Net overseas migration on track to fall by 20 per cent

The latest statistics confirm Australia’s net overseas migration (NOM) level is on track to drop by about 20 per cent by the end of the financial year in response to government reforms to temporary and permanent migration and economic conditions, the Minister for Immigration and Citizenship, Senator Chris Evans, said today.

Preliminary estimates released by the Australian Bureau of Statistics’ (ABS) ‘Social Trends’ series show the level of NOM in 2008 was 301 200 people and fell to 277 700 people in 2009.

‘Based on current visa application numbers, the level of NOM is on track to drop to between 230 000 and 250 000 people by the end of the financial year,’ Senator Evans said.

‘This confirms that record high population growth has been fuelled by growth in temporary long-stay migrants, especially students, as a result of the policies of the previous coalition government.’

Senator Evans said net overseas migration began to climb and get out of control under the previous government, as a result of its decision to open up pathways for temporary residents—particularly students—to remain in Australia permanently.

In response to the ABS report’s findings, Senator Evans said the level of NOM—which includes both permanent migrants and long-term temporary migrants, including students—had peaked and was clearly on the way down.

‘The government is committed to ongoing forward-planning and reform to ensure immigration levels are guided by Australia’s needs and not by the desire of prospective migrants to come to Australia,’ Senator Evans said.

‘Prime Minister Gillard has already articulated her vision for a sustainable population—one that supports our environment and our renewable resources and that is in turn supported by proper resources and infrastructure.’

The government will develop policies to ensure all Australians benefit from our strong and growing economy.’

Source  :  http://www.minister.immi.gov.au/media/media-releases/2010/ce10055.htm

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Perth house prices set for biggest climb

The median price for a Perth house will pass $600,000 within three years as the city’s property market reclaims its title as the strongest and fastest growing in the country, a new report predicts.

The BIS Shrapnel residential property report forecasts house prices in Perth will climb an average 7 per cent a year for three years, pushing the median price to $610,000 from $500,000 today.

No other capital is expected to enjoy such strong capital growth, with even higher interest rates unlikely to slow the Perth market as much as others.

Senior project manager Angie Zigomanis said even though the Perth market slowed before other cities in 2007, conditions were improving on the back of another resources boom. Money flowing from commodities would soon push up house prices across Perth.

“With prices below peak levels in real terms and income in Perth set to grow substantially as the next round of resource expansion projects get up and running, solid price growth should continue,” he said.

“Nevertheless, further increases in interest rates will prevent the boom in prices that we saw in the last upturn.”

Mr Zigomanis said the median house price would climb 22 per cent by the middle of 2013. This growth would be quicker if the Reserve Bank did not increase interest rates in the next six to 12 months.

Growth at that rate would surpass other capitals such as Sydney (up 20 per cent), Melbourne (11 per cent), Brisbane (12 per cent), Adelaide (20 per cent), Hobart (12 per cent), Canberra (14 per cent) and Darwin (12 per cent).

House prices climbed rapidly through the second half of last year and into the first four months of this year.

Mr Zigomanis said this was directly because of record low interest rates in response to the global financial crisis and a “pull forward” of demand from the first-homeowner’s grant. Not only would house prices outpace inflation, they would affect rents.

“Even though overseas migration inflows are steadily easing, a deficiency of stock is still in place with dwelling construction below underlying trend,” he said.

Recent Australian Bureau of Statistics figures show a fall in loans for people buying homes but an increase in loans for investment properties. Financial market analysts do not expect official interest rates to rise until May next year.

source  :  www.thewest.com.au

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Reserve keeps interest rates on hold

The Reserve Bank has delivered some badly needed relief to mortgage holders, deciding today to leave official interest rates on hold.

For the first time since February, the RBA board did not use its monthly meeting to lift rates which now stand at 4.5 per cent.

In a statement, bank governor Glenn Stevens said the issues around sovereign debt in Europe and its impact on financial markets were a major reason behind the move.

He said the impact of these on the wider economy were still to be determined, arguing global growth is still expected to be around trend for the rest of this year.

But Mr Stevens signalled interest rates were likely in the future on the back of the return of the mining boom.

“In Australia, with the high level of the terms of trade expected to add to incomes and demand, output growth over the year ahead is likely to be about trend, even though the effects of earlier expansionary policy measures will be diminishing,” he said.

“Inflation appears likely to be in the upper half of the target zone over the next year.

Consistent with that outlook, and as a result of actions at previous meetings, interest rates to borrowers are around their average levels of the past decade, which is a significant adjustment from the very expansionary settings reached a year ago.”

The decision followed new figures from the Australian Bureau of Statistics which showed retail sales growing 0.6 per cent in April and a 14.8 per cent collapse in dwelling approvals.

However, the retail sales – while stronger than expected – were pushed up by food sales which jumped 1.3 per cent. Once this sector, which accounts for 40 per cent of all sales, is excluded retail was up just 0.1 per cent.

Other ABS figures showed government spending is holding up the economy and will add about 0.8 percentage points to tomorrow’s GDP result. Without that burst, the economy may have actually contracted in the March quarter.

CommSec chief equities economist Craig James said the figures showed the RBA had no option but to leave rates where they are for some time to come.

“Given the latest round of data, there are good reasons for the Reserve Bank to leave rates on hold for the next few months,” he said.

“Not only are retail sales holding at very weak levels, but the housing sector is showing signs of consolidation.”

Treasurer Wayne Swan says the Reserve Bank’s decision to leave the official cash rate unchanged is a “welcome relief”.

“This news will be welcome relief to Australian families and businesses around the country, who are of course doing it tough,” Mr Swan told parliament minutes after the decision was announced.

The national accounts for the March quarter are due for release on Wednesday.

“I have every confidence that with right polices in place, our economy can continue to be one of the best in the world over coming years,” Mr Swan said. Consistent with that outlook, and as a result of actions at previous meetings, interest rates to borrowers are around their average levels of the past decade, which is a significant adjustment from the very expansionary settings reached a year ago.”

“Not only are retail sales holding at very weak levels, but the housing sector is showing signs of consolidation.”

“Source  :  www.thewest.com.au

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Perth to absorb 2 million more

Perth will sprawl further than New York City, be clogged with cars and people will live in each other’s pockets as the city groans under the weight of an extra two million residents over the next 40 years. 

An analysis of how Perth is growing and will grow as more people call the city home also warns that more desalination plants, thousands of kilometres of roads and hundreds of schools will have to be built to cope with the surge in residents. 

The Australian Bureau of Statistics is forecasting Perth’s population to hit 3.8 million from its current 1.7 million by 2050.

For the first time the bureau has looked at what that will mean to Perth residents – and the picture is dominated by sprawling suburbs and long journeys to work.

Already the city covers 5423sq km but statistician Phil Smythe found that if the population reached 3.8 million, and even if housing density increased, Perth would sprawl over 12,000sq km.

New York City, home to 17.8 million people, covers 8700sq km.

Perth would stretch from the coastal hamlet of Lancelin in the north to the Lakes turn-off in the Perth Hills and south to a point midway between Mandurah and Bunbury.

The population density of Perth would increase to 710 people for every square kilometre, up from 319.

Mr Smythe said the number of vehicles would swell from 900,000 to almost two million.

Thousands of kilometres of roads would have to be built to cope with the extra traffic, and the use of public transport would have to increase dramatically.

Mr Smythe said fewer than 10 per cent of Perth residents used public transport now but that would have to increase to avoid serious congestion.

More desalination plants would be necessary to cope with the increased demand for water, and power generation would have to more than double to supply the energy demands.

There would be challenges for the city’s education system, with the number of schools likely to more than double to 2300 with 600,000 students.

“This may mean stiff competition for school names,” he said. “Already there are 73 schools named after saints, including 12 after St Joseph and nine after St Mary.”

Professor of sustainability at Curtin University, Peter Newman, said the attitudes of Perth residents would change, as they were already in the US, with more people moving back towards the city centre rather than out to the suburban fringes.

He said there were huge costs associated with suburban growth, from transport to health, and it meant more people were now looking to higher density or inner-city life.

“You’ll see places like Mandurah, Kwinana, Rockingham, Karrinyup and Morley fill up, especially as younger people start giving up their cars,” he said.

Treasurer Wayne Swan said yesterday that people who demanded a cap on Australia’s population were too narrowly focused in their complaints.

“It is all too easy to speak of the costs of an increased population, and forget the benefits,” he said. “This is a mistake too often made.” “You’ll see places like Mandurah, Kwinana, Rockingham, Karrinyup and Morley fill up, especially as younger people start giving up their cars,” he said.

Treasurer Wayne Swan said yesterday that people who demanded a cap on Australia’s population were too narrowly focused in their complaints.

“It is all too easy to speak of the costs of an increased population, and forget the benefits,” he said. “This is a mistake too often made.”Source  :  www.thewest.com.au

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Market odds move firmly against Reserve Bank interest rate rise

THE market odds have moved firmly against an interest rate rise by the Reserve Bank in February.

The sharp change in direction, which began on Tuesday after the central bank revealed its December 1 meeting minutes, accelerated yesterday following a speech by RBA deputy governor Ric Battellino.

Mr Battellino signalled that rates could stay on hold when the RBA next meets in February, saying the “overall stance” of monetary policy was “back in the normal range”.

His comments, at the Australian Finance & Banking Conference in Sydney, surprised the markets, triggering a slump in the Australian dollar to below US90.

Last night the dollar was hovering around US89.70.

Financial market betting on a 25-basis point rate hike in February retreated from a 67 per cent chance to 45 per cent.

Mr Battellino said that although the cash rate still seemed “unusually low” at 3.75 per cent, monetary policy was back “in the normal range” because the current level of deposit, housing and business lending rates made the cash rate equivalent to a “before the crisis” level of 4.75 per cent.

“Taking these considerations into account, it would be reasonable to conclude that the overall stance of monetary policy is now back in the normal range, though in the expansionary segment of that range,” he said.

The deputy governor’s remarks were made half an hour after the Australian Bureau of Statistics revealed economic growth in the September quarter was weaker than expected.

The national accounts showed GDP edged up just 0.2 per cent in the three months to September, half the pace of growth expected by the market, for an annual rate of 0.5 per cent.

The main drag on growth was a slump in exports which coincided with a jump in imports.

However, demand from households, businesses buying more equipment and government investment was solid.

ANZ acting chief economist Warren Hogan said the GDP figures indicated there was little urgency to get official interest rates back to a neutral setting, adding that Mr Battellino’s comments had “dealt a solid blow” to the prospect of substantial gains in the cash rate over coming months.

“Put another way, the emergency setting for interest rates has now been removed and policy will be adjusted as and when required by economic conditions,” he said.

Westpac chief executive Gail Kelly told reporters after the bank’s annual meeting in Melbourne yesterday that the RBA was likely to raise rates “very carefully” in 2010.

However, she said the official cash rate was not quite yet at a “normal” level.

Mrs Kelly said she remained cautious about the economic outlook while the bank’s chairman Ted Evans said a “V-shaped” recovery for Australia was unlikely.

“It will be a long recovery and that’s what our plans are based on,” he said. 

Source  :  www.news.com.au

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Private school fees to rise 8pc

Parents of children at private WA schools should brace for fee rises up to four times the inflation rate next year, with new figures showing education costs leapt 37.5 per cent in the past five years.

Elite colleges said it was too early to set next year’s fees but they predicted rises between 5 and 8 per cent.

Principals said big pay rises to State schoolteachers last year in a three-year agreement were driving up fees at private schools because they competed for staff.

Scotch College principal Andrew Syme said fees at private schools had to go up at least 6 per cent to keep pace with teachers’ pay rises before any improvements in service.

Anglican Schools Commission chief executive Peter Laurence said fee rises at low-fee church schools would be similar to last year’s increases of between 6 and 9 per cent.

“Teachers’ pay is the number one driver that’s going to keep increases higher than they used to be a few years ago,” he said.

Australian Bureau of Statistics figures show education costs in Perth, comprising school fees and other miscellaneous costs, have jumped 37.5 per cent since 2004 – the biggest increase registered by any capital city. Canberra had the second biggest leap, with 29.4 per cent.

The rise was driven by a 55.9 per cent lift in fees associated with pre-schools and primary schools. By contrast, pre-school and primary school education costs in Sydney rose almost 23 per cent.

Pre-school and primary school fees have grown faster than the average wage of West Australians which, between 2004 and today, jumped 44 per cent – the biggest rise of any capital city.

The State Government has held down public primary school fees so the increase is mainly for private schools.

A private education in WA costs between $3000 a year for Year 12 tuition at low-fee Catholic schools and $17,000 a year at high-fee independent schools. Many private schools in Sydney and Melbourne charge more than $20,000 a year.

Association of Independent Schools of WA executive director Valerie Gould said the recent teacher pay rises and rising construction costs in the building boom two years ago may have been the big contributors to increased education costs.

WA Chamber of Commerce and Industry chief economist John Nicolaou said the fact fees were going up so much in the private sector reflected poorly on the public school sector.

He said people were voting with their feet and going to the private sector even while fees were rising, which said something about what parents thought of Government schools.

WA Secondary School Executives Association president Rob Nairn said students in Years 8 to 10 could get an education at a State school for a voluntary contribution of $235 a year. Costs were higher in Years 11 and 12 but much less than in private schools.

Source  :   www.thewest.com.au

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Retail hiring jumps on spending hopes

Retailers are boosting staff numbers in anticipation of an improvement in consumer spending, according to the Australian Retailers Association.                

The industry group’s executive director, Richard Evans, said surveys of association members showed a 12 per cent jump in employment for small and medium-sized retailers this month, painting a much more positive picture than figures released by the Australian Bureau of Statistics earlier this month.

The number of people employed in the retail sector fell by less than 0.1 per cent last month compared with February, on a seasonally adjusted basis, but the ABS also reported an increase in underutilisation—the proportion of the workforce that is either unemployed or not working as many hours as it would like.

The rate of underutilisation among female workers was 9.1per cent last month, compared with 6.4 per cent for men, which the ABS attributed to the larger proportion of women working in industries with high levels of casual employment, such as retail.

However, Mr Evans said most retailers were holding on to skilled staff in preparation for rising demand, with 68 per cent reporting no change in employment levels in the past quarter.

“A further 16 per cent of retailers actually increased their number of staff during the same period,” he said.

“Retailing works in cycles, and although the sector has experienced a downturn, good retailers are doing their best to hold on to skilled staff as consumer confidence continues to grow and a new type of consumer emerges.”

The same trend was in play among the bigger retailers, with David Jones boosting staffing levels around the Mother’s Day shopping period after the delivery of the federal government’s fiscal stimulus package in April led to a sharp rebound in sales.

Mr Evans said the stimulus package and lower interest rates meant most consumers had more cash available to spend, but “negative and fear-filled commentary” had fuelled a tendency among consumers to cut discretionary spending in favour of saving or paying off debt.

This meant shoppers would be in a better position to spend when confidence picks up again—with the ARA forecasting an improvement as soon as the September quarter.

Source  :  www.careerone.com.au

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