Businesses are increasing prices under cover of credit card surcharge ban: UBS
Patrick Commins
Retailers are using the credit card surcharge ban to justify larger price increases, according to UBS economists.
Businesses were banned from including transaction surcharges from 1 October as part of a Reserve Bank-led reforms aimed at improving transparency for customers and, ultimately, lowering bank fees.
The RBA has predicted that shops would incorporate the bank fees into the final sale price, likely leading to a 0.1 percentage point increase to inflation.
But the UBS economists in a note to clients said this estimate was too low and that there was evidence that businesses, such as cafes, were using the surcharge ban as cover to pass on bigger price rises.
“The RBA’s estimate seems a lower bound estimate, particularly given recent increases in fuel and other input costs,” they said, estimating a 0.2% boost to inflation.
According to a survey of more than 1,500 cafes by Small Flat White, an online coffee price tracker, 17% of cafes have increased their prices since the start of the surcharge ban, with an average increase of 50 cents, or more than 10%.
That is multiples of the typical 1.5% card surcharge fee. The UBS economists said:
Resilient demand and still-elevated inflation expectations may be allowing merchants to use the change as ‘cover’ to pass through broader cost pressures (wages, fuel, and other input costs).
Following years of above-target inflation, consumers may be more accepting of price rises. Evidence of ‘round up’ pricing in items such as coffee suggests pass-through could exceed the surcharge itself.
Key events
Josh Butler
Digital duty of care may be delayed by Senate inquiry
The Greens are considering seeking to refer Labor’s digital duty of care legislation to a Senate inquiry, potentially delaying the bill which is expected to be introduced this week.
Communications minister Anika Wells is at the National Press Club on Thursday to discuss the legislation. But with the Coalition again dealing itself out of negotiations and refusing to consider it, the Greens are in the box seat for this legislation, and the minor party may want to see it pushed to an inquiry.
The Greens will seek “improvements” to the bill, but say they are not interested in “killing” the proposal. The parliament’s sitting calendar only has two Senate weeks between now and the end of the year, with Senate estimates at the end of October, so the Greens say they want to look at the bill now, ahead of the usual end-of-year chaos.
We’ll keep you updated as that progresses.
You can also read more about the legislation, and the disagreement between Labor and the Greens in relation to the proposed laws, here:
Coalition senator Jonathon Duniam rejects claims PM’s office meddled with AI letter
The outgoing shadow home affairs minister, Jonathon Duniam, has been interviewed on Sky News about his role on a parliamentary committee considering AI policy.
We brought you the news earlier today that a senior adviser in Anthony Albanese’s office had made edits and comments in a bipartisan letter from the committee before it was sent to the prime minister, a move which committee member David Pocock said was concerning.
Pocock said he was concerned at the intervention of Albanese’s team in the letter, which raises concerns about copyright, AI safeguards, sovereign capability and AI literacy.
Duniam, who was the deputy chair of the committee, sent the letter with the Labor MP and inquiry chair, Jo Briskey, last night, on behalf of Labor, Coalition and crossbench MPs.
Duniam had already said there was “no guidance, no interference” with the committee’s work and he would be “the first person out of the blocks to criticise the government if the prime minister wasn’t showing interest in the committee’s work”.
He rejected Pocock’s assertions again during his interview on Sky a short time ago, saying that:
Well, I’d love to know what’s not in the letter that should be included that’s been missed out.
I saw some comments that the letter had been heavily vetted, I’m not sure what’s been deleted.
I think it is good that decision making entities like the PMO have been actively interested in what we do… That does not remove the independence of the committee.
The committee does not do what either Anthony Albanese or Angus Taylor says, the committee does what it determines is the right way to go.
And to be clear, the parliament will be master of its own destiny when it comes to things like copyright legislation.
You can read more here:
Liberal frontbencher Jonathon Duniam to leave Senate by end of October
The shadow home affairs minister, Jonathon Duniam, is expected to give his valedictory speech this week and leave parliament at the end of October.
The frontbencher announced he would be resigning from the Senate back in June but committed to stay until the end of the year.
Duniam is expected to stay for the final sitting week of October, which will include Senate estimates. He was first elected as a Liberal senator representing Tasmania in 2016.
It means the Liberal leader, Angus Taylor, will have another frontbench position to fill – which could see a minor shadow cabinet reshuffle.
Businesses are increasing prices under cover of credit card surcharge ban: UBS
Patrick Commins
Retailers are using the credit card surcharge ban to justify larger price increases, according to UBS economists.
Businesses were banned from including transaction surcharges from 1 October as part of a Reserve Bank-led reforms aimed at improving transparency for customers and, ultimately, lowering bank fees.
The RBA has predicted that shops would incorporate the bank fees into the final sale price, likely leading to a 0.1 percentage point increase to inflation.
But the UBS economists in a note to clients said this estimate was too low and that there was evidence that businesses, such as cafes, were using the surcharge ban as cover to pass on bigger price rises.
“The RBA’s estimate seems a lower bound estimate, particularly given recent increases in fuel and other input costs,” they said, estimating a 0.2% boost to inflation.
According to a survey of more than 1,500 cafes by Small Flat White, an online coffee price tracker, 17% of cafes have increased their prices since the start of the surcharge ban, with an average increase of 50 cents, or more than 10%.
That is multiples of the typical 1.5% card surcharge fee. The UBS economists said:
Resilient demand and still-elevated inflation expectations may be allowing merchants to use the change as ‘cover’ to pass through broader cost pressures (wages, fuel, and other input costs).
Following years of above-target inflation, consumers may be more accepting of price rises. Evidence of ‘round up’ pricing in items such as coffee suggests pass-through could exceed the surcharge itself.
Labor, Greens and Coalition party rooms finish up their meetings before parliament sits
The party rooms are finishing up their meetings that happen every Tuesday during sitting weeks.
They are a chance for the party leaders to give their caucus a bit of a gee-up and discuss their position on upcoming pieces of legislation.
That happens before the parliament sitting at midday today.
This morning, Angus Taylor let cameras in to cover his preamble, declaring “project Albanese has failed”.
We have seen Australia going backwards in the wrong direction like at no time in my lifetime. We have a responsibility to deliver that plan that I just talked about, to fix our economy, to protect our way of life.
Real estate can be tight in Parliament House.
So much so that a couple of cabinet ministers were left waiting patiently on the sidelines to have their turn to address the media.
The mural hall, a popular spot for a press conference, has been in hot demand this morning.
US livestreaming Fort Hood firing squad execution ‘repugnant’, Liberal Ted O’Brien says
The shadow foreign affairs minister, Ted O’Brien, says his party has written to the eSafety commissioner to see what can be done to stop the live stream of an execution in the US planned for December. The eSafety commissioner said overnight her office did not have the powers to proactively prevent the stream being shown in Australia.
Speaking to News24, O’Brien says he’s concerned children in Australia are already talking about the execution.
You can respect the sovereignty of the United States, while also speaking personally, and saying that I find the idea of livestreaming capital punishment repugnant. It’s not anything I want to see in Australia.
I’ve heard stories of schoolkids now in Australia talking about this, talking about watching this on their screens, on their devices. That is not the Australia that I want. Candidly, I don’t think it’s the Australia any of us really want … That’s not, that doesn’t align to our values at all.
Lisa Cox
Fire ants detected at logistics centre in Sydney’s inner west
The New South Wales government says it is responding to the detection of a red fire ant nest at the a logistics centre in Sydney’s inner west.
Federal biosecurity officers discovered the ants in a lure used to detect and monitor invasive species. A nest was then found and treated, with genetic analysis confirming the ants likely arrived from overseas via a container.
The state government said specialist fire ant detection dog teams had undertaken surveillance at the Enfield Intermodal Logistics Centre and in the immediate vicinity and no other nests had been found at the site.
Fire ants are one of the world’s worst invasive species. They can sting people and livestock and cause serious harm to the environment and local economies.
The NSW agriculture minister, Tara Moriarty, said:
It’s important to note that no further ants have been found, but we are focused on making sure any potential spread is identified and eradicated quickly.
While fire ants are one of the world’s most invasive species, they can and have been successfully eradicated in New South Wales.
She said the government would work with the local inner west community over the next two weeks “to build awareness, educate and assist members of the public with monitoring for fire ants to contain this invasive pest”.
She said the immediate focus was on inspecting and, if necessary, treating properties within a 500m radius of the centre, followed by surveillance of properties within a 2km radius.
Emergency crews sent to restore power after Alice Springs storms
The Northern Territory chief minister, Lia Finocchiaro, has sent extra emergency crews from Darwin to help restore power after Alice Springs was battered by a destructive storm.
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Thousands of homes lost power in Alice Springs on Monday when the storm toppled trees and power lines, pelted the town with large hailstones and caused widespread damage. In a statement Finocchiaro said:
Our thoughts are with the many Alice Springs residents who have been affected by this destructive storm. We are here to help you get back on your feet as soon as possible
The State Emergency Service responded to more than 100 calls for help. The NT government said no injuries had been reported.
All events on Monday night’s program for the Alice Springs Masters Games were called off after the storm tore through but organisers were confident delayed events could be rescheduled.
Pocock says AI committee letter ‘heavily vetted’ by prime minister’s office
David Pocock says a letter written by the parliamentary AI committee sent to the prime minister on Monday night was “heavily vetted” by his office.
The letter with edits and suggestions from a senior adviser in the prime minister’s office, seen by Guardian Australia, shows the adviser made multiple suggestions and wrote “fine” on some content.
Pocock tells News24 he’s concerned the committee is being used to get a predetermined outcome for the government.
One of the other things that I’m really concerned about is that when I actually loaded the letter up on to my computer, there’s a whole bunch of track changes from the PM’s office. So this is meant to be a letter from the committee, but clearly has been heavily vetted by the prime minister’s office.
I’m concerned that the major parties are working together to potentially get a preconceived outcome rather than actually listening to experts, listening to the community and saying, hey, this is a massive challenge we’re facing.
Pocock says he raised concerns with the chair of the committee.
But he does say there are good recommendations in the letter and that it calls for safeguards that the government shelved a couple of years ago.
‘100% of nothing’: AI committee recommends stronger copyright laws
The parliamentary AI committee has recommended stronger copyright protections to ensure creatives have control over how their works are used.
Labor MP and committee chair Jo Briskey and deputy chair, Liberal frontbencher Jonno Duniam are holding a press conference in parliament after the committee wrote a letter to the prime minister making several recommendations.
Duniam told the press conference:
At the moment, you’ve got a situation where data, copyright, intellectual property, whatever form it comes in, is currently being used by offshore models. It’s being harvested to train models offshore. And do you know how much our copyrights holders are getting as a result? 100% of nothing.
The letter to the prime minister says the government should examine current copyright settings and “prioritise ensuring that Australian creators retain control over how their works are used, that they are paid, and that AI systems reflect Australian values and culture.”
But David Pocock – a crossbench committee member – says the recommendations don’t go far enough to protect creatives. He told News24 in a separate interview:
I think the committee has done some good work so far. I’ve raised concerns last night about some of the lack of detail around things like copyright and artists and journalists wanting to maintain the current way that our copyright laws work and actually forcing these big frontier labs to do deals.
‘Masterclass in deflection’: Duniam and Mulino trade barbs over Frydenberg
Tom McIlroy
During a more tense moment on News24 this morning, Coalition frontbencher Jonno Duniam says Labor is trying to use Josh Frydenberg to deflect from their own problems.
The government has been under pressure over the ATO’s decision to ban credit card payments from November, as well as a series of increasingly difficult economic moves, including interest rates at a 15-year high.
Labor frontbencher Daniel Mulino said the Coalition had “a leader in waiting outside of parliament saying we need to jack up the GST”.
That’s a reference to Frydenberg’s new book, released today, and his pitch for an increase to the GST.
Duniam called the comments “a masterclass in deflection”.
“I just have had the insight into the Labor talking points for today,” Duniam said. “If it starts getting tough, start talking about Josh Frydenberg.”
I mean, seriously, they say they know Australians are doing it tougher, in business or just a household trying to pay the bills.
They’re doing nothing about it, except making political points around what’s happening here in Canberra.
Sarah Hanson-Young says she won’t run for the Greens leadership again
Greens senator Sarah Hanson-Young says she doesn’t think she’ll run for the party leadership again, after putting her hand up when Larissa Waters stepped down at the end of September.
Hanson-Young was in a three way contest with Mehreen Faruqi and David Shoebridge – the latter of whom won.
The senator from South Australia will mark 20 years in parliament next year.
I don’t think so … I put my hat in the ring, of course, a couple of weeks ago when the position was vacant. I put forward a vision for a positive, optimistic, and a caring and defiant progressive force.
She says Shoebridge has “done a good job hitting the road very quickly” and that the party is spreading a positive message.
Greens still in negotiations over digital duty of care bill
The Greens still want bigger fines and the ability for individuals to sue tech platforms as they negotiate over Labor’s digital duty of care bill.
The Coalition have pretty much ruled themselves out of negotiations, saying publicly the bill should be scrapped entirely and started over.
Sarah Hanson-Young tells RN Breakfast she was pleased the government is removing ministerial discretion powers under the legislation, but she wants more before she’s willing to give the bill support.
The proposed fines from the government are around $99m, $100m, that’s peanuts to these big global companies … All the experts around the world say that if you want to hit big tech where it hurts, if you want to hold them accountable and make them pay for the consequences of their harm and damage, that it needs to be a percentage of global revenue.
Two is making sure that Australians and community groups can also take action against these big tech platforms because otherwise it’s just left to the eSafety commissioner, the regulator. And individual Australians, individual users, should be able to complain and have compensation if they are indeed harmed online.
‘Jump on the phone’: Hanson-Young urges PM to call Trump over execution
Greens senator Sarah Hanson-Young says the prime minister needs to call president Trump to express Australia’s dismay over the planned livestreamed execution by firing squad.
She says the government should also “jump on the phone” with the big tech companies to stop them allowing the stream on their platforms.
The eSafety commissioner revealed overnight she did not have the powers to proactively prevent the stream from being shown or accessed in Australia.
She adds, if the laws need to be fixed to prevent the live stream – or any future live stream – that should be done.
The Australian government needs to pick up the phone to the United States president and to the US administration. I mean, this is barbaric … the idea that a state-sanctioned killing would be televised, would be livestreamed as content, almost for entertainment value, as a government PR episode. I mean, it is revolting, it is barbaric, and it must be called out.
And Australians should be protected from it. If the law needs to be fixed, the government should get on and fix it.
