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Sky News AU
2 days ago
- Business
- Sky News AU
Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
Labor needs to 'step up the pace' to fulfil its ambitious housing target, an economist has warned as the rate of building approvals in Australia recently slumped. Dwelling approvals fell 5.7 per cent in April, according to the Australian Bureau of Statistics, coming in well below market expectations and causing concern as the nation continues to grapple with a housing shortage. While the approval trend has been positive over the past year and a half, the recent downturn is a thorn in the side of Labor's plan to deliver 1.2 million new homes by mid-2029. REA Group senior economist Eleanor Creagh urged for greater action to fulfill the major looming target. 'We're really not approving and then building enough new homes to meet pace with where demand currently is and also to meet the federal government target of a million new homes by 2029,' Ms Creagh said on Sky News' Business Now. 'So, we really need to step up the pace of: one, approvals—which is really the best-case scenario for what gets off the ground; two, building activity—which is hard, given continued labour shortages and higher prices, cost materials, etc.; and then, three, completions.' The overall decline in April was driven by lower apartment approvals, according to the ABS' head of construction statistics Daniel Rossi. 'A drop in apartment approvals drove a 19 per cent fall in private dwellings excluding houses,' Mr Rossi said. 'Meanwhile, private sector house approvals were up 3.1 per cent.' This followed a 14.4 per cent drop in March as apartment approval rates have sank compared to the start of the year. 'In original terms, 5,612 apartments were approved across March and April, compared with 8,625 approved across January and February,' the ABS said. Alongside its pledge to build 1.2 million homes, Labor has also committed $10 billion to build 100,000 homes over eight years for first time buyers. The Albanese government has also established the First Home Buyers Guarantee to allow first-time buyers to purchase a home with a five per cent deposit and without paying Lenders Mortgage Insurance. It follows the Reserve Bank of Australia delivering its second cash rate cut of 2025 last week, which is expected to further the turnaround in house price growth after slowing in 2024. Originally published as Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
Sky News AU
3 days ago
- Business
- Sky News AU
‘We're out of time': Leading defence investor and former Shark Tank judge Steve Baxter demands greater defence investment
A leading investor has urged for greater defence investment as a warning that Australia is 'out of time' weighs on the nation. The Australian Strategic Policy Institute (ASPI) published a report on Thursday urging Labor to spend a larger chunk of the nation's budget to go into defence to 'reflect the reality of threats facing Australia'. Australia's defence spending constitutes about two per cent of the nation's GDP, putting the nation considerably behind allied nations such as the United States (3.5 per cent). The nation's lower portion of defence spending sparked concerns for former Shark Tank judge and tech and defence investor Steve Baxter who warned Australia needed to boost investment to better position itself amongst its allies. 'It would be very hard for us to act as a deterrent to China in any respect,' Mr Baxter said on Sky News' Business Now. 'We've always fought alongside and had the cooperation of larger allies. In World War 2 and pre-WW2 it was England and (post WW2) it's been the US. 'We have to be a good ally to assist in that deterrence and to do that we need to spend.' Pressed on whether China was the main adversary Australia faces, Mr Baxter dumped cold water on the prospect Australia faces similar threats elsewhere. 'They're the only one (we're) worried about,' he said. He also weighed in on the importance of attracting investors to the Australian market and referenced two major warnings in the Defence Strategic Review from March 2023. 'It said two things I think it got correct: It named China and then it said 'we're out of time',' Mr Baxter said. 'In the context of being out of time, that alluded to our strategic warning time being eroded and we no longer have 10 years - we have a lot less - to repair. 'What do you do in that context?' He urged the Australian government to 'supersize incentives' and called for bigger tax breaks than those seen with Early Stage Venture Capital Limited Partnerships and investment in businesses that qualify as an early stage innovation company. 'Instead of the 10 and 20 per cent incentives, if we think this is a really strategic problem and we're out of time, let's make that 50 or 100 per cent tax incentives,' Mr Baxter said. 'So, if we are out of time, we need to start acting.' The report from the ASPI said that while the Labor government 'claims to have made a 'generational investment in Australia's defence', that investment has been put off for another generation' as federal investment will not kick in until after 2029.
Sky News AU
4 days ago
- Business
- Sky News AU
Labor delayed approving North West Shelf gas project extension beyond election to avoid 'alienating green-minded voters', MST Financial's Saul Kavonic declares
The re-elected Albanese government delayed approving the 40 year extension of Woodside's North West Shelf gas project until after the election to avoid 'alienating any green-minded voters', a leading gas analyst has declared. Newly appointed Environment Minister Murray Watt on Wednesday confirmed the government will extend the life of the project to 2070. It follows the former minister Tanya Plibersek twice delaying the decision in 2025. The project's approval was 'inevitable', according to MST Financial senior energy analyst Saul Kavonic, who argued Labor tactically postponed the decision. 'This approval was expected, indeed it was inevitable,' he told Sky News' Business Now. 'It was ultimately just delayed until after the election because Labor didn't want to risk alienating any green-minded voters. 'This had to be approved because otherwise the town of Karratha could have died and Australia would be left without about 10 per cent of its domestic supply at a time when the markets already forecast it to be tight. 'It would have been economically diabolical.' Labor faced significant pressure from both industry and environmental groups to either approve or reject the gas project. Following the election victory, Senator Watt rejected claims the government had attempted to shield itself from criticism by postponing the decision. 'That's not my understanding,' Senator Watt told Sky News Sunday Agenda, when asked whether the delay was aimed at protecting Labor's green flank. 'Of course, any of these decisions about big projects like this do require an enormous amount of evidence because they're really important decisions.' Senator Watt said further information had been requested from parties involved in the application, which had in turn extended the timeline. Labor attributed the pushback to delays with paperwork from the Western Australian government in February. It was also reported Labor was waiting for more information about nearby Indigenous rock art from the United Nations Educational, Scientific and Cultural Organisation. Mr Kavonic said the appointment of Senator Watt in the environment portfolio was a boon for local industry as it struggles with lengthy approvals processes. 'The positive side is the removal of Tanya Plibersek and replacing her as Environment Minister with Watt,' Mr Kavonic said. 'That's been a massive improvement for the approvals landscape because instead of Plibersek who was really beholden to inner-city green politics, we have Minister Watt who comes from Queensland, the resource state. 'Even though he's from the left faction, (he's) just inherently more pragmatic and hopefully this is a sign that we see less political interference and delaying approvals going forward.' When the government approved the project, Senator Watt said the extension was 'subject to strict conditions' as the government gives significance to the potential impacts Woodside's activity could have on nearby ancient rock art. Woodside CEO Meg O'Neill said the company has 10 working days to work with the department on the conditions. "The conditions relate to heritage and air quality," Ms O'Neill told reporters on Wednesday. "Our team is working through with the department to find out exactly what the conditions mean and we'll respond and work with the department over the coming days.' Senator Watt's decision came just hours after UNESCO flagged it would knock back Australia's bid to add the Burrup Peninsula, located near the project, to the World Heritage List. UNESCO deferred the decision back to the government to "ensure the total removal of degrading acidic emissions, currently impacting upon the petroglyphs of the Murujuga Cultural Landscape". Ms O'Neill was asked about UNESCO's decisions, but deferred to the government for comment.
Sky News AU
5 days ago
- Business
- Sky News AU
'No amount of money' could have saved Healthscope during 2024 private health insurance attack, Rachel David declares
There was 'no amount of money' that could have saved Healthscope as it was waging war against private health insurers in 2024, a leader in the medical industry has declared. Healthscope was forced into receivership on Monday after the debt-laden hospital operator was handed from its Canadian owners Brookfield to its lenders earlier this month. Commonwealth Bank of Australia has issued the company a $100m lifeline to ensure all of Healthscope's hospitals will remain open and operate as usual. The collapse follows Healthscope launching an aggressive advertising campaign in 2024 to allege private health insurers were not paying their fair share to fund private hospitals. Private Healthcare Australia's CEO Rachel David on Tuesday hit back at Healthscope when questioned about the operator's campaign on Sky News' Business Now. 'There is no amount of money that health funds or the government could have thrown at Healthscope at that point which would have made up for the terrible business decisions made by Brookfield,' Ms David said on Tuesday. She singled out Healthscope's $5.7b sale, which was regarded as overvalued, in 2019 to Brookfield and the decision to sell 22 hospitals for $2.5b to foreign investors before leasing them back to the operator for high rents. 'In a situation like that, there is no amount of money that health funds could have put their hands on that would have resulted in a different outcome,' Ms David said. 'We have to be mindful that … consumers have got to be able to afford their premiums. 'The advertising campaign was a misstep, but now that we're in a situation where new owners can take over ... myself and the private health insurance industry is incredibly optimistic that the private hospital sector will come through this and be able to deliver much more modern and attractive models of care for our patients.' Healthscope faced troubles during the pandemic when patients halted their elective surgeries, leading to major downturns for private hospitals. The uptick in at-home treatment, which was bolstered by private health insurers, also came as a sting to Healthscope as lengthy hospital visits became less necessary. The company has also been marred with controversies, including the death of a two-year-old boy last September, a cancer patient having the wrong side of his colon removed in 2019 and the death of a 17-year-old boy suffering from anaphylaxis in 2021. Healthscope's CEO Tino La Spina told reporters on Monday he is confident there will be a buyer to take over the business. 'I think we're confident that there is interest in taking the Healthscope business as a whole. We have 10 non-binding indicative offers,' Mr La Spina said. 'Some are for the whole (business) and others potentially could include the whole (business) under certain circumstances. That is the focus.' Health Minister Mark Butler said Labor will not bail out the embattled healthcare company amid its financial troubles. 'We remain steadfast in our view that an orderly sales process that maintains the integrity of the entire hospital group will provide the best outcome for patients, staff, landlords and lenders,' Mr Butler said. However, he did stress the hospitals operated by Healthscope 'remain a critical part of our healthcare system'. 'The government does not want any of these important assets to be put in jeopardy to satisfy international investors,' Mr Butler said.
Sky News AU
6 days ago
- Business
- Sky News AU
Self-funded retirees face soaring costs under aged care change from July as Michael Horin lays out 'complex' industry
An expert has laid out the 'complex' aged care industry as a change will come into effect from July where self-funded retirees could see fees increase upwards of $50,000. Labor's Aged Care Act, which was passed in November, received bipartisan support in parliament and will change how different types of retirees in aged care are billed. The major change is the lifetime cap will rise from about $82,000 to about $130,000. Michael Horin, a principal at Clarity Aged Care Advisors, said this will shift towards a means-tested approach for the aged care system. 'The system is designed in a way so that everyone can afford a bed in aged care,' Mr Horin told Sky News' Business Now. 'It's essentially asking those who can afford it to pay more and (for) those that can't afford it - the government's chipping in a bit more.' He said it would be 'predominantly self-funded retirees' who will pay more under the new system; however, some part-pensioners and full pensioners also will. Australia's aged care sector is not currently a profitable industry, but the changes in billing could lead to further investment into the growing sector as the ageing population grows. 'We've got about 200,000 beds across the country at the moment and in the next 25 years - around 2050 - that's going to have to grow to about 800,000,' Mr Horin said. 'Aged care facilities are not very profitable. About 50 per cent of them are run at a loss so they need to become profitable to incentivise more beds and more facilities to be built.' The government continues to fund anywhere from about 70 per cent to 100 per cent of an aged care bed, Mr Horin noted. 'Those that can afford it are being asked to pay more, but the government is also paying more too, to really pump more money into the sector to get those extra beds,' he said. Sky News' Business Editor Ross Greenwood pressed Mr Horin on the complexity of the aged care industry as there are many choices presented for funding a retiree in aged care. 'It's a really complex industry,' the Clarity Aged Care Advisors principal said. 'It's necessary to get advice before entering the industry because there's so many moving parts. 'There (are) so many pros and cons to the different choices that you have ... so there (are) a variety of different choices and with each of those choices and options that you have, there (are) different implications of that.'
