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Chalmers says the world is bracing for third downturn in a decade

Next, treasurer Jim Chalmers is up to speak to the media (I thought we had moved past competing 11am pressers? Please guys, please), and has begun with a long prologue discussing his upcoming trip the United States to meet with the chairman of the US Federal Reserve.

Chalmers buttressed any discussion of the budget with a warning that the world is bracing for a third economic downturn this decade, and that the “deteriorating global situation” was the background to the budget:

The world is bracing for another global downturn. That’s the truth of it. And we’ve seen in the comments from the head of the IMF overnight, we’ve seen in recent commentary from the OECD and the World Bank and the IMF that the prospects for a recession in some of the major economies of the world has edged over from possible to probable, and that has obvious implications for us as well.

The world is bracing for the third downturn in the course of the last decade and a half. And if it goes that way as many expect, this will be a very different downturn to the two others that we’ve had over the course of the last decade and a half.

The first one, the global financial crisis, was a financial shock that became a demand issue. The second one was a health shock which became, mostly, a supply issue.

This one is an inflation shock, and the risk here is a hard landing around the world, brought about by the blunt and brutal, but in some ways necessary tightening of monetary policy that we’re seeing, particularly in the big advanced economies.

Key events

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The AAP is reporting that Telstra’s chairman said the telco’s cyber security capabilities are “considerable” but added he’s avoiding complacency and hubris after the devastating Optus hack.

“It is easy for third parties to be critical of companies who have suffered devastating cyber-attacks such as happened recently to Optus,” John Mullen told shareholders at Telstra’s annual general meeting on Tuesday.

Let me be blunt, however, and say it is easy to be critical when it isn’t you in the firing line.

We should all avoid hubris because no one can be complacent and no organisation can ever be 100 per cent sure that it is completely protected and safe.

New chief executive Vicki Brady said a Telstra third party provider was recently hacked and some employee data was stolen, including her own information. But no customer data was lost, she said.

Ms Brady reaffirmed Telstra’s guidance of $7.8 billion to $8b in underlying earnings in 2022/23 on total income of $23b to $25b.

Mr Mullen said Telstra had been focusing on creating a better customer experience, hiring 2000 new team members across the country so it answers calls in Australia rather than overseas.

It has also brought all of its licensee stores in-house, so they are now Telstra owned and operated.

The meeting is continuing.

So I wanted to also rewind for a second, earlier this morning teal independent Monique Ryan was on ABC Breakfast, saying she believed the government was between a “rock and a hard place” on stage three tax cuts.

Nonetheless, Ryan believed the government should rescind the cuts, noting that “people will understand”:

I think people understand that a government’s role is to respond to the challenges that it has in front of it.

I think people understand that these tax cuts were legislated at a time before we had a trillion dollars in debt. And before we saw the cost of living and in fact, inflationary pressures on the economy that we’re seeing at the moment.

Independent MP for Kooyong Monique Ryan. Photograph: Lukas Coch/AAP

Ryan added that she thought the government would be reluctant to do that, though, in the face of strong criticism from the opposition, which she said was “not helpful”:

The opposition … doesn’t have a whole lot else to talk about (and is) is going to bang on about broken promises and lies in a way that is, I think, not helpful to the Australian people at this point in time.

But that probably does mean that the government is going to be reluctant to withdraw completely from the plans for the stage three tax cuts.

So Jim Chalmers has ended his presser, and there were a couple of interesting titbits. Apart from consistent questions about the budget blowouts and how much the NDIS contributes to that (Chalmers refused to be drawn in), there was a question about immediate relief for low-income families.

Chalmers took a shot at giving a balanced view, saying the government will attempt to address cost of living issues, while being cognisant of the “hard job” the Reserve Bank has on their hands:

It is going to be the most problematic aspect of it, of our inflation problem over the course of the next six or nine months. I have had a number of conversations with Treasury and with others about it. When it comes to support for cost of living, we need to be extremely cautious here that any cost of living support that we provide isn’t counterproductive.

We want to make sure that cost of living support that we provide doesn’t make the already hard job of the independent Reserve Bank even harder. We’re very conscious of that. It is rare that there’s a conversation with our colleagues which doesn’t weigh up in one way another this challenge that you’re getting at when it comes to providing cost of living relief.

What we will do in October is provide cost of living relief where we are supremely confident that it won’t make the job of the independent Reserve Bank harder and the way you do that is you provide cost of living relief in a way that has an economic dividend. Child care is an obvious part of that. Cheaper education costs obvious part of that.

Making medicine cheaper and a lot of people who will be under pressure from high power prices will benefit from cheaper medicines. This is how you go about providing cost of living relief. What I have tried to do for some time now and you have all heard me say it one way or another, is I don’t want to get into the situation of spraying cash around in a way that is counterproductive and just makes it harder for the independent Reserve Bank.

Josh Butler

Josh Butler

Treasurer Jim Chalmers says the world is on track for another economic “downturn”, saying Australia may not be spared, but the government is looking at ways to bring down gas prices ahead of a forecasted spike in consumer costs.

However he also said the government was weighing any potential cost of living relief, in a bid to alleviate power prices rising, against the risk of further adding to inflation.

Chalmers told his Canberra press conference that there was more the government could do to address spiralling gas prices. He didn’t say exactly what that would look like, but said he’d been working with resources minister Madeleine King and industry minister Ed Husic on measures to cut prices.

Asked about predictions electricity prices would balloon in coming months, Chalmers said that would be “the most problematic aspect” would be inflation and how to balance that against more government spending.

“When it comes to support for cost of living, we need to be extremely cautious here that any cost of living support that we provide isn’t counterproductive. We want to make sure that cost of living support that we provide doesn’t make the already hard job of the independent Reserve Bank even harder,” Chalmers said.

What we will do in October is provide cost of living relief where we are supremely confident that it won’t make the job of the independent Reserve Bank harder.

But specifically asked about gas, Chalmers flagged some changes could be made.

“There is more that governments can do and there will be more that we do.. I do think there is more that can be done,” he said.

Chalmers added his trip to the United States this week is “an opportunity to take the temperature of the deteriorating global economy” and what it will mean for Australia.

Benita Kolovos

Victoria’s premier, Daniel Andrews, says work is underway to prepare for storms expected later this week, including 200 generators ready to be deployed if communities lose power. The state’s fleet of emergency helicopters is also on standby to assist with airlifts of supplies, equipment and emergency personnel as needed.

The Emergency Management Victoria deputy commissioner, Chris Stephenson, says Victorians should prepare by having enough supplies on hand to last for up to 72 hours:

“You need to make sure that you are prepared for up to 72 hours of potential isolation and that includes making sure it’s not just yourself but your neighbours, you’ve got provisions for your pets, you’ve got your medication available, because we need our first responders to be able respond to those vulnerable people, those people that need the most so if you can take care of yourself, you must do so leading into an event like this.

Tim Wiebusch from the State Emergency Service is now speaking about Victoria’s upcoming storm event:

“The Dartmouth Dam has spilt for the first time in 26 years, Lake Eildon is about to reach a point where it’s spilling for the first time in 28 years. If you come across to the Thomson Dam indications from Melbourne Water, we could see that spill this weekend for the first time in 30 odd years.

So we are in a situation in Victoria where a number of our storages are reaching capacity right across the state. You’ll see if you look up your local water storage, many of them are now at 90+% and it won’t take a lot of rainfall to fill those … The biggest risk for Melbourne in the coming days is flash flooding.

If we see that 20 to 50mm as we saw last week in metropolitan Melbourne, we will see localised areas of flash flooding. Again we can’t emphasise to people enough to not attempt to drive through flash flood waters. We don’t want to see cars and people on roofs at York Street at Dudley Street and all those other locations that are known hotspots around Melbourne. So please plan and have an alternative route.

Peter Hannam

The ACCC chair, Gina Cass-Gottlieb, has been asked by several members of the economics committee about “greenwashing”, particularly in light of claims about carbon neutrality and other climate action. (The queries were from the coalition’s Garth Hamilton, teal independent Allegra Spender and Labor’s Jerome Laxale.)

In short, this area of the competition regulator will be one to watch as it’s been made a priority this year.

As GCG noted, increasing numbers of consumers are making purchasing decisions “on the basis of the sustainability of products … and we do not want to see a loss of consumer and community trust in these claims”. There are also competitive implications, “where we have businesses genuinely investing in what can be substantial investments in order to have a more sustainable production process”, and shouldn’t be undermined by rivals not making such investments but claiming similar environmental standards.

We are working on a significant body of work here,” the ACCC boss said, and just in the past week have started a sweep of the internet to check what online claims are being and which ones “set off alarm bells for us.

The ACCC is also planning to lay down the guidelines, so that companies only make claims that are “clear, defined, limited in their claims, and always have strong verification materials” since consumers can’t be expected to assess on their own, GCG said.

One issue will be worth watching, though, is how claims are divvied up between regulators. Some will fall within the ACCC’s remit, others for ASIC (for companies and investors), and the Clean Energy Regulator.

As we reported here yesterday, the Clean Energy Regulator is already under an independent review (due to report by the year’s end) but the Albanese government isn’t waiting for the outcome. It’s released draft legislation that will see a new type of carbon credit generated (by industries) to add to a market where there is scepticism about the current veracity of carbon credits.

(Laxale dubbed the latter as an area of “junk credits” with an intent, it seems, to prod ACCC to see where they stood.)

Chalmers says budget ‘won’t be fancy, won’t be flashy’

Chalmers has continued, laying out the three priorities for his first budget:

Our priorities in the budget, as they have been over the course of recent weeks, as the expenditure review committee has met a number of times to finalise this budget – there are three priorities for the budget.

First of all: provide responsible cost of living relief that has an economic dividend.

Secondly: invest in the resilience of the economy. Investing in areas like skills and training where we’ve got obvious skills and labour shortages, so to make the economy more resilient.

‘It will put a premium on what’s responsible and affordable and sustainable,’ treasurer Jim Chalmers said. Photograph: Lukas Coch/AAP

And thirdly: to begin to unwind some of the wasteful spending which has been a feature of budgets in this country for the best part of a decade. So they will be the priorities for the budget.

It won’t be fancy, it won be flashy. It will be responsible. It will be solid. It will put a premium on what’s responsible and affordable and sustainable, and it will be targeted to the economic conditions that we confront together in the here and now, and also into the future and the global situation is obviously front of our minds as we put the finishing touches on the budget in two weeks.

Chalmers says the world is bracing for third downturn in a decade

Next, treasurer Jim Chalmers is up to speak to the media (I thought we had moved past competing 11am pressers? Please guys, please), and has begun with a long prologue discussing his upcoming trip the United States to meet with the chairman of the US Federal Reserve.

Chalmers buttressed any discussion of the budget with a warning that the world is bracing for a third economic downturn this decade, and that the “deteriorating global situation” was the background to the budget:

The world is bracing for another global downturn. That’s the truth of it. And we’ve seen in the comments from the head of the IMF overnight, we’ve seen in recent commentary from the OECD and the World Bank and the IMF that the prospects for a recession in some of the major economies of the world has edged over from possible to probable, and that has obvious implications for us as well.

The world is bracing for the third downturn in the course of the last decade and a half. And if it goes that way as many expect, this will be a very different downturn to the two others that we’ve had over the course of the last decade and a half.

The first one, the global financial crisis, was a financial shock that became a demand issue. The second one was a health shock which became, mostly, a supply issue.

This one is an inflation shock, and the risk here is a hard landing around the world, brought about by the blunt and brutal, but in some ways necessary tightening of monetary policy that we’re seeing, particularly in the big advanced economies.

Victoria warned Thursday is ‘heavy rain day’

Victorian premier Daniel Andrews is fronting the news along with officials from the Bureau of Meteorology and SES, warning that the heavy rainfall approaching the state will bring with it potential flash flooding.

Andrews began by emphasising the danger of the incoming rainfall, adding that catchments are full, and that the risk of flooding was great:

The reason we’re here today is that we’re going to see a significant rain event
beginning tomorrow and pushing into Thursday. We know that our catchments are full. We know that we’ve had record rainfall to this point and the ground is absolutely sodden.

So even a minor amount of rain would be a risk in terms of flooding. But it’s not a minor rain event that we are forecasting. It will be significant rainfall in certain parts of the state and that will pose a flooding risk to communities in lots of different places.

Kevin Parkin from the Bureau gave a sense of the intensity of the rainfall predicted:

We’re expecting it to start Wednesday and intensify in force on Thursday resulting in widespread rain. So what does that look like? Well, Wednesday is a day where we’ll see showers and storms build across Victoria as the day unfolds.

We don’t think that there will be much in the way of heavy rainfall, although we’re quite concerned that severe storms in the western districts may produce localised bursts of heavy rain of 20-30mm.

The real concern, though, is from the very early hours of Thursday morning right through to Friday morning where we’re expecting widespread falls of 20-50mm across much of Victoria, except, perhaps, the far south-west, East Gippsland and the north-east.

Also higher falls of 60mm-100mm about the dividing range and the northern catchments, and that’s where catchments are saturated and we’ve already got riverine flooding. Melbourne is at risk as well – not only of flash flooding on the Thursday, but also seeing river rises through Melbourne’s catchments.

So, I can’t stress the importance that Thursday is very much a flash flood, heavy rain day. Be prepared.

Good morning, a quick thanks to Natasha May to begin, Mostafa Rachwani with you for a short while, there is much going on so let’s dive in.

Natasha May

And with that I hand you over to Mostafa Rachwani who will be on the blog for the next two hours and I’ll see you back here around 1pm!

Passenger who caused Melbourne Airport chaos had been screened in Perth

We brought you the news this morning about the security breach at Melbourne Airport causing flights to be delayed and at least one plane to be evacuated as passengers were asked to go back for re-screening.

The source of the chaos? A passenger who had passed from an unscreened part of the airport to a screened part without being checked.

Guardian Australia now understands the Qantas customer arrived in Melbourne from Perth this morning, where he had been screened on departure.

Instead of proceeding directly to his connecting flight he exited the sterile area of the terminal and made his way towards the baggage carousel.

He was in the baggage area for less than a minute, before he walked back through the one-way security doors the wrong way – apparently because he realised he didn’t need to collect his bag.

An alarm was triggered and the doors briefly locked, however the customer was able to get back into the sterile area.

Guardian Australia understands Qantas is looking into why the doors didn’t lock as they were meant to, but the initial view is that the number of people who were also exiting from the sterile area stopped the doors from locking.

The passenger was subsequently identified and interviewed by the Australian federal police, who are not laying charges.

NSW government backflips on hidden speed cameras

The NSW government is accused of performing a “spectacular backflip” after ditching its unpopular policy of removing signs warning drivers about mobile speed cameras, AAP reports.

Fixed signs for mobile speed cameras were taken down in November 2020, leading to a massive spike in revenue raised from low-level speeding offences.

The number where the limit was exceeded by 10km/h or less went from 3222 in October 2020 to 27,855 by February 2021.

Roads Minister Natalie Ward announced on Monday additional warning signs around mobile speed cameras would return next year, saying the government had listened to community feedback. She said:

Ensuring our local roads are as safe as possible for pedestrians and motorists is an absolute priority for this government.

Ward, an upper house MP, recently announced she would make a run for the lower house seat of Pittwater on Sydney’s northern beaches at the March election.

Roads Minister Sam Farraway said the government had been told of cameras concealed behind poles and trees, and the point of the signage was to slow drivers down. He said:

We have heard loud and clear from the community on this issue.

Labor leader Chris Minns said the government went from collecting about $4m a year in low-range speeding fines to about $45m during one financial year. With an election less than five months away, the policy reversal was timed to placate voters, he said.

The government’s basically admitted what we’ve already known for many years now. This has been revenue raising on a giant scale.

They’ve now backflipped in a spectacular fashion because they’ve been caught red-handed with their hands in your pockets.

The policy was introduced by former transport minister Andrew Constance, who said removing signage would change driver culture and behaviour. He said in 2020:

No warning signs mean you can be caught anywhere, anytime and we want that same culture around mobile speed cameras.

Check out the 2022 Nature Conservancy photo contest prize winners

Winners from the 2022 Nature Conservancy photo contest have been announced – chosen from more than 100,000 entries from 196 different countries and territories.

First place – climate. Lizards and Windmills by Sandesh Kadur, India Photograph: images@felis.in/The Nature Conservancy Photo Contest 2022

Some are so mesmerising they give the impression of a painted canvas rather than a photograph; others are gut-wrenchingly realistic in the brutal truths of the animal kingdom they reveal. If you check out the photos you’ll know exactly which one I’m talking about.

https://www.theguardian.com/australia-news/live/2022/oct/11/australia-news-live-melbourne-airport-evacuated-security-breach-warren-mundine-lidia-thorpe-indigenous-voice-land-tax-nsw-stamp-duty-politics Australia news live: world is bracing for third economic downturn in a decade, treasurer says | Australia news

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