CALENDAR
OF EVENTS
Thursday, July 6
Balance of trade
Wednesday, July 12
Westpac consumer
confidence +
NAB business confidence
Thursday, July 20
Unemployment rate
Tuesday, August 1
RBA interest rate decision
THE BUZZ
ON MY MIND
THIS MONTH
NEWS
&
VIEWS
M
illennials looking to make
headway into the property
marketarenottheonlyonesfeeling
the pinch. Spare a thought for
their parents who, by default, are
postponing their retirement plans to support their
offspring for longer while they battle Australia’s
housing affordability challenge.
The younger cohort, unable to deploy independent
means to get on the housing ladder, are increasingly
reliant on their parents to help them flee the nest. As
such,babyboomersarebecomingaccustomedtothe
“new normal” of dipping into their savings, often in the
form of home equity, to fund their children’s futures.Some are stumping up the deposit, or using their
ownhomeascollateral.Othersaresubsidising
mortgage repayments and, increasingly, more parents
will extend the family home, repurposing the garage or
remodellingoutbuildingstoprovidetheiroffspringwith
somesemblanceofindependence,evenifit’sjustan
illusion.Wemayevenseeahigheradoptionofthe
European practice of the inter-generational household.
Wearecertainlyenteringtheeraofthe“cubbyhouse
syndrome”,onethatlendsnewmeaningtotheterm
“familymoney”andonethatwillseeparentsand
their offspring destined to stay on very good terms
–fortheverylongterm.
Lisa Claes,CEO international, CoreLogicParents pay the price too
ButFinkelreportprovidesblueprintforbetterfuture
Here we go again: up
go the energy prices
F
orthepastdecade,Australian
electricity consumers have
endured continuous price
increases, and this year hasn’t been
any different with rises between
7% and 20%, depending on which
state you’re in, resulting in obvious
negative impacts on family budgets
and business competitiveness.
These July energy price hikes have
come off the back of the closure of
theHazelwoodpowerstationin
Victoria in March, combined with a
tripling of wholesale gas prices over
thepastthreeyears.Aperfectstorm
really,whichhasresultedinbaseload
wholesale electricity prices in effect
doubling in NSW, Victoria and
Queenslandsincethistimelastyear- a crisis that could have been
avoidedwithbetterplanning
and governance.
For instance, establishing a
domestic gas reserve, which would
have acted to insulate the price we
pay for our gas from the price at
the LNG export terminals (as in
Western Australia), could have
significantly reduced the cost
currentlyrequiredtopowerour
homes and businesses. There is
understandable frustration: a
resource-rich nation such as
Australiacanandmustdo
better.And,finally,someone
has remembered the customer!
Voltio welcomes the Finkel report
as the basis for a science-based,
non-partisan path to guide
Australia’senergyfuture–ascheme
that truly begins to prioritise
“rewarding consumers”. Estimates
suggest that the scheme would
save the average household $90 a
year. The scheme calls for an
absolute target for carbon emissions
of700kgofcarbondioxide(CO^2 )
per MWh (megawatt-hour) ofelectricity generated, which is an
achievable goal that is meaningful in
terms of Australia’s international
climatechangecommitments.
Currently, Australia ranks poorly
compared with other nations, with
electricity generation producing, on
average, about twice the CO^2 target
level. In comparison, solar power
produces zero CO^2 emissions and
is now considerably cheaper than
retail energy prices for most
homes and businesses.
Fortoolong,reasoneddebate
and sensible policy formulation
have been hampered – not only
in Australia – by the size and
complexity of the issues and
selective use of statistics by vested
interests on both sides. The Finkel
reportoffersablueprinttotakethe
firststepstoabetterenergyfuture.
Michael Moran,
managing director, Voltio