Queensland Economy Watch

The Force from the North, Bob Katter MP, knows that life is a negotiating table, and he isn’t afraid to make an outrageous demand first off, knowing that after he cuts a deal it’ll still be a big pay day:

Give us $1b a year: Katter

No Government (of any persuasion) will agree to providing anything near this amount each year for a North Queensland infrastructure fund, as demanded by Mr Katter.

To put it in some perspective, consider that there are around 700,000 people living in North Queensland, so $1 billion per annum amounts to around $1,400 per North Queenslander per year.  Mr Katter can’t believe any credible political leader would agree to this much extra funding.  He would be lucky to get 10% of this amount per annum for the North, and I’m guessing he knows it.  But he’s a wheeler dealer from way back, and he’s been waiting for this pay day for a long time.

Residential building approvals fell 18% (seasonally adjusted) in Queensland in July, compared with a 2.3% increase nationally, suggesting Queensland’s residential construction industry is set for a period of softness.  Hence we’ll be relying on strong export growth from the mining sector – seen in today’s Balance of Payments figures and recent evidence from our Ports – to keep the overall economy in reasonable health.

Our recent retail trade performance is seen by some as a positive sign for the economy. Queensland’s retail trade was up 1.5% in July, or around twice the national rate of 0.7%. But consumers will only spend if they’re confident their jobs are secure, so any weakness in the construction sector may restrain retail trade in the quarters to come.   So the heavy uncertainty around our future economic performance remains.

The go card readers on Brisbane buses and City Cats appear to be playing up a bit lately, taking their time to get ready to read your card, and I’ve heard chatter (or did I read it in mX?) that there are black spots in Brisbane where they completely lose the signal that operates them.  Tonight I witnessed this very problem, as the go card reader on the 444 Moggill bus lost its signal half way along Coronation Drive and stopped working.

Obviously, this can be annoying to commuters.  If you touch your go card to a scanner at the start of the journey but can’t touch off at the end, then you end up paying a $5 penalty rather than the $2 something fare.  I know you can call TransLink to get a refund, but many commuters would wonder whether it’s worth the bother.

TransLink really needs to sort this issue with go card readers out soon, so some people don’t start wondering whether public transport is worth the hassle and reconsider driving their cars to work.

With the Force from the North, Bob Katter MP, now a member of an exclusive triad that will anoint the next Australian PM, the odds of a new State of North Queensland (NQ) being created have shortened (although they probably remain pretty long).

Around a fortnight ago, the Force from the North made clear there was a strong desire among NQ residents to split from:

…the blood-sucking establishment of the south (Bob Katter MP, quoted in Queensland Country Life, 11 August 2010)

Of course, NQ Statehood would require a referendum vote by Queenslanders, who would most likely reject the proposal, as the majority of the State living outside of NQ would be very reluctant to give away their share of the North’s resource wealth.  They are a “blood-sucking establishment” after all.

Undoubtedly, federal politics has just got interesting again.

If you haven’t seen it yet, you should check out the Force from the North’s election ad via YouTube.

For a City that owes its existence and livelihood to tourism, it’s a little surprising that some Gold Coast residents would push for a ban on short-term holiday accommodation. As reported in today’s Gold Coast Bulletin:

The Short Term Accommodation Taskforce last Friday recommended to seek approval from the State Government for a Temporary Local Planning Instrument which would ban renting accommodation in residential areas for fewer than 30 days, with exemption for yet-to-be designated tourist areas.

Sensibly, the City Council isn’t prepared to risk the Coast’s reputation as a party town:

City Council wobbles on party house ban

Rather than discouraging tourism through banning so-called party houses, the Council’s efforts would be better directed at lobbying the Government for more police officers to deal with any trouble makers staying in party houses.

The free mX newspaper reports today that:

Brisbane’s property market is almost 30 per cent more expensive than it was a year ago, a new report has found.

A joint study by the Housing Industry Association and the Commonwealth Bank has found housing affordability in Brisbane dropped 29.1 per cent in the past 12 months.

Clearly there are too many buyers chasing too few properties.  If you’re looking to get into the property market, it may be a good idea to wait and see how the market goes over the next year or two.

In any market, it’s generally not a good idea to go with the herd (who collectively tend to either over exuberance or pessimism). In the property market, although it’s possible prices could be driven by reasonable expectations around future capital gains, clearly there are warning signs:

Morgan Stanley analyst bearish on housing market

Safe as Houses (from The Economist) [hover your mouse over “Australia” in the legend]

Disclaimer: I’m not a property market expert, so please don’t sue me based on this post.

The latest ABS Labour Price Index report suggests that public servants have escaped the financial crisis unscathed, with public sector hourly pay rates growing at 4% over 2009-10.  In contrast, perhaps because private sector employers remain cautious in the wake of the financial crisis, private sector hourly pay rates grew at 2.7% over 2009-10.  These figures do not take account of bonuses, however.  Let’s hope the bonus pools are reasonable this year, or there may be a lot of private sector workers checking out jobs.qld.gov.au.