Another year is fast closing, and as we head towards the festive season, our confidence is higher than this period last year when financial institutions were falling over like nine pins. The financial markets appear to have settled the dust, although they continue to be subject to altering prices. However, there is now a consistency which will see a steady stream of investors returning to the stock market. While we bask in better economic times, we must remember 2010 will be tougher, with the certainty of increased taxes or less benefits than we experience now.

The millions of dollars borrowed from Australian taxpayers and the future fund for the numerous stimulus packages will eventually have to be returned to the Government coffers to begin balancing the ledger. The Reserve Bank Governor Glenn Stevens told us late last month that the economic dive we had in Australia “had been one of the mildest on record.”

Our unemployment is now at 5.7 per cent, which is expected to head upwards to about 6.5%; this is in marked contrast to our American friends, who are travelling above 10%. Australia, with more bodies in the work force, means the Government is collecting more taxes, and with less in the dole queues the Government is in a reasonable position. Depending on how quickly they want to collect the large expenditure, the pain for taxpayers will still be lurking in the background.

But beware; do not be complacent, as there will be tough times … although there will also be very bright signs. The experts say that things are looking good for the next generation of baby-boomers heading from the work force into retirement.

But as night turns into day, we have to face the facts that we will be paying higher interest rates, and as our dollar still is above 90 cents compared to the USA dollar, we will face higher prices at the consumer end.

Not withstanding, all the climate change proposals will come at a cost to us, although Governments deny it simply will be another long term tax burden for all.

With Christmas almost here, key economists are predicting a better than expected sales in the traditional hectic time of December. The NAB Bank has released data that suggests the economy is currently performing better than we expected and predict growth will continue. The survey was conducted in all key major cities.

Locally our region mirrors the NAB’s predications, with our own survey returning an air of confidence as time ticks towards December 25th. Retailers say with the current trend of sales, they are confident shoppers will maintain their current trend of purchasing. The real estate sector is experiencing a period of buoyancy with agents reporting sales in price sectors at a high. All say that investors are back and there is good activity in the commercial market.

Tourism continues to be the growth area for our regions, and with a bumper time last December and January due to the economic crisis, it will be interesting to see the domestic market maintain the rise of last year. This year has been an outstanding year for the domestic tourism market – a trend that has seen a higher consistency during year.

Data from surveys are telling, with the majority of Australians wanting to taste more of our country, a figure which is a big reversal from previous years.

There is nothing better than tasting the product to ensure more is wanted. Heading overseas is part of life’s adventure, but it is wonderful to know Australians are increasing their appreciation of Australia.

And finally, we appear to have embraced the lay-by service on offer from most businesses. The major chains report this system is becoming over taxed as consumers steer clear of the temptation of using their credit. With no interest and a liberal time to pay, it makes sense to pay the amounts owing weekly. However, while our credit card debt is still high, compared to years past, we look to be controlling our plastic card with more caution.

To all businesses and readers in the Great Lakes and Manning Valley: Merry Christmas and a Happy New Year.

Where has the year gone?

It is November already, and we are fast approaching the festive season. The year has had many ups and downs, however. By all reports, most businesses are confident they will have a bumper Christmas trading period. Speaking to retailers large and small, all are confident sales will surpass last year. The early year hiccups of the financial markets have seen many alter their strategies in marketing and customer care – a move all believe has improved their business.

Shoppers have been the winners in the past few months, with prices dropping, making those sometimes unaffordable items within reach of the family budget. Surveys also show we have changed our ways in keeping our savings accounts more healthier. Although the increase in savings has not been big, we appear to have more in the bank than at this time last year. One area Australian’s have addressed is the credit card debt.

In April this year, Australia’s credit card debt had climbed to new records after repayment frequency had slumped, with many people holding out in the face of unemployment and the recession. Australian consumers spent $17.1 billion with their credit cards in February, equating to an average Australian person’s debt being $3,349. In September, we had reduced the card debts to below $3,000 per person, with the experts suggesting we as consumers are spending cash, with our expenditure on credit cards slowing.

One area that has seen an avoidance is the use of cash advances, which attract a high interest rate and make credit cards repayments increasing difficult.

Craig James, CommSec’s Chief Economist, says the reduction is the fastest decline since records began 14 years ago. “Household finances are in good shape, people have gained from the fact that taxes have been cut, income levels have been rising and interest rates have been falling, but they’re using that extra cash to pay off credit card debt, ”he said. “Consumers when they make purchases have moved to using debit cards rather than credit cards.” With interest rates on the way up, repayments will increase across the board, particularly with home loans. While we expected the rates to increase, it is hoped the Reserve Bank will increase rates at small intervals to maintain our current level savings and spending.

The Chambers of Commerce are growing stronger and are a great way to network, increase knowledge and be part of a community’s growth for all businesses. The Chambers are the voice and representative of many wide and varied activities in all regions. They address all the issues that concern business at all levels and are the major recognised link with all levels of Government. The Manning Valley Chambers of Commerce hold many events during the year and will be adding many new activities to their year’s activities. They publish a fortnightly magazine, keeping business abreast of activities and reaching most businesses in the region, and they invite your business to advertise.

The rates are inexpensive, and it is another avenue available that will help you reach your target. If you want to know more or to be added to the mailing list, contact the Chamber on 6551 2299.

The annual Manning Valley Chambers of Commerce Business Awards were held in September before a huge crowd, with seventeen awards presented. Nominations were up from the inaugural year (2008), a pleasing result in what have been tough economic times. The mood of businesses who attended was buoyant, with all acknowledging they had experienced a downturn in business. However, most did say they expected to feel the pinch more and felt our region did not experience the same conditions as experienced in the cities. One of the iconic Manning Valley businesses, Steber International won the Business of the Year from four finalists: Steber International, Sorrenson and Caldon, Manning River Pharmacy and Bent on Food.

The winners were: Business of the Year – Steber International; Manufacturing – Valley Industries and Steber International; Construction – Sorrenson and Caldon; Services – Linda Photography and MGL Focus; Retail – Alex Fischer While U Wait and Manning River Pharmacy; Hospitality – Taree Motor Inn, Bent on Food, Waterbird Restaurant and Inspirations on the Water; Professional Services – Valley Vet and Energise Nutrition; Environmental – Valley Industries and Waterbird Restaurant; People’s Choice – Inspirations and Harrington Hotel.

Congratulations to all the winners and nominees, particularly for Focus for securing an award – to all the team, well done.

The first anniversary of the world economic crisis has been and gone. It all started when investment bank Lehman Brothers announced they were in trouble. It was the first to make a public announcement, which was followed by others who were exposed to mortgage-backed securities. The bail out by the United States Government did not work and Lehman Brothers went into bankruptcy, sending all similar banks worldwide into turmoil. Banks became nearly nationalised in England, with most of Europe’s bigger banks edging towards bankruptcy.

Here at home our stock market crashed, interest rates nose dived, superannuation was hit hard, with the Australian Government making a guarantee on all bank deposits up to $1 million and announcing a $10.4 billion of stimulus spending. This was followed by a further $42 billion in spending in February this year.

So in twelve months, has anything changed? Apparently a lot, according to Business editor, Stuart Fagg. “Firstly, we’re all $25,000 worse off. That’s according to analysis of Australian Bureau of Statistics and Federal Treasury data carried out by CommSec, which showed that in the year to April 2009, average wealth fell by 12 percent – the largest annual fall since records began in 1960. If it wasn’t for house prices remaining relatively stable, we would have lost a good deal more.”

Fagg says we are all working less. While unemployment has risen over the past 12 months, there have not been as many job losses as had been previously feared. “It is pleasing to know Australian businesses have chosen to hold on to employees and reduce their hours, leading to Australians working the fewest hours per week since 1985.

“In Australia we’ve been remarkably lucky – the Australian Stock exchange is back near the same levels it was before Lehman collapsed, we’ve avoided a recession and house prices have held up well. But we, and indeed the rest of the world, are not living in normal financial times.”

It will be interesting to see how we are placed in another twelve months. I’m sure we will have more twists and turns.

The Australian Bureau of Statistics indicate that 23.2 per cent of households were reliant on Government pensions and allowances in 2007-08; a decline on the 26.1 per cent in 2005-06 and 28.5 per cent in 1994-95. Housing is the most expensive cost in terms of rent, with an annual increase of about 6 per cent. Low income earners were burdened by food prices rising by 19.7 per cent in the five years prior to 2008 compared to 14.8 per cent for the total Consumer Price Index: fruit rose 27.8 per cent, dairy 23.6 per cent, meat and seafood 13.7 per cent, and bread and cereals 17.5 per cent. In the 12 months prior to the March 2009 quarter, food prices rose 6 per cent. Unfortunately, the Reserve Bank of Australia noted that food prices were likely to rise further because of greater demand from developing economies and the trend towards biofuel production, which doubled in global terms between 2000 and 2007. It seems never ending for the lower income sector but with many in the medium bracket facing rising costs, it is predicted that they will be joining this lower sector.

Many are predicting Australia is heading away from recession and showing every indication of recovery, with the country in better shape than its counterparts.

The cost of living is heading upwards; however, it is rising at its slowest rate for 10 years, with the big decrease in the cost of fruit and vegetables and overseas travel. These figures saw another interest rate cut put on hold, as the Reserve Bank saw no reason to interfere with the cost of borrowings. The Australian Bureau of Statistics reported an annual inflation rate of 1.5 percent, down from 2.5 percent previously.

Economist with the ANZ Bank, Riki Polygenis said; “The figures were consistent with the Reserve Bank of Australia’s expectations, leaving the central bank ‘little imperative’ to cut interest rates. It looks like any further rate cut is less likely, as there has been a reduction in the risk to the economy.”

Adding to the opinions was Craig James, chief economist from CommSec, who said the inflation rate had fallen well below the Reserve Bank’s target of 2-3 percent.

“But with underlying inflation still uncomfortably high, the Reserve Bank will tread warily on future rate cuts, especially given its more optimistic view on prospects for economic recovery,” James said.

Fruit prices crashed, being down 7.6 percent in the three months to the end of June, while vegetable prices fared not much better, going down 6.9 percent.

Australians are turning their backs on overseas holidays and accommodation, being down 3.4 percent. On a brighter note, Australians had turned to domestic touring and holidays, a factor that has seen the industry increase 10% compared to the last twelve months.

However, where there are decreases there are always increases, with the largest rising cost being in furniture. Other price rises included petrol, hospital and medical services, with rents also climbing.

CommSec has predicted the annual rate of inflation will fall below one percent later in 2009, the lowest result in 11 years. This is a key measure of Australian business conditions, which jumped to its best level in nine months in June, with sales and forward orders leading to a record improvement in employment intentions.

Property prices across Australia have bounced back against all the odds to turn in solid gains in the final quarter of the financial year. House prices climbed an average 3.64 percent in the three months to the end of June, while apartments recorded an average 3.9 percent price rise across the nation, according to latest Residex market data. The strong run in the final quarter, driven by low interest rates and many Government incentives, helped recoup earlier losses – with Perth the only capital city to suffer notable losses on a yearly basis. House prices in Canberra climbed 1.36 percent in the year to the end of June, Adelaide prices grew 1.61 percent, Melbourne prices rose 2.69 percent and Darwin recorded a stunning 14.81 percent jump. Sydney and Brisbane house prices were almost flat at 0.79 percent and -0.06 percent respectively.

The Manning Valley and Great Lakes regions are also experiencing a steady flow of sales, with banks and lending institutions still being kept busy.

The stock market has rallied nicely recently, another good indicator that confidence is returning to investors and the economic outlook is heading away from the gloom we had six months ago.

With Australia showing good signs of economic recovery, one of the major players, South Korea has seen its economy roar back to life in the second quarter to put up its best quarterly performance in more than five years.

This performance added to recent evidence that other Asian economies are turning the corner and are past their worst point of the current global financial downturn.

China unveiled excellent growth figures for its economy, with 7.9 per cent growth in the second quarter from the previous year and accelerating from growth of 6.1 per cent in the first quarter.

The State Government continues to fumble its way through the year, adding new programs and expenditure on what seems to be a daily basis. All these projects are for Sydney and its outer suburbs while rural New South Wales continues to be ignored with new infrastructure and or job programs.

The Chambers of Commerce have had most of their ideas and proposals hit the brick wall as they attempt to assist business and regions grow. People want to move to the country, but they have no incentive, with limited opportunities for employment.

Surely this a major signal to the State Governments to instigate employment programs to move people from the city to the country. This movement would assist in reducing the over crowding in cities. Maybe it is time to argue for a re-introduction of a decentralistion project similar to the NSW Government’s program in the 70s and 80s. We have the environment, lifestyle and plenty of room to accommodate the migrants from the city.

Congratulations to the Greater Taree City Council for taking the bold step of seeking funding to upgrade the Taree airport. The airport is a vital link for many services for the Great Lakes and Manning Valley and its residents, so well done – the region needs an airport to expand and provide vital services.

Local Business Update with Peter Lyne from the Manning Valley Chamber of Commerce.

The Stimulus handouts to the population are over from the Federal Government, but what happens now?

Depending on whom you believe, the bonuses were successful – most retailers maintained their sales budgets. However, since the bonus payments have ceased activity, the cash registers has been quieter.

Whatever circumstances you are currently experiencing, we should be thankful that Australia is rated in a better position than most of our counterparts and advanced countries …

One of Australia’s leading economic consultants from Access, Chris Richardson said there were several factors for why Australia was on track to weather the global financial crisis.

“The cutting of interest rates and delivering the Stimulus Packages were a huge help,” said Richardson. “Economists would have preferred more targeting on spending; however, overall our Federal Government delivered better options than the USA and Europe.”

Richardson added that  Australia was operating at buoyancy – an event that assisted greatly in cushioning the impact.

Across Australia, surveys are all positive that the business community will weather the impact, but have introduced contingency plans to overcome the downturn. There is no doubt we are beginning to enter the tough period, an unknown time frame – particularly with rising unemployment and our downturn in exports.

Australian business confidence surged in the June quarter to its highest level since late 2007 and produced the largest quarterly turnaround since 1975, according to an Australian Chamber of Commerce and Industry and Westpac Bank survey.

Chief economist of Westpac, Bill Evans was pleased with the result, however he did express caution saying that a simultaneous study of business conditions had displayed a modest rise.

“Looking at the economic times, the results are better than expected,” said Evans.”We do not want to get carried away, but the next result will hopefully confirm the upward trend.

In context, the respondents are probably only recognising the circumstances that were unlikely to get any worse, rather than declaring a robust future.”

The Australian Business Chamber acting chief executive Greg Evans said that despite some positive signs, it remained a challenging environment.

“Labour market demand remains soft and business expects employment to further soften marginally over the next three months,” he said. “Inflationary pressures have continued to ease, and this is welcome news. On the other hand, with prices still declining at a faster pace than costs, the squeeze on profit margins remains significant.”

The survey also concluded that Australian consumer confidence staged its biggest monthly rise in 22 years after the economy defied predictions it was headed for recession.

“However, we must not be complacent. It would be easy to slip back to times of recession.”

All this sounds relatively sound, but the infrustructure policies announced by the Federal Government still focus on the cities, with the rural regions again left wondering if we exist.

Announcements for spending in some country areas is welcome, but it not enough to maintain a consistent future.

The Manning Valley and Great Lakes regions’ unemployment figures took a dramatic upturn – well above the nation average. The new projects in our regions will assist many contractors, but it is the everyday employees who need assurance that their jobs will be secure.

Without being all doom and gloom, one large employer will be announcing a quarter of their workforce will have no work from the end of July; this will be another 60 jobs lost to the area. This is something that people and the business community cannot afford. The impact will not be immediate, but less spending of money and the urge to leave the area to seek jobs does and will have long term impacts.

Another factor that will have an impact is the certain rise in petrol prices. It is still sitting at the same level as when barrels of oil were $48, and with the current price at $75 per barrel, this is the highest since October 2008. So be prepared to pay more, with predictions of $1.30 per litre.

Tourism continues to be a solid economic driver for the Great Lakes and the Manning, with visits above last year’s figures. With the Government encouraging the population to spend time closer to home, our regions are capitalising on the region’s influx of visitors. It is hoped that the enjoyment of the region will entice most to return.

The annual Business Awards were launched late last month in the Manning Valley by successful Australian businessman Jack Singleton, son of John. It was pleasing to hear that after all his success he remains focused on his customers – believing they are one of the most important elements.

Singleton says most of the best business arrangements were coming from business owners themselves, not from around the board room table. Singleton is the successful owner of 5 businesses.

Local Business Update with Peter Lyne from the Manning Valley Chamber of Commerce.

The 2009 Budget did little for the business community; the bonus tax deduction for investment in new assets such as plant, fittings and equipment and cars has been increased from 30 percent to 50 percent. But there was nothing earth shattering that would see business owners dancing in the street. 

The bonus tax deduction extension is where assets acquired between 13 December 2008 and 31 December 2009 are installed ready for use by 31 December 2010. As usual, there is a catch, with the turnover of the business having to be less than $2 million per annum, exclusive of GST. 

To claim the 50 percent investment allowance deduction in the 2008-09 income year, the asset must both be ordered between 13 December 2008 and also installed ready for use by 30 June 2009, with the minimum cost of an eligible asset being at $1,000. Where the eligible asset is ordered between 13 December 2008 and 30 June 2009, but not installed ready for use until the 2009-10 year, then the 50% investment allowance deduction is claimed in the 2009-10 year. 

With country regions across Australia looking for substantial lifelines to boost their economies, this year’s budget left the rural sector void of any new programs. Local Councils have received funds to assist some infrastructure programs, but programs to encourage business to relocate were ignored. 

While our Treasurer was announcing billions to be spent on city regions, once again we in the bush have been forgotten. Band aiding transport and other areas for the urban population over time will prove a waste of money, as the urban sprawl continues to grow. 

Attracting business to rural areas would relieve the pressure from the city and suburbs and allow rural Australia to grow. If the Rudd Government spent half of their proposed expenditure on a decentralisation program for business to relocate, then much pressure would be relieved on our city cousins’ tight squeeze. 

Why do Governments continue to ignore country areas? Maybe because there are not enough votes around the rural regions and there is more political advantage to spend in these areas. However, one must think ‘will any benefit be gained and will life be improved in five to ten years time?’ Also, how much better off will the residents be? My guess is they will still be living a life of claustrophobia. 

Governments all over Australia always talk about moving people from the city to the country. So far that is all we have … talk.

On the subject of the budge, the deficit announced by the Government – which will grow – only means one thing: that we, the taxpayer, will eventually be liable to return the budget surplus. Some revenue will flow through when business confidence begins to flow again, but long term I would not be expecting too much in the coming years. But overall, it us who will be hit with increases in charges and other measures to offload our deficit. 

Families and business know that they are living in an era where sacrifices will have to made. Decreasing expenditure is on everyone’s agenda, with the flash overseas and interstate holidays now reduced to enjoying life and rediscovering the beauty of our home state.  

It has not taken long for the Federal Government to bow to pressure over its budget. Changes to employee share schemes have already been fast tracked to ensure average workers don’t come off second best. Less than a fortnight after he delivered the budget, Treasurer Wayne Swan has announced the Government was conscious that low-to-middle income workers might have inadvertently been caught in a policy targeted at high income earners. 

The Government announced it would release an options paper examining alternative proposals on what modifications will be  necessary. Mr Swan was answering the unions and business organisations who joined to criticise the measure, which meant anyone earning more than $60,000 would have to pay tax on their employee scheme shares upfront, rather than when the stock was sold. 

The measure essentially stops employees deferring and avoiding paying tax on their shares. It also limits a $1,000 concession to people earning less than $60,000.

As a result of the proposed changes, some companies began closing the schemes down, meaning the government would lose any extra tax revenue it anticipated and all workers would lose out.

Mr Swan said: “Given the community concerns with the proposed changes and the possible unintended adverse impacts on employee share scheme arrangements for ordinary employees, the Government will be fast-tracking the consultation process.” 

The past couple of weeks have seen fuel prices stay put in one region and in another fluctuate. In Taree, petrol prices have seen only minor adjustments; however, in the Great Lakes region the community were paying up to eight cents a litre less. With the two areas so close, it is bewildering. 

With oil companies controlling prices, I believe it is fair to ask, is one area favoured over another? Contacting several oil companies this week, I still cannot receive a sensible reply. Both gave the same answer: “We do not control the price; it is subject to the price of oil per barrel.” 

Well if it is, why are prices not uniform?

Local Business Update with Peter Lyne from the Manning Valley Chamber of Commerce.

Well, reality has finally reached the top bureaucrats. After continual denials, the Federal Government and the Reserve Bank have admitted the country is sliding towards – oh can we use that word … recession.

With all the activity or non activity overseas and daily reports of negativity, the ‘penny’ has finally dropped that Australia will feel the fallout. 

Stock market corrections last year were ignored by the RBA, as it lifted interest rates – even though investors lost about $500 billion in share values. The Prime Minister and RBA’s long drawn state of denial is relevant only in that most people take the view that it’s difficult to tackle a problem until it’s acknowledged that there is a problem. 

What were they hoping for … a miracle?

These two leaders have finally recognised there is a problem, so there now may be an end to the disconnection between what they’ve been saying and what they’ve been doing. 

In the Government’s case, while denying conceding the obvious, they have been throwing more than $60 billion at anyone who has stood still long enough to take the cash. With the Federal Budget this month and the prospect of the full magnitude of the Government’s spending and contingent liabilities (which are mainly the bank borrowing guarantee being revealed), the Prime Minister and Treasurer had little choice but to tell the real story.

Did the Reserve Bank panic last year when it cut the official interest rate a full four percentage points? In effect, the head bank has acknowledged they now have erred when lifting the rate twice in February and March. 

It fact, it was probably those two rate rises that have been the main factor in pushing the economy over the edge into a recession, with the full impact of the global economic crisis yet to hit Australia. 

Just as it will take a few more months for the benefits of the rate cuts to flow through, the impact of the earlier rate rises wasn’t felt until late in 2008, when the economy was going cold. 

The outlook for the major global economies, the US and most of Europe, is still grim, and attempts by the RBA and the Government to give the impression to voters that Australia would avoid a serious downturn were always looking ridiculous. 

In its latest Global Financial Stability Report, the International Monetary Fund (IMF) identifies a sharp increase in the level of bank loans or investments unlikely ever to be repaid or recovered to US$4 trillion ($5.7 trillion), or roughly the equivalent of four Australian economies. This is a mind-boggling amount of money lost by the global banking system, which will take years to write down and digest and may require more nationalisations. The US and Europe will be held back by tight credit markets for years to come. 

The report also gave the Government a slap on wrists over its policy response to the recession – something it refused to acknowledge until last week.

The report said, “When policies are unclear and implemented forcefully and promptly, or are not aimed at the underlying problem, the recovery process is even more delayed and the costs, both in terms of taxpayer money and economic activity, are even greater.” 

Australian taxpayers will hope that the further stimulus measures that the Prime Minister hinted at during his recession confession will be nation-building, job-creating projects in rail, ports, pipelines and the like, and not questionable, unplanned ventures like the broadband proposal. 

So far the Federal government has behaved as if the supply of our (taxpayer) money is unlimited. At some point taxpayers will rightly ask what they’ve got for their investment. At some point, in the future as sure as night follows day, we will to pay higher taxes to start paying off our growing debt, which is predicted to be more than $100 billion.

It may be popular at the moment, but the longer the Government goes with its current policy, it will find itself liable to be accountable to taxpayers. So do not be surprised if we head to the polls early – something the country cannot afford in the current economic climate.

The region’s Councils are trimming their expenditure as they struggle to maintain their services to the community. The Federal Government’s grants will assist; however, they need more to keep up with ongoing requirements.

Taree is being hit from all quarters, with the airport struggling to stay open plus the Percy Allen report identifying many big holes that have to be filled with cash. Full credit to Taree’s Mayor and General Manager, who have been transparent and put their shoulders to the wheel working with the community and all relevant parties to plan for the next 20 years.  

The Greater Taree and Great Lakes Councils would go close to wiping out their budget deficits if they submitted a tender to paint the Martin Bridge. Knowing what the benchmark is, with the RTA quoting a ridiculous $20-25 million, our Councils could slip in a $15 million bid that would greatly assist with the financial woes. 

The RTA has to be kidding to disclose such a cost: we want it painted, not replaced! Although, that would not be a bad idea, as it needs widening. No wonder the New South Wales Government is broke. 

Local Business Update with Peter Lyne from the Manning Valley Chamber of Commerce.

Being a journalist covering many wide and varied stories, no words can paint a picture of tragedy and the devastation of fire. One can try, but many times it is hard to explain the emotions, visions and witnessing the damaged infrastructure, along with the heartbreaking experience of seeing humans and animals die. The events last month brought back sad and emotional memories of reporting fires in the Blue Mountains and Canberra during the past couple of decades.

Yes, it has been a horrific February 2009, with the effects of the recent bushfires and the floods in Northern Queensland adding another unfortunate chapter to our history. Reliving my experiences is not pleasant; sometimes it has been hard. However, living in a country of incredible contrasts, the pain is eased slightly by the generosity of our fellow countrymen.

When our fellow countrymen are in trouble, Australians unite as one. We are probably the most generous and supportive when asked to respond to the call of help! Again, we have not disappointed, displaying unselfishness when called to assist the ravaged areas; our unity is second to none.

The assistance tally is still climbing to a record …  financial donations, goods and services – truly a magnificent result.

Still on the subject of assistance, does the Government do enough?

Sure, they provide all the usual and expected aid and support, but can they do more in the long term restoration of communities?

One of my mates is a great spinner of a yarn, a deep thinker and one of the few who is an astute solver of problems, who talks plenty of sense – sober, or when enjoying many a drink. He believes the Federal Government and all governments around the world can contribute many more concessions and assistance above their current activity for our citizens who have suffered losses caused by the elements.

He suggests ALL TAXES be abolished on all equipment and materials required to rebuild devastated towns, replacement equipment, furnishings and everything required to return to a life of normality. His reasoning is very sound, as the cost of replacement would be greatly reduced with less funds being spent, thus allowing more funds from the pool of finances, goods and services to be spread around to more areas of need.

The current fantastic sum of money raised will not be nearly enough to completely restore towns and the many facilities needed for communities to function. It will be a long, hard road for everyone – taking many years to try to get some normality into daily life. So an abolition of ALL TAXES relevant to the bushfire victims has plenty of appeal. Yes, it is sound reasoning, and over our next drinking discussion we may begin a campaign to persuade him to enter politics (although he would probably fail with all that sound logic, and besides … are we ready to have a former Pommy as Prime Minister?)

Another round of cash handouts are on the way this month. It is hoped this handout will add to staying above the poverty line.

As the statistics filter through about where the spending happened in December, some interesting facts have emerged. Australians chose to use a large slice of the $8.7 billion pre-Christmas Government handouts to pay their credit card debts. The value of credit card repayments rose by $3.9 billion in December – the biggest monthly increase since the Reserve Bank of Australia began recording payments in 1994. We spent $21.464 billion on credit card repayments in December, which was more than the $21.043 billion spent on credit card transactions. Savanth Sebastian from the Commonwealth Bank said most of the Federal Government’s stimulus handout was not spent.

“The Government wanted it going back into the economy and having a multiplier effect, but in this environment of falling property prices and share market wealth, people are using the money to reduce debt levels and ensure they are in the best possible position for a rainy day.”

A survey last week showed the next round also appeared to be heading to further reduce credit card debt, as consumers realise interest rates on cards are still high (with the average carrying a 20% interest rate). The average card debt stood at $3,162 per person at December, with the debt growing at three per cent annually – which is the slowest pace on record. Our credit card repayments jumped by 22.2 per cent in December – the biggest monthly percentage increase since May 2006. Retail sales did rise, but only marginally, at 3.8 per cent – a figure which has reflected where our money is now being directed. We are becoming more frugal.

A poll around retail stores in the Manning Valley and Great Lakes had a surprising result, with a huge majority happy with their sales and with no thought of reducing staff. Businesses have indicated they have introduced measures to reduce spending, with advertising and sponsorship the major area of cost cutting.

It is difficult to predict where we will be in six months time, but the Reserve Bank this week stated it believed by mid year Australia will begin to turn the corner financially. There is no doubt times are a little tougher and many areas of manufacture are suffering, which has been governed by the disasters financially in Europe and America. We seem to get mixed messages daily about our situation from the media … let’s hope the statistics from the Reserve Bank and its predictions are correct.