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Australian Financial Review : October 17th 2006
FBA 007 The Australian Financial Review www.afr.com Tuesday 17 October 2006 7 PM ties aid to behaviour Tracy Sutherland Prime Minister John Howard has defended Australia's right to attach conditions to Australian aid and will restate the government's position if asked at next week's Pacific Islands Forum in Fiji. The federal government has suspended ministerial contact with Papua New Guinea until PNG investigates how suspended Solomon Islands attorney- general Julian Moti escaped on a military plane from Port Moresby to the Solomons last week. Australia had called for the extradition of Mr Moti to face child sex allegations. ''We have every right to attach conditions to the provision of our aid and we will continue to do that,'' Mr Howard said yesterday. ''We will continue to say if you want Australian aid you've got to reduce corruption, if you want Australian aid you've got to improve governance, if you want Australian aid you've got to have a better approach to economic management . . . it'sa question of defending the operations of the rule of law in Australia,'' Mr Howard said. Canberra's balancing act on prostheses John Breusch '' Not one of the newest devices gives better results.'' Federal Health Minister Tony Abbott has warned that moves to toughen up cost effectiveness tests for new medical devices could go too far, saying he does not want to deny patients access to cutting-edge technology. Mr Abbott's comments came after private health insurers called yesterday for clinical trials of prostheses used in lens, cardiac, spinal and joint replacement surgery. The government will meet insurers, doctors and medical device makers on Friday to discuss the issue. The meeting was organised after insurers released a study that questioned the health sector's fixation on expensive technology. The study found that in recent years new joint replacement prostheses had recorded a higher failure rate than older devices. Mr Abbott acknowledged that it was important to apply cost effectiveness tests and to test new devices as much as possible before they were released to market. ''But it's also important that we don't make it so hard for new devices and prostheses to come on that we deny people access to new treatment,'' he said. ''It'sa balancing act.'' The Medical Industry Association of Australia, which represents device makers, warned last week that tougher clinical trialling could end up harming patients by delaying products coming to market. But Australian Health Industry Association chief executive Michael Armitage said concerns about delays had been overstated. ''One hundred per cent of the newest prostheses have been trialled and not one gives a better result, so why would you want to rush [bringing devices to market]?'' he said. In a sign that health funds are more aggressively questioning the benefits of new medical technologies, the AHIA recently drew attention to the risks of cutting-edge devices such as blue-blocking intra-ocular lenses, used in cataract surgery, and drug- eluting stents, which are used to unblock arteries. The high failure rates of new hip and joint replacement prostheses were identified through a registry, established in 2002, that tracks the performance of all joint replacement procedures conducted in the country. Plug pulled on power upgrade Duncan Hughes KEY POINTS The grid's owners are unwilling to invest in an upgrade until their payment system is reviewed. They propose delaying work to relieve bottlenecks until 2014-15. A critical upgrade of the national electricity grid intended to relieve bottlenecks between Queensland and NSW could be delayed by nearly a decade because of a dis- agreement between transmission companies and a regulator about its economic benefit. Angry transmission companies yesterday blamed the delays on ''technocrats'' and called on the federal government's high-powered and controversial Energy Reform Implementation Group to overhaul the regulatory test causing the prob- lems. Transmission companies' returns are determined by a test, set by independent regulators, which con- siders demand and supply of elec- tricity and incentives to invest. Gordon Jardine, chairman of the Transmission Network Owners Forum, whose members have assets totalling $9 billion, called on ERIG to focus on overhauling the test ''rather than on creating a planning bureaucracy''. ''A new planning bureaucracy will not deliver a single megawatt of increased interconnector capacity in the National Electricity Market,'' said Mr Jardine, who is also chief executive of Powerlink. ''We do not know whether they are listening or not, but we have not seen too much coming out of there.'' ERIG, chaired by former Industry Commission chairman Bill Scales, is finalising a reform agenda intended to guide the Council of Australian Governments. A spokesman for ERIG refused to comment, saying the industry would have to await its report next month. Owners of the transmission grid, which moves power across some 40,000 kilometres of poles and wires, are prepared to double invest- ment in the national network to $1 billion a year if offered higher and more reliable returns. Studies by Powerlink and Trans- grid, transmission network owners controlled by the Queensland and NSW governments respectively, have found a $120 million upgrade between the two states would boost flow by 20 per cent. It is estimated that power flows are now restricted about 10 per cent of the time. The transmission companies said their research also suggested that proposed upgrades scheduled for 2009-10 should be postponed until 2014-15 because the test failed to account for the impact of price spikes on consumers. ''This ought to be the focus of ERIG,'' Mr Jardine said. ''If COAG and the major energy users want a more free-flowing national grid, then the existing regulatory test must be addressed. ''We expect the National Elec- tricity Market Management Com- pany will confirm that an upgrade would not now deliver sufficient market benefits under the regulatory cost/benefits test before about 2014-15, even though there are increasing occurrences of it operat- ing at full capacity. The planning body ± which develops the test ± is a bunch of 'techos'. They will only address the issue if this ERIG group tells them.'' Factional deals rankle rank and file Duncan Hughes Steve Bracks's ALP is under fire from local branch members in the lead up to next month's state election. Photo: ANDREW DE LA RUE Victorian Premier Steve Bracks's ALP has finalised its front-line team for the November election by rubber-stamping preselections for key Labor seats made vacant by the unexpected retirement of arts minis- ter Mary Delahunty. But angry rank-and-file members have criticised the ''disenfranchise- ment of local branch members'' over the final batch of candidates following earlier factional deals to protect cabinet members forced to change seats because of reforms to the state's upper house. The party's administrative com- mittee, which is dominated by the Labor Union faction, met last night to approve the last round of deals for the lower house and discuss candidates for the unwinnable final positions on the upper house ticket. Following non-aligned Ms Dela- hunty's resignation due to ill-health earlier this month, there was a factional deal in which Labor Union secretary Fiona Richardson, wife of ALP state secretary Stephen Newn- ham, was able to transfer from number one position on the upper house western metropolitan prov- ince ticket to the lower house seat of Northcote. The socialist left is expected to put forward Rae Perry, a nurse and former mayor, against Ms Ri- chardson. Sports minister Justin Madden is to transfer from the lower to the upper house, from his seat of Bundoora to Ms Richardson's vacated nomination, and former local mayor Colin Brooks, who had been promised the next vacancy, moves into Bundoora. No other nominations for their seats are expected. The administrative committee is expected to endorse the nomi- nations that will then be rubber- stamped by the national executive. Eric Dearricott, a non-aligned member of the administrative coun- cil, has written to party members, praising Ms Delahunty's ''courage'' in standing up against the ''fac- tional apparatchiks'' during her two terms as a member. ''In the early part of the year, the right had decided to take Northcote from her but she stared them down. Now it appears they will get their own way. Surely we have had our fill of the disenfranchisement of local branch members in preselections over the last year?'' Mr Dearricott said. Ms Richardson said that with less than six weeks to the next election, it would have been difficult to have a rank-and-file vote and meeting of the public office selection com- mittee to vote on candidates. Mr Dearricott also criticised head office for waiting until so close to the election campaign to open nomi- nations for the upper house tickets, which will close on October 26, less than a month before the election. ''I moved for these nominations to be opened months ago. Those with the numbers preferred to wait until the last minute,'' he said.