CommBank boss Ian Narev says focus is on customer needs, but is it just talk?

It's fashionable to bash banks because, well, they often deserve it.

Just this week the ABC revealed the Commonwealth Bank's insurance arm had cut off income protection insurance payments from a cancer sufferer for no other reason, apparently, than just because it could.

It's the latest black mark against a bank that's repeatedly been shown to be treating people badly.

Under the pressure of more public humiliation, CBA caved in, admitted it was wrong and paid all the money it owed the Melbourne brand manager.

Australia's big banks are four of the five biggest companies in the country. They operate as an oligopoly with, at times, the worst of monopolistic behaviour.

As scandal after scandal has shown, the banks are often a law unto themselves. Nothing gets in the way of their desire for big profits for shareholders and huge bonuses for executives.

So, despite his bank's reputation being mud, it was refreshing to hear CBA boss Ian Narev articulate a different vision at its recent half-year results presentation.

What Mr Narev said was, "We don't sell, we meet people's needs."

I can hear you laughing, because all the scandals at the banks have been down to their sales driven culture, where employees are handsomely rewarded to sell as much of the banks' products as they can.

And guess what? Repeatedly they haven't met people's needs.

If the banks did heed Ian Narev's advice and just focused on meeting their customers' needs they wouldn't be in the reputational mess they're in now.

Meeting needs not sales targets equals business success

But let's put that to one side if we can because, for all CBA's faults, Ian Narev was right.

Business is not about selling products, it is about meeting customers' needs.

To put Mr Narev's comments in context, he was answering a question about whether the vertically integrated model the banks use, where they're a one stop shop for everything, was still the right one for CBA.

He went on to say, "We'd be letting our customers down if we don't have a solution to their needs."

Solving customers' needs.

We all know businesses that don't.

To give you a small example, there's a shop near the ABC in Sydney which makes wonderful sandwiches.

The only problem is they make the sandwiches they want to make. They won't make sandwiches to order.

I've lost count of the number of times I have looked in their window, seen nothing I liked, and kept walking.

In their mind they make sandwiches. They're focused on themselves. They're not focused on solving their customers' needs.

I wonder how many other people, like me, walk right past.

That's dollars not spent in that shop.

On the other side of the coin, I have twice been rung by someone from Telstra to be offered a different plan for my home internet and telephone accounts which they felt would better meet my needs.

(I wasn't hallucinating. I am aware of Telstra's reputation for customer service ... or not).

Even more surprisingly, both times Telstra contacted me the new plan they offered really was better for me and I ended up paying less.

That's meeting the customer's needs.

Anyone can flog stuff, but the way to keep your customers coming back, and attract new ones, is to give them an experience where they walk away feeling good about you and feeling that their needs have been met.

Ian Narev at the Commonwealth Bank clearly gets it - at least conceptually.

Given the history of his bank though, his challenge is to prove to Australia that the CBA really is about meeting people's needs and not just about selling products.

It's about walking the walk, not merely talking the talk.

Insecure, stressed, and underemployed: The daily reality for millions of Australians

If you've never felt insecure, you're very lucky.

It comes in all aspects of our life — our health, in relationships and with our work.

It's just one of those things. From an early age we have to accept that there are no guarantees in life.

The degree to which we feel insecurity though can be heightened by our circumstances.

I remember when the planes hit the World Trade Centre in 2001, I felt very insecure about my work. I was a stockbroker at the time. The phones rang off the hook that morning. Mum and dad investors couldn't sell their shares fast enough.

The managing director did his daily tour of the trading floor later that day and looked very grim indeed. He realised that while the calls may keep coming tomorrow, that would be it for a long while. Business was about to dry up.

I lost my job around four weeks later. It was my first redundancy. It felt awful. I wouldn't find a full-time work again until April of the following year.

Right now, millions of Australians are feeling some level of job insecurity, and it's hurting.

But the economy's creating jobs, right?

Sputtering economic engine

In economics we talk all the time about "job creation". It's a very abstract term though, isn't it? I mean, how do you create a job out of thin air?

Often, it's to do with demand. For instance, if the local fish and chips shop is overwhelmed by customers at the beach, the manager may want to build an extra till. That way the shop can process more customers... and viola! A job is created.

More broadly though, masses of jobs are created simultaneously when the economy grows faster.

What do I mean by that? Well the Australian economy is currently growing at around 2 per cent per annum. That's about fast enough to keep the unemployment rate steady, but it's not fast enough to create lots of new jobs. To create jobs, it needs to grow at least 2.5 to 3 per cent per annum.

The economy isn't growing fast enough for a whole bunch of reasons, but the big picture is that we haven't been able to transition as smoothly as we would have liked from the mining boom, to an economy being driven by a number of different sectors.

The rise of the part-timer

The sectors of the economy that have enjoyed increased activity are healthcare, hospitality, and tourism. These sectors tend to be biased towards hiring part-time workers.

Nine2Three Employment Solutions in Sydney's Sutherland Shire specialises in placing candidates into part-time roles. Managing director, Kathryn MacMillan, say business is booming. Right now, she's placing job seekers into part-time roles including mining, tourism, retail, clerical and accounts-type roles, sales roles and business development.

Ms MacMillan explained to me that she's placing lots of mums re-entering the workforce, and people after just a few days of work a week. Part-time work can also be convenient for students, and for those returning to the workforce after an illness or injury.

You can't ignore, however, the hundreds of thousands of Australians over the past 12 months that have either lost their job, or would dearly like to work more (to help pay the mortgage, utility bills etc.).

We know, for instance, the economy shed 53,000 full-time positions in September last year. Another 44,800 full-time jobs disappeared in January.

It's really quite straight forward. The Australian economy is transitioning, and many workers are getting left behind.

Remember the kids' game, musical chairs? Everyone has a seat to start with. That was the mining boom. The music started playing during the financial crisis, and now that it's stopped, we've noticed quite a few chairs have been taken away. We're now seeing two or three people trying to squeeze onto the same chair in many cases!

Working more for less

Darren Coppin is the chief executive of Esher House. His company spits out all sorts of interest research. He told me recently that this big economic transition has also ignited a bit of a social change.

He explained to me that 30 years ago the man did most of the paid-for work (40 hours a week). Since then millions of women have entered the workforce. During the 1980s and 1990s both men and women were working more, and earning more (excluding the recession).

Recently, however, the economy's been unable to sustain those jobs.

Now, women tend to be working 25 hours a week, while men also work 25 hours a week (in trend terms). So, overall, the household is working more, but because both jobs may not be strictly full-time, the actual combined take-home pay at the end of the day is less.

So yes, you guessed it, overall we're working more, for less pay.

Record low wages growth is also rubbing salt into the wound.

Time for dad to put on the apron

Anecdotally I've met quite a lot of people who are doing their best to make the best of a bad situation.

Many couples with children, for instance, have decided to work nine-day fortnights. That means mum or dad takes one day off each week. That day's devoted to running errands, and, of course, child care... and cooking.

I spoke to a single mum last month who told me she felt quite isolated. She said she spends all of her waking hours working and looking after her child, with no time left over for friends, because the bills keep piling up (child care and rent being the ones that hurt).

Struggle street

While many Australians are working out how to get by, too many are really struggling.

I spoke to a few people last week who told me the decision by the Fair Work Commission to scrap Sunday penalty rate had been a kick in guts.

Mandy Carr, for example, a retail worker on Queensland's Gold Coast, had decided to return to work (post maternity leave) on the Sunday shift so she and her husband could get ahead financially.

She says the decision will cost her $100 each and every week.

Pressure cooker

Granted, some Australians are living the dream right now. They own their own home, have a good job, plenty of super, and their coveted end of year holiday. That's great. Really.

There are too many Australians though that are angry... really angry.

They're upset because they'd desperately like to make a go of life. They want a home, and enough money on the side to give their kids opportunities in life. But they're being held back by a job that doesn't offer them enough in terms of hours and/or pay, and the cost of living keeps rising.

There's also the emotional toll that workers face with heightened job insecurity, combined with ever-increasing debt repayments.

The Reserve Bank governor told a Parliamentary Committee last week that the situation households face (having to cut back on spending because of rising costs and low wages) is "sobering".

The recognition of the problem is heartening. At this very moment though, recognising the problem is all we seem to be doing.

Housing affordability squeeze pushed down coast as city dwellers flee Sydney

It's often prescribed as a solution for those struggling with the lack of affordable housing in cities like Sydney: just move to the country.

However, those people living on low incomes in coastal regions of NSW are faring just as badly as city dwellers as they hunt for an affordable roof over their head.

In Nowra, on the south coast of NSW, a lack of affordable housing is cited as one of the main driving forces behind a surge in homelessness.

Last year, the problem became so acute homeless people resorted to sleeping rough at the local showground.

This unprecedented phenomenon has tested the social fabric of this small town, inspiring both compassion, and fear and loathing.

The tsunami from the city

Judy Stubbs, an expert in social planning at UNSW, has studied the Shoalhaven — the region that takes in Nowra.

Over the past decade, huge numbers of low income earners have fled Sydney, Dr Stubbs said.

"That tsunami from Sydney is rolling down the coast," she said.

"In net terms, everybody who has moved into the Shoalhaven in the last 10 years has come from Sydney.

"That profile tends to be tree change, but also increasingly low income people."

It's a perfect storm. The proportion of people living on low incomes has increased, while the proportion of affordable properties has decreased.

"For the very low income households, who are largely the people who are the homeless population on pensions and benefits or no income at all, there is really almost nothing available for them," she said.

Kerri Snowdon from the Shoalhaven Homeless Hub says people started sleeping rough at the Nowra showground because they had no other choice.

"There is nowhere else for people to go. This was the last resort. People don't want to be up there in the heat, the wind, the wet," she said.

No shelter at the showground

At a meeting of Shoalhaven City Council in late 2016 a crowd of 130 residents turned up.

Council had been bending the rules by letting the homeless stay at the showground, but many residents wanted that to end.

"We know we have a problem in the town with it. It's everywhere around the place," Peter Maconochie, a Nowra local, told the council.

"But this showground is our showground and we want it back.

"This is a showground. It is not a camping ground for drunks and drugs ... we want the showground back for the use of the people, not as a dumping ground. It is disgraceful."

After a heated three-hour meeting, the council voted to ban tents from the showground — essentially an eviction notice for the homeless.

Driven into dense bushland

While the homeless are now out of sight, most still do not have a roof over their head.

Peter Dover, a pastor at Salt Ministries, has been trying to find where the homeless have moved on to.

"Moving them on? That's not what is happening, they are getting kicked out," he said.

"These people are being scattered, some are in dense bushlands without any services at all. It's quite scary."

Ash McHudson, a volunteer with Salt Ministries, drives the Salt Mobile Response van, providing food and supplies to Nowra's homeless.

"We know that some are staying in their cars and couch surfing, or going on a list to stay in a caravan park, but other than that, we don't know," she said.

One woman, who did not want to be identified, said that when a ranger told her to leave the showground she went deeper into the bush.

"Sometimes I don't feel so safe," she said. "There has been a few nights where you hear some things out in the bush and the dogs start growling.

"I don't even have any defence. The only defence I have is one of the tent pegs. So it is a bit scary."

Another woman, Sharron, has been sleeping in her car on and off for nearly a year. She struggles to even find a place she's allowed to park.

"I parked at the showgrounds for three days in a row and I was told if I didn't get out of the showground they would fine me $800," she said.

"Everywhere I seem to park I get fines. I went out to Huskisson and I got fined $230 for parking out at the beach. You can't park in the main street because the police move you on. They put it down to loitering."

'No other place to go'

Someone like Vernon, who lives on Newstart, has virtually no chance of being able to afford somewhere to rent.

He lives in a van with his two dogs, and says he thinks some local residents don't understand that the homeless community is full of good people.

"We're all tarred with one brush, but we are all like a little community ... we all help each other," he said.

After the council banned tents from the showground, some of the homeless, like Vernon, got round the ban by staying in vans.

But when the show came to the showground in mid-February, the final group was moved on.

"Apparently you can't go here, you can't go to Kangaroo Valley, you can't go to Berry, you can't go anywhere like that ... it's buggered," Vernon said.

Ms Snowdon, from the Homeless Hub, is frustrated. She has homeless people turning up on her doorstep, and she is out of options.

"There is no other place they can camp, that they can access today. There is no way they can get private rental," she said.

"They are here today and they have to find somewhere they can go. And a lot of them have dogs and the dogs are their life.

"I don't know what we're going to do today. Sometimes it's like banging your head against the brick wall."

Shipping industry a bellwether for flailing national economy

While Australia has enjoyed a near-record run of economic growth without experiencing a recession, business conditions are not necessarily reflecting that.

Two firms with an acute sense of the economy's performance have said certain issues, such as the reliance on mining and political uncertainty, are not helping business.

Maritime Container Services, in Sydney's south, is on the front line of Australia's non-mining export industry, making it a bellwether for the national economy.

The company's director of Logistics and Operations, David Wright said, while business was "not too bad", it could also be be going better.

"In an nutshell [it's] not going gangbusters," he said.

Mr Wright's description of how the business was faring neatly captures the national economic picture.

Despite a record run without a "technical recession", Australia's economy is far from running at full speed.

The December quarter economic growth figures, released today by the ABS, showed a very strong three months, but annual growth was a mediocre 2.4 per cent.

If you removed the economic Band-Aid that is the resources sector, Mr Wright said, Australia's sore spots would be very exposed.

A focus on Australian made products

An especially painful raw nerve, Mr Wright said, was the nation's inability to produce things we normally buy from overseas.

He claimed that for every 10 containers that come into the country full of fridges and microwaves, six that would normally contain Australian made products simply go out empty.

"The volume we see going out are our rural commodities," he said.

Australia's commodities export boom helped save the economy from the global financial crisis (GFC).

But Mr Wright said he feared Australia had become too reliant on mining exports, and the economy's "backbone" was not strong enough.

"We export very high quality materials, which is a credit to us and a credit to the rural sector, because in my view, at this point in time, it's probably holding us up," he said.

"Otherwise from our perspective we would probably be exporting not a lot."

Mr Wright said what the country desperately needed was to regain the ability to produce more — and not just minerals from the ground.

"I don't think we're a nation that wants to turn out piles of rubbish," he said.

"But I think we want to turn out — like we're doing in our agricultural sector — high quality, world leading, best-in-class products."

He called for the agricultural and manufacturing sector to be better supported and a focus on Australian made products.

"There should be a push for Australia to be producing more of the stuff that we consume."

Business owners 'are uninspired'

A lack of faith in the Australian economy appears to be filtering through from large, to small and medium-sized businesses.

Quantum Business Finance provides credit to small to medium-sized companies so they can buy things that help grow their businesses, such as machinery and equipment.

But Mr Gandolfo, one of its partners, said recently business owners had stopped knocking on his door for as much money.

"Things are a little bit down actually on last year, probably about 10 to 15 per cent down across the board," he said.

Despite the fact most Australians have some sort of job, and interest rates remain at all-time lows, Mr Gandolfo said business owners were uninspired.

He said the global financial crisis was unlike recessions of the recent past, such as in the early-1990s, where people could generally pinpoint when it was over and allow themselves a collective sigh of relief.

"And then everybody is head down, bum up and working towards growing the businesses again and doing that with confidence," Mr Gandolfo said.

But he said when it came to the GFC, there seemed to be no "definitive end".

"Even though we came out of it reasonably unscathed in Australia, there was still a lot of talk about the economy in the US and there was a lot of noise around the economy in Europe," he explained.

Mr Gandolfo said it was almost as though Australia missed out on a purge to sort everything out and get back to normal.

He also blamed the frustrations of the government in dealing with cross-bench senators for the lack of business confidence.

"So it's not like there's political instability, but there's just no clear political direction, because there seems to be a lot of compromise that seems to be made," he said.

Home prices in Sydney, Melbourne continue investor-driven surge

A property investor-driven buying spree is continuing to push home prices higher in Australia's two biggest cities, with Sydney recording its fastest annual growth in more than 14 years.

The latest CoreLogic home price index for February showed prices jumped 2.6 per cent last month in Sydney, bringing the annual price rise to 18.4 per cent.

That is the strongest annual pace of growth in that city since December 2002, at the peak of the early-2000s boom.

Nationally, strong gains for Melbourne and Canberra led home prices 1.4 per cent higher over the month and 11.7 per cent up over the past year.

CoreLogic's head of research (Australia) Cameron Kusher said that Sydney and Melbourne have "shot the lights out" early in 2017.

"If anything we're actually seeing more strength in Sydney and Melbourne than we've seen over the last few months," he told ABC __news Online.

Mr Kusher attributed this renewed strength to another surge in property investment, particularly after the Reserve Bank cut interest rates twice last year.

"It's pretty clear it's not coming from first home buyers at the moment, we've pretty much got record low levels of first home buyer activity," he observed.

"Quite clearly it's coming from the investor segment of the market - both domestic investors and foreign investors - as well as people who already own homes upgrading."

The analyst added that the boom is defying most predictions of property price growth slowing this year.

"This growth phase has been running for four-and-a-half years now, you would think that it should be starting to slow at this point but it's actually reinflating, if anything," Mr Kusher said.

However, a few analysts are unsurprised by the continued boom, with SQM Research's Louis Christopher forecasting further strong gains for Sydney and Melbourne this year before the risk of a bust next.

While the east coast continues surging, the picture was starkly different in the west and north of the nation, with Perth and Darwin resuming their property price slide as the mining investment boom continued to bust.

Darwin posted a large 4.3 per cent monthly slide, leading to a 5.3 per cent annual drop, while Perth prices were off 2.4 per cent in February and 4.5 per cent over the past year.

"You can see that it's very much a Sydney and Melbourne centric growth phase, it's starting to spill out a little into Canberra and into Hobart, but most other capital cities are either seeing values fall or very little growth," Mr Kusher observed.

However, the extreme strength of the nation's two biggest housing markets is likely to be enough to prompt financial regulators to crack down further on lending to investors, Mr Kusher said.

"APRA [the bank regulator] and the Reserve Bank have really no choice but to step in and look at tightening things even further for the investor market, probably for the foreign buyer market as well, to try and slow down the rate of growth in Sydney and Melbourne," he said.

"We do think that over the year you will start to see that rate of growth slow, but it's going to take a lot more intervention from a regulatory perspective to try and slow down this speeding market."

Finance Department spends thousands on 'excruciating' recruitment video

The Finance Department has paid thousands of dollars for a recruitment video which has been slammed by marketing experts as "excruciating, cliched and a new low".

The video refers to Finance Department graduates as "game-changers" and features them boasting about "paleo pear and banana bread" and buddy workshop groups for recruits.

"No thanks, that's a little bit fancy for me," said one worker offered the paleo bread, who had to dash off to "an Aboriginal and Torres Strait Islander network meeting".

Another said he was "so stoked about his presentation to the executive" while another said they had never imagined they would work on "a project supporting the modernisation program across Government".

Tender documents reveal the Department of Finance paid Sydney-based marketing company Together Creative $37,400 for marketing services.

It is not yet clear how much of this money went towards the video.

Marketing expert Andrew Hughes said it was the worst Government video he had ever seen and described it as a waste of money.

"I was over the clichés in the first 20 seconds it was hard to watch, there was too much information, it was badly put together, fake and plastic," Dr Hughes said.

"Maybe that was the brief from the Department, though so I am not really sure who should get a gun to the head for this one."

Dr Hughes said Finance would have been better off just asking graduates to film their day on their smartphones.

"I see what they were trying to do, but they verbalised the entire thing and it comes across as tokenistic and lacks total believability," he said.

Creative director of the Labor-aligned agency Creative Edge, Dee Madigan said the video was "hilariously bad".

"They have reinforced every horrible notion you have ever heard about the public service," she said.

"Real people are not very good at playing real people because they can never deliver real performances and sound wooden."

Ms Madigan said the video was way too long and was plainly "not a good idea".

Together Creative and the Finance Department have been contacted for comment.

Stricter criteria for welfare

Registrants for the government's welfare scheme for poverty queue up at Government Savings Bank. A new requirement bars those with combined savings of 30,000 baht or more. APICHART JINAKUL

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The government has tightened the requirements for people applying for its subsidy and welfare scheme provided through the national e-payment system.

Potential recipients must have combined savings of less than 30,000 baht to apply at the next registration period.

The existing requirement of an annual income of less than 100,000 baht remains in place for the next round of registration, which runs from April 3 to May 15, said permanent secretary for finance Somchai Sujjapongse.

The Finance Ministry may also take registrant's assets into account, a criterion that has yet to be finalised as asset inspection is a difficult task, Mr Somchai said.

The registration for the scheme is available at three banks: Government Savings Bank (GSB), Krungthai Bank (KTB) and the Bank for Agriculture and Agricultural Cooperatives (BAAC).

Income of less than 100,000 baht a year was the main requirement for those who signed up for the scheme last year. This was seen as a loophole exploited by some registrants with high-value assets, and students who had financial support from their parents, a Finance Ministry source said, as the welfare and subsidies are meant for those at the bottom of the income scale.

Applicants must be Thai nationals aged 18 or older.

The government late last year offered the one-off cash handouts to those who signed up for the scheme, under which those earning up to 30,000 baht a year were entitled to 3,000 baht per person, and those earning more than 30,000 but less than 100,000 baht a year were entitled to 1,500 baht.

Officials found that many of the 8.2 million registrants were not qualified, as they earned more than 100,000 baht.

The source said that those who registered for the scheme last year are also required to sign up in the coming registration to update their information.

The Finance Ministry will offer qualified people cards that can be used to take free rides on public buses and receive discounts for electricity and water bills.

The cards will contain holders' citizen ID card number, full name, income, occupation, how much they borrow from loan sharks and assistance they require from the government, the source said.

In search of a voice

Asean collectively is highly unlikely to confront Beijing over the South China Sea but that doesn't mean diplomacy is doomed

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Lack of decisive leadership and commonality of interest in the South China Sea means that the best Asean can do is foster an environment conducive to perpetuating a stalemate, say experts.

Only if the 10-member bloc is unified and has proper support from other superpowers could it play a meaningful role as a mediator in the various maritime disputes between Beijing and individual members.

China has interests in Asean because of trade and investment and it wants preserve this relationship to maintain its current control over the region's economy. While relations between Beijing and some Asean members have been improving in recent years, China will remain in the driver's seat unless a more assertive United States can force Beijing to slow the pace of its aggressive occupation of the disputed area.

"Does China listen to Asean? Yes, it does. China was nervous before the arbitral tribunal ruling came out because if Asean speaks as one voice, they are worried," Tang Siew-Mun, head of the Asean Studies Centre told a recent Bangkok forum held by Probe Media Foundation and the Embassy of Canada.

He was referring to the July 2016 ruling by the United Nations Arbitral Tribunal that there was no legal basis for China to claim historic rights to resources within maritime areas falling within the "nine-dash line" that it insists on applying. China refuses to recognise the ruling.

The disputed areas include strategic sea lanes through which some US$5 trillion in trade passes annually, rich fishing grounds, along with potential oil and gas deposits.

"China knows that no single Asean country would denounce its position (in the South China Sea) because this single country would be singled out and from this, I think, the current relationship is not on sincere terms," Mr Tang said.

He used the analogy of a marriage, saying that if one partner is unable to convey to the other what is wrong with the relationship, then the only winners are the divorce lawyers.

"The goal is to have a collective resolution or a back-door channel to provide a diplomatic solution, which is what Asean does best to communicate with China about our grievances and our concerns, but who will take leadership on this?" he asked.

Enrique Manalo, the undersecretary at the Philippines Department of Foreign Affairs, said each party in the conflict has its own position, so the real diplomatic challenge is to find a complementary approach that enables Asean to manage the differences.

Under the declaration on the conduct of parties in the South China Sea (DOC), which was co-signed by China and Asean in 2002, all parties may explore or undertake cooperative activities including marine environmental protection and scientific research, safety of navigation and communication at sea, search and rescue and combating transnational crime. But very little cooperation has materialised because of domestic interests and disagreements between China and Asean.

Tensions have increased since 2010 when former US president Barack Obama launched his "pivot to Asia" strategy. Former secretary of state Hillary Clinton attended the Asean Regional Forum in Hanoi where she declared that solving the South China Sea dispute in a peaceful manner was in Washington's interest.

"From that point, the US came to be more involved with the conflict and the conflict came to be heightened and China since then has always blamed the US as the intervening power. That has made the situation worse," said Kitti Prasirtsuk, director of the Institute of East Asian Studies at Thammasat University.

He said Asean continued to rely on two approaches: maintaining its neutrality by not taking any position, and trying to create a conducive environment for disputing parties to talk. He sees no change in this strategy given that no individual member wants to have a problem with China.

"Trade volume and investment have been increasing tremendously in the past ten years, so Asean has come to be more reliant on China, and China has now become the largest export destination for most Asean countries, replacing the US, so the equation of interest has been changing and moving more toward China," he said.

Trade value between Asean and China increased from $117 billion in 1990 to $3.88 trillion in 2015 with annual growth of 17%, according to the Asean-China Centre. China is the region's biggest trading partner, ahead of Japan and the US respectively.

"This is why Asean tends to just want to preserve the status quo and we cannot expect Asean to do much more than that," said Mr Kitti. "This is very unfortunate because we expect international organisations such as Asean to be able to act more to resolve the conflict but this is not the approach that Asean has taken so far."

Negotiations between China and Asean have made no progress because China favours bilateral agreements with each claimant country while Asean tends to lack consensus on the issue.

"Asean members have different geopolitical perspectives on the dispute," he said. "Vietnam has been dominated by China for thousands of years which means that it has deep-rooted feelings toward China, while the dispute has created more nationalist and anti-Chinese sentiment in the Philippines. Thailand, Cambodia, Myanmar and Laos, on the other hand, tend to make friends with China because of economic interests and what China can offer, including investment from Asian Infrastructure Investment Bank."

Cambodia and Laos also receive considerable economic aid and investment from Beijing and are traditionally pro-China.

Settlement is now up to Beijing as Asean cannot take more action to make something happen without clear leadership. At the same time, there are uncertainties surrounding US involvement as President Donald Trump has yet to make clear his administration's intentions for the region, Mr Kitti added.

US Defence Secretary Jim Mattis said during his visit to Tokyo early this month that diplomacy should be the priority in the South China Sea but also blamed China for "shredding the trust of nations in the region".

However, he played down any need for US military manoeuvres, a view welcomed by China. Foreign Ministry spokesman Lu Kang said Mr Mattis's emphasis on using diplomatic means was "worthy of affirmation" and that the situation in the South China Sea was "normalising". Mr Kitti, however, believes that China is still in standby mode.

"China is still in the position of wait-and-see as it is looking closely at Mr Trump's policy and actions. However, there are some positive signs from the claimant countries. Philippine President Rodrigo Duterte and Malaysian Prime Minister Najib Razak visited China last year which shows the improvement in the relationship of China and the two claimant countries."

China claims most of the South China Sea, while Taiwan, Malaysia, Vietnam, the Philippines and Brunei claim parts of the waters. China has built at least seven artificial islands in the sea and installed military equipment on them since the DOC was declared.

However, economic interest in light of Beijing's One Belt, One Road initiative, the improvement of relations with some Asean claimant countries, and possible changes in the US stance mean that China may need to scale back its assertiveness.

"China no longer has the excuse that it has to be aggressive because another power has intervened in the region's problems," Mr Kitti said.

He also ruled out the possibility that Asean could be a mediator given the lack of leadership and common ground between claimants and non-claimants.

"What we can hope for is an increase in joint development programmes between China and Asean to maintain a good relationship and provide a conducive environment for future talks, while the possibility of involving an outside mediator is next to impossible as China and Asean would lose face if that happened," he said.

Thailand and Indonesia are the non-claimants that could take a leading role as mediators but they are not in a position to do so now because of a lack of domestic stability, in his view.

"Currently, there is no strong leadership from Thailand and Indonesia so maybe we can look at Singapore where the conditions that I have mentioned including domestic stability and a high approval rate [for the leadership] in the country. Lee Hsien Loong, I think, is qualified for that," he said.

"Mr Lee has been a leader long enough in Asean to exercise leadership but this time, maybe next year, we may expect something from him. But it all depends on the consensus and whether he can convince the association to take action and that requires cooperation from other non-claimants such as Thailand and Cambodia."

At the Asean foreign ministers' retreat in the Philippines last week, members expressed hopes that it would soon reach a deal with China on a "framework" to turn the DOC into a code of conduct in the South China Sea before the end on this year. But common ground remains elusive.

Philippine Foreign Secretary Perfecto Yasay said not all Asean members were on the same page over last year's tribunal ruling as "there were two, three or four ministers that have expressed concern about the respect for the 2016 decision".

SRT has to prove it's worthy of Red Line

A construction site of the Bang Sue-Rangsit route. The SRT needs to prove its management efficiency is up to standard if it wants to run the Red Line. CHANAT KATANYU

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The Railway of Thailand (SRT) must convince the State Enterprises Policy Commission, the superboard, that its cost management in running the Red Line electric railway meets international standards and is comparable to the operations of Bangkok Mass Transit System (BTS) and Bangkok Expressway and Metro (BEM).

If the SRT wants to run the route, its operating and maintenance costs must meet the standards and be competitive with BTS and BEM, said Amnuay Preemonwong, deputy permanent finance secretary and an SRT director.

His comment came after the superboard asked the SRT to provide additional information on operational cost management and its efficiency in running the Red Line.

The proposal will go before a commission meeting chaired by Prime Minister Gen Prayut Chan-o-cha, he said, without saying when. The coming meeting has been set next month.

The SRT is also required to generate a profit from the Red Line in three years and seek no financial support if it wants to run the route.

The Finance Ministry earlier dismissed the SRT's request for subsidies of 5.6 billion baht to operate the Red Line for the first five years.

The 41-kilometre Red Line electric train with investment of 75.5 billion baht has two sections -- Taling Chan to Bang Sue and Bang Sue to Rangsit. The government hopes that the Bang Sue-Rangsit route will help alleviate traffic for commuters travelling from the outskirts of the city to inner Bangkok.

The SRT is one of the seven loss-making state enterprises the superboard have required to undertake business rehabilitation. Gen Prayut last week invoked Section 44 of the interim charter to remove the governor and entire board of the SRT, citing the need to improve the SRT's management.

Meanwhile, Ekniti Nitithanprapas, director-general of the State Enterprise Policy Office, said the superboard has assigned deputy transport minister Pichit Akrathit to consider whether the SRT should run the Red Line. He insists the superboard has not given the SRT the green light to run the electric route.

The Mekong deserves better

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Last week, a regional forum was held in Luang Prabang for countries in the Mekong River Basin to discuss the Pak Beng hydroelectric dam planned by Laos. It was organised by the Mekong River Commission (MRC), the only organisation that works directly with the governments of Cambodia, Laos, Thailand and Vietnam to jointly manage the shared resources and sustainable development of the river.

Officially, the event was billed as a "prior consultation process" -- an opportunity for the four MRC members to discuss and understand potential trans-border effects of such a project.

True to its name, the process is all about consultation, not joint decision-making. After all, sovereignty still rules, and each country has the right to use the water in its own territory. No matter the outcome of consultations, Laos will be able to build the development.

Indeed, Laos has already shown that it can and will have its way. The government previously built the Xayaburi and Don Sahong dams despite concerns raised by Vietnam and Cambodia. The energy industry is crucial for Laos, which aspires to be the "battery of Asia". It has built numerous plants that sell power to Thailand and China. It plans eight hydroelectric dams on the Mekong and Pak Beng is just the third.

Dam construction is booming in Asia, especially by China and countries in the Mekong Basin, which see hydropower as a source of renewable energy and a way to cut carbon emissions. Governments even see clean energy from hydro-dams as a path toward a low-carbon society.

Cleaner? Maybe. Sustainable? Maybe not. History shows how dam construction can lead to environmental degradation and disrupt livelihoods. When China built the Three Gorges Dam, the world's largest, it led to relocation on a massive scale. Local residents still complain about compensation and the loss of their way of life. There is also scientific evidence that water in dam reservoirs is a major source of methane gas emissions.

Is our push for infrastructure to blame? Definitely not. Dams are useful for irrigation and power production as long as they are built in appropriate locations, with thorough studies and mitigation plans.

Yet, there is great concern about the impact of large-scale hydroelectric dams on biodiversity and transnational river systems such as the Mekong. Vietnam fears freshwater disgorged by rivers into the seas will increase salinity in estuaries and rice paddies -- the economic mainstay of the country. Cambodia -- which has its own plan to build three dams on the river -- has also complained of impact on inland fisheries.

Developments in Laos are an ominous sign for the already fragile ecology of the region. The message is clear: each country has a sovereign right to make use of its resources, but responsibility for trans-boundary effects is a grey area. The MRC has discussed responsibility and financial remuneration if there are "significant impacts" on other countries. But this is something for the future, if it happens at all.

So what will the future of the Mekong Basin be like? Not so good if you look at the trans-boundary effects of 24 hydropower dams. China has already built six and plans six more on the Lancang River, upstream from the Mekong. Another 12 are planned on the lower Mekong.

Indeed, problems are already evident. Last year, countries in the Mekong Basin faced severe drought and China finally decided to release water from one of its dams.

So what should countries in the region do? Of course, a forum such as the one in Luang Prabang is still needed even if it cannot influence decision-making. Member countries need to work together and adopt a more proactive stance under the MRC umbrella. My view is that information and knowledge is the best tool, so there should be more collaboration on studying and monitoring impact.

Last year, Vietnam presented an 800-page study to the MRC on the impact if 12 dams were built on the lower Mekong. That is a good start. If four countries are not enough, others with knowledge of water management, such as Japan or western countries, should join. Remember, environmental problems have no boundaries.

But the most important thing is participation by all stakeholders, more transparency and democratic engagement. That means grassroots communities, not just authorities, investors and energy think-tanks. After all, clean energy and sustainable development are everyone's business. Without more inclusive planning, the region will achieve only clean but non-sustainable energy.

Mazda alert after global recalls on three models

Mazda Motor Corporation last Thursday recalled about 460,000 CX-5, Mazda3 and Mazda6 cars globally to fix multiple defects in diesel engines.

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Mazda Sales Thailand, a distribution unit arm of the Japanese car manufacturer, is closely investigating models sold in Thailand after its parent firm Mazda Motor Corporation last Thursday recalled about 460,000 CX-5, Mazda3 and Mazda6 cars globally to fix multiple defects in diesel engines, including one that could lead to engines stalling.

The cars subject to the recalls were produced between Feb 13, 2012 and Feb 2 this year. No injury or fire has been reported from the defect, Mazda said.

Of the total, 170,000 cars were sold in Japan and the remainder overseas.

Thee Permpongpanth, senior marketing director of Mazda Sales Thailand, said there are roughly 14,000 units of the sport utility vehicle CX-5 sold in Thailand alone.

The diesel-platform Mazda3 and the Mazda6 are not yet available in the Thai market.

"Mazda believes that the Malaysian-made CX-5, which was launched in Oct 2013, is subject to the recalls," said Mr Thee, "but the company has to investigate all possible defects before further notifying customers."

The CX-5 sold in Malaysia is excluded from recalls because it runs on petrol.

Mr Thee said there are five possible defects in Mazda CX-5's diesel engine, but the company has yet to discover any defects since the model has been sold.

He cited Mazda Sales' after-sales service report that the defect rate of CX-5 in Thailand is very low.

"Mazda will not ignore these recalls. Once we find any defects, we will inform our customers immediately," he said.

According to Mr Thee, the Hiroshima-based firm earlier this month recalled about 174,000 small cars in the US because seat angles changed abruptly, making the vehicles hard to drive.

The recall covers the Mazda2 subcompact from the 2011 model year and the 2010 and 2011 models of Mazda3 and Mazdaspeed 3 compacts.

He said only the Mazda2 sold before 2011 in Thailand might be affected by the recall. No effects are likely for the Mazda2 eco-car, which is available now.

"At this time, we are investigating into how many Mazda2 in Thailand will be affected by the recall, while the seat-height adjustment in the Mazda2 will affect mostly Western drivers because they are much taller than Asians," said Mr Thee.

January exports up 8.8% year-on-year

Shipping containers at Klong Toey port. (Reuters file photo)

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Customs-cleared exports rose for a third straight month in January, but by slightly less than expected.

Exports were up 8.8% in January from a year earlier, following December's 6.2% increase, Commerce Ministry data showed on Monday. A Reuters poll predicted a 9.85% increase for January.

The ministry has forecast export growth of 2.5%-3.5% this year, while the central bank projects shipments will be flat.

Imports in January increased 5.17% from a year earlier. Economists had expected a jump of 11.9%, after December's 10.3% rise.

The January trade numbers produced a trade surplus of $826 million, compared with December's $938 million surplus.

Thai exports, historically a key driver of Southeast Asia's second-largest economy, edged up 0.45% in 2016, ending three straight years of contraction.

Supalai gains in provinces

Supalai Bella Nakhon Si Thammarat project in Muang district of Nakhon Si Thammarat was launched late last year and recorded 120 million baht in sales.

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SET-listed developer Supalai Plc is aiming for a 30% growth this year in its low-rise pre-sales from 11 provinces, expressing confidence in provincial demand for the segment.

Chief executive Prateep Tangmatitham said demand for single houses, townhouses and duplex houses in key provinces remains strong despite an oversupply of condos in some provinces.

"This year Chon Buri will generate the largest presales for the company as the province has a mix of income sources in industrial estates, the tourism industry, the agricultural sector and trade," he said.

Last year, Phuket generated the highest presales. Chiang Mai generated the highest in 2015 and Songkhla in 2014 as the company launched condo projects in those provinces.

The southern provinces, Surat Thani, Phuket, Nakhon Si Thammarat and Songkhla, generated the largest presales, revenue and profit, which accounted for 10% of the totals recorded last year.

Supalai has residential projects in Udon Thani, Khon Kaen, Ubon Ratchathani, Nakhon Ratchasima and Rayong. This year it plans to launch a residential project for the first time in Chiang Rai.

"Supalai last year posted 24.1 billion baht in presales, an increase of 5% from 2015, making our presales the third largest among SET-listed peers, up from the fourth or fifth in prior years," Mr Prateep said.

It aims to have a growth of 12% to 27 billion baht in presales this year from the launch of 29 new projects worth a combined 37.2 billion baht.

He said presales growth this year will be driven by low-rise housing projects in Greater Bangkok and provinces which will account for 54%, up from 53% last year.

Presales from low-rise development in provinces will contribute 24% of the total target or 6.5 billion baht, up from 20% or 4.8 billion baht last year.

Supalai recorded a net profit of 4.88 billion baht on revenue of 23.5 billion, up 12% and 9%, respectively, from 2015. It expects 24.5 billion baht in revenue this year.

SPALI shares closed on Friday on the SET 24.70 baht, up 10 satang, in trade worth 160 million baht.

House prices: Ideas and solutions range from dangerous to disastrous

Addicts sometimes come up with all kinds of weird excuses and solutions for their life problems without acknowledging the core issue of their addiction.

Australia's national addiction is real estate and it's no surprise that policy-makers and politicians are coming up with whacky excuses and solutions around housing affordability that range from the dangerous to disastrous.

First to some of the recent excuses, and it is over to the 'don't scare the horses' Reserve Bank.

Yesterday, the RBA's assistant governor economic Luci Ellis offered up a number of reasons why Australians shouldn't be too concerned about the level of the nation's home prices and household debt.

It's not too bad, it's a nice place, shut up ya face

First was that Australian home prices relative to incomes are pretty much in line with comparable countries.

The problem is that many of the countries we are compared to are widely argued to have housing bubbles of their own, such as New Zealand and several large cities in Canada.

Incidentally, Dr Ellis' own graph shows that Australia's price-to-income ratio is around the level Spain's was at the time of its property market crash, while the fact that we are a little short of Ireland's pre-crash peak surely shouldn't offer too much comfort.

Rich hold debts

Secondly, Dr Ellis argues that Australia's high mortgage debts are relatively safe because the biggest debts tend to be held by higher income households.

"Most of the mortgage debt in Australia has been borrowed by those most able to service it," she boasts.

Superficially, this makes sense. But think about how high some of the debts are for those wealthier households, as well as their generally much larger living expenses, and how safe from default are they?

How many dual income, high earning households are there in Australia who could keep paying their mortgage if one partner lost their job and couldn't find another one for six months or more?

Certainly, the older ones who might have got ahead on their mortgage and paid much of it off would probably be OK (and of course the older age groups are more likely to be in the higher earning category), but what about the younger, recent buyers?

That's not to mention the inequality that Dr Ellis skirts over, trumpeting the fact that most investment property debt is held by higher income households, without joining the dots that this is making lower income families the rental serfs of a landed class.

Relationship status determines housing status

A third argument is that the falling rate of home ownership amongst younger people (25-34 years old) started before home prices really took off in the mid to late-1990s, and is therefore due to demographic change more than lack of affordable housing for purchase.

There's probably truth in this, but it ignores another steep downturn in ownership rates amongst this demographic from the mid-2000s.

It also ignores the fact that ownership rates have also dropped noticeably in the 35-44 and even 45-54 demographics, with a smaller decline for older groups.

Speaking of first time buyers, Dr Ellis makes a disturbing observation.

"It seems common to assume that everyone needs a 20 per cent deposit when they first buy," she said.

"This isn't actually true: although lenders require some deposit coming from genuine savings, it doesn't have to be as high as 20 per cent.

"So it's surprising that as housing prices have risen, the distribution of loan-to-valuation ratios — the converse of the deposit — hasn't shifted up over time."

To someone who used to head the RBA's financial stability department this should be pleasing, rather than surprising.

Perhaps banks have realised that housing valuations have become increasingly stretched and it is prudent for them to have a bigger deposit buffer to protect themselves against losses in case the borrower defaults.

Certainly recent experience in WA and regional Queensland suggests that this is a sensible policy — the values of homes in some mining towns having more than halved as the boom turned to bust, while even Perth has seen many properties fall more than 10 per cent from their purchase price.

Genworth, which provides insurance for the banks against potential losses on low-deposit mortgages, recently posted an 11 per cent profit fall due to these trends.

At least Dr Ellis acknowledges that this caution by the banks has a positive side.

"Because a high loan-to-valuation ratio does imply higher risk both for the borrower and the lender, it might not be such a bad thing [that this kind of lending has recently declined]," she said.

No-deposit home loans a recipe for financial disaster

No such reservations from Nationals MP Andrew Broad, however.

He has floated the idea of no-deposit loans for people who can present three years of reliable rental history.

This is financial lunacy.

The idea of a deposit when buying a home is to protect both the bank and the buyer.

For the bank it means that it is unlikely to take a loss if the borrower defaults — unless the home's value has fallen by more than the size of the deposit since the loan was issued.

For the borrower it means that they have a buffer against going bankrupt if they default on their home loan.

Without a deposit, if the home's value has declined when the bank repossesses and sells it, the borrower is liable for the difference. If they don't have the cash, and can't cut a deal with the bank, they're bankrupt.

For the financial system and economy as a whole, widespread no-deposit lending would probably push home prices even higher and then expose banks to large losses and potential collapse in the event of a real estate crash.

Instead of finding new and ever more creative ways of boosting demand and further stretching Australians' already tortured ability to pay for over-priced homes, how about we look at some ways to start kicking our housing habit?

Capital gains tax discount reduction, negative gearing reform and/or a national land tax could be a start.

After all, increasing tobacco taxes has helped Australia in the battle against smoking, so why not raise property taxes in the fight against non-productive land speculation?

How good is renting in Australia?

Let's just say the latest national snapshot of the state of renting a home in Australia does not paint a pretty picture.

That's putting it lightly. It's dire.

Choice and the National Association of Tenant Organisations looked at government stats and surveyed over 1,000 Australian renters. They found renters lacked housing security, many were living in substandard housing and maybe worst of all, renters were putting up with conditions because they were worried about getting kicked out of their home.

With renters now making up almost a third of residents in Australia, we thought we'd break down the figures to look a bit more closely at the situation.

Lease duration

One of the main problems highlighted in the survey was the vast majority of renters felt like they didn't have much security.

As Matt Levey from Choice put it, most renters probably don't know where they're going to be living in a years' time.

Of just over 1,000 respondents to the survey, 83 per cent of people were either on no fixed-term lease or signed up to a lease of less than 12 months.

Renters who say they currently have an urgent problem

Nationally, 8 per cent of ALL renters are currently living in a property in need of urgent repairs.

According to Consumer Affairs Victoria, urgent repairs included things like a burst water service, serious roof leaks, serious storm damage or a breakdown in water or heating.

So it's almost scary to think so many people surveyed are living with these problems.

When you break it down to a state and territory level, that number fluctuates a bit.

• In NSW, it's 10 per cent
• In SA, it's 12 per cent
• In Vic, NT and Tasmania — 6 per cent
• In ACT — 2 per cent

Top 10 problems for renters

If you're a renter, then there's a strong chance you've been hit by one of the following.

If you've only dealt with one, then you're lucky, very lucky. Chances are you've dealt with a lot of these problems, possibly all of them all at once.

Here's the list of the top 10 most common problems for renters and yes, insect infestations top the list.

1. Pests (cockroaches, moths, ants etc.): 27 per cent
2. Doors or windows that don't close properly: 24 per cent
3. Peeling paint or tiles coming off: 22 per cent
4. Leaks or flooding: 21 per cent
5. Mould that is difficult to remove or reappears: 20 per cent
6. No fly screens on windows: 19 per cent
7. It's difficult to keep property warm: 18 per cent
8. It's difficult to keep property cool: 18 per cent
9. Locks that don't work: 18 per cent
10. A key appliance that doesn't work: 17 per cent

So why aren't renters complaining or demanding for repairs?

Well, most of them are scared. So many feel like the odds are stacked so heavily against them in the rental market that they just let things slide.

Despite renters forking out hundreds of dollars each week, Matt Levey from Choice said renters are living in a "culture of fear".

• Concern rent would increase: 42 per cent
• Fear of eviction: 23 per cent
• Fear of bad reference/blacklisting: 14 per cent
• Fear of lease not being renewed: 14 per cent
• Fear of being bullied: 8 per cent
• Belief that request will be ignored: 8 per cent
• Fear they will have to pay for repair: 6 per cent

A national snapshot of renting in Australia

Obviously the rental landscape across Australia is different everywhere you go. Sydney prices, we can all agree, are insane. Melbourne, well, average rent there for a one-bedroom flat exceeds Newstart payments with rental assistance.

NSW

The average Sydney property costs $480 per week — the most expensive rent in Australia (and second in the world).

Victoria

More than 82,700 residential properties — or 4.8 per cent of Melbourne's housing stock — are vacant.

Queensland

Only 10 per cent of Queensland rental properties allow pets. QLD renters have second highest rate of disputes over return of bond (28 per cent).

ACT

41 per cent of ACT renters have felt discrimination.

Tasmania

Hobart is the second least affordable capital city to rent in Australia because of low incomes and comparatively high rents.

Northern Territory

63 per cent of apartments in Darwin are rented out by investors. Rents in Darwin dropped by 4.6 per cent in 2016.

South Australia

SA renters has highest rate of disputes with landlords over return of bond (30 per cent). SA renters are most likely to feel discrimination when trying to rent a property (61 per cent).

Western Australia

WA has the highest rate of short-term leases (19 per cent). WA has the highest rate of disputes over cleanliness when vacating (34 per cent).

Who feels discrimination when trying to find a rental property?

Let's not forget about how frustrating it can be to actually get into the rental market. Forms and open inspections during work hours are nowhere near as bad as some of the issues renting hopefuls have faced.

Some feel they're just facing blatant discrimination trying to get into a house. Here are the most common forms of discrimination for people trying to enter the market.

1. People receiving a government payment (42 per cent)
2. Having a pet (39 per cent)
3. Age (24 per cent)
4. Having young kids (23 per cent)
5. Being a single parent (18 per cent)
6. Needing to use a bond loan (18 per cent)
7. Gender (12 per cent)
8. Disability (11 per cent)

How does Australia compare internationally?

Pretty poorly to be honest.

In the Netherlands for example, tenants are offered an initial 12-month contract with option to extend for five or even 10 years. It is difficult for a landlord to terminate a lease without the tenant's permission and a court order. Imagine that!

Ireland — tenants are given an initial six-month contract, which is then rolled on to a secure six-year lease.

Switzerland — Only 34 per cent of Swiss own their own home. Landlords have to give three months notice to end a lease, and legally cannot evict a tenant without cause.

Germany — indefinite leases are available. Tenants are allowed to paint the walls of the property whatever colour they like, as long as they paint the walls white when they vacate.

But at least it's not Hong Kong, where the median weekly rent for an unfurnished studio is $595.

Or London, where the average rent is equal to 72 per cent of the average income.

Are we becoming slaves to happiness? Critics of corporate culture make case for workplace negativity

Adrian Wooldridge likes a good coffee, but not when it comes served with a plastic smile.

"I've just got a cup from Pret A Manger," he says with a mix of both frustration and annoyance, "and everybody in there seemed to be almost delirious with happiness."

It's not that Adrian has an instinctive set against being joyful. It's just that he prefers his enthusiasm to be natural, not forced.

"Very large numbers of companies are mandating or at least encouraging their workers to be happy," he says. "They want them to have a smiley face; they want them to be bubbly and enthusiastic."

Wooldridge, who writes the Schumpeter column for the Economist, focussing on business, innovation and entrepreneurship, says this kind of mandated happiness functions as an instrument of corporate control.

"Pret A Manger actually will have people — 'mystery shoppers' — who will go in and rate the workers on how happy the whole team is," he says.

"Any member of the team that lets the team down will be negatively judged. That creates a lot of social pressure to be happy."

The emotional labour of happiness

Other companies, like the shoe and clothing retailer Zappos, Wooldridge says, now select people on the grounds of their capacity to be happy.

He sees a time in the near future when workers in all sorts of occupations will be measured and rewarded according to their expression of happiness.

"One sociologist has called it 'emotional labour'. You're being paid for your capacity to feel or at least to express emotions," he says.

"This is happening at a time when we are seeing an increasing casualisation of the labour force, zero-hour contracts, the ability of managers to get rid of people, to sack them.

"On the one hand you have a pressure to be upbeat all the time, and on the other hand you have a very brutal labour force which quite quickly gets rid of people."

The end result, says Wooldridge, is cynicism and despondency.

"What you tend to have with emotional labour is that you get a lot of burnout with people," he says.

"People are expressing emotions that they don't feel or they are over-expressing emotions that they do feel, and that's a tiring and difficult thing to do in the long term.

"In the short term it's great for the company; a sales-oriented company has a lot of positive response from what they do. In the longer term I think it's just another thing that drags workers down."

Viva la Stoics!

Schumpeter isn't alone in questioning the "cult of happiness". Popular British author and social psychologist Oliver Burkeman has also written about the "power of negative thinking".

Burkeman argues a fixation with attaining personal happiness often serves to imprison people, rather than liberate them.

"The relentless cheer of positive thinking begins to seem less like an expression of joy and more like a stressful effort to stamp out any trace of negativity," he says.

"Ancient philosophers and spiritual teachers understood the need to balance the positive with the negative, optimism with pessimism, a striving for success and security with an openness to failure and uncertainty."

Joseph Forgas, a social psychologist at the University of NSW, agrees.

"The ancient Greeks cultivated drama and tragedy for a very particular purpose," he says.

"The idea was that individuals should learn how to cope with negative affect and should expect negative things to happen to them."

He dates the emergence of happiness as a universal ideal to around about the time of the enlightenment. Like Burkeman, he believes the veneration of happiness depletes our natural resilience.

"We really don't have much of a culture of dealing with tragedy and dealing with unexpected negative events," he says.

The power of pessimism

Professor Forgas's latest research has focussed on the influence of mood states on performance.

"A number of our experiments looked at the kind of judgemental mistakes or errors that people commit," he says.

"We find that when we induce people into a mild negative mood before performing a judgement, they typically are going to be more accurate, and they get it right more often."

Similarly, he says, negative mood has benefits when it comes to remembering information.

"People in a mild negative mood tend to look at the environment in a more careful and attentive way and they tend to remember what they see around them," he says.

In other words, people who are excessively positive can sometimes fail to notice the mistakes or dangers that lie before them.

Professor Forgas stresses the word "mild" in championing the virtues of pessimism.

But that's at least one reason to embrace your inner grump in the workplace.

Company directors urged to be more accountable and transparent

Their power is mostly wielded behind closed doors and their disagreements protected by a code of silence. But there is increasing pressure for company directors to move out of the shadows and into the disinfecting power of sunlight.

For a group who wield a huge amount of power in Australia, ASX listed company directors receive very little attention outside the set piece annual general meetings that they are forced to endure once a year.

They are ultimately responsible for setting the direction and strategy for a company and yet receive relatively little scrutiny compared to the high profile CEOs who they appoint.

But, after a run of corporate scandals, there are calls for directors to be more accessible ... and accountable.

'No longer acceptable to say nothing'

The Australian Shareholders Association (ASA) is looking to put the role of directors into sharper focus.

"The ASA board next week is most likely to change our policies, this is the recommendation, requiring that a company must give a full explanation when a director resigns so we don't get a repeat of the situation with Sheila McGregor at Seven West Media," said Stephen Mayne, a director of the ASA.

Sheila McGregor was an independent director at Seven West Media who resigned on February 2 this year, as a sex scandal involving the company's CEO engulfed the company.

The board decided not to sack the CEO. Sheila McGregor walked. No explanation has been given by the company, nor by Ms McGregor, for her departure. Under current rules, that is absolutely fine.

"At the moment companies can say a whole lot or they can say nothing. so what the ASA is proposing is that it is no longer acceptable to say nothing," said Mr Mayne.

"If a director resigns on a matter of principal then the company should inform the stock exchange about why that director has resigned."

Seven West is just one of the multiple Australian companies that have faced corporate governance scandals in the last year.

Origin Energy, Dominos, Bellamy's, Slater and Gordon, Ardent Leisure and Crown Resorts have all been in the headlines and yet, by and large, it has been chief executives facing the music, not the board.

'Limited understanding of directors' responsibilities'

In addition to new policy regarding how a company and director explain departures, the ASA also wants directors to be more available to shareholders.

"Shareholders tend to focus on the CEO, and the media does the same thing, and the analysts tend to do the same thing, and there arguably isn't enough focus on the real power that lies on the board," continued Stephen Mayne.

"We need directors to come out of the shadows and be more accountable for their decision making."

The chair of the Australian Institute of Company Directors, Elizabeth Proust, agreed that there is too little attention paid to the role directors play.

"I think there's limited understanding of directors' responsibilities," she observed.

"I think when something goes wrong most people have an understanding of the liability and responsibility of directors in a particular case, but if you asked the average shareholder or the average person what directors do you'd get a vast variety of answers to that."

Australia 'in pretty good shape'

The AICD runs a training program for current and wannabe directors. It runs over five full-time days of intensive in-class work accompanied by outside study. It uses the case studies of former scandals to hopefully ward against new ones.

One of those who took part recently in the course was Trevor Matthews, a man with over 20 years' experience as a director.

On balance he thinks Australia is doing fairly well when it comes to governance.

"I think we're in pretty good shape here in Australia, I really do, in spite of some of the criticism you see," he said.

"I know that my fellow directors in all the ones I'm involved with take it very seriously."

But he was concerned by one of the tasks in the course.

"We were asked as a group of people to come up and mark on the board based on our experience of the boards we'd served on or were serving on how effective we thought the boards were and we had a spectrum of 0 to 100 and I put some crosses up here because I'm lucky to be on some very good boards but there were some crosses down the other end," he added.

Mr Matthews has a ring-side seat for director deliberations, but it is much harder for the shareholders and the public to assess the problems.

"One of the problems is that you don't have visibility inside the board room so, for collective decisions, it's hard to blame individual directors and hold them to account," observed Stephen Mayne.

"So shareholders tend not to vote against any of the directors because they don't know which one was most to blame.

"There is an argument that directors should be more visible and they should be more available to shareholders and the should be more accountable when major mistakes are made by companies."

But Elizabeth Proust strongly disagreed.

"I think that is a flawed understanding of the role that the board, as a collective, plays," she countered.

"Once a board made up of individuals makes a decision then that is the board decision and that is the decision that is communicated in the case of the ASX to the exchange and more broadly.

"Anybody trying to get at what individuals contributed to that is unhelpful."

Directors in the spotlight: 'A healthy thing' or 'a bit messy'?

Not all directors are reluctant to enter the fray.

Current Seven West director Jeff Kennett, the former premier of Victoria, got involved in a Twitter war with the woman at the heart of the media company's scandal, Amber Harrison.

Stephen Mayne, for one, welcomed a director being available to the public.

"You have seen some directors get onto Twitter, so Jeff Kennett on Seven West, and former Transfield services chair Diane Gander Smith she's on twitter, there's a range of others, and that's probably a healthy thing," he said.

However, Trevor Matthews urged caution before directors start arguing their case in public.

"I think that it's primarily the CEO's responsibility to do that," he opined.

"I think there's a room for the chairman to be there supportive as well, but I really don't think the other NEDs (non-executive directors) should get involved in the public debate.

"I think their job is behind the scenes with their heads down really trying to help the organisation make decisions implement strategy well and do that sort of thing.

"I think it can get a bit messy if non-executive directors speak out, or are asked to speak out, on a whole range of issues."

Governance in Australia has improved from the cowboy days of the 1980s, but there is still relatively little focus on the role of directors except in times of crisis.

It remains to be seen whether more directors stepping into the glare of public attention would help to improve the level of governance.

Medibank Private boss defends health insurance premium increases

The head of Medibank Private has been forced to defend its health insurance premium increases, while also delivering a disappointing half-year profit for investors.

Australia's largest health insurer reported a 2 per cent increase in first-half profit to $231.9 million, weighed down by higher claims and costly initiatives to win back customers.

The result would have been worse but for a 223 per cent increase in investment income, masking an 8.2 per cent drop in operating profit in its health insurance business.

CEO Craig Drummond told The Business that the company is working on lifting the value of its products for consumers.

"We've had some well-known issues in the early part of the new financial year which we've now corrected," he said.

"The service proposition has certainly been improved."

Services may be improving, but premium costs are going up.

Last week, Medibank Private announced a 4.6 per cent increase to the cost of its premiums from April 1, in line with the rest of the sector.

Mr Drummond said the company tried to keep a lid on the price increase.

"We understand that household budgets are under pressure," he said.

"That is a 4.6 per cent increase - and I appreciate it's still an increase - is actually our lowest increase for 15 years and is 0.24 per cent under the average increase that the industry announced a few days ago."

That may come as cold comfort to households who have seen premiums rise 28 per cent since 2012.

The Medibank CEO said the premium increases are necessary.

"There's a lot of structural impediments that we need to deal with going forward, like an ageing population and chronically diseased patients being a large percentage of the population," Mr Drummond said.

"We need to deal with this and we need to deal with it now."

Medibank has conceded underperformance against its peers in getting new customers and holding onto existing ones, with only its budget, low-margin, ahm brand showing growth.

The health insurer's market share fell from 27.6 per cent to 27.2 per cent in the December quarter.

The interim dividend edged up to 5.25 cents a share, but none of this impressed investors and at midday (AEDT) shares had slipped 4 per cent to $2.70.

You can listen to Alicia Barry's interview with Craig Drummond on Business PM at 6:50pm on ABC Radio or watch it at 8:30pm (AEDT) on The Business on __news 24.

ANZ's credit card interest rate cut cold comfort for customers, Choice says

A move by one of Australia's big banks to cut some credit card interest rates has been labelled a feeble attempt to offer consumers a fair deal.

ANZ reduced interest rates by up to 2 per cent on two of its credit cards to 11.49 per cent — its lowest rate since 2003.

Consumer advocate group Choice said the big four banks' rates have been too high for too long, so the move makes little difference for customers.

"They are still toxic products and the big four banks know that — ANZ is a long way from having the most competitive card on the market," Choice spokesman Tom Godfrey said.

"So for the thousands of people out there with the big four banks, who may now get a little bit of relief from ANZ, it's cold comfort."

Choice does not anticipate the other big banks will do the same.

"It would be great if the other four banks dropped their interest rates as well to reasonable levels down below 10 per cent — but this move does not get them out of further scrutiny," Mr Godfrey said.

Choice said unhappy customers should find cheaper rates elsewhere.

"My advice to consumers is that if you have a credit card with one of the big four banks and you are carrying a balance forward then move your money, they do not have one credit card in the top 20 in Australia when it comes to interest rates," Mr Godfrey said

'Banks need to explain themselves', Xenophon says

Independent South Australian senator Nick Xenophon welcomed the move and said the banks were being irresponsible by keeping interest rates so high on credit cards.

However, he said it did not go far enough and the other big banks needed to follow suit.

"We are being gouged with credit cards, we actually need some fundamental reforms," Senator Xenophon said.

"We really need to look at greater market competition or the banks need to really explain themselves in why they are gouging consumers in this way."

Other credit cards on the market offer rates below 10 per cent, with some as a low as 8.99 per cent.

The Turnbull Government has welcomed the move, describing it as a win for families.

But Federal Government backbenchers are vowing to put further pressure on the remaining big four banks.

Federal Liberal MP Scott Buchholz has been a longstanding outspoken critic of the big banks and said the move was a trigger reaction after bank bosses fronted a parliamentary committee hearing late last year.

"What we've seen from the banks over the last five or six years is we've seen interest rates decrease, we've seen the standard variables follow the cash rate downwards, but we haven't seen credit cards follow that same trajectory," he said.

"So pressure was brought about on the banks in that inquiry.

"We will have the banks appearing in the next fortnight in Canberra, along with the Australian Banking Association, where I will continue to take a similar line of questioning with those banks that haven't taken the commercial choice to shift their interest rates yet."

The week in finance: Reporting season hits top gear as business investment, wages stuck in reverse

With global markets on pause waiting for __news about tax cuts in the US and the wobbly world of European politics, the busiest week of the domestic reporting season will capture most of the attention in coming days.

Futures trading over the weekend points to a pretty flat opening on the ASX, following a "going nowhere" sort of end to the week in the US and Europe.

Markets on Friday's close

• ASX SPI 200 futures +0.1pc at 5,760
• AUD: 76.69 US cents, 72.23 euro cents, 61.76 British pence, 86.59 Japanese yen, $NZ1.07
• US: Dow Jones flat at 20,624 S&P500 +0.2pc at 2,351 NASDAQ +0.4pc at 5,325
• Europe: FTSE +0.3pc at 7,300 DAX flat at 11,757 Eurostoxx50 -0.1 at 3,309
• Commodities: Brent oil +0.3pc at $US55.81/barrel, Gold -0.3pc at $US1,235/ounce, Iron ore (Nymex) +0.8pc at $US87.35/tonne

'Trump trade' still in vogue

However, over the last week the "Trump trade" was still in vogue with US and Australian shares up 1.5 per cent, and Europe not too far behind.

The sample size of the February reporting season has reached some sort of critical mass, so a few conclusions can be drawn — basically things are solid and straight-out disasters have been rare.

"We are now just over halfway through reporting season — 58 per cent by market capitalisation — and so far, it feels pretty comfortable to me," director on Citi's equities desk Karen Jorritsma said.

Ms Jorritsma noted a lot of tidying up of earnings expectations had already been done during the AGM season last year and the confessions season leading into results, so there have been few big surprises tabled.

"So far, 51 per cent of results at the EPS (earnings per share) line have come in as expected, with the remaining positive versus negative surprises pretty evenly skewed — 23 per cent versus 26 per cent respectively," she said.

Another big theme of the past couple of weeks, the rebound in resources businesses, will again feature this week with the likes of BHP Billiton, Fortescue Metals Group and Woodside Petroleum all reporting.

Ms Jorritsma said many brokers were now just catching up with the impact higher prices are having on earnings.

"Balance sheets are back in force, with a lot of miners being cashed-up again," she said.

"S32 (the BHP spin-off) had a really good result, but it was sold down on the day because investors were disappointed the cash wasn't returned to them."

This time last year, BHP Billiton (Tuesday) posted a $US5.7 billion ($7.8 billion) loss, things in China looked crook — dragging commodity prices down — and the so-called resources super-cycle seemed on its last legs.

This result will not have the massive $US6.9 billion ($9 billion) of impairments from US shale gas and Samarco dam disaster dragging it down, so that is a positive start.

Underlying profit is tipped to be around $US3.6 billion ($4.7 billion).

Having gone through the pain of ditching the unsustainable policy of never cutting dividends, BHP probably will not be shovelling what will be a huge pile of cash back to shareholders, but a forecast 42 US cents a share (55 cents) will be more appreciated than last year's paltry 16 US cents (21 cents) effort.

How big will Fortescue's profit be?

Fortescue Metals Group (Wednesday) has enjoyed a stellar six months.

It has chiselled costs down to the levels of its bigger neighbours, prices have soared, debt has been slashed and fears about disgruntled bondholders going to the "nuclear" option have evaporated.

As a result, its share price is up 230 per cent compared to this time last year.

The key questions now are: How big will the profit be? And how much will investors get of it?

The market is expecting underlying profit will triple to around $US530 million ($690 million) and the interim dividend should be up around 33 per cent.

Unlike their coal seam gas rivals shipping gas out of Queensland, Woodside Petroleum (Wednesday) and PNG-focused Oil Search (Tuesday) are unlikely to be walloped by massive project impairment charges.

Macquarie is tipping Woodside's underlying half-year profit will be a bit above $US900 million ($1.2 billion) — about 35 per cent higher than last year — while the interim dividend is likely to cut by around 15 per cent.

Macquarie's forecast for Oil Search is less bullish than most brokers', pencilling in full-year underlying earnings of $US95 million ($123 million) — well down from the $US360 million ($470 million) of 2015.

However, Oil Search's headline net profit of $US165 million ($215 million) is likely to look a lot better than its previous $US39 million loss ($50 million).

Woolworths's (Wednesday) big local rival Wesfarmers delivered a solid first half result last week — although it was largely held up by coal — while the Coles supermarket business struggled as it fought a margin-crunching discount war for market share.

That is likely to be a big theme of Woolworths's numbers.

Despite a mountainous $59 billion-worth of sales in just six months, they are still likely to be characterised as "flat".

Net income will probably fall, also hit by the discount battle and ongoing problems in the Big W chain.

However, the headlines should be OK, with net profit forecast to be around $1.4 billion — a $2.7 billion turnaround from the previous Masters-devastated loss.

The other interesting results of the week are likely to include Bluescope Steel (Monday), which, these days, has switched from profit downgrades to upgrades and Qantas (Thursday), which may be levelling-off after regaining altitude in the past couple of years.

Crown Resorts (Thursday) will also grab its fair share of attention.

The issue will not be so much about money — although it is unlikely to be a great profit — as the diabolical problems it has in China where 18 staff, including three Australian executives, are still languishing in jail for "gambling-related crimes".

Business investment and wages to remain weak

Locally, there is a release of important quarterly data on business investment and construction work — the so-called "partials" that feed into the next GDP figure, which comes out in two weeks.

Business investment — or capex — has been so bad, for so long that it seems to have lost its shock value.

Private capital expenditure for the December quarter (Thursday) is again expected to fall, this time by around 3 per cent, as the impact of the winding-up of the big LNG projects continue to drag things down.

Given how glum things are looking backwards, there is more interest in the forward-looking investment "intentions" survey.

Sadly, this is not likely to be great either, as the spurt in commodity prices will not have been enough to get a host of mining projects out of mothballs just yet.

Construction work (Wednesday) will bounce back, primarily because the water-logged third quarter number was so weak.

The forecast is for a 1.5 per cent rise — not great, not awful.

Talking of awful, the wage price index (Wednesday) has been plumbing the depths for a while, and the December quarter could deliver a new record low in growth of just 1.8 per cent over the year, further strangling household income and spending.

It is also a busy week for the Reserve Bank, with the minutes of the February meeting out (Monday), Governor Philip Lowe speaking (Tuesday) and Dr Lowe then heading down to Canberra (Friday) for his bi-annual grilling in the House of Representatives Standing Committee on Economics.

At the end of the week, we will be back where we started, with official interest rates firmly on hold for some time to come.

Globally, there is not much top shelf stuff to drop, although the minutes from the Federal Reserve's last interest rates meeting (Wednesday) may be worth a cursory glance.

Australia
Monday 20/2/17
Tuesday 21/2/17	RBA minutes	Nothing exciting here, RBA is firmly on "hold"
Wednesday 22/2/17	Wage price index	Q4: Wage growth at a record low
	Construction work	Q4: Q3 was weather affected, this should bounce
	RBA speech	Governor Philip Lowe speaks
Thursday 23/2/17	Business investment	Q4: Has been weak for ages, investment & capex intentions will be of most interest
Friday 24/2/17	RBA testimony	Governor Lowe's parliamentary testimony

Corporate
Monday 20/2/17	Bluescope Steel	Interim core profit forecast $330m
	Brambles	Interim core profit forecast $300m
	Worley Parsons	Interim core profit forecast $50m
Tuesday 21/2/17	BHP Billiton	Interim core profit forecast $US2,820m
	Caltex	Interim core profit forecast $525m
	Oil Search	FY core profit forecast $US110m
Wednesday 22/2/17	Fortescue	Interim core profit forecast $US1,025m
	Woodside Petroleum	Interim core profit forecast $US940m
	Woolworths	Interim core profit forecast $880
Thursday 23/2/17	Crown Resorts	Interim core profit forecast $300m
	Qantas	Interim core profit forecast $610m
	Ramsay Health Care	Interim core profit forecast $260m
	Westfield Corp	FY core profit forecast $US700m
Friday 24/2/17	Super Retail Group	Interim core profit forecast $70m

Overseas
Monday 20/2/17	US Presidents' Day	National day off celebrating the first one, George Washington
	EU: Consumer confidence	Feb: Pessimism outweighs optimism
Tuesday 21/2/17	US, EU: PMIs	Feb: Factories still expanding activity
Wednesday 22/2/17	US: FOMC minutes	May hint at a rate rise next month
	EU: CPI	Jan: Inflation under 1pc YoY
	UK: GDP	Q4: Growing around 2.2pc YoY
Thursday 23/2/17	US: House price index	Dec: Modest growth
Friday 24/2/17	US: New home sales	Jan: Should rebound after previous fall

LPN targets foreigners as local condo buyers dwindle

Some 200 units at the Lumpini Suite Phetchaburi-Makkasan condominium have been bought by foreigners, mainly from China.

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SET-listed L.P.N. Development Plc is tapping more foreign buyers as it plans a shift to the middle-to-upper-end segment this year.

The company aims to boost sales from overseas to more than 10%, up from less than 2% now.

Managing director Opas Sripayak said the company this year will introduce new projects in the upper-end segment, catering mainly to foreign buyers through Singapore-based property agent Angel Real Estate.

"We need to find new buyers overseas," he said. "The middle-to-higher-priced condo market needs to rely on foreign buyers because Thai buyers in this segment are limited and there are a lot of products available."

The first project L.P.N. introduced to foreign buyers was the 2.5-billion-baht Lumpini Suite Phetchaburi-Makkasan launched last month. Of the total 636 units, 280 units or 45% were reserved for the agent to sell to foreign buyers, with about 200 units sold.

Mr Opas said the overseas market for L.P.N. products will be in relatively smaller cities in China like Shenzhen, as those in big cities like Beijing prefer units priced higher than 10 million baht. At the Makkasan site, the highest unit price was 6 million baht, which matches wealthy investors in smaller cities.

"Although selling to foreigners comes with a relatively high risk of cancellation, we are unlikely to make any losses because we collect 25% of the unit price as a one-off down payment from them," Mr Opas said.

L.P.N. this year plans to launch 12 new condo projects worth a combined 20 billion baht. Of this amount, eight sites will be in the higher-priced segment with units priced higher than 100,000 baht per square metre. The remaining four will constitute lower-end products.

Mr Opas said a shift to the middle-to-high-priced segment is one of the company's strategies this year to maintain sales growth, with the aim of achieving 10 billion baht in revenue and 20 billion in presales.

"This year we will see a mix of condo development between low- and high-priced projects and no longer cling to any one segment," he said. "Development of only low-end products hurt us last year, largely due to high household debt and banks' mortgage rejections."

Half of the presales target will stem from high-priced units, the other from low-priced units.

Although the company's shift to the upper-end segment is meant to move development locations from the outskirts to inner-city areas where land prices are much higher, the company's land investment budget this year will be close to that of 2016 at 4 billion baht.

LPN shares closed yesterday on the Stock Exchange of Thailand at 12.40 baht, unchanged, in trade worth 125 million baht.