Double-decker buses to run again in Sydney

30/08/2018 // by admin

The new double-decker buses are the latest move to ease congestion on Sydney’s public transport network. Back on the road … Transport Minister, Gladys Berejiklian, shows off the new double-decker buses that will return to Sydney’s roads.
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Double-decker buses are returning to Sydney, as part of a government trial to free road space across the city.

The first bus, unveiled this morning by the Transport Minister, Gladys Berejiklian, will enter service on Monday, running routes between Blacktown and the north-west suburbs.

And seven more will start in the new year, operating routes between the city, the north-west, and the northern beaches as part of the trial to run until 2014.

For a city starved of road space during morning and afternoon peak hours, double-deck buses bring their pros and cons.

Their obvious advantage is to carry more people in the same amount of space as a regular bus.

Their main disadvantage is in the increased “dwell time”, or the length of time it takes passengers to alight and board.

“Double decker buses take about twice the capacity of regular buses,” Ms Berejiklian said this morning.

“And actually also they have greater capacity than the articulated or bendy buses,” she said.

“We are learning from the trial – it’s not the be-all and end-all. It won’t replace all buses.”

Each bus will cost about $650,000, and the first service will be run by the private operator, Busways. The later trial services will be run by CDC and Forest Coach Lines.

Under the terms of Sydney’s private bus contracts, the bus operators purchase the new vehicles but the government pays them back over their life-space.

Ms Berejiklian said the double-deck buses would be useful on routes with fewer stops, and where passengers spent long periods on board.

“It makes sense to us, especially on longer routes, to give customers who are travelling long distances on a bus and don’t need to hop on and off all the time… a trial.”

Double-deck buses ran in Sydney, operated by the government and private operators, between the 1920s and 1980s.

But reliability problems cruelled the fleet in the 1980s, and the last regular service, from Wynyard to Taylor’s Point, was taken out of service in 1986.

The buses bought for the new trial will be manufactured in southern Queensland, Ms Berejiklian said. She said 40 per cent of the manufacturing workers were from NSW.

Monday’s bus will operate the following routes:

T70 – Blacktown to Castle Hill via Glenwood.

T71 – Blacktown to Castle Hill via Rouse Hill Town Centre.

T74 – Blacktown to Riverstone via The Ponds and Schofields.

T75 – Blacktown to Riverstone via Rouse Hill Town Centre.

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Class sizes at risk of rising: teachers

30/08/2018 // by admin

A breakdown in negotiations between the NSW government and the teachers union has ended a staffing agreement that regulates class sizes and teacher numbers.
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Teachers today warned there was nothing stopping the Education Minister, Adrian Piccoli, from increasing class sizes on a whim.

However, Mr Piccoli said he was committed to maintaining existing class sizes as policy.

The director-general of the Education Department, Michele Bruniges, told teachers they had until 5.30pm yesterday to sign a new staffing agreement, with the current one due to expire within weeks.

The president of the NSW Teachers Federation, Maurie Mulheron, said he was not in a position to sign the agreement at such short notice without consulting his executive members.

One sticking point in the negotiations was the government’s refusal to guarantee the number of senior teaching positions.

Mr Mulheron said the staffing agreement would also have formalised class sizes, but these were now at the discretion of the minister.

“There is no way of regulating class sizes and the number of teachers we have,” he said. “These will all be determined unilaterally by the minister.”

Recent research has suggested a tenuous link between educational outcomes and class sizes, despite a long-held belief that smaller class sizes improve student results.

In a letter to staff, Dr Bruniges said four months of negotiations with the teachers federation over new staffing arrangements arising from the Local Schools, Local Decisions reforms had failed.

“Unfortunately these negotiations have not resulted in an agreement and as such the department will implement the new staffing procedures from Day 1, Term 4, 2012 by way of policy,” she said.

“A key element of the Local Schools, Local Decisions reforms is putting an end to the centrally determined one-size fits all staffing model.

“The minister and I have been very clear that the Local Schools, Local Decisions staffing reforms will maintain a statewide staffing system, which has greater opportunities for teachers to be selected at the local level to better meet student needs; maintain the department’s class size policies, and provide greater flexibility for schools to determine the mix of permanent and temporary staff to meet student needs and workforce planning requirements.”

Dr Bruniges said the department considered issues raised by the federation in negotiations, and where consistent with government policy they were included in a draft staffing agreement.

“The department has confirmed that the new Resource Allocation Model will fund schools to maintain their current staffing entitlements if they wish, including the notional executive and specialist teaching positions, assuming student enrolments do not change,” she said.

“The department also confirmed that in determining the number of deputy principals, assistant principals, head teachers and specialist teaching positions schools must meet Board of Studies curriculum requirements and school operational needs.”

Dr Bruniges said the staffing agreement offered to the federation maintained class sizes and incentive teacher transfers would remain.

“Once incentive transfers and Aboriginal employment applicants are placed, schools will be able to fill at least every second vacancy by local choice,” she said.

The Greens MP John Kaye said the real intent of school devolution had “now been exposed”.

“Classroom sizes and important administrative positions in schools have now been completely deregulated,” he said.

“Adrian Piccoli is about to destroy two decades of progress towards better education by making schools entirely cost driven without regards to the consequences for students.”

Mr Piccoli said class sizes would not increase, but be maintained at existing levels.

He said teachers still had the option of signing the agreement to make it legally binding.

“If it’s not an industrial agreement, it’s policy,” Mr Piccoli said.

“The federation can lock this in, making it legally enforceable until 2016 [if they sign the agreement]. The principals wanted the flexibility to determine their mix of staff and we’ve given that to them.

“This is the last thing the teachers federation wants and we are not going to give it to them.”

This story Administrator ready to work first appeared on Nanjing Night Net.

Canberra’s big ‘bedroom stress’

30/08/2018 // by admin

A University of Canberra lecturer has estimated at least 40 per cent of bedrooms in Bonner are empty.”Bedroom stress” sounds like a phrase more commonly spouted by Cleo writers than a university lecturer, especially one speaking about property.
Nanjing Night Net

But when he took the stage at Politics in the Pub’s housing forum last night, University of Canberra lecturer Andrew MacKenzie declared that Canberra had it – and had it bad.

Using the example of Bonner, Mr MacKenzie said Canberrans were paying thousands of dollars each year for rooms left unoccupied in oversized houses.

“Bonner has 1500 residents but there are 1800 bedrooms,” he said.

“Assuming that households listed as couples share at least one bedroom… I would estimate that 730 of the 1780 bedrooms in Bonner aren’t actually used. That’s 40 per cent, 40 per cent of the bedrooms are empty.”

Mr MacKenzie – a lecturer in landscape architecture – said that with a median average annual mortgage of $27,800 and average annual rent of $25,800, Bonner residents were handing over thousands of dollars each year for the unused rooms.

“Maybe we should design houses that reflect the needs of the community and those who occupy them,” he said.

The forum, hosted by the Australia Institute and ACT Shelter, also covered concerns about access to affordable housing and homelessness in the capital.

ACTCOSS director Roslyn Dundas declared the issue a hidden problem, with many of those affected shifting between shelters, cars and the hospitality of friends.

“Across any given year we have over 3500 people experiencing homelessness in the ACT – that’s one out of every 101 people within the community,” she said.

“To top that off in terms of our public housing space, where people are trying to get into to address their homelessness, we have a waiting list of nearly 2000 individuals.”

Ms Dundas said if people weren’t deemed an “extreme priority”, they could wait on the list for as long as 546 days.

“That’s a year and a half,” she said.

“That’s why we need to put the resources there because at the moment, by continuing to not address the homelessness issue within the ACT, we’re excluding these people from our community.”

Chair of National Shelter Adrian Pisarki also spoke on the history of public housing expenditure, deeming the Howard Government’s disinvestments as “the greatest crime perpetrated by an Australian Government in Australia’s history”.

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Slow learners at the flying roo

30/08/2018 // by admin

Big loss suggest Qantas needs a new approach.Qantas cancels jet orders as it posts first loss
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After listening to the Qantas annual results announcement today one couldn’t help but feel a sense of déjà vu.

The airline’s profit result for the 12 months to 30 June 2012,  a statutory loss after tax of $244 million, was the lowest profit result for the group since 1953 when records were available.

In response, the two big chiefs at Qantas, Allan Joyce and Gareth Evans, trotted out the same, seemingly uncontrollable driver of that poor performance – fuel prices.

This excuse, however, has a use-by date. The great thinkers and strategists at the company by now should have developed a deeper understanding of how this force affects the company and developed the optimal response to it.

A share price that sits around $1.18, where it once peaked at over $6 back in October 2007, reflects the managerial inability to develop and implement such a response. Management, and indeed the board, must now begin to be held more accountable because it should become increasingly, although not completely, within their control.

Fuel gauge

To start with, it’s true that the spot price of Singapore jet kerosene, the product that Qantas uses to benchmark its fuel costs, has risen on financial year average terms by just under $US17 per barrel, or in percentage terms 15.54, between 2011 and 2012.

At fuel consumption of about 30 million barrels per year, this increase means an additional fuel cost of about $US500 million per year. As a stand-alone adverse exposure, this hit is massive.

The company’s fuel exposure, however, is not a stand-alone exposure. Over the same period as the jet fuel price increased by 17 per cent the Australian dollar rose by 4.4 per cent. The Australian dollar, therefore, offered the company around 30 per cent protection from higher fuel prices. It doesn’t appear that the airline has accepted this offer.

There are very few airlines in the world with that type of fuel-cost shield from the exchange rate. If Qantas had taken advantage of this protection, the net fuel exposure would have declined to somewhere in the order of the $US350 million mark – a saving of $US150 million.

But the exchange rate protection doesn’t just stop at fuel. The company has a number of other costs in US dollars that it would have paid less for because of the stronger Australian dollar. The biggest are the cost of aircraft purchases, spare parts (including engines), operating leases and capacity hire.

One can imagine the unfavourable cost impact if Qantas were paying for their A380 and B787 aircraft purchases today at the 2001 exchange rate, which is around half the current value.

If Qantas were better able to use these non-fuel costs benefits from a stronger Australian dollar then the adverse fuel costs would almost be completely offset by the reduction in non-fuel costs.

Hedgers clipped

I can’t help but think that the exit over the past few years from Qantas of some of the best fuel hedgers and thinkers in the world, namely the former CFOs Peter Gregg and Colin Storrie, the former treasurer Steve Fouracre, and the former deputy treasurer Craig Hughes, has had an impact on the risk-management function.

Treasury risk management at Qantas is a very small, talented young team but it is hard to give up this old-hand nous without having an impact.

In my view Qantas can go unhedged on fuel and deploy operational foreign exchange hedging. Hedging is incredibly risky – diametrically opposite to its intention, which is to mitigate risk. It is also extremely expensive, often costing the group hundreds of millions of dollars over the space of a year.

When the oil price is trending upward all that hedging will do is delay the onset of higher fuel prices, buying the company time to operationally respond to higher costs. Unfortunately the operational response has not benefited the company’s financials.

Economic strength

The state of the economy is no excuse for the Qantas Group.

Qantas is based in one of the fastest-growing developed economies in the world. It has a strong exposure to the fastest-expanding group of countries in the developing world. And it has a strong exposure to the fastest growing segment of the multi-speed Australian economy, which is the mining and resources segment.

Seat supply or capacity in the international and domestic markets are also forces that Qantas cannot rely on for an excuse. When airline capacity is elevated at the market level, this outcome leads to downward pressure on yield, or ticket prices, which prevents the company from clawing back higher unit costs.

International capacity over the 12 months to May 2012 has grown by 3.2 per cent and domestic capacity by just 2 per cent, although it has ramped up very quickly over the past few months. On average, international and domestic capacity grows at around 5 per cent a year. The past 12 months has therefore seen very moderate capacity growth, which has helped, not hindered Qantas.

Turning it around

What can Qantas do to turn this around? The first thing they should do is abandon the 65 per cent market share target. It’s not profit-maximising despite the rhetoric. This strategic focus on capacity is a distraction for the real objective, which is profit and returns to shareholders.

Imagine a strategy that takes away the most important operationally important weapon that a company is possessed with – its aggregated output. This is what a market-share strategy does.

Every time Virgin Australia raises domestic capacity Qantas must follow it to preserve its market share. This means Qantas’s capacity depends entirely on Virgin Australia capacity (and Qantas must guess what Virgin capacity will be to stay ahead of the capacity game).

Taking away this strategic lever means that its operational response to fuel and the economy is severely constrained. About the only thing it can do is change the mix of Qantas and Jetstar that it flies.

Qantas must hook up with a strong carrier like Emirates. This is a no-brainer. If Qantas cannot make it work with Emirates, then there are no other decent carriers out there to form a relationship with – they are all tied up with the super-smart decisions of Virgin Australia (think Etihad, Singapore Airlines and Air New Zealand).

The most profitable segment for the Qantas business is its Frequent Flyer Program, having made $230 million over the past 12 months, followed closely by Jetstar at $203 million.

An airline has a problem when its non-flying segments are more profitable than its flying segments because the flying segments are at the core of its business, and the non-flying segment performance depends heavily over a long term on the strong performance of the flying segments.

It is unlikely that the Qantas frequent flyer program can hold the ship upright for a long period if the flying segment of the business continues to perform poorly.

Tony Webber was Qantas Group chief economist between 2004 and 2011. He is now managing director of Webber Quantitative Consulting and Associate Professor at the University of Sydney Business School, and contributed this article to BusinessDay

This story Administrator ready to work first appeared on Nanjing Night Net.

The reign of Elisabeth, a different kind of Murdoch?

30/08/2018 // by admin

The spectacular decline of News Corporation over the past year has focused attention on two Murdochs above all others: Rupert, the belligerent 81 year-old media chief who has spent 60 years building the business, and his son James, News Corp’s deputy chief operating officer, who was at one point expected to succeed his father.
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But today another Murdoch will step into the spotlight. Elisabeth, who turned 44 yesterday, will deliver the annual James MacTaggart Memorial Lecture, the most prestigious speech on the UK television industry calendar.

She will be the first woman to do so in 17 years, although she will be the third Murdoch on the Edinburgh podium. Rupert gave the address in 1989, while James used the platform 20 years later to launch a searing attack on the BBC and the “chilling” scale of its ambitions. The lecture almost always sets the media agenda for the year to come. In Elisabeth Murdoch’s case, however, she will not be able to escape the year that has just been.

A timely reminder of the pressures facing the family business was delivered by the deputy leader of the Labour party Harriet Harman last night, calling for legislation aimed at breaking up the Murdoch empire. “The age of deference to the Murdochs is over,” she said.

But, whereas James divides opinion among his industry colleagues, Elisabeth is held in near-unanimous high regard. She earned their respect by leaving BSkyB in 2001 to set up her own production company, Shine Television.

The business made a success of old shows such as MasterChef. Helped by the deep pockets of Elisabeth’s family, it added ballast with a series of shrewd acquisitions. Kudos Film and Television, which made BBC dramas such as Ashes to Ashes and The Hour.

Senior executives recall Elisabeth Murdoch, a softly-spoken Anglophile, pursuing them doggedly, almost like a courtship. In building Shine, Elisabeth demonstrated to the UK television industry, but more importantly to her father, that she could be a media mogul in her own right.

However, all that changed in early 2011, when Elisabeth traded it all in for a large cheque from her father. She had been looking at floating the company but instead ended up selling it to News Corp for 415 million pounds – an eye-watering price, the company’s success notwithstanding.

News Corp shareholders began suing the company for allowing “rampant nepotism” and accused Rupert Murdoch of treating the company “like a wholly-owned family candy store”. The case is still running. Elisabeth made $US214m from the deal but her credibility took a blow. She was supposed to join News Corp’s board but opted to delay her accession.

Since then, she has kept a low profile. She is firmly embedded in the Chipping Norton set in Oxfordshire, where she lives at the weekends with her husband, the PR chief Matthew Freud, with whom she has four children and two stepchildren, but she almost never speaks publicly. However, her comments are sometimes leaked. Last summer, while the phone-hacking crisis at the News of the World was at its zenith, she reportedly claimed her brother James had “f—– the company”.

It was rather surprising, then, that she agreed to deliver the MacTaggart. Sources close to Elisabeth claim that when she signed up for the job around Christmas, she intended to deliver a lecture on “creative leadership”. She was also expected to call for the BBC to close large parts of its gargantuan in-house production unit, and source more of its content from the UK’s fiercely competitive pool of independent producers. While that sort of shake-up would be radical for the BBC, it has been altogether eclipsed by the much bigger issue of News Corp, and the still-unfolding scandals that are weighing on its future.

“I have no idea why she thought this would be a good idea,” said a close colleague. “She had no idea at Christmas how the News Corp scandal would develop. It seems uncharacteristically naive.”

If Elisabeth is anything like her father, and it appears she is, her decision will be part of a much bigger game of chess. She is deliberately setting out to make her move, impressing upon the News Corp board that she is a heavyweight member of the Murdoch clan who should have a major bearing on the company’s future, while establishing herself to the wider world as a different type of Murdoch to those seen before.

Like any potential grand master, she is playing the long, steady game in her ascent of the News Corp empire.

The Telegraph, London

This story Administrator ready to work first appeared on Nanjing Night Net.