Key events
Peter Hannam
Some important words are ‘headline killers’, think “energy efficiency” or “biodiversity”, or “productivity”.
On the last of those, the Productivity Commission has released its latest report on how Australia is faring with the sisyphean task of squeezing ever more output from a set amount of resources or time. Rising living standards hinge upon it.
We have a look at the PC’s “The Key to Prosperity” report here:
To put it bluntly, though, past reports have not been particularly productive in terms of results.
The previous five-year report, “Shifting the Dial,” didn’t shift much at all since the Morrison government sat on it and never produced a response. What they did do, though, was to pencil in a magical increase in anticipated productivity growth in their last budget, which was a bit cheeky.
What to make of the new report? Well, there are no doubt “lessons” to be learnt from how we adjusted to life under Covid restrictions (think, WFH).
And there’s a recognition that decarbonisation is going to be costly and, at least in transition, potentially dent productivity. It has to be handled with care, the PC says.
And what might ensure the transformation is handled as efficiently as possible?
How about a price on greenhouse gas pollution? For some reason, that’s NOT one of the PC’s recommendations despite their otherwise strong support for markets…why not, we have to ask?
Stuart Robert spoke to ABC News Breakfast this morning and he was asked about the Coalition’s position on climate, and why, if it is supportive of a higher emissions reduction target than the one it had in government (26 to 28%) why it won’t support Labor’s bill.
We’ll keep faith with the Australian people. We went to the election to say that we were on track for up to 35% reduction. That would be driven by technology. Labor, of course, is driving their emissions down by taking the top 215 large corporations and putting a de facto tax upon them*. We don’t believe that that is the right approach. So we’ll keep faith with our election commitment but we’ll also keep a very healthy ambition.
*This is not correct
Robert was also asked about this story by Samantha Maiden
Q: A Liberal Party MP has told news.com.au, “67% of the research think that the Liberal Party are weirdos on climate change.” Is he or she right?
Robert:
I don’t know if I agree with that, and the fact that they didn’t put their name to it tells me everything about who you’re speaking to. The bottom line is that we’ll keep faith to what we took to the election. We want to have a strong ambition and get the emissions down as low as possible. That’s why we want to have a sensible debate about the role of nuclear power and other areas of technology that can make a difference. But we all want to leave a better planet for our kids.
Peter Hannam
When will banks move on interest rates?
The Reserve Bank’s latest interest rate increase moves into its next phase today with attention on how soon commercial banks follow suit and push up their variable rates.
Will any of them go beyond the 50-basis point increase in the RBA’s cash rate? (Or go lower?) As of yesterday evening, Macquarie Bank, the fifth biggest lender, was the first to move, lifting the lowest variable rate by half a percentage points to 3.69%.
Interestingly, Macquarie also said it would cut its fixed mortgage rate by as much as 75 basis points from Friday, a change RatesCity says may be a sign the market is shifting after rates began rising last year.
We noted yesterday after the RBA decision to hike rates for a fourth time in as many meetings (which effectively meant four rises in a little over three months since the first one was on 3 May) that the language in the accompanying statement suggested the run-up in rates might be less vigorous than previously feared.
A weaker Australian dollar and a bounce in the stock market were clear signs investors thought so too. Their prediction of coming RBA moves has also been slightly moderated:
Investors have pared some of their enthusiasm for further rate rises by the RBA after Tuesday’s slightly dovish comments. They are tipping another 50 basis point increase as just over a 50-50 chance when the RBA board next meets on 6 September. pic.twitter.com/CAHtDMwX48
— Peter Hannam (@p_hannam) August 2, 2022
What’s to come? Well, the short answer, nobody really knows. Will China do something rash over the visit to Taiwan by US House Speaker Nancy Pelosi or will Russia’s Vladimir Putin do more to curb energy supplies to Europe, reversing the slide in global oil prices?
And as we note here, the RBA relies on a lot of backward-looking data, while more than a few current numbers are starting to turn south:
Cashless debit cards linked to buy-now-pay-later services
The government used the new standing orders to declare its legislation to end the cashless debit card “urgent”. The legislation to end the Indue card (but not the Basics Card which is used in the Northern Territory, meaning income management still continues) should pass the House today.
The cashless debit card trials were meant to end in December under a sunset clause in the Coalition’s legislation (there was always the option to renew) but Labor wanted to meet its election promise earlier.
But a new group have popped up to express their concern – it turns out cashless debit cards could be linked to buy-now-pay-later services, and those groups are worried about how debts will be paid off now that the card is being axed.
So people who have connected their cards to services like Afterpay will have to continue to have their income run through the cashless debit card.
Tony Burke addressed the issue briefly when declaring the bill urgent overnight:
The phase-down period is required because – and I’m not sure how this has happened, and I don’t want to engage too much with the debate – it has been possible with this particular card for people to connect it to Afterpay accounts. As a result of that, you can’t just suddenly end it on a set date without there being a staged-down period. For that reason, for the bill to be able to work, the government requires when we return in the next sitting fortnight for the Senate to pass it at that point.
Penny Wong tightlipped on Taiwan
Foreign minister Penny Wong has been speaking to ABC radio AM’s Sabra Lane where she is asked about Nancy Pelosi’s visit to Taiwan.
Wong is pretty tightlipped and won’t say if Australia would back the US if China were to make a move on Taiwan.
Penny Wong tells AM’s @SabraLane re China vs US on Taiwan… “it’s really important that we all continue to calmly assert the importance of peace and stability and urge all parties to contribute to de-escalating tensions” @abcnews
— Stephanie Smail (@sjsmail) August 2, 2022
Good morning
Happy Wednesday!
We have made it to the week’s halfway point and, as a little treat, we will find out the Greens position on the government’s climate bill.
Adam Bandt will address the National Press Club today, where he will reveal which way the Greens will vote on Labor’s climate change bill. The party met twice yesterday to try to come to a consensus and declined to update the media after the second meeting, so we’ll have to wait until midday for Bandt to explain whatever position it is the party has landed on.
The government can not pass its bill through the Senate without the Greens. That doesn’t put a halt to climate action – Labor can still act without legislation but, given the momentum around actually acting on climate after a decade of … well, not a lot, refusing to pass the first major bill threatens to derail that momentum.
So we wait.
One thing we do know Bandt will talk about is the Coalition’s “gas-led recovery” projects it was in the process of setting up.
Bandt says Labor is now in a position to do something tangible about climate. He also points out that the Liberals are now “irrelevant”.
In the meantime, we have what the Coalition is doing, which is opposing Labor’s climate bill and deciding, after almost a decade in power, to look into nuclear power.
Something it didn’t touch while it was in a position to do anything about it. The Sky After Darkers (SADs) might be pleased with the review but anyone who has had anything to do with climate for the last decade is screaming with frustration.
Exhibit A:
In other news, the Coalition is still very upset about Labor’s superannuation changes while most people are still focused on the interest rate rises and the economy.
Looking more widely to the region, Nancy Pelosi, the speaker of the US House of Representatives, and a delegation from the US Congress have touched down in Taiwan, which has created some anxiety about China’s reaction. Pelosi is the highest-ranked US politician to visit Taiwan in about 25 years. People are watching for Beijing’s reaction.
We will cover the day’s events as they happen. You have Mike Bowers, Katharine Murphy, Sarah Martin, Paul Karp, Josh Butler and Tory Shepherd keeping their eyes and ears everywhere for you.
You have Amy Remeikis on the blog for most of the day. I’m fuelled by chocolate chip cookies this morning, so it is going to be fun.
Ready?
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