Kevin Rudd stood at the despatch box as his first day back as prime minister yesterday and gave away nothing for the business community. Questions remain for Rudd and Opposition Leader Tony Abbott and the business scribes are keen to ask them.
The Australian’s John Durie writes that the “overwhelming view” of business is that a Rudd victory in September (or whenever an election is held) is terribly unlikely and the returned prime minister’s calls for the business community to engage with him stinks (alright, Durie didn’t use that word) as a result of his contempt for them when he was there last time.
However, the idea that business is back as a topic of policy discussion gives business leaders a window to engage if not with Rudd then at least with Abbott.
“The opposition leader’s push for a levy to fund the parental leave scheme is the major business bugbear, but there are myriad other policies with little in the way of firm detail attached. Malcolm Turnbull’s alternative national broadband network proposal is a case in point. Now is the chance to push for some detail to actually assess what he wants to do.”
While parental leave is the big question for Abbott, Fairfax’s Malcolm Maiden points out that business has two specific policy questions in particular – 457 visas and the carbon tax.
“The more intriguing question is whether a Rudd government’s settings would also be more expansive than those set out by the former treasurer, Wayne Swan, when he handed down the government’s budget in May. The budget predicted a $19.4 billion deficit in the financial year that is drawing to a close this week, an $18 billion shortfall in 2013-2014, a $10.9 billion deficit in 2014-2015, a wafer-thin $800 million surplus in 2015-16 and a $6.6 billion surplus in the following year. Will Rudd stretch that timetable to give himself some headroom for new policy initiatives? Will the Coalition hold its ground if he does? We must wait to see.”
The Australian Financial Review’s Chanticleer columnist Tony Boyd notes the surge in bank shares on the back of Rudd’s elevation, which he believes says something interesting.
“The switch from Rudd as prime minister and Chris Bowen as treasurer to Tony Abbott and Joe Hockey respectively is being seen as a switch to increased confidence among businesses and households. Higher confidence would normally translate to higher credit growth, which is a fundamental driver of bank profits. The mining boom was largely financed using internal funds rather than bank debt.”
Meanwhile, Fairfax’s Elizabeth Knight calls game-on for the Virgin Australia register following the approval from the Foreign Investment Review Board for Etihad to take a 19.9 per cent stake in the carrier.
In other company news, The Australian Financial Review’s Matthew Stevens has a cracker introduction to his piece on the battle for third party rail access in the Pilbara.
“The contest for access to Fortescue Metals’ Pilbara railway continued its walk on the weird side of the tracks on Wednesday, with the publication of public responses to a pricing model that remains a secret to everyone but a small management cohort inside the miner and the Western Australian regulator of the infrastructure that little team manages. Sorry if that sounds a bit confusing, but there really is no other way of introducing a process that is as arcane as it is bizarre.”
And finally, The Australian’s Bryan Frith reports that the complicated liquidation of Duke Group is moving towards finalisation after a brief quarter of a century.
Twenty-five years? Pfft! Frith has been writing his column for 41 years. And this is his final offering.
“As the walrus said, the time has come to talk of other things,” writes Frith.
“For those who have helped me along the way, and there have been many, my heartfelt gratitude. It has been a privilege and a pleasure, but it's time to move on."
Right back at you, sir. Congratulations from The Distillery.