former gangland lawyer as an informer. The Age - A Royal Commission will be held into a big legal scandal in Vic's history. The Courier Mail - A six-hour standoff occurred in Brisbane yesterday. The Advertiser - The paper reports on the preferred location of Adelaide's new women and children's hospital. NT News - Nearly 100 shop fronts in Darwin are empty. The Canberra Times - The Chief Minister says Canberra must contain its urban sprawl or risk losing its status as the bush capital. The Mercury - A push to install pipes on Mt Wellington might cause problems with a proposed cable car. 201,000 All, 103,000 MALE 16+, 96,000 FEMALE 16+ Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

2 News Headlines... Sky News Live, Sydney, First Edition, Kieran Gilbert and Laura Jayes 7:00 AM Duration: 1 min 6 secs ASR AUD 348 National Australia Industry Super Australia - Radio & TV ID: X News Headlines - The Liberal Party has adopted reforms to leadership rules to end Canberra's coup culture. - Sky News understands a deal on encryption laws could be finalised by today. - Vic Premier [Daniel Andrews] has launched a Royal Commission into alleged police misconduct in the gangland war. - Two Brisbane men have been charged over a five hour standoff with police. - Three astronauts have arrived at the International Space Station after the successful launch of Russia's Soyuz rocket. - Sports. - Weather. 12,000 All, 7,000 MALE 16+, 6,000 FEMALE 16+ Also broadcast from the following 9 stations Sky News Live (Melbourne), Sky News Live (Canberra), Sky News Live (Brisbane), Sky News Live (Adelaide), Sky News Live (Perth), Sky News Live (Regional NSW), Sky News Live (Regional Queensland), Sky News Live (Regional Victoria), Sky News Live (Tasmania) News Headlines... Sky News Live, Sydney, First Edition - Early, Laura Jayes and Kieran Gilbert 6:16 AM Duration: 0 min 45 secs ASR AUD 100 National Australia Industry Super Australia - Radio & TV ID: X News Headlines - The Coalition has adopted changes to its leadership rules to make it harder to oust elected PMs. Two-thirds of the party room would be required to agree before a leader could be sacked. - Vic Premier Daniel Andrews has launched a Royal Commission into alleged police misconduct during the gangland war. - Climate change summit. 5,000 All, 4,000 MALE 16+, N/A FEMALE 16+ Also broadcast from the following 9 stations Sky News Live (Melbourne), Sky News Live (Canberra), Sky News Live (Brisbane), Sky News Live (Adelaide), Sky News Live (Perth), Sky News Live (Regional NSW), Sky News Live (Regional Queensland), Sky News Live (Regional Victoria), Sky News Live (Tasmania) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

3 Newspaper Headlines... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 6:15 AM Duration: 2 mins 9 secs ASR AUD 11,223 National Australia Industry Super Australia - Radio & TV ID: X Newspaper Headlines The Daily Telegraph - The Liberal Party has introduced changes to stop the knifing of sitting prime ministers. The West Australian - Scott Morrison is seeking to pacify voters with an overhaul of party rules that would make it harder to oust Liberal leaders. The Guardian - Sitting Liberal prime ministers can only be removed by a two-thirds party room majority in the future. ABC News - Scott Morrison and Liberal MPs held an unscheduled meeting last night to pass changes that would make it harder to change leaders. The Australian - Changes to protect the Liberal leadership is seen as a move by Scott Morrison to preserve his position from potential rivals like Julie Bishop. The Sydney Morning Herald - Sydney's property downturn is set to overtake the recession of the early 1990s. The Financial Review - The temporary ceasefire between the US and China has seen a surge in Australian shares. The Herald Sun - Police recruited a former gangland lawyer as an informer. The Age - A Royal Commission will be held into a big legal scandal in Vic's history. The Courier Mail - A six-hour standoff occurred in Brisbane yesterday. The Advertiser - The paper reports on the preferred location of Adelaide's new women and children's hospital. NT News - Nearly 100 shop fronts in Darwin are empty. The Canberra Times - The Chief Minister says Canberra must contain its urban sprawl or risk losing its status as the bush capital. The Mercury - A push to install pipes on Mt Wellington might cause problems with a proposed cable car. 80,000 All, 46,000 MALE 16+, 33,000 FEMALE 16+ Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) Vic Premier Daniel Andrews has launched a Royal Commission into the alleged... Sky News Live, Sydney, First Edition - Early, Laura Jayes and Kieran Gilbert 6:05 AM Duration: 2 mins 31 secs ASR AUD 330 National Australia Industry Super Australia - Radio & TV ID: X Vic Premier Daniel Andrews has launched a Royal Commission into the alleged misconduct of Vic Police during the gangland wars after the High Court labelled some practices atrocious and reprehensible. A Commissioner is yet to be named but the inquiry will cost $7.5m. It will release its interim and final report in July and December ,000 All, 4,000 MALE 16+, N/A FEMALE 16+ Interviewees Daniel Andrews, Victorian Premier Graham Ashton, Chief Commissioner, Victoria Police Also broadcast from the following 9 stations Sky News Live (Melbourne), Sky News Live (Canberra), Sky News Live (Brisbane), Sky News Live (Adelaide), Sky News Live (Perth), Sky News Live (Regional NSW), Sky News Live (Regional Queensland), Sky News Live (Regional Victoria), Sky News Live (Tasmania) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

4 Program Preview... Sky News Live, Sydney, First Edition - Early, Laura Jayes and Kieran Gilbert 6:00 AM Duration: 0 min 46 secs ASR AUD 100 National Australia Industry Super Australia - Radio & TV ID: X Program Preview - Leadership rules. - Encryption laws. - The Vic Premier announces a Royal Commission after allegations of police misconduct during the gangland war. - Two men have been charged with 38 offences after a five-hour standoff with police in Brisbane. - Astronauts arrive at the International Space Station after Russia successfully launches its Soyuz rocket. - Wayne Bennett has arrived in Sydney and will front the camera's live this morning from South Sydney. - Luke Brooks re-signs with the West Tigers. 5,000 All, 4,000 MALE 16+, N/A FEMALE 16+ Also broadcast from the following 9 stations Sky News Live (Melbourne), Sky News Live (Canberra), Sky News Live (Brisbane), Sky News Live (Adelaide), Sky News Live (Perth), Sky News Live (Regional NSW), Sky News Live (Regional Queensland), Sky News Live (Regional Victoria), Sky News Live (Tasmania) How Afterpay and Zip dodged an ASIC bullet Australian Financial Review, Australia, Technology, James Eyers Page words ASR AUD 5,340 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 601 word(s), ~2 mins 44,635 CIRCULATION Cry of double standards on preselection call The Australian, Australia, General News, Greg Brown Page words ASR AUD 4,116 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 402 word(s), ~1 min 94,448 CIRCULATION Heine's Netwealth maps out windfalls as an investor, too The Australian, Australia, Business News, John Stensholt Page words ASR AUD 18,549 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 742 word(s), ~2 mins 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

5 Sick of work? How to get your hands on super The Australian, Australia, Business News, Monica Rule Page words ASR AUD 7,101 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 777 word(s), ~3 mins 94,448 CIRCULATION HENRY'S BRAVE NEW BOARD HAS LITTLE TO RECOMMEND IT The Australian, Australia, General News, Judith Sloan Page words ASR AUD 10,882 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 1124 word(s), ~4 mins 94,448 CIRCULATION Labor still wants super reform, despite delay The Australian, Australia, General News, Anthony Klan Page words ASR AUD 3,293 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 297 word(s), ~1 min 94,448 CIRCULATION Look to the past to beat corporate greed Australian Financial Review, Australia, Letters Page words ASR AUD 1,477 Photo: No Type: Letter Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 210 word(s), <1 min 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

6 Profit to be made from confusing customers Australian Financial Review, Australia, Letters Page words ASR AUD 1,719 Photo: No Type: Letter Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 218 word(s), <1 min 44,635 CIRCULATION HAYNE'S HARD WORK BEGINS The Australian, Australia, Business News, Alan Kohler Page words ASR AUD 9,622 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 931 word(s), ~3 mins 94,448 CIRCULATION It's full steam ahead for the financial revolution The Australian, Australia, Business News, Robert Gottliebsen Page words ASR AUD 9,828 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 1014 word(s), ~4 mins 94,448 CIRCULATION Loan returns halve The Australian, Australia, Business News, John Durie Page words ASR AUD 1,904 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 208 word(s), <1 min 94,448 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

7 Bank pay lash to hit pair Australian Financial Review, Australia, Companies and Markets, Patrick Durkin Page words ASR AUD 8,374 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 747 word(s), ~2 mins 44,635 CIRCULATION ASX surges to best day in two years Australian Financial Review, Australia, Companies and Markets, Sarah Turner Page words ASR AUD 16,687 Photo: Yes Type: Share Market Report Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 795 word(s), ~3 mins 44,635 CIRCULATION AMP counts cost of paying big bucks for outside advice that ultimately fixed nothing The Australian, Australia, Business News, Joyce Moullakis Page words ASR AUD 5,248 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 449 word(s), ~1 min 94,448 CIRCULATION Banking empathy Adelaide Advertiser, Adelaide, Letters Page words ASR AUD 818 Photo: No Type: Letter Size: cm² SA Australia Industry Super Australia - Press ID: View original - Full text: 108 word(s), <1 min 112,097 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

8 Old playbook out for GrainCorp bid Daily Telegraph, Sydney, Business News, Terry McCrann Page words ASR AUD 9,498 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: View original - Full text: 346 word(s), ~1 min 232,067 CIRCULATION The 2018 play born in the 1980s Herald Sun, Melbourne, Business News Page words ASR AUD 21,711 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 810 word(s), ~3 mins 303,140 CIRCULATION New chief aims to win trust Geelong Advertiser, Geelong VIC, General News Page words ASR AUD 303 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 175 word(s), <1 min 16,687 CIRCULATION 'Magic number' you'll need to retire in comfort Gympie Times, Gympie QLD, General News, Anthony Keane Page words ASR AUD 293 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 432 word(s), ~1 min 2,997 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

9 Faster rail services on the agenda Sydney Morning Herald, Sydney, General News, Matt O'Sullivan Page words ASR AUD 16,080 Photo: No Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: View original - Full text: 479 word(s), ~1 min 88,634 CIRCULATION Bank misread ASIC boss's grievance The Australian, Australia, Business News, Four Pillars Richard Gluyas Page words ASR AUD 14,613 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 896 word(s), ~3 mins 94,448 CIRCULATION NAB gets jump on rivals in loan fight The Australian, Australia, Business News, Joyce Moullakis Page words ASR AUD 7,409 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 545 word(s), ~2 mins 94,448 CIRCULATION Big super funds shun agricultural assets Australian Financial Review, Australia, Companies and Markets Page words ASR AUD 7,362 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 315 word(s), ~1 min 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

10 From car dealer to $100m hedge fund genius Australian Financial Review, Australia, General News, Story Jonathan Shapiro Page words ASR AUD 40,372 Photo: Yes Type: News Item Size: 1, cm² National Australia Industry Super Australia - Press ID: View original - Full text: 4121 word(s), ~16 mins 44,635 CIRCULATION Super fund startup to focus on women Age, Melbourne, Business News, Emma Koehn Page words ASR AUD 13,315 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 439 word(s), ~1 min 83,229 CIRCULATION AMP boss aims to win trust Border Mail, Albury-Wodonga, General News Page words ASR AUD 691 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 241 word(s), <1 min 13,519 CIRCULATION The wrong path on retirement incomes Canberra Times, Canberra, Public Sector Informant, Andrew Podger Page words ASR AUD 23,744 Photo: Yes Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: View original - Full text: 2107 word(s), ~8 mins 17,579 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

11 Taxing issue West Australian, Perth, Letters Page words ASR AUD 281 Photo: No Type: Letter Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 142 word(s), <1 min 147,676 CIRCULATION Financial industry watchdogs are letting taxpayers down Gold Coast Bulletin, Gold Coast QLD, Letters Page words ASR AUD 1,342 Photo: No Type: Letter Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 279 word(s), ~1 min 21,468 CIRCULATION GRAINCORP BID: 2018 PLAY THAT WAS BORN IN THE 1980S Gold Coast Bulletin, Gold Coast QLD, General News, Terry McCrann Page words ASR AUD 2,714 Photo: No Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 812 word(s), ~3 mins 21,468 CIRCULATION AMP boss aims to win trust Launceston Examiner, Launceston TAS, General News Page words ASR AUD 1,099 Photo: No Type: News Item Size: cm² TAS Australia Industry Super Australia - Press ID: View original - Full text: 262 word(s), ~1 min 17,631 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

12 AMP boss aims to win trust Warrnambool Standard, Warrnambool VIC, General News Page words ASR AUD 558 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 241 word(s), <1 min 8,274 CIRCULATION COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

13 Australian Financial Review, Australia Author: James Eyers Section: Technology Article type : News Item Classification : National : 44,635 Page: 22 Printed Size: cm² Region: National Market: Australia ASR: AUD 5,340 Words: 601 Item ID: Page 1 of 1 How Afterpay and Zip dodged an ASIC bullet Fintech focus James Eyers The spectre of regulatory intervention in the fastest-growing area of fintech buy now, pay later payments has created plenty of volatility this year for the likes of Afterpay and Zip. Investors have taken a dim view of the turmoil: Afterpay narrowly missed a strike on its remuneration report at last week s annual meeting. But that wasn t the only bullet it dodged. A highly anticipated report from the Australian Securities and Investments Commission said the National Credit Code would not be extended to the sector (Afterpay, Zip, Openpay, Oxipay, Brighte and Certegy Ezi-Pay). This triggered a relief rally: Afterpay shares rose 27 per cent last week; Zip s were up 12.5 per cent. But ASIC s verdict that responsible lending laws do not need to be extended to the sector doesn t mean providers have avoided the need to better understand their customers. ASIC also said it wants to use a new product intervention power (if extended by Parliament) to influence the point-of-sale products should they start to create problems for vulnerable customers. And as economic stress grows, the pool of vulnerable customers is set to increase. There were 1.9 million buy now, pay later transactions in June this year, up from 50,000 a month two years ago. Over the past year, the number of active users for these six companies has doubled to 2 million. Outstanding debt has doubled in two years to $903 million. Retailers are encouraging the growth so they can sell more goods. ASIC s report contains three key warnings that are also relevant to the fintech sector more broadly. These will be in focus as a Labor-initiated Senate inquiry examines sector practices. Thefirstis thatcontractsmust comply with the government s unfair contracts terms laws. Second, merchantscannotinflate thecostofthe products if buy now, pay later is chosen as the payment method. The third and mostsignificant risk isthegrowinguse ofmultiplebuy now, paylateraccounts by vulnerable customers. ASIC said its research showed 30 per cent of buy now, pay later users have used more than one provider. Two case studies in the report pointed to Afterpay borrowers running up big debts when they were bogged down with other buy now, pay later loans, payday loans or other consumer loans. After the royal commission, banks are on notice to conduct more thorough checking of borrower income and expenses before lending. In the buy now, pay later sector, the checking varies significantly. ASIC said Afterpay only examines previous repayment history with Afterpay itself. Open banking could let Afterpay improve. For example, it could require that new customers authorise it to tap into their transaction accounts to work out if they have other buy now, pay later accounts and debts. ASIC s report recognises the potential for these fintechs to encourage responsible spending at least when compared to credit cards, the competing product. Credit cards contemplate multiple advancements of credit. Customers are encouraged to build up big limits, on which big interest rates are charged, in addition to fees. ASIC criticised credit cards in a recent separate report. In contrast, Afterpay told the ASX last week it does not allow a consumer to make another purchase if a single payment is late. ASIC s report last week also provided an insight into Millennial spending psychology. Many users of buy now, pay later services, who are typically younger and on lower incomes, are using them to smooth repayments on big items so they can meet regular commitments like rent. ASIC says the National Credit Code will not be extended to the fintech sector.

14 The Australian, Australia Author: Greg Brown Section: General News Article type : News Item Classification : National : 94,448 Page: 5 Printed Size: cm² Region: National Market: Australia ASR: AUD 4,116 Words: 402 Item ID: Page 1 of 1 Cry of double standards on preselection call GREG BROWN Liberal MPs are bewildered Malcolm Turnbull has come out against cancelling preselections for sitting MPs in his home state of NSW, given the former prime minister voiced no opposition to the same process in Victoria. Several Victorian powerbrokers say Mr Turnbull voiced no opposition to the automatic preselection of sitting MPs in the state, which was waved through by the Victorian Liberal Party s administrative committee in the final weeks of his prime ministership. One Victorian Liberal yesterday said Mr Turnbull merely questioned whether the same process would be applied to Victorian senators, which it was. The cancellation of preselections in Victoria, ed by outgoing president Michael Kroger, came amid concerns several MPs would face a challenge, including Kelly O Dwyer, Kevin Andrews, Russell Broadbent, Julia Banks and Tim Wilson. Conservative figures wanted to use the process to save Mr Andrews, while more moderate MPs wanted Ms O Dwyer protected from a futile but potentially damaging push to unseat her led by Jack Hammond QC, who was angry at her role in the Turnbull government s superannuation reforms. A Victorian Liberal MP said: Strangely, Malcolm had no problem with the Victorian administration committee re-endorsing all incumbents when he was PM. A federal NSW MP said Mr Turnbull had no consistency in his opposition to cancelling preselections for sitting members. It is ironic he is attacking something Scott (Morrison) is doing that he endorsed himself only a few months ago, the MP said. Mr Turnbull pressured moderate candidate Kent Johns to stand down against Craig Kelly for Liberal preselection in the seat of Hughes before the 2016 election. Mr Turnbull said yesterday that Liberal members in the seat of Hughes deserved to have their say on who should be their candidate. We ve just had a very long debate in NSW in the Liberal Party about the importance of democracy and grassroots members participation, Mr Turnbull said. In my view, the party should allow the preselection process to take its course and then Mr Kelly will either succeed or not, depending on the views of the Liberal Party members whose candidate he is. Mr Turnbull said the prospect of Mr Kelly resigning to the crossbench if he was not saved was the worst and weakest reason for the state executive to step in. It is ironic he is attacking something Scott is doing that he endorsed himself a few months ago NSW LIBERAL MP ON MALCOLM TURNBULL

15 The Australian, Australia Author: John Stensholt Section: Business News Article type : News Item Classification : National : 94,448 Page: 22 Printed Size: cm² Region: National Market: Australia ASR: AUD 18,549 Words: 742 Item ID: Page 1 of 2 Heine s Netwealth maps out windfalls as an investor, too HOW THE RICH INVEST Holding the hottest stock has helped boost its returns JOHN STENSHOLT Billionaire Michael Heine s Netwealth group is an active investor in its own right. In fact, just now it holds the hottest stock on the ASX, the aerial imagery technology and location data company Nearmap. Shares in Nearmap have shot up about 170 per cent since January 1, making it the fastest-growing stock on the All Ordinaries Index and one of only six companies to double in value during the year. Nearmap has rewarded shareholders such as Netwealth, the superannuation and financial planning firm Heine and his family founded, since floating on the ASX, thanks to rapidly improving profits and a strategy to expand quickly overseas. In September, Nearmap raised $70 million from investors to expand, mainly in the US, and boost its balance sheet. Stock picker David Paradice is also a Nearmap shareholder. Meanwhile, Heine s flagship Netwealth group has quietly been one of the best major ASX floats of the past year or so, and has doubled in value itself. Netwealth shares listed at $3.70 in November last year and yesterday were trading above $8.50 (they were as high as $9.92 in June) to give it a market capitalisation of more than $2 billion. Netwealth shares are up about 17 per cent since January 1. The company was founded by Heine and his family in 2000 after previous careers in property, radio stations and investment, while tracing their business success to a steel trading business Walter Heine started in Australia after fleeing Nazi Germany. According to Bloomberg data, Netwealth appears on the shareholder list of about 130 companies listed on the ASX, including Nearmap and a host of other small and emerging companies that have outperformed the market this year. Heine s firm, of which he is the co-chief managing director alongside son Matt, has about $19.3bn worth of funds under advice spread across a range of investments including blue chips such as the big banks, BHP, Woolworths and Macquarie. Based in Melbourne, Netwealth provides wealth management products and services to financial advisers and wealthy investors via its own in-house platform. It is not aligned with any banks or other financial services groups, something that has helped it quickly grow its business this year as the banking royal commission has kept their competitors in the headlines for negative reasons. The $19.3bn funds under advice was up $5.6bn, or 40.6 per cent, in a year, and it directly has $3.1bn funds under management, a figure that has grown $1.1bn, or 55.3 per cent, in the past 12 months. Heine s company has put client funds in some companies with rich-list connections, including Hamish Douglass s Magellan Financial Group, and Computershare, founded by Chris Morris. Fruit and vegetable giant Costa Group, which counts rich-lister Frank Costa as a big shareholder, has been a good holding for Netwealth, having risen about 15 per cent this year, while Computershare is up about 11 per cent. Blue-chip stocks like Macquarie, up 14 per cent since January 1, and CSL, up 25 per cent, have performed well for Netwealth, offsetting falls in the likes of Commonwealth Bank, down 11 per cent, and Westpac, down 17 per cent, in the same time. (Commonwealth Bank is Netwealth s biggest holding, CSL is its second largest.) Netwealth also has shares in dozens of small and micro companies, some of which have been excellent investments this year. Take the little-known Kangaroo Resources, which has surged 677 per cent this year. On January 1 it was trading at 1c, but the company which has a portfolio of coal concessions in Indonesia is about to be taken over by major shareholder Bayan Resources in a transaction for 15c a share to be completed next week. Then there is Allegra Orthopaedics, which has doubled in value since July. Allegra makes and sells medical implants and is targeting expansion into the US market. Netwealth holds about 9 per cent of Allegra s shares. Another is Scottish Pacific Group, which has risen 33 per cent this year. Scottish Pacific provides debtor and trade finance for small and medium-sized businesses. Netwealth also has shares in Respiri, which is up about 95 per cent this year. Respiri s techno-

16 The Australian, Australia Author: John Stensholt Section: Business News Article type : News Item Classification : National : 94,448 Page: 22 Printed Size: cm² Region: National Market: Australia ASR: AUD 18,549 Words: 742 Item ID: Page 2 of 2 logy and devices are used to combat and manage asthma. $ Netwealth shares since IPO 7 6 $ Source: Bloomberg MICHAEL HEINE Age: 68 Lives: Melbourne Estimated wealth: $1.27 billion Source: Shares in Netwealth Group Secrets of success: Building a super and wealth management platform independent of the big banks

17 The Australian, Australia Author: Monica Rule Section: Business News Article type : News Item Classification : National : 94,448 Page: 23 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,101 Words: 777 Item ID: Page 1 of 1 Sick of work? How to get your hands on super MONICA RULE Are you sick of working and wish you could retire and live off your superannuation? But when can you get your hands on your super? To be able to access your super savings, you need to meet one of the conditions of release under superannuation law. The most common condition is reaching your preservation age. Superannuation fund members born prior to June 30, 1961 would have met their preservation age. People born after this date will need to wait until they turn 57, 58, 59 or 60. If you have not reached your preservation age, then you may be able to access your super under financial hardship grounds or compassionate grounds. To qualify under financial hardship grounds, you need to have been receiving commonwealth income support payments (e.g. NewStart, disability support, parenting payment, carer s payment, or widow s allowance) for at least 26 weeks. If you do qualify, then you can access up to $10,000 in 12 months. To qualify under compassionate grounds to pay for such things as medical treatment, mortgage repayments or pay for funeral cost of dependants, you need to apply to the Australian tax office. If you have reached your preservation age, you can access super while you are working. You do not need to cease work or reduce work hours. However, your super must be accessed as a transition to retirement income stream where a total pension of no less than the minimum limit and no more than the maximum limit must be withdrawn each financial year. If you decide to resign from work after reaching your preservation age, you may be able to access your super as a lump sum payout or as a retirement pension benefit. If you are 60 or older, and work for more than one employer, you can access your super without resigning from all of your jobs. That is, you can leave one job and continue working for other employers. You do not have to give up all paid work. If you are under 60 however, you do have to cease working for all your employers. It gets better when you are 65 or over. You can access your super any time after your 65th birthday. It does not matter whether you continue to work or not. Since July 1, 2017, superannuation fund members 18 or older can also access their super to fund a deposit for their first home. The maximum amount is $15,000 per year up to a total of $30,000 across all years. People who previously owned a home in Australia may qualify if they satisfy the ATO s financial hardship provisions. If you ceased work due to a physical or mental illness, you may be able to access super as a lump sum or pension permanent disability benefit. You may be able to access a lump sum or pension terminal benefit if your doctor has certified your illness is likely to result in your death in 24 months. There has been a recent review of early access to super rules by Treasury, which is due to formally conclude in March next year. Minister for Women, Kelly O Dwyer, announced last month that women leaving abusive relationships will have easier access to their partner s superannuation as well as getting early access to their own super as part of a package of government measures to help improve financial security. The changes though limited were welcome by legal groups: Helen Matthews, the legal and policy director at Women s Legal Service Victoria, said the service had been campaigning for easy access to information about their partner s superannuation via the ATO as well as a streamlined small claims property process. These reforms are life-changing for women fighting for fair financial outcomes in our family law system, Matthews said. The financial advice sector is divided on early access to super as regulators try to get the balance right between a fair system and ensuring that all workers get the full compounding benefit of super over a working lifetime. A recent straw poll conducted by SMSF Adviser revealed that SMSF professionals were fairly divided on this proposal with just over half of the 306 respondents in favour of allowing victims to access their perpetrator s superannuation assets, while others were against the idea or supported in limited circumstances. Around 55 per cent of respondents were in favour of amending the law to allow this, 26 per cent were against it completely, and the other 19 per cent supported it where superannuation was accessed by the victim of a violent crime. Monica Rules is an SMSF specialist and author of The Self Managed Super Handbook Superannuation law for SMSFs in plain English.

18 The Australian, Australia Author: Judith Sloan Section: General News Article type : News Item Classification : National : 94,448 Page: 12 Printed Size: cm² Region: National Market: Australia ASR: AUD 10,882 Words: 1124 Item ID: Page 1 of 2 There is a right way to run a company, as the Corporations Act sets out quite simply HENRY S BRAVE NEW BOARD HAS LITTLE TO RECOMMEND IT JUDITH SLOAN CONTRIBUTING ECONOMICS EDITOR The last fortnight of public hearings at the banking royal commission saw the grilling of several chief executives and chairmen of the big banks. It would be fair to say that the quality of the performance of these men Catherine Livingstone was the only woman was varied. Some have been able to explain the rationale for their processes the chief executive of the Macquarie Group while others have been more apologetic about the misconduct and failures that have been features of their organisations recent history. The most unforgettable was Ken Henry, National Australia Bank chairman and former Treasury secretary. He was in the dock for some time. It would be fair to say that he was verbose and ponderous. When it came to the bank s misconduct, he seemed to see the only alternative to trimming the bonuses paid to executives was to sack them all. No doubt, this came as something of a shock to the commissioner, counsel assisting and members of the audience. Perhaps he was joking, but it s hard to see that a royal commission public hearing is an appropriate venue for humorous or ironic remarks. Someone should have reminded Henry that he was not appearing before a Senate estimates committee, where the largely amateurish questions can be batted away, dismissed or taken on notice. But Henry was keen to tell the commission he had given considerable thought to the functions of companies, the role of boards, and capitalism more generally. Whether entering into such a broad and contested set of issues was a good idea is open to debate Henry doesn t think companies should just serve their shareholders who have put up the capital so they can go about the business of selling goods and services. He thinks boards should be responsible to shareholders as well as other stakeholders and the community at large. Now this is all very well, but the Corporations Act sets out the general duties of directors and officers and it is clear that directors of companies must exercise their powers and discharge their duties in good faith in the best interests of the corporation. What this doesn t mean in practice is that boards should ignore customers. In fact, it means quite the opposite: no customers, no company. It also doesn t prevent the company from being an exemplary employer or treating its suppliers fairly. And directors need not just think about the short-term interests of shareholders. There is nothing in the law that prevents a company from adopting a longrun strategy, for instance, although it is always best to communicate this thinking to shareholders. Henry s idea of putting customers first and the board having multiple responsibilities is muddle-headed, to say the least. The reality is that no company can serve its shareholders well unless it provides value-for-money goods and services. Banks are an interesting case as financial intermediaries with many customers having longterm obligations to them think the repayment of loans. This contrasts with the purchase of a watermelon from the fruit shop or a jacket from David Jones. In other words, much of what

19 The Australian, Australia Author: Judith Sloan Section: General News Article type : News Item Classification : National : 94,448 Page: 12 Printed Size: cm² Region: National Market: Australia ASR: AUD 10,882 Words: 1124 Item ID: Page 2 of 2 banks do is not part of some spot market. Rather, it involves longstanding and complex interactions with customers, and responsibilities cut both ways. There must be remedies, for instance, if customers fail to meet their side of the bargain, although the terms of that bargain need to be made very clear. Good customer service on the part of banks doesn t mean letting all delinquent borrowers default on their loans. However, it s easy to see why the banks have encountered such public opprobrium. Their wealthmanagement businesses are quite distinct from the core banking function of providing loans to businesses and individuals. Let s face it, wealth management is essentially a selling business in which financial products, often manufactured by or connected to the bank, are flogged to customers hopefully to meet their financial objectives. Apart from the large scope for conflicts of interest, in part arising from the payment of commissions, the selling of financial products and providing loans entail quite different skills. It was always going to be an unhappy mix. The banks vertical integration model and the role of cross-selling to customers are now close to dead. Within a few years, there will be very little left of the arrangement within the big banks. All that retraining of NAB s branch managers to be licensed financial planners will have been for nought. So let s come to Henry s alternative vision for companies and the role of boards. One obvious criticism is that by making boards accountable to multiple groups and who is going to define community, by the way? they will in fact become less accountable. If one group is disappointed, the directors can always argue that they have been serving another group well. Where Henry s vision of this alternative role for boards looks particularly weak is in relation to remuneration. There is little doubt that the final report of the royal commission will highlight the centrality of defective remuneration incentives as a major source of the banks failings. With staff driven by the lure of maximising their short-term bonuses, it is hardly surprising that employees would try to game the system to ensure this outcome. Given the boards reluctance to cut bonuses even in the face of poor performance, it has been money for jam for many bank executives. While Henry may be right to eliminate short-term bonuses from the remuneration structure of the NAB, his alternative plan has little to commend it. Executives will be rewarded though a single variable reward based on performance, with 40 per cent paid in cash and the remainder in deferred shares that can be clawed. The size of the reward pool for executives includes a mix of customer, risk and financial metrics. Regulatory compliance, customer outcomes and damage to a bank s reputation also can been taken into account. In all likelihood, Henry s plan will be voted down by the shareholders, who regard the downgrading of the financial performance of the group as a retrograde step. It s one thing for the bank to improve customer service and to manage risk and reputation better (and bear in mind the subjective element to any assessment) it s another thing to largely ignore the shareholders. The bottom line is that the role of company boards as set out in the Corporations Act remains fit for purpose. But directors who are confused about their roles and are seemingly asleep at the wheel some of the time should think about doing something else. Banking involves longstanding and complex interactions with customers, and responsibilities cut both ways

20 The Australian, Australia Author: Anthony Klan Section: General News Article type : News Item Classification : National : 94,448 Page: 7 Printed Size: cm² Region: National Market: Australia ASR: AUD 3,293 Words: 297 Item ID: Page 1 of 1 Labor still wants super reform, despite delay ANTHONY KLAN Trustees responsible for managing $2 trillion in superannuation are unlikely to be subject to any penalties for failing to act in members best interests until at least after next year s federal election, with the Morrison government failing to secure support from the ALP over a package of reforms. The government has failed this week to list before parliament the member outcomes No 1 bill which would penalise trustees who break longstanding best interest laws, among other changes blaming the ALP for failing to support the package. But opposition financial services spokeswoman Clare O Neil said she remained absolutely committed to introducing penalties for trustees who broke the law, but said the ALP would not approve the reforms because they included other changes that would not be applied consistently across the super sector. Included in the bill are plans for new regulatory requirements relating only to the already better-performing and betterregulated MySuper products, rather than to non-mysuper products, which hold more than $1 trillion of the public s money but underperform, largely due to widespread fee gouging. Actuary Rice Warner says the underperformance of non-my- Super products over the next decade will cost investors $53 billion, well above the nation s $44bn annual spend on the Age Pension. Labor is absolutely committed to cracking down on misconduct in the financial services sector, including trustees who fail to act in the best interests of super members, Ms O Neil said. Since the bill was referred to the Senate standing committee on economics last year, the ALP has said it would not support it unless it was amended to apply consistently and comprehensively across the superannuation system. Assistant Treasurer Stuart Robert said the proposed new disclosure laws did not include non-mysuper products because the proposals built on the existing laws for MySuper products.

21 Australian Financial Review, Australia Section: Letters Article type : Letter Classification : National : 44,635 Page: 35 Printed Size: 73.00cm² Region: National Market: Australia ASR: AUD 1,477 Words: 210 Item ID: Page 1 of 1 Look to the past to beat corporate greed While we have the Hayne royal commission, at which bank executives and regulators struggle with explaining why everyone thought it was OK for banks to steal from their customers, Eugenie Joseph makes a valid point in explaining that capitalism is not to blame ( Capitalism s no moral vacuum, Ken, November 29). A combination of competition and law is supposed to stop both banks stealing from people and people stealing from banks. It is obvious that it hasn t been working very well as the big companies have been successful in capturing their regulator and avoiding competition. If we are looking at a way to avoid this perhaps we could look to the past. Would this have happened if we still had the CBA owned by the people through the government and AMP as a mutual? If the law and competition are insufficient to stop large companies from stealing from their customers, would the presence of a large commercial competitor not owned by shareholders help them understand that they should not steal (or at least provide an alternative to customers). The establishment of a Post Office bank may do more to solve the culture problems of the banks than the royal commission and the thoughts of Ken Henry. Reg Lawler Dagun, Qld

22 Australian Financial Review, Australia Section: Letters Article type : Letter Classification : National : 44,635 Page: 35 Printed Size: 85.00cm² Region: National Market: Australia ASR: AUD 1,719 Words: 218 Item ID: Page 1 of 1 Profit to be made from confusing customers Your editorial argues there is no capitalist conflict between corporate profit seeking and customers (November 30). This assertion flies in the face of the evidence. There is much profit to be made from exploiting customers. Take consumer lending, which has been a focus of the banking royal commission. In areas like credit card lending, we have seen there is significant profit to be made by pushing Australians to the edge people scraping to make their minimum repayments ultimately pay the most in interest and fees. There are other examples where maximising profits conflicts with community interests, but there are no laws that are broken. In complex services markets, like energy, insurance and others, there is profit to be made from confusing people so they can t choose the best product. It is now well established by behavioural economics research that people struggle to make good decisions when overwhelmed by information or complexity. Companies have been wrongfully exploiting this vulnerability for years. NAB chairman Ken Henry is right that we need to broaden duties of directors beyond serving shareholder interests. Particularly where corporations are delivering goods and services with a public interest dimension, the needs of the community should be better recognised in our corporations and consumer laws. Gerard Brody Chief executive Consumer Action Law Centre Melbourne, Vic

23 The Australian, Australia Author: Alan Kohler Section: Business News Article type : News Item Classification : National : 94,448 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,622 Words: 931 Item ID: Page 1 of 2 HAYNE S HARD WORK BEGINS The banking royal commission is over, but what now? ALAN KOHLER The banking royal commission has been such a valuably gruesome process that it is to be hoped that it isn t messed up by a final report that overreaches. That s especially so since the report will be released in the febrile lead up to a federal election, when both sides of politics are likely to fall over themselves to promise to implement every word of it, before reading it. It s fair to say that much of what the final report can possibly contain is already being feverishly implemented by the banks and their regulators. Which is not to suggest that the report will be redundant, but simply that much of its impact has already happened. The recommendations about the banking system will be written by an eminent lawyer, assisted by other lawyers, having spent 12 months hearing about misconduct, and nothing but misconduct. It is a royal commission into misconduct in the banking, superannuation and financial services industry, not another inquiry into the industry. To say that his honour Kenneth Hayne and staff may have developed a jaundiced view of the industry must be an understatement. We all have. Only Macquarie Group and the industry funds have escaped unscathed, and they must still be high-fiving in disbelief. The banks and AMP have been gutted, along with APRA and ASIC. Hapless junior executives, unhappy customers and finally CEOs and chairmen were put in the box and questioned, under oath, by well-briefed QCs, often hearing the dreaded words: can I show you a document, supported by the work of expert document system providers, Law in Order. And as a result, it has been a media festival. There s been nothing like it since the HIH Royal Commission of 2001, and that was relatively tame since it was about one company that had gone broke, so we already knew it was bad. This was about the badness of the longstanding pillars of the Australian financial services industry all of them. One journalist over the weekend wished it would it would just keep going, while another suggested it become an annual event, and who can blame them? Usually we spend our lives buried in spin from armies of PR people and smoothtalking CEOs. This year, for once, we were able to ride the coat-tails of expert, well-resourced questioners wielding the law of perjury. It has been a wonderful show. Corruption has been exposed and boils have been lanced; comeuppances have been had and predecessors thrown under buses. The only question remaining is: what now? What will Mr Hayne recommend in February? Incremental improvements in regulation? Or a radical restructuring of the industry? I have been opening a random sample of the 10,140 submissions just short ones from individuals. Without exception they called for the banks to be broken up and most of them, surprisingly, used the term Glass Steagall suggesting that the now-repealed American law that used to forcibly separate banking from insurance and investment banking be introduced into Australia. That would certainly be a fertile field for the royal commissioner to plough, although most of the banks have already announced plans to break themselves up along those lines so perhaps such a recommendation would lack drama. But Westpac says it will keep its insurance and wealth management division and AMP and Macquarie have not announced any plans to get rid of their banks, so an Australian version of Glass Steagall would make it uniform and would make sure they didn t slide into their bad old one stop shop ways in future. Perhaps Mr Hayne will recommend a system of spot checks of bank cultures, along the lines of Health Department spot checks of restaurants for cockroaches or random breath tests of drivers. How these might proceed is hard to say and it s here we start to get into what might be called overreach. I don t know whether the extra regulation to be recommended by Mr Hayne will extend to spot culture checks, but it must be tempting, given how hopeless APRA and ASIC have been at keeping an eye on this in the past. Certainly in his recommendations Mr Hayne can be expected to tell the regulators how to do their job, as he should, and he will probably tell bank directors how to do theirs as well. And since Mr Hayne is a lawyer, that won t involve telling them to get out there and make more money. Oh no. It will more likely involve increasing the mound of board papers. I had dinner during the week with the CEO of a top 100 company and, late in the evening, the subject of the royal commission came up. He said he meets regularly with a group of other CEOs to compare notes, and all of them report that their boards have undergone a marked transformation over the past few months. This CEO s board papers were now up to 600 pages for a two-day meeting; others were reporting something similar.

24 The Australian, Australia Author: Alan Kohler Section: Business News Article type : News Item Classification : National : 94,448 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,622 Words: 931 Item ID: Page 2 of 2 Australian company directors in all industries have become obsessively compliance focused in 2018 as a direct result of the royal commission into misconduct in financial services. There but for the grace of compliance go I, seems to be the thinking. No doubt the sight of Catherine Livingstone and Ken Henry sweating in the box under oath will have that effect. So after the drama we ve seen this year, I m rather hoping the final report is an anticlimax. Alan Kohler is business editor at large of The Australian and editorin- chief of Investsmart Group.

25 The Australian, Australia Author: Robert Gottliebsen Section: Business News Article type : News Item Classification : National : 94,448 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,828 Words: 1014 Item ID: Page 1 of 2 It s full steam ahead for the financial revolution ROBERT GOTTLIEBSEN We are witnessing the biggest peacetime revolution in our financial system in 100 years. The power of the revolution and its implications are being obscured by gender and carbon politics, the noise that surrounds the royal commission and the turmoil in Canberra. The revolution started in the 1980s but its acceleration stems from the transfer of funds out of the bastions of institutional equity power AMP, MLC and Colonial into industry superannuation funds. Any major company in Australia looking to raise equity or promote their shares must now first target the fund managers for the industry funds in Melbourne. But that s only the first step of accelerating this revolution. The next step is to recognise this is not merely a transfer of money from one institution to another. Rather it is the start of a fundamental change in the gatekeepers of capital. It s moving from the old director elite to a style of power dominated by a new form of unionism, where the union is a business and works with employer organisations who align themselves with union power. There s no doubt the practices and priorities of public companies will be changed. The power of the leg of the change will be multiplied by what is happening in politics. Conservatives are in disarray and not only is the ALP almost certain to control the nation for the next six years but the control may extend further because most states are or are set to be ALP. As we were told in the 1976 film All the President s Men, follow the money. The biggest funders of Labor are the union businesses that are set to share authority for the provision of equity capital. Is there any precedent for this development in our history? For most of the first 50 years of federation, conservative parties were disorganised. It was not until near the end of World War II that Robert Menzies organised conservative forces and was prime minister for 16 years between 1949 and Then it was to the deep conservative party problems until John Howard brought the forces together and was prime minister for 11 years until Now it s disunity again. But whether the conservatives were in or out of power, there was a more indirect link to politics. It s true conservative forces controlled most of the big board rooms, but it worked in a loose way. The boards and executives of financial institutions were members of the powerful clubs in Melbourne, Sydney and other capitals. Here they mixed with the boards and managers of corporations. The clubs had all sorts of rules curtailing business in their walls but the networks around them, often led by powerful men, the board gatekeepers, were the base of corporate power. Power over boards and appointments is set to shift from the old networks to the networks that surround the industry funds and it s hard to see it changing in the foreseeable future. One problem with the club network was it did not adjust to the new role of women. When Paul Keating set up superannuation as we now know it in the 1980s, helping establish industry funds, it was clearly a long term plan to enable unions to become more involved in capital formation. He could never have dreamt the major providers of equity in 1980s and 1990s, the big life offices, would underperform the industry funds and their hard-selling, highcommission cultures would be a disaster when combined with bank ownership. The only force standing between the industry funds and domination of the provision of equity capital is self-managed funds, whose development has stunned everyone. They now control about 30 per cent of the super market and almost 50 per cent of the retirement market. Shadow treasurer Chris Bowen has a plan to damage selfmanaged funds and reduce their share of the market. A big portion of SMSF beneficiaries are in pension mode and are set to lose their franking credit entitlements because they are paid in cash. But they can retain that cash if they move out their funds into an industry fund. That the decision as to who gets cash franking credits is decided on the basis of the choice of fund manager is outrageous. But the ALP/union friendly sections of the media are ing it and the Coalition is too divided to worry about it. This means that not only will unions be the dominating force in capital formation, but the union-ed ALP will reign in Canberra and in most states. This uniting of political and capital power is unprecedented. And it happens at a time when bank chairmen are talking about a different culture, a culture more focused on customers than shareholders. NAB chair Ken Henry says it will take about a decade to switch to a strategy that focuses first on customers and staff. My message to Henry is that in all

26 The Australian, Australia Author: Robert Gottliebsen Section: Business News Article type : News Item Classification : National : 94,448 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,828 Words: 1014 Item ID: Page 2 of 2 major companies, board appointments, remuneration packages and strategic decisions will now need to be shown to the industry funds. In banking, the aggressive regulators will also want to provide a tick. It s important to underline the industry funds might have got a leg up from Keating and the ALP but they won the market share war with the big life offices fairly. They thought longer term and mostly their performance was better. But it is equally important to remember their duty is to the members of their fund. And, as they near retirement, those members want performance rather than social agendas. It will be fascinating to see how the new networks use their powers. My hope is industry funds revamp their disclosure patterns. Vast sums in industry funds will mean a change of capital flows. A greater proportion of super money will go into infrastructure and long-term investment. If we combine this with the attack on franking credits, we may see money diverted from the sharemarket. Australia is moving from an enterprise culture akin to Europe And it is happening at a rapid pace as the money flows from the old institutions to the new.

27 The Australian, Australia Author: John Durie Section: Business News Article type : News Item Classification : National : 94,448 Page: 29 Printed Size: 74.00cm² Region: National Market: Australia ASR: AUD 1,904 Words: 208 Item ID: Page 1 of 1 JOHN DURIE Loan returns halve Last week ANZ chief Shayne Elliott confided that return on equity on home loans has halved in recent years, from more than 30 per cent to below 15 per cent which he put in the context of why there was a push to maximise home loans in the early years. Given the profit pool is lower now, there is less incentive to bend the rules. UBS figures yesterday noting that housing growth in October was the lowest since 1976 is another dampener, because clearly housing credit growth is slowing to zero. Later this month, the Australian Prudential Regulation Authority will release its final round of risk weightings on mortgages, which will increase the amount of capital to be held against interestonly loans, and overall risk weightings will edge up from 25 per cent for the big banks. The smaller banks, which don t have advanced accreditation status, originally wanted the playing field levelled by cutting risk weightings, which would make it easier for them as they now are required to keep 35 per cent capital. Instead, the regulators have narrowed the gap but only by increasing the capital weights, which makes loans more expensive and arguably safer. The combination now comes as the housing market is slowing fast.

28 Australian Financial Review, Australia Author: Patrick Durkin Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 14 Printed Size: cm² Region: National Market: Australia ASR: AUD 8,374 Words: 747 Item ID: Page 1 of 2 Bank pay lash to hit pair Patrick Durkin Westpac Banking Corp director Craig Dunn and ANZ Banking Group director Paula Dwyer are set to bear the brunt of a lash against bank executive pay at their upcoming shareholder meetings. Westpac and National Australia Bank face a major protest vote over bank bonuses while ANZ is likely to follow the Commonwealth Bank and avoid a strike after major proxy firms sided with the bank, despite a revolt led by industry super funds. The bank AGMs will round out a fiery AGM season where 13 top companies including Telstra, AMP, Tabcorp and Myer have received a strike or protest vote of 25 per cent or more, up on last year where just 11 top 300 companies received a strike. The investor lash is on track to pass high investor outrage in 2013, 2015 and 2016, after a moderate AGM season last year. The average vote last year against the remuneration report when strikes were registered was 35.5 per cent but has jumped to 45.7 per cent with individual directors being targeted more than even before. In the face of the royal commission hearings, where we have often seen a lack of urgency from directors about dealing with the issues that have come to light, shareholders seem to be expressing their concern through voting, Australian Shareholders Association chief Judith Fox said. Major super funds, including Australian Super, UniSuper, Cbus and Hostplus, are expected to vote against the remuneration reports of Westpac, NAB and ANZ with CEO of the Australian Council of Superannuation Investors Louise Davidson asking If they didn t cut the pay this year, when would they [bonuses] ever be zero? Major proxy firm ISS which can influence up to 30 per cent of the vote has joined the industry super funds in taking issue with NAB and Westpac s pay after its CEO Brian Hartzer Continued p16 From page 14 Bank pay lash to hit pair AFRGA1 A016 received a $2.2 million bonus last financial year, despite forfeiting $4.3 million in long-term incentives. The proxy firm have also recommended a vote against a proposed grant of $6 million in shares and performance rights to Mr Hartzer that they label as excessive. Proxy firm CGI Glass Lewis and the ASA have recommended against the re-election of Westpac director Craig Dunn and ISS have flagged concerns because of his role as chairman of Westpac s remuneration committee and former AMP CEO, ahead of next Wednesday s AGM. We believe that directors have a collective corporate responsibility and Mr Dunn was on the Westpac board in 2015 when matters were being overlooked, the ASA said. In addition Mr Dunn was a CEO at AMP when there were serious corporate governance problems. NAB also faces a strike at its AGM on December 19 with ISS among those taking issue with the bank s new combined plan, which removes the old long-term financial metrics, with chairman Ken Henry admitting there s a mix of views. Others would prefer that NAB executives be rewarded more in the way that they [have been] rewarded, which is for outstanding share price performance, Dr Henry told the bank royal commission last week. ANZ looks likely to avoid a strike at its December 19 AGM despite CEO Shayne Elliott receiving a bonus of $1.7 million, in addition to base pay of $2.1 million after being ed by proxy firms ISS and CGI. However, ANZ director and Tabcorp and Healthscope chairman Paula Dwyer is facing a significant protest vote with CGI recommending against her re-election and ISS also flagging concerns. It is not expected the protest votes against Ms Dwyer or Mr Dunn will reach the 50 per cent required to block their re-election, but they will be hefty. Both Tabcorp and Healthscope received a first strike against the remuneration report [this year] and Tabcorp has been subject to a regulatory investigation and subsequent penalties... in relation to breaches of antimoney laundering, ISS said. The bank lash follows a fiery AGM season that has delivered recordhigh protest votes against individual directors including Myer s Lyndsey Cattermole (42.74 per cent against) and Dave Whittle (36.27 per cent against); Andrew Harmos at AMP (37.6 per cent against) and directors at APA, Computershare, Japara and Ramsay Health.

29 Australian Financial Review, Australia Author: Patrick Durkin Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 14 Printed Size: cm² Region: National Market: Australia ASR: AUD 8,374 Words: 747 Item ID: Page 2 of 2 Pay pain Companies that recieved strikes* against their renumeration report this year Company Votes against (%) Mineral Resources AMP Telstra Goodman Group Harvey Norman NRW Holdings QBE Insurance Tabcorp Holdings Myer Austal Karoon Computershare Healthscope *A strike is 25% or more against SOURCE: AUSTRALIAN SHAREHOLDERS ASSOCIATION

30 Australian Financial Review, Australia Author: Sarah Turner Section: Companies and Markets Article type : Share Market Report Classification : National : 44,635 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 16,687 Words: 795 Item ID: Page 1 of 2 ASX surges to best day in two years Equities Sarah Turner Australian shares rallied at the start of the week, as trade war concerns that have rattled markets for months took a seat after the US and China agreed to a temporary truce. It was the best day in two years. The S&P/ASX 200 Index climbed 104 points, or 1.8 per cent, to 5771, while the All Ordinaries Index rose 106 points, or 1.9 per cent, to The signs are there that both parties want to do a deal, TMS Capital portfolio manager Ben Clark said. It looks like there is some progress. Miners, banks and energy stocks led the rally. In the mining sector, BHP jumped 3.7 per cent to $31.82 while South32 climbed 7.1 per cent to $3.32 and Rio Tinto rose 2.3 per cent to $ Of the banks, Westpac rose 1.1 per cent to $26.25 while Macquarie was up 2.8 per cent to $ Energy stocks lifted as the oil price rallied, with Woodside higher by 3.5 per cent to $32.16, Santos up 8.7 per cent to $6 and Origin up 6 per cent to $6.87. GrainCorp shares soared 26.7 per cent to $9.25 on news of a $2.4 billion takeover offer. Former Business Council of Australia president Tony Shepherd is behind the bold bid for control of GrainCorp. GrainCorp, the dominant force in east coast grain handling, has received a non-binding, indicative proposal from Long-Term Asset Partners that values its stock at $10.42 a share. Steel maker BlueScope Steel surged 11.8 per cent to $12.55 after announcing a $250 million share buy. The Reject Shop formally rejected a takeover bid by packaging billionaire Raphael Geminder, calling it inadequate and highly opportunistic. The $2.70-a-share bid lobbed two weeks ago, valuing the discount retailer at $78 million. Shares fell 2.4 per cent to $2.81. Grocery and hardware wholesaler Metcash s half-year profit ticked up 3 per cent, supported by earnings growth from its network of Mitre 10 and Home Timber & Hardware stores. The company reported a statutory profit of $95.8 million for the six months to October 31, up from $93 million in the same half last year. Metcash shares lost 5 per cent to $2.63. WITH WIRES What moved the market Aussie dollar The Australian dollar hit a level not seen since August after the news that the US and China have put their trade dispute on hold for 90 days. The currency climbed 0.7 per cent to US73.64 as the US dollar softened. On the local data front, company profits rose 1.9 per cent in the September quarter, seasonally adjusted, missing the 2.8 per cent increase the market was looking for. The June quarter was also revised higher to 2.4 per cent from 2 per cent. Oil Oil prices surged to join in the risk rally on Monday after the lowering of trade tensions and ahead of a meeting this week by producer club OPEC that is expected to result in a supply cut. US West Texas Intermediate crude futures rose to $53.78 per barrel, up $2.85 per barrel, or 5.6 per cent from their last close. Canada s Alberta province will cut output to deal with a pipeline bottleneck that has led to crude building up in storage. Brent crude oil futures were up $2.86 per barrel, or 4.8 per cent, at $62.32 a barrel. Chinese factories China s factory activity grew slightly in November, a private survey showed, though new export orders extended their decline in a further blow to the sector already hurt by the Sino-US trade frictions. The Caixin/ Markit Manufacturing Purchasing Managers Index for November, ticked up to 50.2 from 50.1 in October, just above the 50 level that economists had been expecting. That level also separates economic expansion from contraction. Asia rallies Markets climbed across Asia as investors reassessed their views on the trade relationship between the US and China. Trade tensions have dampened global growth and rattled investors worldwide. Hong Kong s Hang Seng surged 2.3 per cent to 27,116 and the Shanghai Composite index jumped 2.7 per cent to Japan s Nikkei 225 index climbed 1.1 per cent to 22,596 and the Kospi in South Korea jumped 1.7 per cent to 2133.

31 Australian Financial Review, Australia Author: Sarah Turner Section: Companies and Markets Article type : Share Market Report Classification : National : 44,635 Page: 29 Printed Size: cm² Region: National Market: Australia ASR: AUD 16,687 Words: 795 Item ID: Page 2 of 2 Overview Markets roundup Monday S&P/ASX 200 Index (points) Sector performance (%) Stock watch Coca-Cola Amatil share price, daily ($) 10:00 12:00 2:00 4:00 Chart of the day CBA Manufacturing PMI growth 50 = no change on previous month Energy Materials Health care IT Comm services Real estate Cons staples Cons disc Utilities Industrials Financials Best and worst stocks (%) Graincorp Bellamy's Australia BlueScope Steel Coca-Cola Amatil Coca-Cola Amatil shares climbed 1.3 per cent to $8.75 after JPMorgan upgraded the firm to hold from underweight while cutting its target price to $8.50 from $8.75. The broker said that it made the rating change as it believes the shares now have valuation support. More optimism over the firm s Australian beverages operation following an investor day was tempered by disappointment over Indonesian operations for the broker, who noted that 2019 looks set to be another transitional year for the firm as it accelerates investment in some of its operations. Sep 52wk high 52wk low 1yr return 60-day moving average Oct $10.50 $ % Close $8.75 Nov Fwd EPS Fwd P/E Div yield $ x 6.9% Syrah Resources Santos $A/$US ($US) Brent crude oil ($US/barrel) Ardent Leisure St Barbara Metcash Ausdrill Afterpay Touch Northern Star Newcrest Mining Sep Oct Nov Sep Oct Nov SOURCE: BLOOMBERG, CBA

32 The Australian, Australia Author: Joyce Moullakis Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 5,248 Words: 449 Item ID: Page 1 of 1 AMP counts cost of paying big bucks for outside advice that ultimately fixed nothing JOYCE MOULLAKIS AMP s new chief executive Francesco De Ferrari has a long list of strategic and tough tasks ahead at the beleaguered wealth group, including decisions on how to reform culture and how much external advice to pay for. The Hayne royal commission has revealed AMP has had three accounting giants and law firm Clayton Utz all conducting separate reviews spanning across fees for no service, corporate culture and compliance over the past three years. Deloitte rolled up its sleeves on several pieces of work at AMP, including an audit of culture dubbed Project Luminous and an assurance review two years ago. EY Australia has also been involved in AMP projects in recent years, while the royal commission heard of another external workplace investigation called Project White. Acting AMP chief Mike Wilkins last week told the royal commission PwC was reviewing conduct and compliance issues after eight breach notices were lobbed with the corporate regulator this year. They related to AMP s small business and corporate superannuation business, where Mr Wilkins admitted the prospect of another fee-for-no-service scandal was real but unlikely to be material in terms of customer remediation. AMP has faced the wrath of investors over a series of scandals, including providing customers with poor advice or charging for ongoing advice that was never received. While fund managers didn t take great issue with the heavy use of consultants, accounting firms and external advice, they did caution that it was hard to measure tangible outcomes. The big banks are no different, Arnhem Investment Management s managing partner Mark Nathan said of their use of consultants. What s not transparent is how much of that (use of accounting firms and consultants) has been taken on board and used. Another fund manager, who declined to be named, said: Directors are not inside the business so sometimes they need more comfort. The most shocking thing to me is that AMP didn t use an independent expert s opinion on its life insurance sale. The observations at the royal commission came at the same time a study by London-based firm Source Global Research found companies in Australia and Britain are the top candidates globally for calling in consultants and external advisers. Back at AMP, the now infamous Clayton Utz report was meant to delve into detail on instances where customers were charged fees and received no service and provide insight to the corporate regulator. In earlier rounds, the royal commission heard of changes and deliberations around that boardcommissioned report, leading to question marks over its independence and legality. The furore that followed claimed the jobs of then chief executive Craig Meller and chairman Catherine Brenner.

33 Adelaide Advertiser, Adelaide Section: Letters Article type : Letter Classification : Capital City Daily : 112,097 Page: 18 Printed Size: 55.00cm² Region: SA Market: Australia ASR: AUD 818 Words: 108 Item ID: Page 1 of 1 Banking empathy SO the royal commission hearings into misconduct in the banking, superannuation and financial services industry by Justice Kenneth Hayne have ended. After 68 days, with 130 witnesses fronting the commission, we all now await the recommendations. To Justice Hayne, I say good luck. One solution is to jail all those with proven misconduct but that s defined, together with their cohort do-nothing regulators. And, of course, compensate victims. But what of the future? Corporations have no social responsibility and subjective greed is not a crime. If empathy is the fail-safe mechanism for behaviour, and I believe it is, how do we regulate for that? BOB RUWOLDT, Seacombe Heights

34 Daily Telegraph, Sydney Author: Terry McCrann Section: Business News Article type : News Item Classification : Capital City Daily : 232,067 Page: 20 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 9,498 Words: 346 Item ID: Page 1 of 1 Old playbook out for GrainCorp bid TERRY McCRANN Spend a few billion dollars to buy a business actually, also a critically important national asset and then find somebody to be its owners. That somebody will be investors, big and small. That s essentially what the Tony Shepherd-Chris Craddock Long-Term Asset Partners vehicle is doing with its bid to buy GrainCorp. Craddock who s a former investment banker and asset manager is the brains behind and driver of LTAP. He went to Shepherd to give his $2.4 billion good idea practical grunt. Shepherd is a long-time public servant-turned business executive with the Transfield infrastructure group. He has found a subsequent second life as a public policy player, kicking off with the presidency of the Bus Council and AFL-afic ado as chairman of W ern Sydney. Shepherd has gath the group which has g practical credibility Craddock s play, w the combination criti to getting the $3.6 b lion mostly from Goldman Sachs to finance first the proposed takeover and then the subsequent GrainCorp operations. In a broad sense what Craddock and Shepherd are trying to do is a further advancement on what Ian Silk and his Aus- Super industry super fund are trying to do with a number of plays of which the most determined has been private hospitals owner Healthscope. What Silk has been trying to do is to similarly become the go-to-guy for anyone wanting to invest in a key asset like private hospitals by joining with a hedge fund to take Healthscope private. Now we see a similar play with GrainCorp. It s a step further because Silk s AusSuper would be an upfront owner of Healthscope were it to succeed, which is not looking so likely with the intervention of a second bidder. The difference with LTAP is that it doesn t have an exlong-term ownerase for GrainCorp. it ll buy GrainCorp d then later attract the long-term owners, such as super funds. While doing this it will also, critically, refine the actual mix of financial instruments for both the long-term ownership and the way the business is funded.

35 Herald Sun, Melbourne Section: Business News Article type : News Item Classification : Capital City Daily : 303,140 Page: 22 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 21,711 Words: 810 Item ID: Page 1 of 2 The 2018 play born in the 1980s TERRY McCRANN SPEND a few billion dollars to buy a business actually, also a critically important national asset and then find somebody to be its owners. That somebody will be investors, big and small. That s essentially what the Tony Shepherd-Chris Craddock Long-Term Asset Partners (LTAP) vehicle is doing with its $2.4 billion bid to buy GrainCorp. Craddock, who s a former investment banker and asset manager, is the brains behind and driver of LTAP. He went to Shepherd to give his good idea practical grunt. Shepherd is a long-time public servant-turned-business exec with the Transfield infrastructure group. He has found a subsequent second life as a public policy player, kicking off with the presidency of the Business Council and AFL-aficionado as chairman of Greater Western Sydney. He s gathered the group which has given practical credibility to Craddock s play, with the combination critical to getting the $3.6 billion, mostly from Goldman Sachs, to fund first the proposed takeover and then the subsequent GrainCorp operations. Ironically but entirely coincidentally, and with no practical relevance to either the bid or the way it will be dealt with and play out his counterpart chairman of GrainCorp, Graham Bradley, was Shepherd s immediate predecessor as BCA president. In a broad sense what Craddock and Shepherd are trying to do is a further advancement on what Ian Silk and his AusSuper industry super fund are trying to do with a number of plays of which the most determined has been private hospitals owner Healthscope. And both have even longer dated roots in what one-time ACTU heavy-turnedentrepreneur Garry Weaven pioneered with his Industry Funds Services operation in the early 1990s and its push to corner the market in the early stages of the windenergy industry. Weaven as assistant ACTU secretary and Bill Kelty as secretary joined in the 1980s with then-treasurer Paul Keating to create compulsory super as a wages trade-off. That led to the industry super funds and the rest, would be history. The big step Weaven took was to become the go-to guy for anyone wanting to invest in renewable energy and, in particular, wind. Investment in wind has of course widened dramatically to many other main-chancers since those IFS days and his move on to Industry Funds Management. What Silk has been trying to do 20 years later is to similarly become the go-to guy for anyone wanting to invest in a key asset like private hospitals by joining with a hedge fund to take Healthscope private. NOW we see a similar play with GrainCorp. It s a step further because Silk s AusSuper would be an upfront (partial) owner of Healthscope were it to succeed (which is not looking so likely with the intervention of a second bidder).

36 Herald Sun, Melbourne Section: Business News Article type : News Item Classification : Capital City Daily : 303,140 Page: 22 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 21,711 Words: 810 Item ID: Page 2 of 2 The difference with LTAP is that it doesn t have an existing long-term ownership base for GrainCorp. First it ll buy GrainCorp effectively as a bridge-owner and then attract the long-term owners, such as, especially, super funds. While doing this it will also, critically, refine the actual mix of financial instruments for and the way the business is funded. By doing it this way, LTAP has maximum flexibility in tailoring the whole package to maximise the return and to customise for a variety of investors and investment products and asset classes. Now, the first question that the play raises is exactly the same as what happened with AusSuper at Healthscope. Having rung the bell on the double-level appeal of GrainCorp both its intrinsic value and as a major and almost irreplaceable or even replicable infrastructure asset, its long-term investment appeal does this ring the bell on a competitive race? This goes to the two bigger and broader issues, which this play and a host of other attempted or successful infrastructure acquisitions highlight, while also posing really fundamental public policy questions. First, Australian owners dramatically undervalue our assets in a global investment environment where there are literally trillions of dollars looking for safe, long-term good investments. There are none better than most of Australia s. Crudely, to me this means if Craddock is prepared to pay $2.4 billion, we and by that I mean Australia Inc should be asking for $4.8 billion. Better still we shouldn t be selling. At least with LTAP we would be selling largely to another form of we maybe even the same we as That s the second big question: how many of these critical infrastructure assets that all used to be either publicly or producer-owned GrainCorp is critical to getting a big slice of our grain crop into the market should we allow to be foreign-owned? Both are wrapped together in the short-termism that is the all-corroding rot festering within our super and fundsmanagement industries. The underlying ethic is to grab the profit and move on to the next returns-boosting play.

37 Geelong Advertiser, Geelong VIC Section: General News Article type : News Item Classification : Regional : 16,687 Page: 23 Printed Size: 91.00cm² Region: VIC Market: Australia ASR: AUD 303 Words: 175 Item ID: Page 1 of 1 New chief aims to win trust FRANCESCO De Ferrari has started work as AMP chief executive after what he says have been some of the most challenging days in the company s 169-year-old history. The former head of Credit Suisse s Asia Pacific private banking business (above) took charge yesterday, with interim chief executive Mike Wilkins who stepped in following Craig Meller s sudden exit returning to his role as an independent non-executive director. Mr De Ferrari said he aims to win trust following the exits of Mr Meller and chairman Catherine Brenner over damaging revelations of extensive misconduct heard at the banking royal commission. Mr De Ferrari said his immediate priority was to review AMP s business model. The royal commission... has provided an additional impetus for change in our business - and I m determined we seize the opportunity, he said. Our focus must be on doing better for our customers, shareholders and people. AMP has lost more than half its market value since April s revelations that the group charged customers for advice that was never given and misled the regulator.

38 Gympie Times, Gympie QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 2,997 Page: 29 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 293 Words: 432 Item ID: Page 1 of 1 Magic number you ll need to retire in comfort ANTHONY KEANE WORKING out how much money you ll need to retire comfortably can be one of life s most confronting tasks. However, it doesn t have to be difficult, and there are tools and techniques to help Australians plan well for life after work. People can feel dejected hearing that $1 million-plus may be required to retire comfortably, but advisers say it s best to focus on income needs rather than lump sums. Boutique Advisers strategic adviser Katie McDonald uses a magic number approach, where people examine their current lifestyle costs and work out the amount needed to cover that. For example, $50,000 of income would require a $1 million lump sum sitting in a balanced mix of investments earning 5 per cent. This does not factor in any age pension benefits or drawing down on the balance. The aim of investing for the future is to put yourself in a position where you don t need to rely on the age pension, Ms McDonald said. You need to start somewhere. Most people are currently spending everything they earn. Work out how much you will need in retirement. Then work out the shortfall. Look for i areas in your current budget where you can trim and put this into an investment most likely super. Most retirees receive some pension, and the Association of Superannuation Funds of Australia s respected Retirement Standard includes pension impacts. ASFA says a couple currently needs $56,548 of annual t ti income to retire comfortably, while a single needs $40,798. Assuming people will receive a part pension and gradually draw down all of their assets, couples need a lump sum of $640,000 and singles $545,000, it says. Certified financial planner Patrick Canion said very few people had an idea of the size of nest egg they would need when they retired. It s much better to bring it right down and say how much money do you need every week or fortnight, he said. People like to think in small amounts. Mr Canion suggested people use the Government s moneysmart.gov.au super and retirement calculators to project their future wealth. You can be simple, or fiddle around with it, and have no worries they re going to try and sell you anything, he said. But it s one thing to know the number it s another thing to do it. The maths aren t complicated, it s the implementation. Seeking good advice around diversification, asset allocation and pension planning would help, Mr Canion said. Ms McDonald said people should also have a look at superannuation incentives, such as the co-contribution scheme or the new catch-up contribution rules. Learn some life hacks moneysaverhq.com.au

39 Sydney Morning Herald, Sydney Author: Matt O'Sullivan Section: General News Article type : News Item Classification : Capital City Daily : 88,634 Page: 9 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 16,080 Words: 479 Item ID: Page 1 of 1 Faster rail services on the agenda Matt O Sullivan Transport The Berejiklian government is expected to commit to a feasibility study to identify the best route for faster rail services to connect regional areas to Sydney. With the Liberal-National coalition entering campaign mode ahead of the state poll in March, the government is understood to be set to announce as early as this week that it will consider the feasibility of as many as four routes for high speed, or faster rail services. The most likely routes to be considered include Sydney-Canberra via the new $5 billion-plus airport at Badgerys Creek, and Sydney- Newcastle. A commitment to a feasibility study will place the prospect of faster rail on Australia s east coast on the agenda for both the federal and state elections next year. Three business cases for faster rail on the country s east coast one of which will consider a line between Newcastle and Sydney are also due to be completed early next year after the federal government set aside funding in March. Transport sources said the most viable route for a faster train line was Sydney-Goulburn-Canberra. But you can t build it without federal funding, one said. The state government is already committed to new transport projects, such as a metro line from Sydney s CBD to Parramatta and a second motorway tunnel under Sydney Harbour, whose combined cost will run into the tens of billions of dollars over the next decade. In July, NSW Labor promised to commit funding for a study into reducing the four-hour train journey time between Sydney and Canberra if it is elected to government at the state election next March. Premier Gladys Berejiklian said several months ago she would love to see high-speed rail servicing the state but noted that it would need to go beyond NSW and would require federal funding for it to become viable. The Premier s office declined to comment yesterday. But NSW Nationals leader John Barilaro, who holds the marginal seat of Monaro, said last month that part of the funds the state received from the sale of the Snowy Hydro scheme will go towards identifying a new rail corridor for a fast train line between Sydney and Canberra. A report by Infrastructure Australia last year said highspeed trains could be running between Canberra and Sydney within 15 years. However, the country s peak infrastructure body said governments needed to act quickly to buy land along any proposed rail corridor to avoid potential cost blowouts. Federal Labor s transport spokesman, Anthony Albanese, has long been a proponent of highspeed rail on Australia s east coast. He has been pushing for a high-speed rail authority to be set up to oversee planning, a business case and the options for private sector investment. Digging deep A new line for a fast train from Sydney to Newcastle is likely to be prohibitively expensive because the terrain would require a significant length to run through tunnels.

40 The Australian, Australia Author: Four Pillars Richard Gluyas Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 14,613 Words: 896 Item ID: Page 1 of 2 Bank misread ASIC boss s grievance FOUR PILLARS RICHARD GLUYAS Now that the royal commission s public hearings are over, huge reform challenges await the nation s banks and regulatory agencies not only internally but in the way one group interacts with the other. National Australia Bank s complete misreading of ASIC s exasperation in the continuing adviser service fees (ASF) debacle is but one example. In the lead-up to chief executive Andrew Thorburn s critical first meeting with new ASIC chairman James Shipton on April 26, which was only scheduled to last 30 minutes, NAB staff prepared an eight-page internal briefing note for Thorburn. While Shipton s office had confirmed it would be an introductory meeting only, the note and its three appendices included a half-page summary of the ASIC chief s career, was adorned with a recent photo, and touched on all potential topics of discussion. You couldn t fault NAB for thoroughness, but what was the point? It s a classic example of a common problem in large organisations identified by NAB in last Friday s self-assessment on governance, accountability and culture where action is misinterpreted as progress. The core problem with the note was its complete failure to anticipate that Shipton would deliver a rocket to Thorburn about the technical and legalistic way in which the bank was dealing with its ASF debacle. The single dot point on this burning issue was relegated to Page 7, well after the Page 4 profile. Even then, it noted blandly that NAB was continuing to receive notices from ASIC on ASF, and that the bank was waiting for the regulator s response to its remediation proposal. The April 13 proposal the latest in a string of unsatisfactory offers pitched for a contrived distinction between customers signed up before and after the 2013 implementation of the future of financial advice laws. Chief legal and commercial officer Sharon Cook said NAB should be able to keep the pre- FoFA fees because it could have persisted with commissions instead of switching early to a fee structure. If the payments were treated as commissions, there was no obligation to provide a service. When NAB received ASIC s response on May 9, it more than echoed the frustration expressed by Shipton in his meeting with Thoburn. Senior executives Tim Mullaly and Joanna Bird slammed Cook s proposal for failing to engage at all with the serious concerns conveyed by ASIC. The suspected misconduct, they said, took place over an extended period and affected a substantial number of customers. NAB continues to justify its position based upon its decision to move to a fee-for-service model, the letter said. The simple point is how NAB went about implementing that decision is the problem. For a significant period of time, NAB suggested various methodologies that ASIC has consistently rejected as unacceptable, and the latest proposal retreats even further from what we would expect NAB to consider to be in the interests of customers. As the royal commission was told, NAB chairman Ken Henry was appalled the bank had completed a U-turn, with a resolution seemingly more distant than ever after three years of negotiations. Thorburn s briefing note is almost other-worldly compared to the undercurrent of tension in the relationship with ASIC. As the first such meeting since JS s (Shipton s) appointment to chairman of ASIC, it will be an important window for AGT (Thorburn) to articulate NAB s commitment to working constructively and transparently with ASIC, and to continue to develop the strong working relationship established under former ASIC chairman Greg Medcraft s leadership, the note said. The two organisations, it said, shared the now-critical priority of seeking to restore the trust and confidence in the banking industry, and in acting with urgency to address customer remediation and to drive meaningful reform in the uplift of industry practices. Self-serving memorandums and briefing papers are not unique to NAB. While all large organisations have the same problem to varying degrees, it s the banking industry that s in the frame at the moment, with an independent panel s May review of the Commonwealth Bank s culture, risk and governance now spreading to its three major rivals through a process of self-assessment. One of NAB s self-criticisms is that it has a tendency to confuse activity with progress when it comes to resolving more complex issues. In two case studies examined by the internal review, cross-bank issues remained open and unresolved for several years, contributing to a tolerance for delays. NAB s time-frames were comfortable rather than stretching, and the amount of progress to be achieved between various stagegates could only be seen as incremental. The bank, at least, is now aware of its inability to resolve its socalled matters of interest. The report said the board considered resolution periods to be

41 The Australian, Australia Author: Four Pillars Richard Gluyas Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 14,613 Words: 896 Item ID: Page 2 of 2 outside acceptable standards the bank s 37 matters have been open in their current form for an average period of 20 months. Some were linked to previous matters, suggesting that the underlying issues had been open for longer than that. Part of efforts to deal with the issue was the introduction last October of summary reporting to the board, including elapsed time and expected closure dates. Each matter now has now been allocated to an executive accountable under the BEAR legislation introduced earlier this year. gluyasr@theaustralian.com.au One of NAB s selfcriticisms is that it has a tendency to confuse activity with progress when it comes to resolving more complex issues ASIC chairman James Shipton leaves the banking royal commission in Sydney AAP

42 The Australian, Australia Author: Joyce Moullakis Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,409 Words: 545 Item ID: Page 1 of 2 NAB gets jump on rivals in loan fight JOYCE MOULLAKIS National Australia Bank s decision not to hit customers with an out-of-cycle rate rise is underpinning stronger mortgage growth over its big bank rivals, but has prompted analysts to warn on lending standards and margins. Analysts drawing on monthly data lodged with the prudential regulator pointed to a divergence in the big banks October mortgage growth. They said NAB was a clear outlier with higher growth because it had not raised interest rates in recent months like its peers to help offset higher funding costs. UBS analysts led by Jonathan Mott sharpened up their bearish view on housing credit growth, saying the 0.3 per cent rise in October reflected the weakest monthly growth across the industry since data began in Mr Mott believes part of NAB s better mortgage growth is also linked to looser lending standards and borrower criteria. NAB continues to lend relatively aggressively, up 0.44 per cent, or more than twice its major bank peers. We believe NAB has not tightened its standards as far as the other majors, he said. Mr Mott is of the view that industry credit growth could stall on an annual basis, an opinion that others in the industry label as too negative. If mortgage fundings (flow) contract by a further 14 per cent in FY19 (estimate), which is consistent with current monthly trends, then major bank housing credit growth is likely to slow to zero by the end of FY19, he said. However, we have not taken into account any further tightening of verification or potential changes to negative gearing, which leaves downside risk to these forecasts. UBS continues to point to rising risks of a credit crunch as house prices and credit growth drop further. However, Macquarie analyst Victor German points to a less extreme outcome and is expecting credit growth to moderate to 3.5 per cent in the 12 months to September 30 next year, and per cent the following year. His analysis showed a decline in mortgage balances at ANZ and Bank of Queensland in October and moderating growth at Westpac, where the numbers were annualised over three months. Mr German cautioned that NAB s stronger mortgage growth was coming at a material cost to the bank through its net interest margin, given it had not repriced mortgages. Commonwealth Bank s home loan growth came in just behind NAB on Macquarie s analysis. ANZ chief executive Shayne Elliott in October tipped that housing credit for owner-occupiers could fall to 2-3 per cent annually across the industry. The Australian Prudential Regulation Authority data put CBA s total gross loans and advances at $615.4 billion at the end of October, followed by Westpac at $587.1bn, NAB at $474bn and ANZ at $398.7bn. Separately, Macquarie s analysis showed the major banks market share losses started to abate in October as growth from non-bank lenders slowed. While this could be just a one-off aberration, we believe a more likely explanation lies in non-banks starting to implement tighter lending standards, Mr German said. Several of the big banks argued that non-bank lenders were unfairly taking advantage of a lending standards clampdown, which had largely targeted deposit-taking institutions. The UBS report highlighted that Macquarie was continuing to grow its investor loan book very quickly, while the major

43 The Australian, Australia Author: Joyce Moullakis Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,409 Words: 545 Item ID: Page 2 of 2 banks kept shrinking in that area. Credit growth % change (yoy) Source: Macquarie

44 Australian Financial Review, Australia Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 15 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,362 Words: 315 Item ID: Page 1 of 1 Big super funds shun agricultural assets The prospect that GrainCorp may be worth more to unlisted investors will put the spotlight on Australia s $2 trillion superannuation sector and why it doesn t like investing in listed agricultural assets. Once news of the potential deal hits Canberra and it will, it s just a matter of time there ll be all sorts of questions flying around about why GrainCorp could be worth 42.7 per cent more to an unlisted bidder than Australian equity investors, including the superannuation funds. Funnily enough the government shouldn t have to look too far for a response. Because while GrainCorp s suitor Long-Term Asset Partners has been running around stitching up support for its deal, there has been a parliamentary inquiry into the issue. Treasurer-turned-prime minister Scott Morrison announced it in May, and there have been eight public hearings. Industry fund Prime Super stepped up and did the heavy lifting, saying it had invested directly into agriculture for many years and the outcome was less than satisfactory. The manager blamed droughts, crop export quality and the Australian dollar, and being unable to obtain sufficient scale for true diversification across geographies and climatic zones. It also pointed to risks in not meeting return expectations, a lack of liquidity and government involvement as among the risk factors. Industry Super Australia painted a bleak picture. It said across its industry fund membership, only about 0.3 per cent of investments were in domestic agriculture which, according to the inquiry chair, was remarkably low. As always, the focus was on why the big Canadian funds were writing cheques for Australian agriculture and the locals weren t. Harvest time Investment risk-returns accross asset classes 1990 to 2016 (%) Private equity International fixed interest ALL FARM INDUSTRIES* Cash Beef* Infrastructure Inflation linked bonds Wheat and other crops* Australian fixed interest Direct property HFRI FOF Diversifed Index S&P/ASX 300 S&P 500 S&P/ASX 300 Accum Property MSCI World ETF Hedged MSCI World ETF Unhedged Dairy* Long term volatility (%) *Farm industry returns data include both income and capital appreciation; beef, wheat and other crops and all (broadacre) farm industries returns are from large-scale farms with revenue greater than $1million, obtained from ABARE database. SOURCE: INDUSTRY SUPER AUSTRALIA

45 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 1 of 7 From car dealer to $100m hedge fund genius Inside story Jonathan Shapiro The one-hour time difference between Queensland and NSW adds an element of confusion for those with matters both sides of Tweed Heads. The time is 2.38, said David McArthur, an investigator at the Brisbane office of the Australian Securities and Investments Commission moments after he turned on his electronic recording device. No it s not, responded Kenneth Charles Grace who had agreed to the interview at the office of his investment company Goldsky in Kingscliff, south of the border. Sorry, in New South Wales, 3.38pm on Friday the 26th of October 2018, McArthur, a former police detective confirmed, setting the record straight. He and ASIC lawyer Phillip Mines had travelled over an hour to the Salt Village resort complex to find out how this local Toyota dealer and paint business operator who almost qualified for a Bachelor of Business had built a complex multimillion-dollar hedge fund from a boutique store front. More importantly they had some serious questions about what had happened to the millions of dollars Goldsky had raised from friends and family in the Tweed Heads community and a host of local sporting celebrities. The money was coming in, but it was being spent on watches, plastic surgeons, vets and cars. And the balances were running down after some large withdrawals over $7.3 million between September 10 and October 23. Goldsky was officially registered in New York City. It claimed to have Continued p36 From page 1 From car dealer to hedge fund genius managed over $100 million of assets and returned almost 20 per cent a year to his investors, using sophisticated trading strategies that identified shifts in market sentiment. The fund was so impressive that it was named among Asia s top hedge funds of the year in But 2018 proved more challenging. In late September, the US Securities Exchange Commission sued Goldsky and Grace for making false and misleading claims about who their auditors were, how much money they had, and whether they had told the truth to ASIC in claiming they had no business in Australia. And earlier that week, The Australian Financial Review had plastered on Page 1 a feature about this curious Kingscliff hedge fund. The lawsuit and the coverage had moved Grace from a local celebrity to international notoriety. But the picturesque town of Kingscliff population about 7500 is a long way from New York. If they had to choose who to trust, this tightly-knit community would one of their own over big-city media and over-zealous US regulators. The reality is Goldsky had been on the radar of the regulator for at least a year. In September 2017, ASIC received a tip-off from Alison Levell, the Australian compliance head of Boston funds giant State Street. She called out a lack of professional behaviour in lifting and reusing almost verbatim, sections of our website. Our concerns stem not only from Goldsky having copied our website material but the possibility that there may be dishonest conduct occurring, she wrote in a lengthy . A month later ASIC received another complaint this time from Morgan Stanley s Australian head of compliance Bill Miels, refuting documents that said it was a prime broker of Goldsky. ASIC had also been exchanging s with Goldsky and its lawyers at Sydney firm Meridian. The fund had been granted an exemption from holding a licence to operate an Australian finance business by registering its operations in the US. The exemption was based on the provision that Goldsky did not conduct any activities in Australia, but ASIC had reason to believe this was not the case. In April the fund confessed to ASIC that it was under investigation by the SEC and had money from 21 Australians mostly friends and family from the local region. Goldsky said it would close the fund and return all the investor money by the end of the month. But the real drama for Grace had yet to begin. Goldsky was once again in the running to win the Asia region s top hedge fund award but in September, when the SEC filed its lawsuit, the fund s activities attracted unwanted scrutiny. Grace was defiant, vowing to fight the SEC and branding the complaint unwarranted and unprecedented. Goldsky had not raised a single dollar in the US so there were no investors to protect, he said. But the team at ASIC was becoming increasingly concerned about Grace s activities. So McArthur and Miles headed south with the weekend traffic to Kingscliff after arranging the meeting with Grace. Their arrival coincided with that of vacationing families and wedding parties who descended on the popular resort complex that had helped transform Kingscliff from a sleepy seaside town to a desirable tourist spot and a sophisticated sea-change location. The Goldsky office is along a wooden walkway, in between a beautician and a pilates studio, and beneath two stories of holiday flats. The meeting rooms have terracotta-coloured walls and dark ceilings. Grace confirmed he was 53 years old and that he lived 500 metres away. The address he provided is a luxury Balinese villa on the corner of a quiet street adjacent to the Peppers holiday apartments. He lives there with his second wife, Jane, and their children two daughters and a son. Locals said Grace bought the house, which can be seen from the cafes of Salt Village resort, in an off-market transaction last year for an estimated $1.7 million from local artist and conservationist Michelle Phillips. Ms Phillips paintings were on sale in the Mantra hotel lobby metres from the office for about $700. McArthur wanted to know what qualifications Grace had acquired that led him to become a market-beating money manager. Almost a Bachelor of Business, he said. I lost it by one month. I then went to university and studied fractals and chaos theory and some other science-related subjects, he explained. (Chaos theory is an emerging field of study that has lured mathematicians attempting to identify the border between randomness and order.) Grace then began trading equities, futures et cetera, he said. He had also been a director of three Toyota dealerships, some property companies and a distressed debt company. Grace had a breadth of business experience but no formal qualifications. McArthur then quizzed Grace s complex structure of funds based in the US and in the Cayman Islands and how he had invested the funds from the 30 or so Australian clients. They were all friends and associates and they had given him ballpark $5 million to AFRGA1 0036

46 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 2 of 7 $6 million to trade. We never marketed the fund or promoted anything, Grace said before noting that all their money had been returned. McArthur asked about the role of Victor Popov, an employee of Goldsky who Grace described as a famous physiotherapist. Given that we decided to ramp this business up, his role was to obviously gain more clients Grace explained. So how exactly did Grace beat global markets? He told McArthur he traded international equities through brokerage platforms Interactive Brokers and CMC Markets. Grace said he used algorithms to make a decision about which equities to buy and sell. We also use data supplied by Bloomberg to analyse behaviour and human sentiment to give us an indication of the ideal time to enter and exit the position, he added. McArthur also wanted to clarify how much money Goldsky had managed and which service providers it had hired to audit and administer the funds. The fund had once claimed it managed over $100 million and was targeting $200 million. But Grace explained the $100 million figure was partly clerical error when it applied for a licence in the US. Goldsky didn t have nearly as much, he said. It was closer to $5 million. As for the claims that Ernst & Young, Citco and Northern Trust audited and administered their funds, this was all a misunderstanding: the consequence of rescinded offers, prospective agreements and products that never made it to launch. The misuse of State Street s marketing, reporting and compliance information was unintentional, Grace said, as he pinned the blame on an external graphic design firm. He had given up the hedge fund game in April, he said, and returned all the money plus profits to his 30 investors. With a son in crisis, it was all too much. I guess I couldn t cope with the pressure or the stress any more so I needed to be with him. But Grace, it appeared, was still trading for himself, and his friends. Well I do quite a few for quite a few people. Which is probably illegal, but anyway I probably, I do it for quite a few friends. I don t purport that to be a fund or anything. They re personal relationships. It is not clear whether those clients were among the 30 investors he had cashed out when he closed the fund in April. I may get myself into trouble but anyway, we ll see what happens, Grace said. Hopefully my name will be cleared, because no one s ever lost money. Until a few weeks ago, Ken Grace was respected in the local community as a trading mastermind. That an international hedge fund publication agreed, only enhanced his reputation. In October 2017 Grace and wife Jane flew to Hong Kong to attend the AsiaHedge Fund Awards after Goldsky was nominated in the global equities category. To Grace s apparent surprise, Goldsky was victorious, providing the operation with an enormous credibility and marketing boost. McArthur was intrigued how that had come about. They kept asking and asking, you know, they all try to contact you over and over, Would you like to submit your figures?, Grace said. We didn t have audited figures, he said. But he was told they would still be accepted so he ed them through. So we submitted the figures. We didn t think we d expect to be winning anything, and then we won the award. Grace stood proudly by the numbers. I achieved them personally. In fact, Goldsky was in line to win the award again in 2018 and was nominated in the category before news of the SEC lawsuit led AsiaHedge to replace it in the roll. The awards were held last week in Hong Kong. In the absence of Goldsky, Platinum s healthcare fund took out the global equities category. McArthur and Mines would soon get on to more serious matters. So as a result of our investigations, you know, we ve had some concerns about the fund and how it was operating, McArthur explained before informing Grace they had used their statutory powers to gain access to the company s bank statements a National Australia Bank account for the Global Access Fund and two Westpac accounts. The statements dated to March It showed that investors had deposited money into a NAB account before it was transferred into two Westpac accounts. The first Westpac account was the Goldsky Investment account for which Ken Grace and Tracey Lee Grace were signatories, and which was closed in January. The second was the Goldsky Asset Management account for which Ken Grace and his wife Jane Marzin were signatories. The latter account became active in January, around the time the initial Westpac account was closed. At the time the SEC made its lawsuit public on September 26, the asset management account had a balance of $3.3 million. By October 25 the balance was around $1 million, and by the end of the month, just under $300,000 remained. McArthur wanted to know where the money was going and he ran through a list of references tied to large payments, such as Carl and Kat and Dave and S.T.. Grace said the recipients were clients, friends and family. They included his wife Jane, his daughters, his son, his employee Jack, Victor Popov whose payments totalled $415,000 the office cleaner, his cousin and several friends. Now also out of these two business accounts, there s been a lot of personal spending, McArthur said, pointing to $72,000 in grocery bills. (In fact the sum later presented to the courts from March 2017 to October 2018 was closer to $92,000.) Just bear in mind this is not other people s money. It s my money, so I can spend my money on what I want, Grace said. McArthur was interested to know how given these spending habits Grace could track what funds belonged to investors and what was his personal money to spend. Grace said he could provide spreadsheets before stating again it was my own money. When I do someone a personal favour and manage a trade, I don t do it for free. If the bank statements were any indication of his management fee, Grace provided an expensive service. In fact, he had previously pledged 20 per cent of his management fee to the Sleep Safe Sleep Sweet foundation (or Ssssh), the charity he set up with Jane to tackle the significant homelessness problem in the Tweed region. McArthur didn t confront Grace on the full extent of the personal expenses and family transfers, which amounted to over $1.1 million. But further analysis revealed that since March 2017, over $58,000 had been spent on cosmetic procedures, including payments to two plastic surgeons, Dr Michael Miroshnik and Dr Michael Zacharia, who operate out of Bondi Junction and Double Bay in Sydney. Over $47,000 had also been spent on beauty treatments and services, with a large portion to the luxury Byron Bay Gaia Retreat & Spa. The amount spent on luxury goods ran to over $100,000 due to large purchases of Breitling and Rolex watches, Tiffany jewellery and Louis Vutton accessories. The family transfers totalled $747,646, with Jane receiving $365, while his son received $169,000 The pubs and restaurants in the Salt Village were also beneficiaries of the Grace s largesse. Over $13,000 was spent at the Salt Bar, the family pub at the beach end of the village complex, while bills totalling $ were racked up at Fins, the cele-

47 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 3 of 7 brated seafood restaurant located directly behind the Goldsky office. The restaurant is run by celebrity chef Steve Snow, who records show deposited a total of $140,000 into Goldsky s NAB bank account. ASIC s analysis of the bank accounts showed that over $16 million of proceeds had been raised by Goldsky, while $8.8 million had been remitted out. By examining the notes on the deposits, which tended to be for large round-number figures, ASIC compiled a list of investors in Goldsky, which it presented to the courts. The largest investor on this list was a 53-year old builder from the neighbouring town of Casuarina, who had transferred $2.475 million, in addition to $250,000 in a self-managed super fund set up in May. The Financial Review attempted to visit the individual to determine the status of the funds. A carer named Michael answered the door and a business card was left. No call was returned. Three other investors deposited over $1 million into Goldsky s bank accounts. In total ASIC listed 56 depositors, most from in and around the Kingscliff area, and surrounding towns such as Burleigh Waters in Queensland. The Financial Review visited some of the individuals listed among the original Goldsky investors, and who lived in the vicinity of Salt Village. I don t want to talk to you, said a middleaged lady with an Irish accent when the Financial Review explained the purpose of the visit. Court documents show this individual had deposited $256, into Goldsky bank accounts. Another investor, a mortgage broker, told another resident on the phone he had been cashed out, but had never had a losing month when he was invested. He had deposited $30,000, according to court documents. Other investors did not return calls, answer their doorbell, or respond to s or text messages. Some locals believed there may have been other individuals and self-managed superannuation funds with multi-million dollar investments that may not have appeared on ASIC s list. Several Kingscliff residents said investors were not concerned and believed the SEC action was the consequence of a misunderstanding. The general feeling in the community is that everything is under control, said one woman who declined to be named. From the few locals who would talk, on condition of anonymity, the clear sense was that the Kingscliff community stood by the Grace family. One resident said there was a general sense of mistrust in the media, particularly in relation to coverage of the new Tweed Valley hospital that had divided residents. They were not buying the story that Grace would mishandle his friends money. We are a very trusting community, one local said describing how on weekends they placed witches hats at either end of their streets so their children could roam freely. They were ing Jane and Ken too, who last year set up the Ssssh charity to help deal with youth homelessness in the Tweed region. The charity launch was held last August at Plantation, a popular event venue, about six kilometres west of Kingscliff. They cast the net very wide, said one local man who was invited. In attendance was finance celebrity Mark Bouris and a cast of local sports stars including surfer Joel Parkinson, Olympic cycling duo Stuart O Grady and Rob McEwen. Boxer Jeff Horn also made an appearance, which received widespread coverage in the local media. But not everyone bought the investment pitch that followed the launch. We didn t invest in it. We didn t understand it and we are very conservative, said one individual. A local woman who is a property investor also chose not to invest in the fund. She doubted it was so simple to work out sentiment in financial markets and trade on it, because in property that was the most important but hardest factor to figure out. It is about people, and people are unpredictable. But, she admitted, her mistaken impression that Jeff Horn was endorsing the fund almost convinced her otherwise. The presence of sporting celebrities may have dazzled the locals. But they turned out to be the prime targets. Several with ties to the physiotherapist Victor Popov were among the largest deposits. They include McEwen, who deposited $50,000. O Grady it appears may have also been an investor, as bank statements show several payments with the reference stuart ogr. Olympic swimming medallist Sam Riley also made an appearance at the function and invested $50,000. Her husband Tim Fydler, a real estate agent, invested $100,000. Riley s former coach Scott Volkers from Brisbane sent $220,000 Goldsky s way. And Brisbane Lion AFL great Simon Black deposited $80,000. Lachlan Penfold, the Melbourne Storm s high-performance coach, tipped in some cash $127,559 in total. David Bick, who is a colleague of Popov at the Queensland Sports Medicine Centre, invested $25,000 while Essendon star Devon Smith had $100,000 tied up. The investors lured into Goldsky ranged from Olympic athletes to local builders. But their common trait is they were cashed up, and lacked the knowledge of financial markets that Grace claimed to possess. As for Grace, he has proved elusive of late. The Financial Review visited Goldsky s office on three consecutive days. Other than the office furniture, two Bloomberg terminals, a note pad, a phone charger and a bicycle, the office was empty. Local shopkeepers say they have not seen Grace since the administrators at William Buck were dispatched, about a month ago. That was the result of a Queensland Supreme Court order to freeze Grace and Goldsky s assets, requested on October 29, shortly after the ASIC visit. Last week, the courts froze the assets of Jane Marzin. The receiver has been given an extension to produce a report because of a delay in regards to the production of books. In requesting the court s approval, ASIC pointed out that $3.5 million had been transferred to an unknown account between September 11 and September 28 with the description Ken Grace, while $1.1 million was transferred to an unknown account on October 22. The matter was scheduled to return to court next Monday, December 10. Grace did respond to an initial to arrange a meeting but did not confirm whether or not he was in Kingscliff. His charcoal Mercedes has remained parked out the front of the house. When the Financial Review knocked on the front door of his villa we were confronted by Jane in jeans, a blue-and-white buttoned shirt, holding her phone. She had a tattoo on her wrist. I don t know what you are doing, going around the community asking people if they are concerned, she said. The money is there, she said, adding that the lawyers would be responding. A young male voice from inside urged her to call the cops while a middle-aged lady in a purple tank top and jean shorts stood behind her. It is because of people like you, that people kill themselves, Jane said before slamming the door. Local residents who were investors believed there was no reason to be concerned and that their money was safe. Ken Grace said as much to McArthur.

48 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 4 of 7 He still owed about $1 million to three or four people, he said. But I am going to pay it all out so I can cleanse this, and clean this mess up, he explained as the interview drew towards a conclusion. About those bank accounts, the balances are getting progressively lower, McArthur said. There s no problem paying everyone out I can assure you of that, Grace replied. The NAB bank accounts, however, showed that Goldsky was still raising money. ASIC later said in a court filing that it was concerned about numerous large deposits from existing investors as recently as Octo- ber 15. Two female investors Christine Chauntler and Rachel Cunningham tipped in $150,000 and $75,000 in September and October, according to the NAB bank statements, with Chauntler doubling her total investment to $300,000. So when we started looking into your accounts, obviously we had some serious concerns because we couldn t see any money going to trading platforms, so that really concerned us, McArthur told Grace. And what we are seeing in those accounts made us suspect that it could be a Ponzi scheme. Are you familiar with that term? There was no audible response. McArthur appeared to offer an explanation. That you were paying old investors with new investor money and it was going around in a washing machine fashion. From your accounts we found, we haven t been able to find any evidence of transferring money to platforms. Can you explain to us how you do that? That was not a problem, Grace said. You know the Bankwest account one of the trading platforms with CMC as well, and one of the, one of the transactions probably goes through that. But I can get you, I ll get you the information. The interview had gone for over an hour, and was close to wrapping up. But McArthur had two more requests. Ken, at present do you have plans to travel? No. It would be our preference if you stay in the country, you know until we sort this out. And McArthur wanted some paperwork relating to the elusive trading account where Grace had worked his investing magic on behalf his loyal friends and associates. I can t no, not really. I can t provide them now. This was because they were in stor- age. We ve knocked all the walls down in there. The rest of them, probably get something from home or something, but, no, I think provide it with my lawyer. The interview was almost over. All that was left was for Grace to validate the time. Do you agree the time is now 4.05pm? McArthur said. Yes Grace responded. This time McArthur corrected himself: Sorry, 5.05pm New South Wales time. Still on Queensland time, Mines added in apology. Another weekend in Kingscliff paradise would begin. But on Monday McArthur and Mines would be making the three-block walk from their office to the Queensland Supreme Court to freeze the fund. AFR This is not other people s money. It s my money, so I can spend my money on what I want. Kenneth Grace I do quite a few for quite a few people. Which is probably illegal... Kenneth Grace We also use data supplied by Bloomberg to analyse behaviour and human sentiment. KennethGrace AFRGA1 0037

49 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 5 of 7 From the few locals who would talk the clear sense was that the Kingscliff community stood by the Grace family. SPORTING CELEBRITIES AMONG THE INVESTORS Jane and Ken Grace of Goldsky, as displayed in a tweet. Below: David McArthur, ASIC enforcement officer, via LinkedIn. Olympic cyclist Stuart O Grady may have been an investor. Brisbane Lions AFL great Simon Black deposited $80,000. Olympic swimming medallist Samantha Riley invested $50,000. Melbourne Storm performance coach Lachlan Penfold tipped in $127,559.

50 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 6 of 7

51 Australian Financial Review, Australia Author: Story Jonathan Shapiro Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 40,372 Words: 4121 Item ID: Page 7 of 7 Below: Goldsky offices in Kingscliff. PHOTO: JONATHAN SHAPIRO

52 Age, Melbourne Author: Emma Koehn Section: Business News Article type : News Item Classification : Capital City Daily : 83,229 Page: 27 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 13,315 Words: 439 Item ID: Page 1 of 1 RETIREMENT Disruptors prepare for launch Super fund startup to focus on women Emma Koehn Christina Hobbs was in Baghdad when she decided it was time to become a start-up founder and disrupt Australia s superannuation space. A lot of it was thinking about these huge problems around climate change, war and what we can do. And about investing in industries doing the right thing, Hobbs says. The former Deloitte management consultant and United Nations financial inclusion expert will launch her women-focused superannuation fund, Verve Super, with co-founders Zoe Lamont and Alex Andrews this week. The start-up will aim to build the financial power of women by inviting them to join a super fund that will screen investments through a gender lens, including only investing in businesses with women on their boards and meeting specific ethical requirements across supply chains. The fund also plans to write to company chairmen who do not have women on their boards and if they don t work to improve this, Verve will drop them from possible future investments. Hobbs previous experience included setting up emergency banking systems and women s financial security projects for the UN. From Iraq to Somalia, she says she s seen the importance of financial inclusion for women around the globe, and says Australian super funds can definitely do better. Self-employed women in particular are an area of focus for Hobbs, who has built the start-up out of Melbourne s female-focused One Roof Women co-working space. She says given Australian women retire with 47 per cent less retirement savings than men on average, the aim was to create a fund focused on financial education and respect. It s about making a fund that would have a conversation with them and respect them. Taking aim at larger financial institutions and their superficial engagement with female customers, Hobbs says building a superannuation start-up is about much more than putting letters in pink. We welcome women, nonbinary people and men to join the fund. We re very clear that what we re doing is tailored to women, but I think we ll get a whole broad church of Australians. Verve will kick off with $200,000 of start-up capital, $100,000 of which has come from Hobbs personal savings. The goal is to get $300 million in funds under management within four years. The start-up was born because of the huge unmet need for an education-focused fund, Hobbs says. She s not alone. Across Australia a number of niche retirement providers are preparing for kickoff, including GigSuper, which will be pitched at self-employed Australians. Co-founder Peter Stanhope says the fund is looking to launch in February 2019 to capture the 1.7 million self-employed Australians who have been ignored by traditional funds.

53 Border Mail, Albury-Wodonga Section: General News Article type : News Item Classification : Regional : 13,519 Page: 17 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 691 Words: 241 Item ID: Page 1 of 1 AMP boss aims to win trust FRANCESCO De Ferrari has started work as AMP chief executive after what he says have been some of the most challenging days in the company s 169-year history. The former head of Credit Suisse s Asia Pacific private banking business took charge on Monday, with interim chief executive Mike Wilkins who stepped in following Craig Meller s sudden exit returning to his role as an independent non-executive director. Mr De Ferrari said he aims to win trust following the exits of Mr Meller and chairman Catherine Brenner over revelations of misconduct at the banking royal commission. This year, AMP has faced into some of the most challenging days of its 169- year history, Mr De Ferrari said. However, I strongly believe in the company s purpose and I look forward to overcoming recent challenges and leading AMP s return to growth. Mr De Ferrari said his immediate priority was to review AMP s business model. The royal commission... has provided an additional impetus for change in our business - and I m determined we seize the opportunity, Mr De Ferrari said. Our focus must be on doing better for our customers, shareholders and people. AMP has lost more than half its market value since April s revelations the group charged customers for advice that was never given and misled the regulator. In August, AMP reported a 74 per cent plunge in its first-half profit after it set aside $290 million to refund and compensate customers.

54 Canberra Times, Canberra Author: Andrew Podger Section: Public Sector Informant Article type : News Item Classification : Capital City Daily : 17,579 Page: 10 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 23,744 Words: 2107 Item ID: Page 1 of 3 The wrong path on retirement incomes Andrew Podger The idea that a compulsory super contribution of 9% is enough is deeply flawed. Despite its detailed analysis, the latest Grattan Institute report on retirement incomes policy is annoying. Grattan chief executive John Daley s style is to grab headlines, campaign loudly for his particular policy preferences and, equally loudly, dismiss alternative views. There is, as in most of Grattan s work, some very useful supporting evidence, but it takes effort to appreciate the assumptions and caveats involved, and to understand all the implications, limits and uncertainties of the report s headline prescriptions. Other expert groups such as the Centre of Excellence in Population Ageing Research, which released three documents on retirement income a week before the Grattan report was published, and the Committee for Sustainable Retirement Incomes have also presented preferred policies but generally with less fanfare and more care to address the objectives of the retirementincome system as a whole. The Grattan report makes some sensible recommendations but also some highly questionable ones, and has important omissions. The headline story is the institute s view that there is no need to increase the compulsory superannuation contribution rate beyond the current 9.5 per cent, and to that do so would disadvantage needy working families and cost taxpayers a lot of money. Indeed, the authors suggest that retired people even today can expect more than adequate incomes compared to their preretirement incomes (a significant proportion at both low and high incomes can expect incomes now above their pre-retirement incomes). Not readily apparent from the headlines is that this: assumes that retired people draw down not only their super savings but nearly all their assets h h h i h b h i other than their homes by the time they are 92; is based on survey data that such non-super savings are significant across income levels; and assumes, for those eligible for some age pension, that their income from savings does not even need to keep up with inflation (given the pension is indexed to earnings). The authors surprising result is also due to the high average returns on investments in the last two decades. The report emphasises that, on a similar basis and with the currently legislated 12 per cent compulsory contributions to be phased in over the next few years, all young people would be able to meet the adequacy benchmark of 70 per cent net income replacement, with many on lower incomes having higher incomes in retirement than before. At the current 9.5 per cent contribution rate, Grattan s modelling suggests only a minority of people, all on above-median earnings, would not reach the 70 per cent net income replacement benchmark. It may be reasonable to view non-super, non-home-ownership savings as available to fund consumption in retirement, but Grattan s calculations are based on average levels of such assets by income decile; no doubt, however, the levels will vary considerably within each decile and will be affected by levels of superannuation and homeownership savings. The purpose of the retirement-income system, however, is to ensure secure and adequate incomes in retirement for all Australians. It may be that, for some, increasing super contributions is unnecessary because they are already saving in other ways but, if so, they could and almost certainly would adjust their other savings (Grattan seems to suggest the other savings would largely be unaffected by increasing the compulsory super contribution). Grattan dismisses (with a snide reference to self-interest) those who focus only on the age pension, super (mandated and voluntary) and home asset pillars of our retirement-income system, and largely ignore other i B i i h f ill savings. But it is these four pillars that the government must focus on to ensure secure and adequate retirement incomes for all. Work commissioned by the Committee for Sustainable Retirement Incomes two years ago confirmed that 12 per cent contribution rates would ensure that those up to just below median earnings would meet the 70 per cent net income replacement adequacy benchmark, given access to some age pension. At 9.5 per cent contributions, the replacement rate for couples on median earnings would be under 60 per cent. More recent work by the Centre of Excellence in Population Ageing Research seems to confirm these findings. Those on incomes above the median would generally need to save 15 per cent or more to achieve the adequacy benchmark (i.e. they must voluntarily supplement the mandated 12 per cent contributions). Such contribution levels are particularly important for those who wish or need to draw on some of their super before age 67. These estimates may seem much more credible than the Grattan data to public servants, whose compulsory employer contributions are 15.4 per cent, and who are encouraged to supplement these with their own contributions, recognising they are unlikely to be eligible for much if any age pension. (Those, like me, on the CSS that required effective employer contributions of about 20 per cent, and another 5 per cent in employee contributions, are fortunate to live comfortably in retirement, but the income-replacement rates after tax were generally no higher than the 70 per cent adequacy benchmark, albeit they could access the pension from age 60.) Grattan is right to draw attention to the fact that the legislated increase in compulsory contributions to 12 per cent over the next few years will add to employees costs and, over time, will be borne by employees. There is therefore a strong case for carefully phasing in the increases, linking them to real increases in i j d i

55 Canberra Times, Canberra Author: Andrew Podger Section: Public Sector Informant Article type : News Item Classification : Capital City Daily : 17,579 Page: 10 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 23,744 Words: 2107 Item ID: Page 2 of 3 remuneration, just as was done in the 1990s when the first steps were taken to introduce and increase the compulsory contributions. Low real-wage growth at present may justify adjusting the phasingin arrangements, though these are already quite prolonged. But the case for most people to spread more of their lifetime earnings in order to maintain living standards in and through retirement remains strong, particularly when they can expect more years of retirement living. One of Grattan s continuing arguments against the current Australian retirement-income system is the claimed cost of superannuation tax expenditures. The latest report suggests a further cost of $2 billion a year from increasing the compulsory contribution rate. It is important to recognise the basis of these claimed tax-expenditure costs. They assume super contributions should be taxed at employees marginal tax rates, and that all earnings from the accumulated savings should be taxed the same way, while incomes drawn in retirement should not be taxed (a comprehensive income tax approach, or TTE). This is not the orthodox way to tax savings intended to spread lifetime earnings. The orthodox approach is to exempt contributions and fund earnings but fully tax the incomes derived in retirement (a comprehensive expenditure tax approach, or EET). It is simply too hard now for Australia to adopt the EET approach, after more than 20 years of taxing contributions and fund earnings. Work commissioned by the Committee for Sustainable Retirement Incomes, however, examined what concessional taxes on contributions and earnings, with no tax on retirement incomes (a tte approach as distinct from TTE), might be broadly equivalent to the orthodox EET approach. The finding was that the progressive tax on contributions introduced by the Turnbull government, and the caps on contributions and accumulated savings for the purposes of our tte regime, achieves about the same net income in retirement as the ideal TTE approach right across the income spectrum with no significant subsidies to either high or low-income earners. There is no tax expenditure involved unless one assumes, as Grattan does, that current taxes on contributions and fund earnings should ideally be doubled. So the $2 billion a year cost Grattan claims is based on a false assumption. Similarly, its suggestions to further tighten the current tax regime for super are inappropriate. Indeed, while the system is still maturing, there is a good case for relaxing the $25,000 cap on contributions introduced by the Turnbull government, particularly for older female workers with low levels of accumulated super savings. Again, this is likely to be seen as obvious to public servants on higher incomes, whose 15.4 per cent employer contributions already exceed the cap. Despite these criticisms of the Grattan Institute report, it does include recommendations with which I strongly agree, but these have been overshadowed publicly by its emphasis on not increasing compulsory contributions. These include in particular the importance of increasing rental aid for pensioners who do not own their own home, and of relaxing the recently tightened assets test. The evidence from Centre of Excellence in Population Ageing Research and the Committee for Sustainable Retirement Incomes, as well as that in the Grattan report, demonstrates overwhelmingly the serious problem of poverty among pensioners in private rental accommodation. A sizeable increase in rental aid is long overdue, not only for age pensioners but also for other social-security recipients. There is also a strong case for relaxing the assets test, which was unwisely tightened by Scott Morrison when he was social services minister. The test taper was increased from reducing the fortnightly pension by $1.50 for every $1000 of assessable assets above a threshold to $3 a fortnight. This imposed the equivalent of a 7.8 per cent tax, well beyond expected earnings from investments, and beyond the annuity the asset could generate (which includes return of capital). It is difficult to reconcile such a test with the rest of the retirementincome system, which is meant to f ili f l fi i l facilitate careful financial planning to achieve desired levels of retirement incomes and living standards. It can only lead to confusion and distortions in savings behaviour (for example, to invest more in housing than in super) by those in their fifties looking carefully at how best to achieve their desired postretirement living standards. Grattan suggests lowering the taper to $2.25 reduction in fortnightly pensions for every $1000 of assessable assets; I suspect that is still too tough, noting it would still be tougher than the income test. A merged means test (as existed in the 1960s), or at least a more coherent approach to the separate income and assets tests, could simplify the retirement-income system, making it easier for people to plan how to achieve the retirement income they want. Tellingly, Grattan omitted any reference to the greatest weakness of the Australia s retirementincome system, and the issue rightly getting the most attention from the Treasury, the Department of the Prime Minister and Cabinet, and external experts. This is the failure to convert the growing levels of accumulated savings into secure retirementincome streams for life. Grattan s calculations like those of the other researchers mentioned above, as well as the OECD refer to the income streams that should be possible from accumulated savings, not retirees actual incomes or consumption levels. As the financial system inquiry revealed, too many retirees are self-insuring for longevity risk by holding onto their savings, unnecessarily limiting their retirement living standards and leaving excessive funds in their estates (this is far more common than people running out of savings). Longevity risk management requires people to pool savings. The latest government announcement goes some way to address this issue, requiring funds in future to offer retirees with more than $100,000 in super savings a comprehensive income product for retirement (or CIPR).

56 Canberra Times, Canberra Author: Andrew Podger Section: Public Sector Informant Article type : News Item Classification : Capital City Daily : 17,579 Page: 10 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 23,744 Words: 2107 Item ID: Page 3 of 3 (I favour the suggestion from a recent conference participant to change CIPRs to secure lifetime income products for retirement, or SLIPRs.) Such a product will generally include an indexed lifetime annuity. I strongly suspect that further action will be needed sometime in the future to press people to place more of their super into annuities. Perhaps people may even see merit in the sort of indexed pensions provided under the old CSS and PSS schemes, and start thinking about their super savings not as big sums of money but in terms of the secure, indexed lifetime incomes they may deliver (mostly, with a part age pension). They should be thinking and planning this from about age 50 if not earlier. Grattan seems to think we have a problem of sustainability in our retirement-income system. That is simply not the case, as the continuing fall in age-pension g g p coverage demonstrates (down already to about 65 per cent of those over 65, with an increasing proportion of pensioners over 40 per cent now on part pensions only). It s more important to ensure the system actually delivers secure and adequate retirement incomes for all, including by proceeding with the legislated increase in mandated contributions. Andrew Podger is an honorary professor of public policy at the Australian National University and was a foundation member of the Committee for Sustainable Retirement Incomes. andrew.podger@anu.edu.au Too many retirees hold onto their savings, unnecessarily limiting their living standards and leaving excessive funds in their estates.

57 West Australian, Perth Section: Letters Article type : Letter Classification : Capital City Daily : 147,676 Page: 20 Printed Size: 16.00cm² Region: WA Market: Australia ASR: AUD 281 Words: 142 Item ID: Page 1 of 1 Taxing issue Shane Wright s column headlined Turning off the tax perk tap (Opinion, 3/12) makes an unfair comparison between two mid-60-year-olds, one earning $80,000 in income and the other drawing an $80,000 pension from their superannuation fund. The income earner correctly pays tax on his/her income because it is income that they are receiving, increasing their net worth. The pensioner, on the other hand, is merely drawing money out of an existing super fund that he/she already owns. To tax that would be like taxing a bank withdrawal from one s savings account. Also, to think that any government would allow one group of people to pay less tax if they could increase the tax on others is like waiting for pigs to fly. All that would happen is that the government would increase its spending, which it does anyhow. Gerry Hofmann, East Perth

58 Gold Coast Bulletin, Gold Coast QLD Section: Letters Article type : Letter Classification : Regional : 21,468 Page: 16 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 1,342 Words: 279 Item ID: Page 1 of 1 Financial industry watchdogs are letting taxpayers down ONE thing the Royal Commission has really exposed is the complete waste of taxpayer money the Australian Prudential Regulation Authority (APRA) and Australian Securities and Investments Commission (ASIC) have been. Both established in 1998, they ve been exposed as slush pits for highly paid bureaucrats who ve done little to nothing about fulfilling their role and protecting the public from exploitation in the financial services industries. APRA in its own words is an independent statutory authority that supervises institutions across banking, insurance and superannuation, and is accountable to the Australian Parliament Under the legislation that APRA administers, APRA is tasked with protecting the interests of depositors, policyholders and superannuation fund members. Yet it has taken only one institution to court in 11 years. ASIC again in its own words is Australia s integrated corporate, markets, financial services and consumer credit regulator we have powers to protect consumers against misleading or deceptive and unconscionable conduct affecting all financial products and services, including credit. In the past 10 years, ASIC has issued less than $1.3 million in infringement notices to banks. The Australian public has been duped by these expensive organisations. But worse is the role of our politicians (of all sides) who ve sat idly by and poured money into their coffers without question. No member of the public can be expected to have the knowledge and power to investigate, but the parliament which does have the power and finances, simply made no effort. Again politicians have let us down. How much longer do we have to put up with politicians doing whatever they please with tapayer s money (particularly with pay and perks) without being truly answerable? IAN TIMMINS MERMAID BEACH

59 Gold Coast Bulletin, Gold Coast QLD Author: Terry McCrann Section: General News Article type : News Item Classification : Regional : 21,468 Page: 25 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 2,714 Words: 812 Item ID: Page 1 of 1 GRAINCORP BID: 2018 PLAY THAT WAS BORN IN THE 1980S TERRY MCCRANN SPEND a few billion dollars to buy a business actually, also a critically important national asset and then find somebody to be its owners. That somebody will be investors, big and small. That s essentially what the Tony Shepherd-Chris Craddock Long-Term Asset Partners (LTAP) vehicle is doing with its $2.4 billion bid to buy GrainCorp. Craddock, a former investment banker and asset manager, is the brains behind and driver of LTAP. He went to Shepherd to give his good idea practical grunt. Shepherd is a public servant-turned business exec with the Transfield infrastructure group. He has found a subsequent second life as a public policy player, kicking off with the presidency of the Business Council, and AFLaficionado as chairman of Western Sydney. He s gathered the group which has given practical credibility to Craddock s play, with the combination critical to getting the $3.6 billion, mostly from Goldman Sachs, to fund first the proposed takeover and then the subsequent GrainCorp operations. Ironically but entirely coincidentally, and with no practical relevance to either the bid or the way it will be dealt with and play out his counterparty chairman of GrainCorp, Graham Bradley, was Shepherd s immediate predecessor as BCA president. In a broad sense what Craddock and Shepherd are trying to do is a further advancement on what Ian Silk and his AusSuper industry super fund are trying to do with a number of plays of which the most determined has been private hospitals owner Healthscope. And both have even longer dated roots in what one-time ACTU heavyturned entrepreneur Garry Weaven pioneered with his Industry Funds Services operation in the early 1990s and its push to corner the market in the early stages of the wind energy industry. Weaven as assistant ACTU secretary and Bill Kelty as secretary joined in the 1980s with thentreasurer Paul Keating to create compulsory super as a wages-trade-off. That led to the industry super funds and the rest, would be history. The big step Weaven took was to become the goto guy for anyone wanting to invest in renewable energy and in particular wind. Investment in wind has of course widened dramatically to many other main-chancers since those IFS days and his move on to Industry Funds Management. What Silk has been trying to do 20 years later is to similarly become the goto-guy for anyone wanting to invest in a key asset like private hospitals by joining with a hedge fund to take Healthscope private. Now we see a similar play with GrainCorp. It s a step further because Silk s AusSuper would be an upfront (partial) owner of Healthscope were it to succeed (which is not looking so likely with the intervention of a second bidder) The difference with LTAP is that it doesn t have an existing long-term ownership base for GrainCorp. First it ll buy GrainCorp effectively as a bridge-owner - and then attract the long-term owners, such as especially super funds. While doing this it will also, critically, refine the the actual mix of financial instruments for both the long-term ownership and the way the business is funded. By doing it this way, LTAP has maximum flexibility in tailoring the whole package to maximise the return and to customise for a variety of investors and investment products and asset classes. Now, the first question that the play raises is exactly the same as what happened with AusSuper at Healthscope. Having rung the bell on the double-level appeal of GrainCorp both its intrinsic value and as a major and almost irreplaceable or even replicable infrastructure asset, its long-term investment appeal does this ring the bell on a competitive race? This goes to the two bigger and broader issues which this play, and a host of other attempted or successful infrastructure acquisitions highlight; while also posing really fundamental public policy questions. First, Australian owners dramatically undervalue our assets in a global investment environment where there are literally trillions of dollars looking for safe, long-term good investments. There are none better than most of Australia s. Crudely, to me this means, if Craddock is prepared to pay $2.4 billion, we and by that I mean Australia Inc should be asking for $4.8 billion. Better still we shouldn t be selling. At least with LTAP we would be selling largely to another form of we maybe even the same we as in repackaged super funds. That s the second big question: how many of these critical infrastructure assets that all used to be either publicly or producerowned GrainCorp is critical to getting a big slice of our grain crop into the market - should we allow to be foreign-owned? Both are wrapped together in the shorttermism that is the allcorroding rot festering within our super and funds management industries. The underlying ethic is to grab the profit and move on to the next returns-boosting play.

60 Launceston Examiner, Launceston TAS Section: General News Article type : News Item Classification : Regional : 17,631 Page: 16 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 1,099 Words: 262 Item ID: Page 1 of 1 AMP boss aims to win trust FRANCESCO De Ferrari has started work as AMP chief executive after what he says have been some of the most challenging days in the company s 169-year history. The former head of Credit Suisse s Asia Pacific private banking business took charge on Monday, with interim chief executive Mike Wilkins who stepped in following Craig Meller s sudden exit returning to his role as an independent non-executive director. Mr De Ferrari said he aims to win trust following the exits of Mr Meller and chairman Catherine Brenner over revelations of misconduct at the banking royal commission. This year, AMP has faced into some of the most challenging days of its 169- year history, Mr De Ferrari said. However, I strongly believe in the company s purpose and I look forward to overcoming recent challenges and leading AMP s return to growth. Mr De Ferrari said his immediate priority was to review AMP s business model. The royal commission... has provided an additional impetus for change in our business - and I m determined we seize the opportunity, Mr De Ferrari said. Our focus must be on doing better for our customers, shareholders and people. AMP has lost more than half its market value since April s revelations the group charged customers for advice that was never given and misled the regulator. In August, AMP reported a 74 per cent plunge in its first-half profit after it set aside $290 million to refund and compensate customers.

61 Warrnambool Standard, Warrnambool VIC Section: General News Article type : News Item Classification : Regional : 8,274 Page: 13 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 558 Words: 241 Item ID: Page 1 of 1 AMP boss aims to win trust FRANCESCO De Ferrari has started work as AMP chief executive after what he says have been some of the most challenging days in the company s 169-year history. The former head of Credit Suisse s Asia Pacific private banking business took charge on Monday, with interim chief executive Mike Wilkins who stepped in following Craig Meller s sudden exit returning to his role as an independent non-executive director. Mr De Ferrari said he aims to win trust following the exits of Mr Meller and chairman Catherine Brenner over revelations of misconduct at the banking royal commission. This year, AMP has faced into some of the most challenging days of its 169- year history, Mr De Ferrari said. However, I strongly believe in the company s purpose and I look forward to overcoming recent challenges and leading AMP s return to growth. Mr De Ferrari said his immediate priority was to review AMP s business model. The royal commission... has provided an additional impetus for change in our business - and I m determined we seize the opportunity, Mr De Ferrari said. Our focus must be on doing better for our customers, shareholders and people. AMP has lost more than half its market value since April s revelations the group charged customers for advice that was never given and misled the regulator. In August, AMP reported a 74 per cent plunge in its first-half profit after it set aside $290 million to refund and compensate customers.