ICAC: Barry O’Farrell can’t recall $3000 bottle of Grange

NSW Premier Barry O’Farrell has flatly denied suggestions he wrote a letter supporting Australian Water Holdings (AWH) in exchange for Liberal Party donations.
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Nor can he recall receiving a bottle of vintage Grange wine, bought for $3000 by AWH and apparently couriered to his home just after the 2011 state election.

Mr O’Farrell was on Tuesday quizzed before the NSW corruption watchdog about a letter he wrote to then-AWH chief executive Nick Di Girolamo in late September 2010.

He agreed it was ‘‘broadly supportive’’ of the company’s push to secure a lucrative public-private partnership.

‘‘We can show you lots of money going into Liberal Party coffers which coincides with this letter of support. Did you know anything about that?’’ counsel assisting Geoffrey Watson, SC, asked Mr O’Farrell.

Barry O’Farrell with Nick Di Girolamo, right, at the Italian Chamber of Commerce Business Awards Gala Dinner. Photo: Supplied

‘‘No, the Liberal Party’s financial code requires members of parliament to be at arm’s length from fundraising,’’ Mr O’Farrell replied.

‘‘If your inference is that this letter was signed by me because of donations made by Australian Water Holdings then I reject it completely.’’

Mr Di Girolamo has told the Independent Commission against Corruption he bought Mr O’Farrell a bottle of Grange wine to express his congratulations on securing the premiership but denied using the gift to ‘‘butter Mr O’Farrell up’’.

The ICAC has heard the 1959 vintage bottle – aged since the year of Mr O’Farrell’s birth – was delivered to his home in Roseville, on Sydney’s north shore, on or around April 20, 2011.

But Mr O’Farrell said he never received it and that he may have been away on a family holiday to the Gold Coast for Easter when the bottle showed up.

‘‘It’s the Don Bradman of wine. Unforgettable,’’ Mr Watson said.‘‘Yes. If it had been received, I don’t believe I would have forgotten it,’’ Mr O’Farrell replied.

The gift was never declared on the premier’s pecuniary interests register and ICAC investigators have been unable to find a document from the courier company to show when it was dropped off.

But Mr Di Girolamo has told the inquiry he received a thank you call from the premier after sending the wine – and on Tuesday afternoon, Mr O’Farrell was shown a record of a 28-second telephone call from his mobile number to Mr Di Girolamo’s, made about 9.30pm on April 20, 2011.

‘‘I’ve no knowledge – I don’t know about this phone call,’’ Mr O’Farrell said.

‘‘What I do know is if I had received a bottle of 1959 Penfolds Grange I would have known about it and I did not receive a bottle of Penfolds Grange.’’

How to ask for more money

Asking for a top-up on your loan doesn’t have to be a drama. Living the dream: Chloe Brandt and Zach Gadd
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If, like Oliver Twist, you would like some more, consider asking for a home loan top-up. It won’t have the dramatic turns of the Dickens classic. A top-up can either be an increase to your home-loan limit, or a separate account set up behind your home loan.

Chloe Brandt, 24, and her fiance, Zach Gadd, 27, took the top-up route this year. The couple bought their Sydney northern beaches house in late 2012, knowing they would eventually need some extra dollars to finish renovations.

“It was a bit of a dump,” says Brandt. “We did as much as we could without having to borrow anything.”

But by the end of 2013 they needed a fresh injection of funds to hire professionals to build decks and change the roof. “Our goal with the top-up was to get it to a point where we can then rent out another room and get an income from it.”

The house had risen in value by $120,000, so they had no trouble getting a $65,000 top-up. About $15,000 went into consolidating debt and the remainder into renovations.

Minor renovations are the most common reason people apply for a top-up, according to Dennis Mrljak, personal mortgage adviser at Smartline Personal Mortgage Advisers.

Debt consolidation, school fees or a new car might also prompt people to go cap-in-hand to their lenders. Paying $300 a month via a mortgage is a lot more cashflow-friendly than the $800 a month you might pay for a five-year car loan.

Others, such as property investor Emilia Rossi, have a longer-term plan. “The main reason I topped up all of my three loans was to be able to use the equity I had in each property to then put towards the deposit for the next investment,” she says.

It is a strategy she will use again next month when she tops up her current loan to buy a fourth investment property.

So if a home loan top-up is sounding like a handy tool, what do you need to consider?

How much do you need? Most lenders put limits on top-ups. “Banks do get a bit nervous above $50,000,” says Mrljak. “The majority of them have $100,000 as a threshold and then you’ve got some lenders who almost have it uncapped, I guess, based on your equity and the affordability they will let you take it out for as much as you really need.”

Your lender will run the ruler over your current income and liabilities when you apply for a top-up and possibly require an updated property valuation. “It’s almost like applying for a loan from scratch with a lot of lenders,” says Mrljak.

How much equity do you have? “A lot of people are prevented from either refinancing or topping up because they might be staring down the barrel of $7000, $8000 or $10,000 of [lender’s] mortgage insurance,” says Mrljak. He suggests waiting 12 to 18 months before applying for a top-up, particularly if you bought a property with a deposit of 20 per cent or less.

Why do you want the top-up? Mrljak suggests thinking twice before consolidating debts or buying a car with your mortgage.

“If you are going to enhance the value of the property or you’re going to put it into another property or shares then it makes perfect sense. It’s a cheap way of getting your hands on that sort of money.

”But if you’re doing it to fund a big family holiday, it may not be the best idea to turn it into a 20-year loan and pay twice as much interest as you normally would.”

Unless you make extra repayments, the total interest can make topping up significantly more expensive in the long run. For example, a $30,000 personal loan over five years at 12 per cent will add up to about $10,000 in interest. A $30,000 top-up at 5 per cent over 20 years will result in interest charges of $17,500.

Beware of making a habit of topping up if you want to access equity for wealth-building strategies, Mrljak warns. “It can be quite easy to top-up your mortgage each time you feel you need extra money and this could eat away at your equity.”

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

Fund managers trailing ASX in 2014

Markets have been tough to pick in 2014.Australian fund managers are slightly underperforming the broader market despite the economy slowly gaining traction, according to an investment survey.
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In the three months to March, funds tracker Mercer found the median Australian fund manager underperformed the ASX by 0.1 per cent.

Weak returns were across the market, according the survey, with the benchmark index rising a ‘‘modest’’ 0.2 per cent in March.

Although the fund managers generally underperformed, Mercer said in the past year they have delivered solid results, outperforming the broader market by 2.3 per cent.

This compares with positive results in the past three and five years, with fund managers outperforming the benchmark index by 1.5 and 0.9 per cent respectively.

Fund managers look set to deliver better returns later this year as the economy strengthens thanks to rising house prices and an improving domestic labour market, the Mercer survey found.

But gains will be limit, with a ‘‘significant slowing’’ in China and a brutal budget expected from federal Treasurer Joe Hockey, undermining growth.

Large caps only delivered a 0.3 per cent return in March, with mid caps rising 0.3 per cent and small caps dropping 1.2 per cent.

The worst performing sectors were materials and consumer staples, which were down 3.2 and 2.1 per cent respectively.

Index heavyweight BHP Billiton and rival Rio Tinto both slid 4.7 per cent, while Wesfarmers declined 3.8 per cent.

The best performing sectors were financials (+3.2 per cent), Telecom (+3.7 per cent) and information technology (+0.8 per cent). Leading stocks were CBA and Westpac, the returns of which rose 3.7 per cent, and ANZ, which gained 3.3 per cent.

Mercer said it retained a bias to risk assets. It said stock valuations were no longer expensive, but should be supported by ‘‘slowly strengthening’’ recovery in global GDP growth and corporate earnings.

‘‘In this environment, with the US Federal Reserve and some other central banks also continuing to map out exit strategies from highly expansionary monetary policies, we expect returns from fixed interest will struggle to keep abreast of inflation in the medium-term,’’ the survey authors said.

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John Howard praises Brian Harradine as a man of ‘great decency’

Former Tasmanian senator Brian Harradine. Photo: Mike Bowers Former Prime Minister John Howard Photo: Jeffrey Chan
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Brian Harradine with fellow independent senator Meg Lees in 2002. Photo: Andrew Taylor

Former Prime Minister John Howard has praised Brian Harradine, Australia’s longest-serving independent senator, as a man of “great decency” who made a lasting contribution to Australian public life.

In a letter of sympathy for Mr Harradine’s family, the former Liberal leader says the late senator was a tough political negotiator who occupied a “special place” in Australian politics for close to 30 years.

Mr Harradine died on Monday after a long illness, aged 79.

As an independent with the balance of power in the Senate, Mr Harradine played a key role in the early days of the the Howard government.

“In my discussions with Mr Harradine I was left in no doubt that he shared none of my enthusiasm for labour market deregulation or the introduction of the GST,” Mr Howard has written.

“When he famously said ‘I cannot’ in rejecting the central component of the 1998 tax reform plan, he disappointed, but did not surprise me.”

Mr Harradine played a significant role in the GST debate in 1999, causing panic within government ranks by suddenly announcing in the Senate that he could not support the controversial tax.

That decision forced the Howard government to turn to the Democrats’ leader Meg Lees for support.

Mr Howard also referred in his letter to Mr Harradine’s dramatic expulsion from the Labor Party in 1975 for claiming the ALP had links to the Communist movement.

“The former Secretary of the Tasmanian Trades and Labour Council remained loyal to what he saw as traditional Labor values. He never rejected the Labor Party; rather, it shunned him,” Mr Howard said.

“He went on to win the immense respect of many in the Liberal and National Parties for the consistency of his views as well as the integrity of his dealings as a senator during the years of the Howard government.”

Mr Harradine held the informal title “Father of the Senate” because he served longer, continuously, than his senate contemporaries, from 1975 to 2005.

At times he was extremely politically powerful, particularly in the mid-to-late 1990s, when his balance of power status meant the government needed his support to pass policies such as the Private Health Insurance Rebate in 1998.

Mr Howard says Mr Harradine negotiated honourably with his government while keeping a “proper eye” for the interests of Tasmanians, whom he represented.

“I record my gratitude for the support Brian Harradine gave to my government during the time that it was in office.”

“He respected the mandate it had been given by the Australian people, whilst remaining loyal to his fundamental beliefs. His support allowed us to do many good things for the people of Australia.”

“I extend my deep sympathies to Brian Harradine’s family on their great loss.”

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Western Sydney: Where your MP stands

Blaxland: Jason Clare (Safe ALP, 11.4%) Conditional support.
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“Sydney needs a second airport but it is critical it has a rail link not just road links. The airport should have a curfew. What’s good for the goose is good for the gander. If the eastern suburbs and the north shore have a curfew then so should the west.”

Chifley: Ed Husic (Safe ALP, 10.5%) Opposed.

A 24-hour airport is “completely unacceptable for western Sydney residents who’ll be forced to contend with something the other side of town doesn’t”.

Fowler: Chris Hayes (Safe ALP, 16.8%) Opposed

“How can this be supported by the community if questions [on jobs, infrastructure and curfews] remain unanswered?”

Greenway: Michelle Rowland (Marginal ALP, 3%) Opposed unless conditions met.

“Significant road and public transport infrastructure needs to be built, which is tied in with local employment – and it cannot operate for 24 hours.”

Hughes: Craig Kelly (Safe Liberal, 10.7%) Support.

“I welcome the economic opportunities and infrastructure investment an airport for western Sydney will provide our region, and I would especially welcome the proposed Moorebank Intermodal’s relocation as part of an integrated freight and transport precinct at Badgerys Creek.”

Lindsay: Fiona Scott (Marginal Liberal, 3%) – Support conditional on roads and curfew.

“It’s about building the right roads and infrastructure and the roads absolutely have to come first.”

Macarthur: Russell Matheson (Safe Liberal, 11.4%) No reply.

Macquarie: Louise Markus (Liberal, 4.5%) No reply.

McMahon: Chris Bowen (ALP, 5.3%) Conditional.

“If there’s going to be a second Sydney airport at Badgerys Creek, despite what the Deputy PM says, there must be a curfew and proper infrastructure for western Sydney.”

Mitchell: Alex Hawke (Safe Liberal, 22.1%) Conditional.

“If Kingsford Smith retains a curfew then this airport, Badgerys Creek, should also have a similar curfew.”

Reid: Craig Laundy (Marginal Liberal, 0.9%) Support.

“People often criticise governments for not making decisions beyond the electoral cycle. I applaud the Prime Minister for this decision, which will be a shot in the arm for the 1.3 million people expected to move into western Sydney over the next 20 years.”

Werriwa: Laurie Ferguson (Marginal ALP, 2.2%) Opposed.

“I have grave doubts about the applicability of studies that are decades old and lofty visions of infrastructure and jobs being promoted by the big end of town.”

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