Amber Harrison's lawyers allege senior Seven Network staff openly disparaged her, breaching confidentiality deal

Amber Harrison was openly disparaged by senior Seven Network staff in breach of its own confidentiality deal with the former executive assistant, her legal team has alleged.

In one case, Ms Harrison's lawyers claim Seven's director of corporate affairs Simon Francis told Seven West's then-director of __news Rob Raschke that Ms Harrison left the media company suddenly because "she had ripped off Seven to the tune of $200,000".

The alleged conversation occurred in December 2014 at the annual Walkley Awards for Journalism in Sydney — just weeks after Ms Harrison signed confidentiality agreements in return for payments totalling $350,000 and later left the company.

In another instance in February 2015, it is alleged Mr Raschke spoke with Australian Financial Review's Rear Window columnist Joe Aston and repeated the comment that Ms Harrison had suddenly left Seven using words to the effect that she "has ripped off Seven to the tune of $200,000".

In a cross-claim filed in the NSW Supreme Court, Ms Harrison's lawyers claimed Seven failed to ensure its directors "did not make any adverse statement, publicly disparage" or otherwise bring Ms Harrison into disrepute.

Ms Harrison's lawyers claim the "disparagement" was a breach of a deed where Ms Harrison received $150,000 as part of the $350,000 settlement for alleged injury including loss of professional standing and reputation, pain and suffering while working at Seven.

However, Ms Harrison's lawyers claim Seven ceased to make regular agreed payments in March 2015 in breach of the settlement.

It is also alleged Ms Harrison suffered pain and humiliation as Seven investigated claims she abused her company credit card and racked up massive debts.

Barrister seeking to have matter heard in Federal Court

Ms Harrison — whose ill-fated affair with Seven West chief executive Tim Worner sparked the high-profile case — has hired celebrity barrister Julian Burnside QC to take over the legal battle.

Mr Burnside is seeking to have the matter heard in the Federal Court under the Fair Work Act, claiming Ms Harrison suffered "pain, stress, humiliation and dislocation of life" as a result of her time at Seven.

The cross-claim was released to the media by Justice John Sackar although a confidential annexure was withheld to a later hearing.

Former Victorian Premier and Seven West non-executive director Jeff Kennett is alleged to be in breach of the settlement for comments about Ms Harrison broadcast on media outlets including the ABC's AM program in February 2017.

Mr Kennett's earlier comments on Twitter about Ms Harrison and an opinion piece published in The Australian are also cited by Ms Harrison's lawyers as examples as disparaging her character.

In addition to Mr Kennett, the cross-claim points to comments made by Seven chairman Kerry Stokes, who allegedly "made disparaging comments" about Ms Harrison after Seven West Media released its financial results in February.

Ms Harrison has been targeted by Seven for releasing confidential documents about Seven and her relationship with Mr Worner.

Last month, Justice John McDougall said Ms Harrison had "taken the nuclear option" by releasing emails and documents in her campaign to destroy Mr Worner.

Follow Peter Ryan on Twitter @peter_f_ryan or on his Main Street blog.

How the free market failed Australia and priced us out of our own gas supply

Fashion has a habit of turning full circle.

Remember that old shirt, the super tight one with the stretchy material and weird collar that you found at the bottom of the wardrobe? What on Earth possessed you to buy it, you wonder. What were you thinking?

For anyone who lived through the '70s, the memories of those fashion crimes often come back to haunt us.

It was also an era when free market ideology began to assert itself in public policy. And with good reason.

Government-run businesses were inefficient, bloated and bureaucratic. Letting them loose would free up scarce public funds, competition would lower prices and scarce resources would be allocated with the greatest efficiency.

When Margaret Thatcher came to power in the UK in the 1980s, she unleashed a wave of privatisations that transformed the economy and contributed to decades of economic growth.

It didn't take long for the fad to gain ground here. Government-owned businesses from airlines to banks and insurance companies were jettisoned.

Even vital infrastructure like roads, telecommunications and power generators were flogged to the highest bidder with little thought about the long-term consequences.

But have we gone too far? Free market theory, while it's terrific in theory, has some almighty shortcomings and, as we now are discovering, may not be the economic cure-all we once imagined.

Suddenly, the winds have shifted. Business leaders talk in hushed tones, openly uttering a phrase once considered unmentionable: market failure.

In the past few days, there has even been a call for part nationalisation of our energy industry from a free market wheeler dealer. More on that later.

A fortnight ago, competition chief Rod Sims let fly with his annual swipe at the fee-gouging taking place at our airports.

Airlines and the travelling public were forking out an extra and largely unnecessary $1.6 billion in fees.

What's going on with gas?

The problems arise when the business being sold is a monopoly, when the buyer, having paid an exorbitant price, is given carte blanche to extract its tonne of flesh. The benefits flow from the community to private interests, often offshore.

Generally, we're talking about utilities — things like power companies, for instance. And then there is gas.

For years, electricity and gas operated independently. But the two have become intertwined as the shift towards a cleaner environment and lower emissions has thrust gas firmly into the box seat as the transition fuel to generate electricity.

We've suddenly discovered, however, we don't have enough. It's no exaggeration to describe the power situation now facing eastern Australia on both fronts as a catastrophe. And here's why.

Within the next four years, Australia will overtake Qatar as the world's biggest supplier of gas. We are sitting on vast gas reserves. In fact, we're swimming in the stuff.

And yet, we face critical shortages at home which could starve manufacturers of fuel, see power outages across the eastern states and force energy prices through the roof while any profits that are made will be shipped offshore.

This is a public policy fail of epic proportions.

And it's worth getting a handle on how it all came about and the shenanigans employed by the gas majors that have deliberately created this crisis and the supposed shortage which is a total con.

How could this happen?

First, however, consider this: the gas we are exporting does not belong to the energy giants. It belongs to us.

Companies like Woodside, Origin and Santos and their foreign partners merely have bought the right to exploit those gas reserves, which was supposed to lead to massive benefits for ordinary Australians.

Here's the scorecard so far. Having spent close to $250 billion building new export facilities, no-one seemed to think that flooding the globe with extra energy would see global prices drop.

They have. Gas prices into Asia, where we export, have now dropped below what it costs to extract, process and ship the stuff. In fact, the east coast suppliers so far have written off around $6 billion on their new plants.

It gets worse. Extracting the gas from coal seams in Queensland was a little more problematic than originally thought. Then farmers, incensed at the activity taking place on rich agricultural land, began shutting the gates.

That meant the companies couldn't get enough to satisfy the huge supply contracts they'd written in Japan, South Korea and China. So they plundered the supplies, much of it from Bass Strait, that once powered the domestic market. That's why we have an artificial shortage.

But wait, there's more. No-one ever considered that once we were plugged into the global market, we'd be paying global prices. Around the time all these new gas plants were developed, prices in Asia were up to $25 a gigajoule. Back then, we were paying between $2 and $4.

Prepare now to be outraged. Global prices have more than halved to $10 and under. Domestic prices, meanwhile, have soared, to well above $10 because of the domestic shortage.

By putting the domestic market under pressure, they deliberately pushed local prices higher.

The upshot is that we now are paying more than Japanese manufacturers for our own gas. In fact, power company AGL is actively considering buying Australian gas in Japan and shipping it back home. And why not? It's cheaper there.

That means energy-rich Australia is subsidising Asian manufacturers while penalising our own, a situation likely to force many to the wall.

Just to rub salt into the wound, the ramp-up in exports has not delivered the resources rent tax bonanza once promised by US giant Chevron. In fact, thanks to a shifty cash shuffle, ExxonMobil, Chevron and Shell until two years ago were booking around $3 billion a year in profit, tax free.

That's seen our Petroleum Resources Rent Tax proceeds, which in the past delivered around $2 billion a year, plummet. In fact, by the time we overtake Qatar for global gas domination, it's anticipated our resources tax will collect just $800 million.

Qatar, on the other hand, is expected to receive $26.6 billion in royalties that same year for roughly the same volume of exports.

So what's being done about it?

Treasurer Scott Morrison last year declared he would urgently look into the matter. He's called a review to get to the bottom of why soaring exports have coincided with a halving in the resources rent tax collections.

The review panel could do worse than read a report sent out last week by global investment bank Credit Suisse.

Hardly a bastion of left-wing ideologues, the report — entitled The Wolf Who Cried Boy — raises the prospect of Australia establishing a national oil company as one possible solution to the concocted crisis. And it goes straight for the jugular.

"If the gas producers and sellers are the wolves, they themselves are seemingly calling foul just as the danger is truly upon us," it begins.

"We wonder whether a national oil company, a la Kumul Petroleum in PNG, could work? Instead of the petroleum resources rent tax on future projects, could we see state participation instead?"

Could we indeed? There undoubtedly will be howls of protest from the business lobby and their associated hangers-on. But consider this. Is this not the ultimate form of capitalism?

We are the landlords. The energy companies are tenants. If we had a controlling stake in the business, it would be much easier to ensure the kind of chicanery that has taken place in the past few years was never repeated. There would never be shortages.

And just perhaps, we'd end up with a dividend cheque, maybe even along the same lines as Qatar's.

Just a thought.

Hazelwood closure leaves major energy black hole, electricity prices will inevitably rise

The stink of rotting barramundi in the Hazelwood cooling ponds will be an apt metaphor for Australia's rancid energy planning, after the generator's last unit shuts the day after April Fool's Day.

Despite the long-anticipated closure of the plant, the Victorian Government introduced the tropical fish into the balmy waters of the Hazelwood pondage in April 2016.

The aim was to attract tourist anglers and there has been keen interest, even the odd poacher.

But when the plant's boilers are switched off the pond waters will go cold — when temperatures in the La Trobe Valley plummet to single digits in winter.

The optimum temperature for barramundi to thrive is 28 degrees Celsius — so the fish will die and the stench will be an eloquent testament to Australia's policy-induced energy crisis.

The Australian Energy Market Operator is forecasting shortfalls in energy that could see major blackouts in Victoria and South Australia from December. How did it get to this?

The beginning of the end

Australian politics broke on December 1, 2009.

On that day then-opposition leader Malcolm Turnbull lost the Liberal leadership to Tony Abbott by a single vote. He had battled for months, and failed, to get the coalition to sign on to Labor's Carbon Pollution Reduction Scheme.

The Greens also opposed Labor's plan, arguing it would "lock in failure".

So began the carbon wars that rage to this day. The upshot for the energy sector has been an investment strike on building new gas-fired baseload power.

In comes the Renewable Energy Target…

In the absence of a carbon price the Renewable Energy Target has been driving investment and helping Australia hit its carbon reduction targets.

Much of that investment has been in wind and most flowed into South Australia, because of its abundant resources and receptive state government. Rooftop solar has also more than doubled there since 2012.

Now, with 43 per cent of its generation sourced from renewables, that state has a higher penetration of wind and solar power than almost any other jurisdiction on Earth.

This has been an unexpected, and instructive, experiment.

And then the market broke

Subsidised wind farms bid on the National Electricity Market against other forms of power.

The market works on a merit order, where low-cost generation is dispatched first.

When the wind is blowing a generator's marginal cost of producing electricity is next to nothing, so it underbids coal and gas.

And there's another problem for thermal generators.

The rapid rise of solar panels on suburban homes means that electricity demand is supressed in the middle of the day, which also cuts into their margins.

So the drop-off in demand coupled with a subsidised, underbidding competitor, drove coal-fired power stations out of business in South Australia and saw high-price gas plants mothballed.

Capacity constraints

The end of fossil fuel generation in South Australia would be a cause for celebration if wind and solar could be relied on to deliver power all the time, but they can't.

Research by the Australian Energy Market Operator shows that wind farms deliver their advertised capacity for about 35 per cent of the year.

Financial year	Annual South Australian wind generation (GWh)	Annual change in wind generation	Annual capacity factor
2011-12	3,563		34pc
2012-13	3,475	-2pc	33pc
2013-14	4,088	18pc	32pc
2014-15	4,223	3pc	33pc
2015-16	4,322	2pc	33pc

So, when South Australia hits the calm-dark of a hot summer evening, demand surges back on to the grid and thermal power has to "ramp up" to meet demand.

The perverse effect of all this is that wholesale electricity prices are rising sharply across the national electricity market as coal exits and high-priced gas steps in to fill the void.

Frequency control

There is another, more complex, problem…

Coal-fired generators, hydro and gas have a large spinning mass of turbines embedded in them.

Put out the fire or remove the water and the inertia in the turbine will keep it spinning until it is stopped by friction. The stability and reliability of the entire electricity system depends on inertia.

Even when wind and solar are providing the bulk of the power in South Australia, they are doing little to keep its frequency stable.

This is another service that is often imported from Victoria.

What's the fix?

So, as South Australia has discovered, putting large amounts of 21st-century renewable energy on a 20th-century grid throws up some big challenges.

With other states setting high renewable targets, and without a clear direction on a carbon price from the Federal Government, is it any wonder that no-one wants to invest in baseload power?

The foundation stone for securing the power system has to be a cross-party commitment to a carbon price and a national energy plan signed off by the Commonwealth and the states.

History shows this will be a very hard fight and the man who has to lead it is the one who was so badly battered in the very first round.

There is an equally difficult battle on the left, where few will admit the current technical limitations of renewables demand that gas generation has to fill the void left by coal.

Even if that was all sorted, getting that gas at a reasonable price will be another test as Australia's political class has also managed to lead the nation to a domestic gas shortage, with the big gas companies chasing the highest bidders in the global market place.

So, whatever shape the future takes, only one thing is certain: electricity prices will rise.

Property bubble called by economist and former Liberal leader John Hewson

Australia's housing market is in a bubble caused by the "neglect and drift" of successive state and federal governments, economist and former Liberal leader John Hewson has concluded.

Speaking as part of a panel during a Lateline special on housing affordability, Dr Hewson said national economic data conclusively showed evidence of a housing bubble.

"I think it's a crisis, it is a bubble. I know people are hesitant in saying that, it is a bubble," he said.

"House prices have gone up 250 per cent since the middle '90s in real terms.

"Household debt is more than 200 per cent of disposal income, 120 per cent of GDP, and it stands as a monument really to neglect and drift by both levels of government."

Dr Hewson is not the first one to declare Australia has a property bubble, with ASIC boss Greg Medcraft using the term almost two years ago and repeating it earlier this week, and the Commonwealth Treasury secretary John Fraser also declaring a bubble in parts of the Sydney and Melbourne market almost two years ago.

A bubble is where investors drive prices higher due to expectations of future capital gains, rather than the income generated by an asset, such as rental from a house or unit.

Negative gearing, CGT changes would slow investor demand

In the case of Australian housing, Dr Hewson argued that prices are being driven unsustainably higher mainly by debt-fuelled speculation, rather than real supply and demand factors.

Dr Hewson said a reduction in the benefits investors can gain from the combination of capital gains tax concessions and negative gearing should be implemented to both cool the housing market and book up to $10 billion in extra revenue to close the Federal Government's budget deficit.

"It will work in the direction of slowing the investor demand for housing, which has been a major reason I think demand has outstripped supply and, in those circumstances, it is something that should be done," he told Lateline.

"In terms of a world where the budget is in deficit $100 billion over the budget period, those sort of savings are significant.

"In those circumstances, it makes sense to contemplate doing both negative gearing and capital gains tax, but probably grandfathering them so you phase them in over time."

The Labor Opposition has proposed such a policy, including halving the CGT discount to 25 per cent and allowing negative gearing to be used only for newly built dwellings, while grandfathering the old system for existing investments.

The Government has previously ruled out such changes, but there has been continued speculation that some tinkering with those two tax breaks may be included as part of a housing affordability packaged that has been promised for this year's budget.

'Very significant problem' if you burst the bubble

Stephen Koukoulas, who runs consultancy Market Economics and was an economic advisor to former prime minister Julia Gillard, said he does not believe that limiting negative gearing or reducing the capital gains tax discount would see prices drop greatly.

"It is important that we remove one of the areas, if you like, artificial demand for housing from the investor base who are merely doing it to minimise their tax and hoping they get a capital gain," he told Lateline.

"So, if you change those tax rules, you would certainly remove some of the demand for housing and you would put downward pressure on prices from those tax changes.

"How much depends on the other things - interest rates, immigration levels."

However, John Hewson said caution is needed in unwinding property investor tax breaks, and any other changes that will affect property prices.

"If you hit house prices hard, for example, you can burst the bubble and cause a very significant problem," he warned.

"The herd, people get on it and pull out of the housing market and cause a crisis."

Another tax policy change at the state level which Dr Hewson thinks would be beneficial is the replacement of stamp duty on property with a broad-based land tax on all property.

"If we can move away completely from stamp duties towards a broad-based land tax that is the way to go," he added.

ASX: Australian shares drop steeply on US sell-off

The Australian share market has dropped around 1.5 per cent, following a steep fall on Wall Street overnight.

The benchmark S&P 500 US share index was down 1.2 per cent, as investors got nervous about potential delays in the Trump administration's planned tax cuts and healthcare changes.

It was the biggest one-day fall for that index since September last year.

Michael McCarthy from CMC Markets said the sell-off in smaller companies was even bigger than for the major firms.

"Overnight in US trading we saw an emergence from a period of very low volatility," he told ABC News.

"Market moves have been very muted and generally upward and yet we saw a reversal of that overnight as some participants worried about valuations and disruptions to the new US administration's plans to stimulate the US economy.

"That resulted in a substantial sell down in US markets. Most of the indices fell by more than 1 per cent, but it was the smaller and medium sized businesses that were hit very hard and one of the broader measures of the market was down almost 3 per cent."

The sell-off on Australia's market has been slightly worse than the US, with the benchmark ASX 200 index of large companies falling 1.6 per cent to 5,681 by 1:50pm (AEDT).

The broader All Ordinaries was off a similar amount to 5,729.

Big investors warn global markets overvalued

The retreat comes as a record number of the world's biggest fund managers believe equities are currently overvalued.

The Bank of America Merrill Lynch fund manager survey found 34 per cent of global investors said shares were too expensive, the highest reading in 17 years.

The US was identified as the most expensive region, with 81 per cent of those surveyed saying it was overvalued, compared to 44 per cent in emerging markets and just 23 per cent in Europe.

The survey covered 200 fund managers with around $US600 billion worth of assets under management.

BoA Merrill Lynch chief investment strategist Michael Hartnett said investors were now in a "bullish" holding pattern, with a pause in the risk rally likely to continue through next month.

Cash holdings edged down this month to 4.8 per cent of portfolios, still above the long term average, but not high enough to trigger a sell signal.

The biggest risks fund managers cited were European elections leading to the disintegration of the eurozone, followed by trade wars and a crash in global bond markets.

'Days or possibly weeks of selling' ahead

Mr McCarthy said a number of factors are contributing to the steeper losses locally.

"We're seeing particular pressure on Australian shares because, not only did shares fall overnight, but certain important commodities traded lower, including copper and oil, and today we're seeing pressure on iron ore prices," he observed.

Iron ore specialist Fortescue was down more than 5 per cent, while Rio Tinto was off more than 3 per cent and BHP Billiton down 1.5 per cent.

Woodside Petroleum had fallen nearly 2 per cent, while smaller rivals Oil Search and Santos were down 1.6 and 2.3 per cent respectively.

The major banks were also out of favour, with Westpac's 2.7 per cent fall the worst of the big four and NAB's 1.7 per cent slide the smallest.

One of the few companies in the black was Newcrest, with the gold miner up 2.1 per cent as investors sought safe havens.

Mr McCarthy said this is a pullback from elevated levels, which is a natural and normal function of the market, and could have a bit further to run.

"We're looking at corrective action," he said.

"Having said that, the pullback, as measured by the index, could be as deep as 5 per cent, so we could see several days or possibly even weeks of selling as markets readjust."

Currency markets also readjusted away from the Australian dollar, which had fallen to 76.6 US cents.

SA's energy plan affordable, will increase power security, Moody's says

The South Australian Government's energy plan, drawn up in the wake of the state's recent blackout woes, has been given a tentative tick of approval by the global credit ratings agency Moody's.

Moody's has left its credit rating of South Australian debt unchanged, despite noting the $500 million plan could increase the budget deficit and leave the state exposed to the risks associated with operating a power plant.

"We believe that this plan — if executed as outlined — has a high likelihood of improving the state's energy security and reliability over time, but there is less visibility over the extent to which it will reduce power price volatility," Moody's said.

"These considerations will influence investment in the state, which in turn is a factor in managing its economic transition after the forthcoming closure of its motor manufacturing industry later in 2017."

The South Australian plan includes building a new gas-fired gas generator at an estimated cost of around $360 million by next summer and establishing a $150 million battery storage and renewable energy technology fund.

On Moody's figures, the capital expenditure portion of the plan represents a 3 per cent increase in SA's total capital spending of around $9.8 billion.

Given the costs have yet to be offset by savings, Moody's found the plan would increase the budget deficit to 1.6 per cent of revenues over the next three years, compared to the 0.6 per cent estimate published in the SA treasury's mid-year economic update.

"The additional spending will place greater pressure on the state's budget, but will be manageable, given the amounts involved," Moody's said.

Impact downplayed

Moody's also downplayed the impact on the creditworthiness of the SA Government's decision to re-enter the energy market by operating the planned 250 megawatt gas-fired peaking power station.

"The Government only intends to dispatch electricity from the proposed power station when supply is insufficient to meet demand in the state," Moody's said.

"We believe such an approach will limit the state's exposure to potential losses relative to those of a typical merchant peaking power plant.

"While we expect the new peaking power station to have a higher marginal cost of generation than the state-based renewable generators and electricity supplied from neighbouring Victoria, we expect any operating losses will likely be an immaterial portion of the state's overall budget."

Moody's said addressing power supply and reliability concerns were vital in maintaining stable economic conditions over the longer term.

"These conditions in turn influence the State Government's finances through their second-order effect on government revenue sources, such as payroll taxes and conveyancing duty," Moody's noted.

Moody's left South Australia's debt pegged at Aa1 with a stable outlook, one notch below the Aaa rating of Commonwealth, New South Wales and Victorian debt and on-par with Queensland.

Nufarm's fortunes rebound after restructure costs

Australian agricultural chemical firm Nufarm has announced a massive turnaround in its fortunes after experiencing a heavy loss in 2015 due to significant restructure costs.

The company made $20 million after tax in the six months to February, dramatically recovering from its $91 million loss during the same period in 2015.

That loss was driven by substantial restructuring costs exceeding more than $102 million.

Nufarm managing director and chief executive Greg Hunt said the results demonstrated the benefits of changes that have been made to the business over the past 18 months.

"The sales growth was achieved despite tough industry conditions with the global crop protection market estimated to be down approximately 2 per cent in calendar year 2016," he said.

The subdued global crop price has put pressure on both demand for and pricing of farming inputs, according to Nufarm.

"We expect the global crop protection market to remain very competitive, with low soft commodity pricing prevailing due to the strong crop harvests in most key cropping regions" Mr Hunt said in a statement.

Sales and revenue growth as well as margin expansion has been credited for the strong performance.

Mr Hunt said sales increased across all regions - except Europe, which was down by 3 per cent on a constant currency basis.

"With the benefit of our cost savings and performance improvement program, together with new product launches and improved customer relationships, I'm confident the business will continue to generate profitable growth."

Nufarm's share price jumped as much as 4 per cent this morning in a generally falling market on the back of the half-year results announcement.

Reserve Bank concerned on highly indebted households, real estate bubble

The Reserve Bank's warnings about the risks of a potential real estate bubble in Sydney and Melbourne are getting louder.

The March minutes released today underscored the Reserve Bank's concern about how highly indebted households would deal with a shock from a combination of rising unemployment and falling consumption.

In its most recent meeting a fortnight ago when the board kept rates on hold, the RBA did not appear to see an end to accelerating real estate investment in Australia's major east coast cites.

The RBA warned that recent data continued to "suggest that there had been a build up of risks associated with the housing market".

"Even though building approvals had fallen significantly in recent months, the substantial amount of work in the pipeline suggested that dwelling investment would continue."

The RBA said the continuing strength in real estate investment remained concentrated in New South Wales after dwelling investment rebounded in the December quarter.

"Conditions appeared to have strengthened in Sydney and remained strong in Melbourne," the minutes said.

"These cities had continued to record brisk growth in housing prices and auction clearance rates had remained high."

Capital Economics chief economist for Australia, Paul Dales, said the two cuts in interest rates by the RBA last year led to a surge in household borrowing.

"The acceleration in house price inflation in the fourth quarter of last year has undoubtedly continued into the start of this year and will remain a thorn in the side of the Reserve Bank of Australia for a while yet," he said.

'Little doubt' of bubble in Sydney, Melbourne

The Reserve Bank's warning about the risks came after ASIC chairman Greg Medcraft said there was little doubt that a real estate bubble existed in Sydney and Melbourne.

ABS data released today shows home prices have risen 4.1 per cent in the fourth quarter. Sydney prices have surged 10.3 per cent year-on-year, while Melbourne jumped 10.8 per cent.

"Borrowing for housing by investors had picked up over recent months and growth in household debt had been faster than that in household income," the minutes said.

However, the Reserve Bank made the point that the housing risks were centred on the east coast while growth in other parts of the country was sluggish.

"In contrast, housing prices and rents had fallen in Perth for two years or so and apartment prices had declined in Brisbane."

Despite better than expected economic growth in the December quarter, the Reserve Bank pointed to weak wages growth with household savings continuing to decline.

"Members noted that over the past two decades movements in the Australian household saving ratio have been much larger than those in similar economies," the minutes said.

Last week, RBA assistant governor Michelle Bullock warned that an acceleration in investor growth could pose a risk to the financial system in the event of a downturn or a global shock.

The RBA was also concerned that labour market conditions "remain mixed" and that employment was "not quite as strong" as the headline figures indicated.

The rising Australian dollar remained a concern and the RBA believed "an appreciating currency would complicate the adjustment of the economy" as the mining investment boom fades.

The Australian dollar has been sitting around 77 US cents after the US Federal Reserve signalled a more cautious path to future rate rises.

The great gas robbery is happening before our eyes. But what can we do about it?

It's the great gas robbery. And it's right before us in our utility bills.

When you next look in horror at your gas bill, think this: you are the unwitting victim of a gigantic game of risk shifting by the multinationals.

These companies have played the domestic customer on a break, because they saw something we didn't see two years ago.

And it's resulted in gas that was once destined for our heaters, cookers and manufacturing plants being sucked north to Gladstone where it is liquefied and sent to Japan, South Korea and China.

It's all about the price of oil

Those ginormous LNG projects in Queensland were pursued by their proponents on the industry-wide assumption that the price of oil would never dip below $US65 a barrel.

In fact, $US65 a barrel was the worst-case scenario when some of these projects were sanctioned.

Oil is now well south of that price and has been for some time. There's expectation the price of oil will remain relatively low for some time yet.

That might be good for motorists but not so good if you're a domestic gas consumer, even though the price of gas is linked — internationally at least — to the price of crude oil.

This sounds awfully illogical, but stick with me.

The state and federal governments, which also assumed a certain oil price trajectory, gave approval for LNG projects on the expectation that the proponents would develop their large reserves.

But investing in coal seam gas isn't as attractive as it once was. The cost of drill rigs, compressor stations, pipelines and other associated infrastructure have made new CSG wells more expensive than the gas we have been using on our stove tops and in our factories.

The LNG companies saw this coming two years ago and set about buying up the cheapest gas possible to fulfil their international contractual obligations.

It's meant that Gladstone's massive LNG trains are now sucking gas from as far as Victoria and South Australia.

Cheap gas for domestic consumers has disappeared

Spot prices for gas, once about $3 a gigajoule, have more than tripled (about $10 today, according to the Australian Energy Market Operator), and an Australian customer wanting 12 months guaranteed supply can expect to pay up to $20 a gigajoule for contracted gas.

Particularly galling is that Japanese householders, using gas once destined for our kitchens and manufacturing plants, are paying less than Australians.

LNG producers have decided against putting any more capital into CSG projects, leaving many of their own reserves undeveloped, in favour of long-term contracts of up to $8 a gigajoule from Bass Strait and Cooper Basin.

By deferring exploration and development of their own reserves, the LNG companies are effectively shifting the risk of these investment decisions to Australian customers.

It's hard not to conclude that the LNG producers are cheating the system.

Having secured a tenancy with the landlord, they are now asking someone else to pay the rent while they hoard their riches for when it can fetch more.

This is the LNG market in operation; a market which was allowed to develop in the blithe assumption that the price of oil would not fall so low and stay so stubbornly low.

Effective moratoria on new onshore gas projects in NSW, Victoria and Northern Territory — for coal seam gas and conventional gas wells — further squeeze the domestic market.

The Prime Minister's summoning of the gas chiefs to Canberra on Wednesday only advertised the limits of federal intervention in this area.

"We are a massive gas exporter. It is utterly untenable, unacceptable, for us to be in a position where domestic gas consumers — whether it's generators, whether it's businesses and industry, or whether it's families — cannot have access to affordable gas," Malcolm Turnbull said.

Everyone would agree with that sentiment, but what's to be done?

The PM made reference to the Commonwealth's "enormous power" under the Constitution over exports, but the idea of the Federal Government interfering in such a way would only invite sovereign risk concerns.

The Prime Minister's reminder to gas companies of their "social licence" was code for not aggravating the population or the Government through the abuse of market power.

More emotional blackmail than anything else, this is the sort of appeal to good corporate citizenry we've previously seen from governments in response to bastardry from the banks.

Of the guarantees that Mr Turnbull managed to extract from the gas chiefs, one was a promise to release gas during peak demands, such as during heat waves.

The fact this guarantee had to be sought reflects the imbalance in the relationship between government and the gas companies.

Getting more gas into the domestic market is obviously key.

WA's 15 per cent domestic gas reservation policy — supported on a bipartisan basis at a state politics level — once faced hostile criticism federally from both the ALP and the Coalition.

Not any longer.

Federal Labor now supports a "national interest test" for future or significantly expanded gas projects, which would potentially impose a domestic gas quota.

The Turnbull Government is not ruling out a reservation policy either.

But sovereign risk means it's probably too late to impose any reservation policy on existing LNG projects in Queensland or elsewhere.

However, if the companies do not accelerate the exploitation of their gas reserves, there is another tactic that will likely be used against them.

It's a policy successfully deployed against oil and gas companies sitting on rich, undeveloped resource tenements off the coast of WA: use it or lose it.

Superannuation: Using your retirement pool for housing? Don't even think about it

Common sense has prevailed and the Treasurer has thankfully struck out the idea of letting people use their super savings for a home deposit.

My ABC colleague Michael Janda wrote an excellent piece last week on why the rumblings from Coalition backbenchers for superannuation to be used for a deposit for a first home are ludicrous.

It's Michael's last line I want to expand on: that smart baby boomers will "walk away with the biggest profits, while recent younger buyers will be left with more housing debt than equity, and no superannuation either, and the intergenerational transfer will be complete".

Superannuation is for your retirement income, nothing else.

The Federal Government finally recognised that last year with its commendable changes to super that help stop the wealthy using it as an estate planning tool to leave millions of dollars to their children.

From July 1, $1.6 million will be the maximum amount allowed in the retirement phase of super, which will provide an income of around $80,000 a year, assuming your fund earns 5 per cent a year.

Lose your super, lose your retirement dreams

In reality, the wealthy don't need super.

You and I do though.

Lose your super and you lose your retirement dreams of living near the sea, joining the grey army and travelling the outback, cruising down the Seine, or whatever else you couldn't do while working.

You'll be living on the aged pension, which is about $23,000 a year for a single person and $34,000 for a couple.

Enough to buy food, pay the basic bills and maybe run a dilapidated car, if you own your own house, but not much more.

According to the Association of Superannuation Funds of Australia, for what they call a "comfortable" retirement, a single person will need $39,000 a year and a couple $54,000.

That will allow luxuries like holidays, eating out, better clothes, a better car and so on.

Even on $54,000 for a couple though, that sort of lifestyle will be tight.

To fulfil your retirement ambitions you may need more.

The nuts and bolts of super are that there are two things that drive it - tax breaks and compounding - and it's the compounding where your retirement income can be turbocharged.

Compounding is interest on interest.

To give a simple example, if you have $100 and earn 10 per cent interest you'll have $110 at the end of the year.

The following year you'll earn 10 per cent of $110 ($100 + the $10 interest from last year) which is $11, and so it goes on, with the interest on the interest, or the compounding, meaning you earn more every year and your balance grows faster.

Of course with super you're increasing the capital by at least 9.5 per cent of your salary every year, which helps that compounding process.

$54,000 a year retirement means saving $1m over working life

Now let's really crunch the numbers.

Using the peak superannuation body, ASFA's, figures, to achieve an income of $54,000 a year in the current investment environment where a return of around 5 per cent a year is all you can realistically hope for, you will need to save $1,080,000 over the course of your working life.

The lower the rate of return, the tougher that goal becomes and, yes, there will be years when your fund will earn a lot more than 5 per cent, but there'll be years when it will earn a lot less.

With interest rates still exceptionally low (although rising) and inflation almost non-existent; with financial markets and the property market looking increasingly like they're poised for a major correction; and with so much uncertainty around the global economy, it would be a brave person to predict regular high returns in their super fund on a regular basis any time soon.

So if you use your superannuation to pay for a house and the bottom falls out of the housing market, your retirement is going to be behind the eight ball.

Even if house prices continue their upward momentum you may have to downsize on retirement because you will have robbed yourself of the benefits of that compounding I spoke about earlier.

There's no denying that if you live in Sydney and Melbourne in particular, getting into the housing market is very, very hard unless you have help.

But you don't want to throw out the baby with the bathwater.

What's important for your long term financial wellbeing (as opposed to what we want now) is to be living in a home without a mortgage when you retire.

A better strategy may be to save as much money as you can both inside and outside super over the long term, and that may mean winding back your current lifestyle, but there are no easy fixes here.

Let the compounding work for you and only when you know you have enough in your super fund to pay for your retirement should you consider using part of it to help fund a house.

And one final point.

The intergenerational wealth transfer to baby boomers that Michael Janda identifies in his article won't last forever because our parents won't last forever.

If your parents own their house (or houses) the chances are you'll be getting some of that intergenerational transfer back, in time.

Focus on the long term.

Size isn't everything

When it comes to the development game, it's not easy being a small fish in a big pond. But for those willing to wait for openings where larger players dare not swim, a world of opportunity awaits. By Kanana Katharangsiporn

Kave Condo, a new low-rise condo project opposite to Bangkok University, Rangsit Campus by Asset Wise Co, will have a sky pool which is rarely found at projects by small developers.

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When it comes to business, being small has its disadvantages, such as poorer access to finance, resource constraints, a lack of high-calibre staff and lower job security. Small companies are also linked to having weak business strategies and planning, on top of lower standards.

But being small also comes with strengths, such as greater customer focus, more responsiveness to market needs, highly-visible top management, less red tape, informal working environments, innovativeness, the ability to pounce on opportunities and flexibility.

And that definitely extends to the property industry.

Experts say to stay afloat, small-sized property developers should spot gaps in the market, do more market research and improve products and services amid intensifying competition where large players now dominate the market.

But it is also not a cakewalk these days -- even for large developers -- to boost sales or launch a project on account of the market slowdown, weakened by lower purchasing power and consumer confidence, high household debt, mortgage rejections and oversupply in some locations.

Lertmongkol Waravenuch, managing director of property developer Legend Property Co, says small developers should build a new segment or find areas that larger developers have ignored or are otherwise not worth their time investing in.

"Many large developers are not interested in small-scale projects. Projects sized smaller than five rai for single house or townhouse sites or those with less than 80 units for condos are unlikely to attract interest from big firms. That's where the small developers step in," he says.

While large developers mostly prefer developing projects on main roads, small firms should venture into the sois, where land costs are lower. Better situated plots are also feasible for small-scaled projects that don't capture the interest of large developers.

Mr Lertmongkol's company is currently developing The Ace, an eight-storey condo on a 183-square-wah plot on Ekamai Soi 12 with only 69 units worth 250 million baht. Launched in late 2014, it is 80% sold.

"It is not necessary [for a condo project] to cling to a mass transit station. Your project can be located on a soi but it needs to have a selling point," he says. "The selling point of my project is its proximity to an international school where demand comes from parents."

He says that small developers should differentiate their locations as not all condo buyers need a project close to a mass transit line.

Kromchet Viphanphong, managing director of Asset Wise Co, says location is the most important thing for smaller-sized firm to develop a project amid the market slowdown, where demand is limited and oversupply abounds.

"We need to analyse where strong demand is as there are many locations with too much condo supply," he says. "We should find a zone where demand and purchasing power are strong but supply is limited."

Since being established in 2013, Asset Wise has launched a total of nine projects worth more than 5 billion baht, including eight condo sites and a high-priced single house project.

All of the condo projects are low-rise buildings with eight storeys located in non-central business district locations like Lat Phrao, Saphan Mai, Ngam Wong Wan, Ram Intra, Min Buri and Ratchadaphisek.

Five of them have been completed with one being completely sold out and the other four having 5-10% of their units still up for sale.

"Our locations are in the outer city but demand is real with no speculation," says Mr Kromchet. "We don't need to develop a high-rise building, but low-rise ones with complete facilities just like those in a high-rise project."

The company's new projects being launched this year will also be in outer city locations like the Rangsit area opposite to Bangkok University, on Soi Chok Chai 4, on Lat Phrao Soi 71, as well as Saphan Mai and Ram Intra.

He says small developers should cultivate projects with the same standards employed by large developers, adding it is better to give customers more than they had expected.

"Small developers should work hard, do more market research and follow customer trends and lifestyles," says Mr Kromchet.

As a new entrant at the time, Asset Wise had touch-screen control panels and built-in speakers installed in every one of its units, despite the fact they were only priced 1.5 million baht. All of its projects also boasted digital door locks, he says.

Good after-sales services and customer care are also a must for no-name brands as they can build a reputation and bring in new buyers by word-of-mouth.

"After-sales service is a key concern for customers, particularly at projects developed by small or no-brand developers," he says. "When customers bring a problem to light after getting a unit transferred, developers should do repairs or solve their problem as soon as possible."

When a property management firm steps in after a unit transfer at a project, the company should have a customer relationship management unit to monitor it, as many cases have arisen when the developer gets blamed for a problem stemming from the management firm.

Saowapark Thanomsakkul, chief executive of S Park II Co, Ltd, a new property firm founded in December last year, says the company has seen market opportunities in the luxury single house segment on small-sized plots of land in the Srinakarin area.

Its first project will only have five units of four-storey single houses priced from 50 million baht a unit, to be located on a 517-sq-w plot near Suan Luang Rama IX Park on Soi Premiere off Srinakarin Road. Designed by renowned architectural firm A49, all the units can be customised.

"Locations near Suan Luang Rama IX Park are attractive for those seeking a single house, as it has a good environment and refreshing weather," she says. "Location is key for high-priced single houses."

The company is confident in the area, where demand is from wealthy families. This segment has no problem with bank mortgage rejections as buyers have good credit and most of them can pay in cash.

Ms Saowapark says the project has no rivals as it taps a niche market segment and is small scale, leaving it outside the purview of bigger players.

Mr Kromchet with a Kave Condo model. He says small firms must be big on standards.

Caltex looks at best strategy as industry gets tougher

RORO or CORO? Caltex is doing a feasibility study to find a better retail oil business model to help it cope with the intense market competition.  THANARAK KHUNTON

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Caltex Thailand Co is conducting a feasibility study to find a better oil retail business model amid fierce market competition, says Boonyarit Srionkong, manager for policy and public affairs.

Generally, the oil retail business is operated on two models. Under the first model, the oil company operates the petrol station and owns the assets. With the second model, the station and its entire assets are owned by the retailer, an investor who buys the oil from a certain oil company, uses its brand and participates in its marketing campaigns.

Currently almost all of Caltex petrol stations are owned and run by investors under the retailer-owned, retailer-operated, or RORO, model. Only 3-4% of its total of 375 stations are owned and operated Caltex itself, under the company-owned, retailer-operated scheme, or CORO.

"We want to know if we increase the number of stations we own and run ourselves to be equal to the number of our RORO stations, this will improve our business margin, corporate image and market share," said Mr Boonyarit.

Caltex has allocated 640 million baht to build new petrol stations and renovate existing ones once the study is finalised.

Mr Boonyarit said the local petrol station business has been getting tougher over the past decade, forcing all players to keep adapting their strategies.

Most major oil companies use both models even though the CORO model allows the oil company full control of the business. But this model requires huge capital for expansion, whereas the RORO scheme enables them to increase their station network much quicker. But the risks for investor-owned stations are safety standards and oil quality.

"We have to admit the investors who run their petrol stations are doing a good job, and as they are local people, they know what their clients need. But we have to keep looking for ways to improve our business," said Mr Boonyarit.

This year Caltex plans to have 30 more new stations, at 20 million baht each excluding land price, and all to be run under the RORO model. The company also plans to revamp and modernise 20 existing stations, at 2 million baht each. Mr Boonyarit said 60% of its petrol stations had been renovated in the past two years.

Caltex expects its retail oil sales volume to grow 6% this year, ahead of 4-5% market average estimated by energy policymakers. Last year, Caltex reported sales of 500 million litres, a 5% growth from a year before.

State-owned PTT Plc is the long-time leader with a 40% market share, followed by Esso and Bangchak at 15% each. The third place is a close fight between PT, Shell and Caltex, with their market shares veering between 12% and 13%.

Singapore best in Asia for quality of living

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Singapore remains first among cities in Asia for quality of living, with its infrastructure securing top spot worldwide, according to the human resources consulting firm Mercer.

But great disparities in the quality of living still persist on the continent as indicated by the vast disparity in rankings between cities in developed and developing countries, the New York-based firm said.

While Singapore ranked 25th for overall quality of living -- European centres led by Vienna dominated the top 10 -- the city-state edged Munich and Frankfurt for the world's best infrastructure, based on supply of electricity, drinking water, telecom services, public transport, traffic congestion, and the availability of international flights.

Hong Kong, in sixth place, was the next best Asian city for infrastructure in Mercer's 19th annual Quality of Living survey.

"Cities that rank high in the city infrastructure list provide a combination of top-notch local and international airport facilities, varied and extended coverage through their local transport networks, and innovative solutions such as smart technology and alternative energy," said Slagin Paratakil, a principal at Mercer responsible for quality of living research.

"A city's infrastructure, or rather the lack thereof, can considerably affect the quality of living that expatriates and their families experience on a daily basis. Access to a variety of transport options, being connected locally and internationally, and access to electricity and drinkable water are among the essential needs of expatriates arriving in a new location on assignment."

Well-developed infrastructure can also be a key competitive advantage for municipalities trying to attract multinational companies, talent and foreign investments.

"Internal stability, wide availability of consumer goods, availability and quality of housing, and low incidence of natural disasters" are other key attributes contributing to Singapore's high score, said Mercer.

In the global ranking of 231 cities, Singapore jumped one spot to 25th this year, and four Japanese cities are among the top 60 for overall quality. They are Tokyo (47), Kobe (50), Yokohama (51), and Osaka (60).

In Southeast Asia, Kuala Lumpur was 86th overall followed by Bangkok (131), Manila (135), and Jakarta (143). Other notable cities in Asia include Hong Kong (71), Seoul (76), Taipei (85), Shanghai (102), and Beijing (119).

Despite increased political and financial volatility in Europe, many of its cities still offer the world's highest quality of living and remain attractive destinations for expanding business operations and sending expatriates on assignment, according to Mercer.

Vienna tops the table for the eighth year running, with the rest of the top-ten list mostly filled by European cities: Zurich (2), Munich (4), Dusseldorf (6), Frankfurt (7), Geneva (8), Copenhagen (9), and Basel, a newcomer, in 10th place. The only non-European cities in the top 10 are Auckland (3) and Vancouver (5). Montevideo, the Uruguayan capital, is the highest-ranking city in Latin America in 79th place.

Vienna's 1.8 million inhabitants benefit from the Austrian city's cafe culture and museums, theatres and operas, said Mercer. Rents and public transport costs in the city, whose architecture is marked by its past as the centre of the Habsburg empire, are cheap compared with other western capitals.

Global centres including London, Paris, Tokyo and New York City did not even make the top 30, trailing most big German, Scandinavian, Canadian, Australian and New Zealand cities.

The Mercer survey is influential in helping companies and organisations determine compensation and hardship allowances for international staff. It uses dozens of criteria such as political stability, healthcare, education, crime, recreation and transport.

Still, the survey indicates a considerable gap in the quality of living among Asian cities. In contrast to Singapore and Japanese cities, Beijing is ranked 119th, with Shanghai 102nd and Guangzhou 121st.

Baghdad is again ranked lowest in the world. Waves of sectarian violence have swept through the Iraqi capital since the US-led invasion in 2003.

Six years into Syria's bloody war, Damascus is seventh from bottom, with Bangui in the Central African Republic, the Yemeni capital Sanaa, Port-au-Prince in Haiti, Khartoum in Sudan and N'Djamena in Chad filling out the lowest tier.

Problem of producing cheap biofuel from cassava solved

New yeast species is key to cutting cost

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The state's research agency and energy policymakers have finally discovered a way to produce biofuel from cassava at a competitive cost, says a senior Energy Ministry official.

A researcher works at a pilot plant for producing cassava-based ethanol designed by Thailand Institute of Science and Technological Research.

Previously the use of cassava in ethanol production was not viable despite the abundance of the shrub, because the production costs were far higher than those for fuel derived from molasses, the by-product of refining sugarcane into sugar.

After 18 months of research and experiments, the Thailand Institute of Science and Technological Research (TISTR) has found that they can use a species of yeast named Saccharomyces Cerevisiae in the cassava fermentation process, resulting in ethanol with a far lower per unit cost.

The yeast is well suited to ethanol production as it is highly resistant to high temperatures and can grow with the high content of sugar and alcohol during the fermentation process.

"Due to the quality of the yeast, we can use it in cassava-based ethanol production, resulting in ethanol with a quality and cost on par with that from molasses," said Praphon Wongtharua, director-general for the Department of Alternative Energy Development and Efficiency (DEDE).

Employing the yeast can lower the production cost of cassava-based ethanol by 80 satang per litre or almost 4% from 21.5 baht a litre to 20.7.

"We are excited by the new discovery as it will not only give us more choices in using green fuels. What's more, it will also help reduce the burden for farmers when cassava prices decline due to output gluts," said Mr Praphon.

The DEDE has supported the TISTR financially in a bid to find the new fuel options for the country.

The research budget is undisclosed.

The TISTR has also designed a new cassava-based ethanol production process to serve its future plans to push the research to become commercially viable.

"We are modifying existing ethanol production to make it more efficient, boosting productivity as much as 33% higher than that garnered from widely-used ethanol production methods," he said.

Currently, the TISTR is operating a small pilot plant in Rangsit, Pathum Thani.

Thailand's total ethanol production as of the end of 2016 was 4.7 million litres per day, made by 21 producers across the country. Of the producers, 33% uses feed stock from cassava and the rest use molasses or sugar cane juice.

He said that the next TISTR mission is to find other species of yeast that can be used in the cassava-based ethanol production with similar or better outcomes, as a substitute should be prepared.

In tandem with the yeast species breakthrough, they are also conducting research to boost productivity in the industry.

After the first stage of development is completed, the DEDE is hoping it will find new investors, including existing ethanol producers, who can help commercialise forthcoming TISTR innovations.

"We are very optimistic about the future as existing operators can invest in this scheme to upgrade their productivity and cost efficiency. There are also two ethanol plants under construction, and their owners might be interested in investing in this technology," said Mr Praphon.

The DEDE will continue in its research and development efforts for alternative fuels and renewable energy even though consumption has grown more slowly than expected since crude prices began falling in 2014.

For example, an ethanol promotion plan that was intended to phase out gasohol 91 by Jan 1 next year never got off the ground.

Thailand's National Alternative Energy Development Plan 2015 has set its ethanol consumption target in 2022 at 9 million litres per day, and to 11.3 million litres in 2036.

Roadmap planned for elderly care

Krisada: New fund to help poor old people

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The Finance Ministry is to lay out a roadmap to deal with the advent of an ageing population, also setting up a fund to provide an additional living allowance for poor elderly people.

The Fiscal Policy Office (FPO) was delegated by the government to discuss drafting of the roadmap with related ministries, including the Public Health, Social Development and Human Security, Labour, Education and Interior, said FPO director-general Krisada Chinavicharana.

Measures to care for the growing number of elderly is among the government's priorities, aimed at allowing them to live comfortably in post-retirement life and alleviating the government's financial burden as the population ages. In 2015, the government successfully pushed for the establishment of the National Savings Fund (NSF), a voluntary retirement safety net for 25 million non-formal workers.

The cabinet last year also approved a package allowing companies that hire ageing workers with a salary of 15,000 baht a month or less to be eligible for a double corporate tax deduction on expenses incurred.

Other measures in the package included reverse mortgages -- a home loan that allows the elderly to convert their home equity into cash -- and a mandatory provident fund to help retired senior citizens afford living costs and to strengthen the retirement safety net.

Mr Krisada said the Finance Ministry is considering raising the monthly living allowance for poor elderly people. The monthly living allowance should be at least 1,200-1,500 per person, he said.

All elderly citizens are now entitled to the step-up living allowance, with 600 baht monthly paid to those aged 60-69, 700 baht to those 70-79, 800 baht to those 80-89, and 1,000 baht to those 90 and older.

There are about 10 million people aged 60 or older nationwide, 8 million of whom receive a monthly living allowance from the government. The government spends 70 billion baht annually to cover their living expenses.

The Finance Ministry plans to redirect portions of sin taxes -- taxes from cigarette and alcohol sales -- worth 4 billion baht from the Thai Health Promotion Foundation and the National Sport Fund to finance the new elderly fund, he said.

Whatever portion of the living allowance some elderly people abstain from receiving will be redirected to those in need, said Mr Krisada.

He said previous registration for the government's subsidy and welfare scheme found 2 million elderly people earn an annual income of 100,000 baht or less. The higher living allowance will be directed to these people.

The road map will also cover health problems and accommodation of the elderly.

Dealing with an ageing society requires cooperation from the private sector, said Mr Krisada, such as volunteers who take care of bed-ridden elderly.

An FPO report forecast those aged 60 and older will account for 20% of the total population in 2025, an increase from 14% in 2015. It also predicted the government's financial burden to the Social Security Fund, the NSF and the Government Pension Fund will increase to 698 billion baht in fiscal year 2024 from 290 billion in fiscal 2016.

Startups get insider tips for survival

From left Ravit Hanutsaha, owner of Srichand cosmetics brand, Somyos Chavalit, managing director of JIB Computer, and Siruwat Chatchaval, owner of Tummour restaurant, are among the business leaders sharing their experiences at the seminar. Patipat Janthong

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Young startup entrepreneurs must understand the market and have clear and serious business objectives in order to survive, say business leaders.

Kriangkrai Kanjanapokin, co-chief executive of leading event organiser Index Creative Village, said small and medium-sized enterprises (SMEs) play a major role in driving the Thai economy.

But many of the young people, or Gen Y, running startups lack a strong market focus and do not understand consumers' changing behaviour in the digital era, he said at a seminar on Saturday.

The seminar, entitled "Following 100 Million Baht with Young Self-Made Millionaires" and held at GMM Live hall, was organised by Mushroom TV and aimed at helping SMEs understand the challenges they face to survive.

"Gen Y always see success from the time they start a business, and that's totally wrong. They should know that they must first build strong business fundamentals before it can be sustainable in the long term," said Mr Kriangkrai.

Many of them also want success fast, he added. They work hard but lack good business strategies, especially on financial planning, which can finally lead to the business failing. Young business people should carefully set their revenue projections to help ensure the company is on track to sustainable growth.

"To have a sustainable growth, small business needs an effective strategic plan based on what business trends are coming," he said.

It's important to focus more on right business strategies and do a market research based on customer demand and trends.

During heavy market competition, Mr Kriangkrai also urged younger people to not only have strong business fundamentals but also be more creative on their products to attract customers.

Akarat Nitibhon, managing director of Mushroom TV, said young people want success fast because they have more opportunities and are equipped with digital tools for doing business.

They should use this advantage to build their businesses and keep it growing, he said. But they have to keep in mind that a strong knowledge of business trends is very important for survival.

Mushroom TV is a subsidiary of Post Publishing Plc, the publisher of the Bangkok Post among others. The TV content producer aims to generate 6 million baht from holding seminars and training courses for SMEs this year. It offers three types of training courses: beginners, expansion and business clinics. The company plans to hold at least three seminars in 2017.

Wall Street's Charging Bull statue stared down by Fearless Girl on International Women's Day

A new statue of a resolute young girl now faces Wall Street's famous Charging Bull, erected for International Women's Day to highlight the scarcity of women on the boards of the largest US corporations.

Investment giant State Street Global Advisors had the statue created to push companies to increase the number of female directors.

Artist Kristen Visbal's Fearless Girl drew both tourists who came to pose for pictures with the bull and workers arriving at their jobs in the Wall Street area.

The girl, sculpted in bronze, appears to be staring down the bronze bull, her hands firmly planted on her waist. Her head is held high, with a ponytail that looks like it is swinging.

"Know the power of women in leadership. SHE makes a difference," a plaque at her feet said.

State Street's deputy global chief investment officer Lori Heinel said: "As a steward of nearly $US2.5 trillion ($3.3 trillion) of assets, we want to engage with boards and management around issues that we think will drive core results."

"And what you find repeatedly is having more diverse boards and more diverse senior management will actually drive better results for companies."

Twenty-five per cent of the Russell 3000 — an index of the nation's largest companies — have no women on their boards, according to State Street, which manages many of their assets.

Nearly 60 per cent have fewer than 15 per cent of female directors.

Ms Heinel said State Street would contact those companies, urging them to change the composition of their leadership.

She said the financial giant also was working with companies in Australia and the United Kingdom to urge them to pursue diversity in board membership.

Negotiations underway for girl to remain

The mammoth bronze bull was a "guerrilla art" act, dropped in the middle of the night in Bowling Green Park in 1989 without permission by an artist who created it as a symbol of Americans' survival energy in the face of the 1987 stock market crash.

The city gave its permission for the bull to remain.

This week, McCann New York, a top advertising agency, dropped off the statue of the girl — with a city permit for at least a week.

Negotiations are underway for the piece to remain there longer.

Why choose the Charging Bull as the site to place the girl?

"We really wanted the bull to have a partner, and a partner that we thought was worthy of him," Ms Heinel said.

"And so we got a very determined young woman who is fearless and is willing to drive the change that we believe we need."

AP

Gas prices will rise and there's not much we can do to stop it

The gas price debate is full of hot air, so let's use some economic logic to cut through.

The most basic principle of economics is supply and demand.

This is the basis of the Federal Government's preferred solution to Australia's surging domestic gas prices — relaxing state restrictions on unconventional gas (such as coal seam gas, or CSG) to increase total production.

It seems logical until you consider this: the reason we have a shortage is because we are shipping the vast bulk of it to Japan, Korea and China, not because we don't have enough.

There are now seven, and soon to be 10, export plants liquefying gas and shipping it offshore.

If Australia simply produces more gas, it will find its way to the destination that pays the most. Right now, that's Asia.

But won't we be able to make the export dollars and produce enough to push prices down at home if we increase supply?

Again, it sounds logical — until you consider how huge the export demand is, much of which is already locked in through export contracts.

Australia needs to double production in six years

According to the International Energy Agency, Australia produced 2,462 petajoules (PJ) of gas in 2014.

Australia will need to lift that total output by 50 per cent just to meet its expected exports in 2020, according to an ANZ analysis from 2015.

Even if domestic consumption remains steady, the nation will need to more than double its gas output from 2014 levels to meet export and local needs — if that's indeed possible.

A large part of the increase will come from massive, proven conventional offshore gas resources located in WA's North-West Shelf.

But the export boom is also relying on three giant liquefaction plants located near Gladstone in mid-north Queensland.

Some of the Queensland coal seam gas fields that inspired the construction of those three plants have turned out to be less productive and costlier than originally hoped.

That has forced LNG operators to turn to the east coast's conventional gas supplies, mainly from South Australia and Victoria, to fulfil their export contracts.

These raids of the domestic market are putting huge upward pressure on local gas prices; gas was cheap until the LNG export boom kicked off.

Getting fracked won't slash prices

The Federal Government's response is — get fracked.

Lifting restrictions on hydraulic fracturing of coal seams, or 'fracking' — particularly in New South Wales — would boost output, taking pressure off prices, it argues.

Australia's estimated gas reserves

Resource category	Conventional gas	Coal seam gas	Tight gas	Shale gas	Total gas
Reserves	77,253	45,949	39	0	123,241
Contingent resources	108,982	33,634	1,709	12,252	156,578
All identified resources	186,235	79,583	1,748	12,252	279,819
Prospective resources	235,913	6,890	48,894	681,273	972,969

Source: Geoscience Australia

Once again, it sounds logical. But where does the Government think that extra gas will go?

Now that the Queensland LNG plants are in production, the gas can simply be shipped offshore if the price is right.

It's a dollars and sense equation.

If overseas prices, minus processing and shipping costs, are higher than domestic prices, then the gas will be exported.

The only way prices would fall is if we engineer a gas glut where the LNG plants are at full capacity, and there's a surplus.

But if that happens, and overseas prices were high enough, the gas producers could always build more export capacity.

You see, rising east coast gas prices are no accident, they were always an integral part of the energy companies' plans.

Firms such as Santos were no doubt sick of selling their gas at bargain basement prices and low profit margins to domestic industry and households.

Especially once they saw competitors in WA and the NT start shipping high-priced LNG cargoes overseas.

East coast gas producers knew that once they had the ability to ship overseas, the global gas price would be the benchmark upon which domestic gas prices are set.

The die is cast for higher gas prices

Now that Australia's east coast has entered the global gas marketplace, there is no turning back.

No reasonable, or achievable, amount of domestic supply is going to bring prices back to the levels they were at when Australian gas was isolated from global markets - unless governments are prepared to reserve a large percentage of gas for domestic use.

WA did this when prices started surging in 2006, keeping 15 per cent of output for the state's industry and households.

Even that didn't prevent WA prices taking off once the state's major producers had access to export markets, but they have eased back since 2009, with Queensland now passing it as the most expensive market.

But don't hold your breath for this to happen.

For Australian industry, it's another harsh introduction to the competitive pressures and costs its global counterparts have long confronted.

For households who have enjoyed several decades of falling real import prices for items such as clothes and electronics, its a lesson that globalisation doesn't always leave you better off.

Investor property lending surges, putting regulators on 'high alert'

Investor lending accelerated to its fastest growth since the bank regulator APRA imposed tough restrictions to slow down lending at the riskier end of the property market.

Australian Bureau of Statistics figures show investor lending grew at a seasonally adjusted 27.5 per cent over the year to January, almost three times the 10 per cent speed limit imposed on the banks in late 2014.

It is the fastest growth since August 2014 and comes on top of another heady month in December where investor mortgage growth came in at just under 20 per cent.

Owner-occupier lending came in at a far more modest annualised pace of 1.9 per cent, and when refinancing is stripped out actually fell by 1.5 per cent.

"The recent acceleration in investor activity is sure to keep both the RBA and APRA on high alert, as market sentiment shows no signs of easing," ANZ economist Daniel Gradwell said.

The January figures pre-date the moves by a number of banks — particularly Australia's biggest lender, the Commonwealth Bank — to throttle back on the investor sector last month.

The Reserve Bank this week was more muted in language about the success the APRA speed limit was having saying that the "supervisory measures have contributed to some strengthening of lending standards".

Previously the RBA had said APRA's measures had "strengthened" lending standards in the sector.

Investor appetite for property has shown a marked resurgence over the past six months, since tumbling in mid-2015.

Westpac's Matthew Hassan said the January figures suggest lenders will either have to start reining in growth in investor loan approvals back to a sub 10 per cent annual pace in coming months or run the risk of sanctions from the regulator.

APRA has warned the banks if they breach the speed limit they may be required to hold higher levels of top tier capital, which would lead to a drag on profitability.

"While the growth rate in the stock of investor debt remains below APRA's 10 per cent limit, further results like today's are likely to see growth nudge closer over coming months," Mr Gradwell said.

First home buyer commitments continued to fall in January, both in dollar terms as a percentage of total lending.

Australian beef gaining popularity in China's fifth-largest city

A young Chinese businessman who lived in Brisbane for three years is behind a string of Australian-style butcher shops popping up in Chengdu, China's fifth-largest city.

"I did eat a lot of beef when I was at uni in Queensland!" Ming Yang said.

"I didn't know beef was that good before I went to Australia, I love it."

Three years ago Mr Yang started Sichuan Yutai after securing exclusive rights to sell Coles branded beef in Chengdu.

He named the small butcher shops AFD, which stands for "more Australia happiness".

From 25 tonnes a month, three years ago, Sichuan Yutai now imports 100 tonnes a month to supply its four shops and a large wholesaler.

Mr Yang said 16 more shops would be opened in Chengdu by the end of 2018.

"It's very exciting and very important," Coles meat general manager Alex Freudmann said.

"We are committed to that whole animal model and that means we look to recover as much as we can from every inch of that animal, and there's quite a large proportion you can't market domestically because the demand for those cuts does not exist.

"We are actually one of the largest exporters of Australian beef into China."

While there is not much of a market for items such as patellas (kneecaps) and paddy-whack (the tendon which keeps a cow's head up) in Australia, the cuts are used in Chinese slow cooking.

The China deal was brokered by David Foote, the managing director of Australian Country Choice (ACC), one of Australia's largest privately owned beef businesses.

ACC runs 250,000 head of cattle across 2.4 million hectares in Queensland as well as three feedlots and an abattoir.

Mr Foote and Mr Yang met in Chengdu in 2014 during Australia week.

"Mr Yang was there to pick me up from a dairy factory to take me back to the hotel, he loved beef and he asked me could I help him learn about and become part of the beef [industry]," he said.

Despite being a wine importer with no experience in beef retailing Mr Foote was surprised by Mr Yang's Aussie butcher shop pitch.

"I just loved the concept," Mr Foote said.

"It was a great idea because it's all about presenting beef where the customers go which is the local markets.

"That's where they're more comfortable to shop rather than driving an hour into the city, get a park and go into an upmarket western supermarket is really not where the bulk of the population chooses to shop."

Mr Yang said business was continuing to grow.

"One hundred to 150 people come to each shop every day and more than 80 per cent buy the product and the feedback's really good," he said.

"The younger generation [have started] to eat more beef than pork so we believe in the future there'll be more and more customers for us."

A series of shocking food safety scandals in China has left consumers mistrustful of locally grown and manufactured food.

Those who can afford to prefer imported food from countries like Australia with a clean, green reputation and strong food safety standards.

At the busy Wan Nian market Mr Yang's competition looked very different.

Cuts hung unchilled in the open, one man wielding a cleaver had a cigarette in the corner of his mouth, and a dog at his feet and few staff wore gloves.

Sechuan Yutai's butcher shops all have chilled meat cabinets and staff are gloved and hatted.

"When customers come to our shop they do ask questions like 'is this smuggled?' So they do care a lot about the certificate from the Chinese consulate," Mr Yang said.

"Our customers say they trust this shop. They know it sells the real Aussie products and also they think Australian beef is very fresh, tender and natural without any other stuff."

On the walls were framed official documents to prove the beef is Australian.

"Their stores are clean, they're dependable, customers can get product which is consistent week to week," Mr Freudmann said.

"They have taken this business from a few trial loads now they have four stores, a huge wholesale business, and we know they plan to open 16 more stores in the next two years ... beyond that the growth is limitless."

Mr Foote said the success of the partnership was a lesson to Australians keen to export to China about not forgetting second tier or smaller cities.

"I thought Chengdu didn't count it didn't matter but that was before I worked out there was over 10 million people here," he said.

"The scale and the opportunity here is mind-blowing."

Volkswagen pleads guilty in United States diesel emissions scandal case

Volkswagen has pleaded guilty to fraud, obstruction of justice and falsifying statements as part of a $US4.3 billion ($5.7 billion) settlement reached with the United States Justice Department over the automaker's diesel emissions scandal.

The criminal and civil penalty, if approved by a federal judge, would be the largest ever levied by the US Government against a car manufacturer.

VW has agreed to pay $US2.8 billion ($3.7 billion) in criminal penalties and another $US1.5 billion ($1.9 billion) in civil fines.

The guilty plea comes as the company strives to put the most expensive ever auto industry scandal behind it.

In total, VW has agreed to spend up to $US25 billion ($33.1 billion) in the US to address claims from owners, environmental regulators, states and dealers and has offered to buy back about 500,000 polluting US vehicles.

The emissions scandal erupted in 2015 when US researchers discovered many VW vehicles sold in the US were fitted with software that discretely turned on pollution controls during Government tests and switched them off in real-world driving.

VW at first denied the use of the so-called defeat device but finally admitted to having intentionally cheated on emissions tests in September 2015.

The company admitted about 11 million vehicles worldwide were affected, including almost 80,000 cars in Australia.

The cars affected in Australia include vehicles made by Skoda and Audi, which are subsidiaries of Volkswagen.

The Australian Competition and Consumer Commission (ACCC) initiated proceedings in the Federal Court against Volkswagen, Audi and Audi Australia over the diesel emissions scandal last week.

Emissions scandal a 'calculated offence', says lawyer

Even after admitting to the scandal in 2015, company employees were busy deleting computer files and other evidence, VW's general counsel Manfred Doess acknowledged to US District Judge Sean Cox.

Summing up the scandal, Assistant US Attorney John Neal said it was a "calculated offence", not a "momentary lapse of judgment".

The judge said he wanted more time to study the terms of the punishment negotiated by the US Justice Department, and set a sentencing date of April 21.

"This is a very, very serious offence," Mr Cox said.

Investors in VW stock took the __news in stride after the expected guilty plea, sending shares up slightly in Germany to close up 0.3 per cent at 143.70 euros ($203.51).

The US Justice Department and VW have argued that the company has already agreed to significant restitution.

"Volkswagen deeply regrets the behaviour that gave rise to the diesel crisis," the company said in a statement.

"Volkswagen today is not the same company it was 18 months ago."

AP/Reuters/ABC

Young women 'greatest untapped potential' in Australia: OECD report

Young women at home looking after children represent "the greatest untapped potential" in Australia's workforce, according to an OECD report out today.

The Organisation for Economic Cooperation and Development also warned the Australian economy would continue to suffer unless mothers were encouraged back to work.

"There are potentially large losses to the economy when women stay at home or work short part-time hours, " the OECD said in its study of employment participation in Australia.

"One of the areas of greatest untapped potential in the Australian labour force is inactive and/or part time working women, especially those with children."

The OECD said tapping the potential of women, especially highly-educated stay-at-home mums, would be a boost to the Australian economy.

Economic growth in OECD countries would increase by 20 per cent over the next 20 years if female labour participation matched the level of men, the OECD stated.

The reality check on the potential of women who chose to stay at home with their children coincided with the decision by Labor frontbencher Kate Ellis to quit politics to spend more time with her young son.

However, the OECD maintained that paid employment was "important for women's personal wellbeing and perceptions of their overall quality of life".

According to the study, the employment rate of Australian women aged between 25 and 54 is at 72.5 per cent, but ranks in the lower third of OECD countries.

The employment rate of single mothers is 50.8 per cent, the third lowest in the OECD ranking after Ireland and Turkey.

It also found that 54 women aged between 25 and 34 have university qualifications, compared to 43 per cent of men.

The OECD found that people with a disability, a mental health condition and disadvantaged youth were badly represented in Australia's labour force.

"These groups face considerable and other multiple barriers to employment," the OECD said

"Lacking work experience, low education and poor health are the single most important employment barriers."

The OECD urged a better combination of various government policies to assist overrepresented groups, in particular Indigenous Australians.

Energy retailers making millions buying solar power on the cheap from homeowners

At a property on Victoria's Mornington Peninsula, workers are up early to install a rooftop solar system. While there's been anger in South Australia over its blackouts this summer, here there are outages every day.

The panels being installed will provide a back-up and generate extra power for the grid.

It's been called the great solar scam: households investing in solar energy and feeding electricity back to the grid for just a fraction of what it's worth, and sometimes for free.

At the same time, the energy market operator is complaining that even it can't find out how much solar is going into the grid at peak times that are critical for the network. It comes amid surging power prices and calls for a bipartisan energy policy.

"This installation is large enough to that we expect it to cover all our costs and also feed back in, so supporting the grid on an ongoing basis," says Ingrid Williams, a solar customer.

The electricity market is weathering a series of shocks, with extreme heat in New South Wales and in Victoria. The Hazelwood power station will close down within weeks.

About 1.6 million Australian homes already have solar panels installed.

"In the places where there isn't a regulated minimum then there's a lot of evidence that retailers are really getting quite a good deal by paying customers either nothing or four or five cents and avoiding having to buy on the wholesale market for seven, eight, nine cents," said Jack Gilding, executive officer at Tasmania Renewable Energy Alliance.

That may sound like small potatoes, but these days, solar generates huge amounts of electricity for households.

And, for the network, it supplies well over half the annual output of a big coal plant like Hazelwood.

Solar flowing into the grid means retailers don't have to source that power from the wholesale markets, which have more than doubled in the last year, and can have massive price spikes at peak times.

"You can get prices up to $14,000 per megawatt hour, which is $14 per unit at the household level and the solar feed-in rate is five cents," said Bruce Mountain, energy economist at CME.

That energy is then sold to other customers at retail prices of about 20 to 30 cents.

But the energy industry says the price the market sets for household solar is correct.

"It costs money for a retailer to pull that energy from a solar PV system into the grid and redistribute it to a customer base," says Sarah McNamara, the general manager of corporate affairs at the Australian Energy Council.

"That is not a costless exercise, and the cost of the wholesale energy on the spot market, or on the long-term contract market, has different variables at play than solar PV does."

Generous payments phasing out

There are still thousands of households getting generous payments on premium feed-in tariffs that were put in place to kickstart the solar industry. But these are being phased out.

In Tasmania and regional Queensland, the state sets a minimum feed-in price, while Victoria is more than doubling its minimum to about 11 cents.

The rest of the country relies on market forces.

"We support market-based tariff schemes for that energy that might be fed back into the grid because we believe the market is best placed to set the rate at which that energy is valued," Ms McNamara says.

The market is complex, with more than 50 retailers selling contracts to households, and more than 8,000 contracts on offer.

"Many retailers are offering nothing or next to nothing and it's very difficult for households to discern if they're getting a good deal because it's wrapped up in a purchase contract," Mr Mountain says.

"You need to split apart the purchase contract and the sales contract to figure out if you're getting the best offer overall."

Part of the problem is that no-one knows for sure how much rooftop solar is going into the national network.

The market operator says not even it knows, and that's a problem.

It says with increasing so-called "behind-the-meter" power generation, such as solar, "there is a real risk the power system will increasingly operate inefficiently, with assets under-utilised, less informed investment decisions being made and increased costs being borne by customers".

Even making some conservative assumptions, household solar is a bargain for power retailers.

Solar households are being paid between five and seven cents per unit for power that would cost between eight and 10 cents to buy wholesale.

On these numbers, retailers are making between $74 million to $370 million a year by getting rooftop solar on the cheap.

And with the massive price spikes on the wholesale spot markets, the real figure would be much higher.

As solar and battery technology improves, the reality is that households may decide to leave the ageing and increasingly unreliable national grid, especially if they think their solar energy is undervalued.

"That's certainly a possibility and people call that the death spiral for networks," Mr Gilding said.

"It's actually a situation in which everybody loses."

Master Builders breaks its own glass ceiling with first female chief executive

The blokey glass ceiling in one of Australia's most male-dominated industries has been smashed with the appointment of a female chief executive to lead the construction sector's chief lobby group.

Denita Wawn's appointment at Master Builders Australia marks the first time the national body has had a female chief executive in its 127-year history.

Mrs Wawn, a former chief executive of the Brewers Association of Australia and New Zealand, replaces Wilhelm Harnisch who was at the helm for 15 years.

Master Builders chose International Women's Day to announce Mrs Wawn's appointment, citing her leadership qualities and success in driving industry campaigns at the National Farmers Federation and the Australian Hotels Association.

Mrs Wawn told The World Today her appointment represented a new era in terms of cultural change at Master Builders and across the building and construction industry.

"We need to ensure that women in the industry are recognised for their efforts just as much as men, particularly in large, medium and small sized businesses," she said.

But Mrs Wawn rejected a suggestion that the timing of today's announcement could be perceived as tokenistic.

"Not at all. My appointment was certainly a rigorous and merit-based selection process that just happened to find a female in the role," Mrs Wawn said.

"It was a great opportunity to highlight on International Women's Day that women can strive for excellence and they can be leaders in their field, including in male dominated area in building and construction but also in the political world."

Building and construction remains the domain of men, with less than 1 per cent of women in building trades and slightly more in professional roles such as site and project management.

However, on the gender pay gap, Mrs Wawn said she was "absolutely" happy with her negotiated pay deal compared to her predecessor.

"Women can undertake these roles. It doesn't matter if you have kids or not, we do have the confidence and we do have the capacity to take leadership roles in Australia," Mrs Wawn said.

On broader policy challenges, Mrs Wawn said she would be addressing housing affordability and developing the right messages to ensure the campaign for a corporate tax cut over 10 years succeeds.

Mrs Wawm is an internal appointment, having been general manager of operations at Master Builders Australia for the past year.

Follow Peter Ryan on Twitter @peter_f_ryan and on his Main Street blog.