New job probation plan… Coonan, G9 talk… Late lodgers warned… Tax take grows… Wesfarmers’ Coles swoop…

Labor considers double probation period for small-business employees

Labor is considering increasing the period small businesses can keep employees on probation to 12 months, instead of exempting businesses with fewer than 100 employees from unfair dismissal laws.

The Opposition spokesman on industrial relations, Craig Emerson, appeared to confirm that Labor will abolish AWAs and remove the unfair dismissal exemption for businesses with fewer than 100 employees, in comments reported in The Australian today.

Emerson says Labor is considering a range of initiatives for small businesses, including:

  • Increased access to mediation services to help resolve unfair dismissal claims before they reach the courts.
  • A more user-friendly BAS reporting process.
  • A low-cost “fair contracts” jurisdiction to deal with contractual disputes involving independent contractors modelled on a process currently run by the Victorian Small Business Commissioner.
  • Create a low-cost remedy for disputes between franchisees and franchisors.

The director of employment law with the National Retail Association, Susannah McAuliffe, says although anything that gives small business increased flexibility should be “strongly supported,” it is “essential” that small businesses retain protection from unfair dismissal.

“We want to see both,” she says.

Tony Steven, a spokesman for the Council of Small Business Organisations of Australia, says any backdown by Labor from the unfair dismissal arrangements implemented by WorkChoices would be “detrimental” to small businesses.

He welcomed Emerson’s suggestion that Labor would look at ways of simplifying the BAS reporting process. “We encourage the ALP to investigate the possibilities in that area.”

– Mike Preston

Coonan talks broadband with G9

The Government’s hunt for an alternative to Labor’s $4.7 billion broadband proposal continued yesterday when Communications Minister Helen Coonan met with the G9 group of telecommunications companies.

The Australian Financial Review reports that the G9 group of companies, which includes Optus, Powertel and AAPT, met with Coonan to argue for its privately funded fibre-to-the-node (FTTN) broadband roll-out proposal. The proposal is the only substantial alternative that has been proposed to Telstra’s stalled broadband plan.

Optus, the informal leader of the G9, is also competing for a slice of the $600 million the Government has allocated for rural broadband services through its Broadband Connect program.

Meanwhile, speculation has emerged about the form Telstra’s broadband package will take if it goes ahead. The Australian reports Telstra told a telecommunications industry association that it would build an FTTN network using VDSL2 technology, a faster alternative to the more commonly proposed ADSL2+.

– Mike Preston

Automatic fines for late tax lodgments

Many business owners and taxpayers are in for a rude shock. The tax office will automatically fine late payers $110 a month for late lodgment even when no money is owed. Medium-size companies may pay up to $250 a month and large companies $550.

A tax office spokeswoman says the plan was piloted in February and came into effect in March, although it was probably still too early for people to receive letters. The tax office is using new data matching to generate bulk penalty notices.

About a fifth of taxpayers file BAS statements and tax returns late. Many mistakenly believe they don’t have to lodge a return because they are either owed a refund or they did not owe the tax office any money.

But anyone who lodges late can now expect a warning letter before being hit with a fine. And worse for chronic late payers: they will receive SMS messages from the taxman.

– Amanda Gome

The Government’s growing tax take

Total taxation revenue collected in Australia rose by $19.3 billion, or 6.9%, between 2004-05 and 2005-06, according to Australian Bureau of Statistics figures released today.

Taxes on income increased by $13.2 billion and taxes on the provision of goods and services increased by $3.1 billion.

In payroll tax, the Federal Government collected $369 million in 2005-06 and the states collected $13.08 billion.

– Jacqui Walker

Wesfarmers play for Coles

Suppliers to Coles, K mart, Target and Officeworks will be watching events unfolding at Coles with keen interest.

Yesterday a Wesfarmers-led consortium bid $16.47 for up to 15% of Coles and is likely to follow up with a full takeover bid. The price beats the $15.25 a share offer by takeover rival Kohlberg Kravis Roberts last October. Long-standing Coles shareholder, Solomon Lew’s Premier Investments, has exited his 6% stake for $1.14 billion.

This morning Coles and Wesfarmers suspended their shares from trading pending announcements from the companies.

– Jacqui Walker

IT News: Copy-control free downloads

EMI Music has become the first of the big four record companies to make its entire catalogue available as downloads free of copy control measures, reports the Age. EMI Group chief executive Eric Nicoli made the announcement with Apple CEO Steve Jobs last night.

Jobs said Apple’s iTunes Store will carry the new EMI tracks, marking the first time that digital rights management-free music will be offered to on iTunes. DRM is intended to prevent unauthorised copying but it frustrates consumers.

Now, DRM-free music bought through iTunes tracks – which will cost about 30% more – should be able to be played on MP3 players made by rival manufacturers such as SanDisk, Creative and Microsoft. EMI will be hoping the move increases sales of online music to compensate for the falling sales of CDs.

– Amanda Gome

Intergenerational fizzer

The long awaited Intergenerational Report is a fizzer with critics saying it barely pays lip service to the economic consequences of climate change, throwing into question the credibility of the economic predictions.

The omission also makes it more likely that next month’s federal budget will not include any meaningful measures to deal with climate change as the Intergenerational Report in 2002 led directly to many policy changes and legislation across many areas.

In a nutshell, the report says Australia is at the sweet point of demographic change and that it is all downhill from here, with a steep rise expected in dependent people and a decline in those of working age.

Future tax cuts are probably out of the question and the growth of real GDP per person is expected to decline from an increase of 1.6% per year on average over the next 40 years compared with 2.1% over the past 40 years.

Treasurer Peter Costello notes the lift in fertility rates and in workforce participation but the ageing of the population and the changes it will bring remains the biggest economic challenge for Australia over the medium and long term.

There will be a 10% lift in population forecast, resulting in 27.8 million Australians in 2042 against an earlier estimate of 25.3 million.

Smart entrepreneurs looking for future opportunities would find no real insights in the latest report that were not in the 2002 report.

– Amanda Gome

Slater & Gordon lodges prospectus

National plaintiff law firm Slater & Gordon took the its first steps towards listing on the Australian Stock Exchange yesterday when it lodged a prospectus with the Australian Securities & Investments Commission.

Slater & Gordon is seeking to raise $35 million by offering 35 million $1 shares to the public in an IPO and hopes to list by early May. The offer opens on April 11 and closes on April 27.

– Mike Preston

Economy roundup

The flow of strong economic data continues this morning as the Reserve Bank board meets to decide whether it will increase interest rates.

The SAI Global-ACCI Survey of Investor Confidence released today shows April has seen a rise in business confidence, while the survey’s key indicator of business conditions returned its strongest result in two years.

International trade figures released by the Australian Bureau of Statistics today report that both exports and imports increased by 2.1% in February, resulting in a below market expectation trade deficit of $838 million for the month.

The mining sector experienced the strongest export growth of 3.5%, while the services sector experienced the slowest growth of 0.2%.

The S&P/ASX 200 has picked up by a strong 1.2% this morning to sit on 5986.4 points at 12.25am. The Australian dollar is trading at US81.63¢, well up on yesterday’s US81.35¢ close.

– Mike Preston


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