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The ‘car park rorts’ story is scandalous. But it will keep happening unless we close grant loopholes

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Dean Lewins/AAP

Yee-Fui Ng, Monash UniversityOn Monday, a senate hearing produced yet more damning evidence about the “car park rorts” affair.

The Australian National Audit Office told a parliamentary committee a list of the top 20 marginal electorates guided the distribution of a $389 million car park construction fund during the 2019 election campaign.

Sitting Coalition MPs were invited to nominate projects for funding. In some cases, money was allocated to electorates when a project had not yet been identified. An adviser from the Prime Minister’s Office was involved in the funding allocation — the same adviser involved in the “sports rorts” incident.

Earlier this month, the Audit Office released a scathing report, finding 77% of the commuter car park sites selected were in Coalition electorates, rather than in areas of real need with congestion issues. None of the 47 project sites selected for funding commitment were proposed by the infrastructure department.

So, why do these rorts keep happening? What mechanisms are in place to try and stop them? And what further protections do we need?

Why do rorts keep happening?

Pork-barrelling involves the channelling of public funds to government electorates for political purposes, rather than proper allocation according to merit.

We have been inundated with pork-barrelling scandals in recent years. This includes the “sports rorts” scandal that led to Bridget McKenzie’s resignation from cabinet last year, and NSW Premier Gladys Berejiklian’s biased distribution of the Stronger Communities fund.

A victorious Scott Morrison with his family on election night 2019.
The Audit Office has delivered a damning assessment of the Coalition’s car park fund.
Mick Tsikas/AAP

Australia has a single member electorate parliamentary system, which makes it more susceptible to pork-barrelling than multi-member electorates like Norway or Spain. The belief is that politicians who “bring home the bacon” for their constituents are electorally rewarded for doing so.

This means there are incentives for the central cabinet to strategically apportion benefits to marginal electorates to increase prospects of electoral success. There is also an incentive to bias the apportionment of funds towards the party in power.

In short, rorts scandals keep happening because governments believe that channelling money to marginal and government electorates will win them elections.

What are the accountability arrangements for grants?

At the federal level, we have sophisticated financial management legislation that provides a framework for grant rules. The Commonwealth grant rules provide a detailed set of guidelines that ministers and government officials must follow on grant application and selection processes.



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Another day, another rorts scandal – this time with car parks. How can we fix the system?

However, there are significant loopholes in the rules. For example, the “car park rorts” scandal is not covered by these rules because it involves money being channelled through the states.

Also, there are no sanctions for breaching the rules. So ministers and government officials can break the rules without any repercussions.

Who keeps an eye on the grants?

The auditor-general is the main actor who investigates federal grants administration. The auditor-general has significant coercive powers, and is independent of government. Although the auditor-general lacks the power to change governmental practices, the publicity of their reports may encourage government agencies to respond in a positive and productive way.

In Australia, parliaments have a strong constitutional role as overseers of the activities of government.

Australian National Audit Office executive director Brian Boyd
Australian National Audit Office executive director Brian Boyd appeared before a senate committee on Monday.
Lukas Coch/AAP

Parliamentary committees have become the main form of scrutiny of government in recent years. They are set up to investigate specific matters of policy or to evaluate the performance of government.

Parliamentary committees are normally tasked with making inquiries into matters by taking submissions, hearing evidence and reporting their findings to parliament. They have been highly effective identifying and investigating issues relating to government rorts.

Where to now?

To fix the system, we need to reform the rules about grants allocation and close the loopholes. We also need to impose punishment for breaching the rules.



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The ‘sports rorts’ affair shows the need for a proper federal ICAC – with teeth

It is imperative our grants administration system be reformed to ensure that taxpayer funds are protected from governmental abuse. If the ministerial discretion available in grants processes is improperly used, this can give rise to political favouritism and corruption.

Ministers, as our elected representatives, are the custodians of public trust. As part of a well-functioning democracy, it is important there is probity, transparency and accountability in the use of public funds.The Conversation

Yee-Fui Ng, Associate Professor, Faculty of Law, Monash University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

South Australia will re-open its borders to some states, but not others. Is that constitutional?

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Benjamen Franklen Gussen, Swinburne University of Technology

In one relatively short section of the Australian Constitution, section 92, you will find this phrase:

[…] trade, commerce, and intercourse among the states […] shall be absolutely free.

You would think there is not much in it, but it turns out this section is one of the most litigated sections in the constitution.

Australians have taken a special interest in section 92 since mid-March. Debating the constitutionality of state border closures in response to COVID-19 seemed to be trending with everyone staying home to help flatten the curve.

Legal challenges on border closures are already underway in the High Court, with arguments of its constitutionality.



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States are shutting their borders to stop coronavirus. Is that actually allowed?

Now, this interest in section 92 is being rekindled with the partial re-opening of borders between South Australia, Western Australia, the Northern Territory and Tasmania.

With Australia being one country, it was hard enough to accept it is constitutional for states to close their borders, but now South Australia seems to be offering travellers from these states and the territory special treatment.

West Australian Premier Mark McGowan has more recently suggested the partial opening of borders may be unconstitutional. Is it?

The issue is not the partial opening of borders. It is the rationale for these actions.

When South Australia announced this partial re-opening, it also indicated it plans to open its borders to all remaining states by July 20. The issue then is whether South Australia’s discrimination against New South Wales, Victoria and Queensland can be justified by efforts to prevent a second wave of COVID-19 deaths.

Since 1988, the High Court has interpreted section 92 as prohibiting discrimination of a protectionist kind – that is to say, the section prevents states from passing legislation to restrict trade. In the 1988 case of Cole v Whitfield, the High Court, in a unanimous decision, upheld Tasmanian regulations prohibiting a person from taking, buying or selling crayfish of less than a prescribed size, whether or not taken in Tasmanian waters.

In the course of his interstate trade, David Whitfield brought crayfish from South Australia to Tasmania for the purpose of sale to mainland and overseas markets. The crayfish were less than the prescribed size under the Tasmanian regulations, though above the prescribed size under comparable regulations in South Australia. The court explained in the decision that the legislation was not protectionist in nature. It was intended to help protect Tasmanian crayfish rather than restrict trade. The court elaborated in the following terms:

[D]iscrimination commonly involves the notion of a departure from equality of treatment. It does not follow that every departure from equality of treatment imposes a burden or would infringe a constitutional guarantee of the freedom of interstate trade and commerce from discriminatory burdens […]

As was the case when all states decided to close their borders, the legal issue is whether the purpose of the closures is to restrict trade or to help protect the citizens of each state from becoming infected with COVID-19.

The orthodox view among Australian constitutional jurists is that section 92 does not allow for a balancing exercise between the competing interests of free trade and combating a pandemic. This might well be a question for the High Court to elaborate on when deciding the legal challenges brought against the Queensland government.

At a different analytical scale, the issue is not the interpretation of section 92, but rather the effect of crises on the interpretation of our constitution.

This interpretation is not impervious to pandemics or other crises. We see this in what are known as purposive powers, such as the defence power in section 51. In times of war, the core of this power will expand to equip the Commonwealth with the type of intervention necessary to keep Australia safe. There is no reason this rationale would not extend to pandemics.



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National and state leaders may not always agree, but this hasn’t hindered our coronavirus response

Enter the principle of subsidiarity. Elsewhere, I have argued the Commonwealth Constitution is superior to the Canadian and US constitutions, because it is more efficient. It allows for a wider area of concurrent powers. Our federal model is more agile, in the spirit of true subsidiarity, with its rules of assistance, non-interference and helping states acquire more competencies over time.

It is this principle of subsidiarity that holds the key to understanding the constitutionality of border closures and partial re-opening in response to the coronavirus pandemic. The states are best positioned to judge what intervention will work best in their case.

In the time of crises, no one size fits all.The Conversation

Benjamen Franklen Gussen, Lecturer in Law, Swinburne University of Technology

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Another savage blow to regional media spells disaster for the communities they serve

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David Mariuz/AAP

Kristy Hess, Deakin University

With swift and savage force, the COVID-19 pandemic has inadvertently attacked Australia’s local news media ecology, which was already battling a weakened immune system.

As a researcher working on Australia’s largest academic study into the future of local newspapers, the phones have been running hot in recent weeks. We’ve had calls from everyday people, journalists made redundant, cadets surviving on JobKeeper, and independent news proprietors, all navigating their way through the crisis.



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Local newspapers are an ‘essential service’. They deserve a government rescue package, too

News Corp has announced plans to close or suspend printing operations of more than 100 suburban and small community titles. Its more successful publications, such as the Geelong Advertiser, Gold Coast Bulletin, Hobart Mercury and the iconic Northern Territory News, will remain with print and digital editions.

Other independently-owned newspapers across rural and regional Australia are still breathing: they are gasping for air, but they are breathing. They’ve either temporarily suspended operations, cut back the number of print editions or shifted to a digital-only model to “see how it goes”.

Since the COVID-19 crisis emerged, there have been two key funding schemes introduced (or re-introduced) to support news providers – the government’s $50 million Public Interest News Gathering Program and a $5 million Regional and Small Publishers Innovation Fund.

The federal government has also announced plans to force Google and Facebook to share advertising revenue with producers of quality journalism in Australia. The Australian Competition and Consumer Commission is now seeking views on its new draft mandatory code that will address bargaining power imbalances between Australia’s news media businesses, and Google and Facebook.



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Trust in quality news outlets strong during coronavirus pandemic

This has been met with some initial concern from the Country Press Association of Australia amid fears the modelling may only benefit big companies and not the little players that serve small towns and cities.

The Victorian government has waded in to provide more than $4 million in additional advertising support for local and regional print publications. Our preliminary research indicates Victoria leads the way with this type of support for local news. Other states, such as South Australia and New South Wales, lag behind or have announced changes to legislation that provides government authorities freedom to advertise on their own sites or via social media.

The problem is, social media sites like Facebook don’t put the interests of local communities first, whereas local news outlets do (or at least they should). Facebook has gone to great lengths to distance itself from the types of local content posted on its platform. In the local news ecology, it tends to feed from traditional local news providers or the goodwill of citizens who moderate and upload content of local importance and reap the advertising rewards. One off, $10,000 grants from social media juggernauts to local news entrepreneurs won’t fix this systemic problem.

In some local areas, business owners are offering donations or advertising support to preserve the journal of record during COVID-19. JobKeeper is keeping many cadet journalists on the payroll, and there are some keen reporters doing their bit to report on the news, even if they are not getting paid.

There’s also stories of new start-ups emerging – like Matt Dunn in Victoria’s South Gippsland region. He was made redundant by the local newspaper, which is planning to close its doors permanently. He immediately set to work developing his own digital news platform, “The Paper”.

Dunn is confident elderly residents who have little experience with technology will come on board because they will be hungry for good quality local meaningful news. It’s about the content, not the platform.

However, digital-only publications are problematic in areas of rural and regional Australia that struggle with broadband connectivity. It’s even more worrisome for those areas with ageing populations, where reading the local paper is a daily or weekly ritual to maintain a sense of connection to their community.

I’ve spoken with several elderly residents in recent weeks who are distressed about the decline of Australian Community Media’s local content and the reduction of the print edition. Without the newspaper and technological capabilities, they feel “lost”. And importantly, they can’t read the death notices, so have no idea who has died.



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Without local papers, regional voices would struggle to be heard

Perhaps that is the key for policymakers, researchers and industry in a post COVID-19 world. Big news conglomerates around the world have been accused of building a plethora of zombie newspapers that are local in name only – full of syndicated content, without really being attuned to the needs and wants of a community or helping people to develop shared social connection and purpose to place.

My hunch is zombie papers will be the first to fall.

Audiences aren’t stupid. It’s the newspapers and community individuals determined to provide news that are the heart of their communities and should survive into the future. Policymakers, researchers and industry need to be acutely aware of the types of news outlets and individuals that best provide – or are willing to provide – real, credible and meaningful local news and information for their communities in areas of Australia big and small.

They are the ones that should be at the front of the queue for any type of media vaccine.The Conversation

Kristy Hess, Associate Professor (Communication), Deakin University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Other countries are shutting schools – why does the Australian government say it’s safe to keep them open?

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Peter Collignon, Australian National University

Victoria started school holidays a week early while parents can choose whether to send their children to school in other states. All states and territories are working towards reopening schools in term two.

Prime Minister Scott Morrison has said the medical expert advice is that it is safe to send your children to school.

This seems inconsistent with other strict quarantine measures the country is adopting to reduce the spread of COVID-19, the disease caused by coronavirus, termed SARS-CoV-2.

People are told not to leave the house if possible. All non-essential travel in and out of the country (and between some states) has been banned. Many businesses have closed and services, including open house inspections, have been banned. Even funerals are limited to no more than ten people.

Why then are our schools still open? And why are so many other countries closing their schools?

In short, strict quarantine measures have been shown to be more effective in reducing the spread of COVID-19 than closing schools. And many countries where schools have closed had community transmission for too long before putting in measures to prevent it.

But let’s look at it in more detail.

Children appear to spread the disease less

There is a lot we still don’t know about COVID-19. But we do know children appear to very rarely have serious disease and complications, compared to those in the older age groups like their parents and especially grandparents.

We have a lot of data from a number of countries (China, South Korea, Japan, Italy) where this pandemic has infected large numbers of people. The data show children have rarely (and in many countries never) died from the infection.



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Worried about your child getting coronavirus? Here’s what you need to know

Even those under the age of 30 have rarely died from the disease. Children also appear to get infected at a much lower rate than those who are older – although we can only confirm that once we have rolled out large-scale testing.

Children can get infected. And both here and in other countries, children with infections have attended schools. But there have been no documented outbreaks in the schools infected children attended and the schools were shut and cleaned.

Australia has low community transmission

In Australia (as of March 25) we still have very low community transmission of this virus.

Some argue we haven’t detected community transmission because we are not testing enough. Yes, there will be some cases that might be missed – but not many. Australia has done more than 135,000 tests with only 1% of those tested showing positive results.

Australia has one of the highest per capita testing rates in the world and one of the lowest rates of positive diagnoses. And more importantly, current testing includes people who come to hospital with pneumonia, especially if they need to go to the intensive care unit.

If there was already widespread community spread we would be picking up these cases.

The cases we are seeing are overwhelmingly still in returned travellers and in their contacts. Hopefully by quarantining cases and high-risk people (close contacts and returned travellers) for infection, we will be able to limit any ongoing spread in the community.



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COVID-19: what closing schools and childcare centres would mean for parents and casual staff

What we are seeing with our rapid increase in numbers is not an uncontrolled epidemic in Australia. It is more a reflection of what has been the uncontrolled community spread of the infection in places like the US and Italy. This is reflected in returned travellers who were in recent months part of those communities and who were or are now quarantined.

Australia’s situation is different to other countries

Most of Europe and the United States introduced widespread school closures. This is because they didn’t control community spread until very late, and the virus had already been circulating widely without them realising due to less or delayed testing . This is not the case for Australia where there is still little community spread.

There have not been extended national school closures in some countries where there has been good control with a reversal of the curve and fewer and fewer new cases, such as South Korea and Singapore.

These countries and others have had localised school closures in many areas. But this usually occurred where frequent community spread was detected. This may also be what is needed in some areas in Australia.

Data released by the Imperial College, London found:

in the UK and US context, suppression will minimally require a combination of social distancing of the entire population (and especially for those over 70 years of age), home isolation of cases and household quarantine of their family members.

Most models have been done so far on the assumption the coronavirus spreads in a similar way to influenza (the normal flu). But this doesn’t appear the case. COVID-19 appears to cause many less infections in children than occurs with influenza. While we don’t know the exact infection rates in children, symptomatic infections appear to be much lower than what would be expected with influenza .

The Imperial College model assumes household contact rates for student families will increase by 50% during the time schools close. Contacts in the community increase by 25% during closure.

These increased community interactions, such as with grandparents and the community in general, may be why there are worrying findings from their model during the first three months with school closures.

Their model shows that if school closures themselves were our only intervention, that would only have a modest impact on decreasing the demand for hospital beds (14%) and be the least effective of all their modelled interventions.

But what about teachers?

Children do get infected but at a much lower rate than other age groups. Some teachers might be at risk, such as those over 60 years old with heart conditions. Those teachers should be be at home anyway and practising even more social distancing than the general population, along with all those over the age of 70 years old.

Higher risk groups should be decreasing their current contacts and trying to use the 2 meter distancing as well as not letting anyone unwell, such as those with a cold symptoms (including their children and grandchildren) visit.



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No, Australia is not putting teachers in the coronavirus firing line. Their risk is very low

Closing schools will not likely decrease the spread of the virus by much, but the spread in our community will be associated with lots of potentially long term and detrimental outcomes on children’s education. It will also impact the ability of society to function and deliver essential and other important services. It may even increase deaths from COVID-19 based on some modelling.The Conversation

Peter Collignon, Professor of Infectious Diseases and Microbiology, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

It’d be a mistake to shut financial markets: more than ever, we need them to work

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Stephen Kirchner, University of Sydney

The extreme volatility and losses seen in stock markets in recent weeks has seen calls for financial markets to be closed and short selling restricted.

But shutting them down would be a mistake.

Amid the volatility, financial market prices convey much needed information.

S&P/ASX 200 share index over the past year


Source: Yahoo Finance

In an early morning meeting at the White House the day after the 1987 stock market crash, then US Treasury Secretary Jim Baker floated the idea of closing the stock market.

The Chair of President Reagan’s Council of Economic Advisers, the Chicago-trained monetarist Beryl Sprinkel, was having none of it.

According to several second and third-hand accounts, when his opinion was sought, Sprinkel said “we will close the markets when monkeys come flying out of my ass.”

When Reagan asked Fed Chair Alan Greenspan for his opinion, Greenspan declared, “I go with the monkeys”.

The US stock market stayed open that day and rallied late in the afternoon, injecting a note of much-needed confidence.

Prices tell us truths

The Fed’s operations to maintain liquidity (the ability to buy and sell) remain a textbook case of how to respond to severe financial market stress.

The US economy was spared recession on that occasion.

Today’s situation is different in important respects. Policymakers are choosing to shut down the economy, and financial markets are pricing shares accordingly. Bond markets have been shaken as investors sell bonds to raise cash and prepare for governments to issue a flood of new bonds.



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The US dollar has rallied as the world scrambles for US dollars, sending exchange rates against the US dollar dramatically lower.

As my previous research shows, the US dollar often climbs when the economic outlook is most dire, explaining why the Australian dollar is at its lowest in nearly two decades.

US cents per Australian dollar


Source: Reserve Bank of Australia

Amid such extreme volatility, it would be tempting to close financial markets, in particular, stock exchanges.

There is no reason to close markets for reasons of public health. Financial markets are now traded almost entirely electronically. The US has been forced to close its trading floors in New York and Chicago, but these trading floors were already legacies of an earlier era, largely ornamental adornments to digital trading.

Stock markets have their own circuit breakers that kick in during extreme volatility, but to do more than that would be to deprive traders and policymakers of the insights they offer.

Price movements function as alerts. It is noteworthy that financial markets sold off days before the World Health Organisation finally declared a pandemic.



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This coronavirus share market crash is unlike those that have gone before it

They can also inform policymakers about what to do. When share markets begin a sustained recovery, it will be a sign the worst of the pandemic might be behind us.

We need prices for financial products in the same way we need prices for goods and services. Without them, decision-making becomes difficult, if not impossible.

Preventing investors from selling stocks to raise cash (which is what a stock market shutdown would do) could cause severe hardship.

With share market prices falling sharply, it’s tempting to think closing them will stem the losses, but it could trigger even more painful adjustments elsewhere.

Even short sellers have a place

Other countries have imposed bans on short selling, which is the sale of a share the seller does not yet own.

Short sellers profit by buying back shares at a lower price after they have sold them. They do it by borrowing rather than owning stocks. Their actions help the owners of stocks who want to protect their financial positions from further declines in price.

If owners can’t protect themselves in this way, they can be forced to liquidate shares, making the downturn even worse.



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Coronavirus market chaos: if central bankers fail to shore up confidence, then what?

The global financial crisis gave us a wealth of experience with bans on short-selling, including in Australia. The evidence from that experience overwhelmingly suggests short-selling bans were counter-productive.

Keeping markets open will be a painful experience for many, but closing them is the equivalent of shooting the messenger.

Eventually, they will signal better times ahead and give business the confidence to move forward with the recovery.The Conversation

Stephen Kirchner, Program Director, Trade and Investment, United States Studies Centre, University of Sydney

This article is republished from The Conversation under a Creative Commons license. Read the original article.

NZ’s decision to close its borders will hurt tourism but it’s the right thing to do

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Siouxsie Wiles

Prime Minister Jacinda Ardern has done exactly what is needed to limit the spread of COVID-19 in New Zealand and the Pacific. Two new cases were confirmed today, just hours before new border restrictions come into force.

From midnight today, nobody (including residents) will be able to enter New Zealand without first going into 14 days of self-isolation. People arriving from Pacific Islands are the only exception to this new rule.

The new cases bring the total in New Zealand to eight. They have all been people who arrived from overseas – Iran, Italy, Denmark, the United States and Australia – or family members with whom they had extensive close contact. We should expect to see more cases in the days and weeks ahead.

Director-General of Health Ashley Bloomfield said the latest cases reinforce the new border restrictions.

Reducing the flow of people [with COVID-19] coming into New Zealand and ensuring that those who do arrive are required to immediately self-isolate are essential frontline tools in our response and in preventing wider outbreaks in New Zealand.

I expect it is going to take months or even years, rather than weeks, before the pandemic is contained because some other countries aren’t responding quickly enough. New Zealand’s new measures will hit tourism, but they are necessary to keep COVID-19 under control.



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The next line of defence

I use a fire analogy to describe how the COVID-10 pandemic is spreading around the world. Countries with community transmission of the virus – this list is growing by the day – are each a blazing fire. Anyone leaving these countries is a potential ember that can seed a fire somewhere else.

So far, New Zealand has done a good job of catching any burning embers and stamping them out. This is the role of contact tracing and self-isolation. But the median incubation period for the virus is around five to six days, with most people developing symptoms within 11 days, and we should expect more cases.

Ardern has seen the growing number of fires overseas. She has listened to experts telling her there will soon be too many embers to catch and she made the call to deploy the next line of defence: fire breaks.

This is the right move and follows that of Samoa which put travel restrictions in place very soon after the virus emerged. Our Pacific neighbours do not have the same resources New Zealand has to carry out contact tracing or treat the very ill.

It is only a few months since Samoa experienced an extensive and deadly outbreak of measles, which likely started when someone incubating the measles virus travelled to Samoa from New Zealand.



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Minimising spread New Zealand’s best chance

Many people are surprised by the strength of the measures. Apart from the entry restrictions through airports, cruise ships are also banned from coming to New Zealand until at least the end of June. As Ardern herself said the restrictions are among the most stringent in the world.

COVID-19 is a serious illness. From the outbreak in China we know about one in five people will need to be hospitalised. About one in 20 people will end up in intensive care, and one in a hundred will need a ventilator to help them breathe.

The reality is almost everybody in New Zealand is susceptible to catching the virus. While many of us will only experience a mild to moderate version of COVID-19, if the virus were to sweep New Zealand as it is other countries, we would not have enough hospital and intensive care beds or ventilators to care for those who need them.

Depending on a person’s age and whether they have any underlying health issues, we could see as few as four deaths in every thousand infected people under the age of 50, but as many as seven in every 50 people if they are over 80. People with diabetes and and high blood pressure are also more likely to experience a severe infection.

China built new hospitals in a matter of days and weeks to be able to care for the ill. In New Zealand, we are about to head into winter, the busiest season of the year for hospitals.

If COVID-19 took hold here, our medical staff could soon find themselves in the awful position of having to decide who gets a bed or a ventilator, as they are now considering in Italy.

New Zealand’s best chance to get through this unprecedented global crisis is to minimise the chances of the virus establishing here. Given we will remain susceptible to the virus, we may need to wait for the pandemic to burn out or until a vaccine is developed before life returns to normal.The Conversation

Siouxsie Wiles, Associate Professor in Microbiology and Infectious Diseases

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Goodbye Google+, but what happens when online communities close down?

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File 20190403 177184 jfjjy0.jpg?ixlib=rb 1.1
Google+ is the latest online community to close.
Shutterstock/rvlsoft

Stan Karanasios, RMIT University

This week saw the closure of Google+, an attempt by the online giant to create a social media community to rival Facebook.

If the Australian usage of Google+ is anything to go by – just 45,000 users in March compared to Facebook’s 15 million – it never really caught on.

Google+ is no longer available to users.
Google+/Screengrab

But the Google+ shutdown follows a string of organisations that have disabled or restricted community features such as reviews, user comments and message boards (forums).



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So are we witnessing the decline of online communities and user comments?

Turning off online communities and user generated content

One of the most well-known message boards – which existed on the popular movie website IMDb since 2001 – was shut down by owner Amazon in 2017 with just two weeks’ notice for its users.

This is not only confined to online communities but mirrors a trend among organisations to restrict or turn off their user-generated content. Last year the subscription video-on-demand website Netflix said it no longer allowed users to write reviews. It subsequently deleted all existing user-generated reviews.

Other popular websites have disabled their comments sections, including National Public Radio (NPR), The Atlantic, Popular Science and Reuters.

Why the closures?

Organisations have a range of motivations for taking such actions, ranging from low uptake, running costs, the challenges of managing moderation, as well as the problem around divisive comments, conflicts and lack of community cohesion.

In the case of Google+, low usage alongside data breaches appear to have sped up its decision.

NPR explained its motivation to remove user comments by highlighting how in one month its website NPR.org attracted 33 million unique users and 491,000 comments. But those comments came from just 19,400 commenters; the number of commenters who posted in consecutive months was a fraction of that.

This led NPR’s managing editor for digital news, Scott Montgomery, to say:

We’ve reached the point where we’ve realized that there are other, better ways to achieve the same kind of community discussion around the issues we raise in our journalism.

He said audiences had also moved to engage with NPR more on Facebook and Twitter.

Likewise, The Atlantic explained that its comments sections had become “unhelpful, even destructive, conversations” and was exploring new ways to give users a voice.

In the case of IMDB closing its message boards in 2017, the reason given was:

[…] we have concluded that IMDb’s message boards are no longer providing a positive, useful experience for the vast majority of our more than 250 million monthly users worldwide.

The organisation also nudged users towards other forms of social media, such as its Facebook page and Twitter account @IMDB, as the “(…) primary place they (users) choose to post comments and communicate with IMDb’s editors and one another”.

User backlash

Unsurprisingly, such actions often lead to confusion, criticism and disengagement by user communities, and in some cases petitions to have the features reinstated (such as this one for Google+) and boycotts of the organisations.

But most organisations take these aspects into their decision-making.

The petition to save IMDB’s message boards.
Change.org/Screengrab

For fans of such community features these trends point to some harsh realities. Even though communities may self-organise and thrive, and users are co-creators of value and content, the functionality and governance are typically beyond their control.

Community members are at the mercy of hosting organisations, some profit-driven, which may have conflicting motivations to those of the users. It’s those organisations that hold the power to change or shut down what can be considered by some to be critical sources of knowledge, engagement and community building.

In the aftermath of shutdowns, my research shows that communities that existed on an organisation’s message boards in particular may struggle to reform.

This can be due to a number of factors, such as high switching costs, and communities can become fragmented because of the range of other options (Reddit, Facebook and other message boards).

So it’s difficult for users to preserve and maintain their communities once their original home is disabled. In the case of Google+, even its Mass Migration Group – which aims to help people, organisations and groups find “new online homes” – may not be enough to hold its online communities together.

The trend towards the closure of online communities by organisations might represent a means to reduce their costs in light of declining usage and the availability of other online options.

It’s also a move away from dealing with the reputational issues related to their use and controlling the conversation that takes place within their user bases. Trolling, conflicts and divisive comments are common in online communities and user comments spaces.

Lost community knowledge

But within online groups there often exists social and network capital, as well as the stock of valuable knowledge that such community features create.



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Zuckerberg’s ‘new rules’ for the internet must move from words to actions

Often these communities are made of communities of practice (people with a shared passion or concern) on topics ranging from movie theories to parenting.

They are go-to sources for users where meaningful interactions take place and bonds are created. User comments also allow people to engage with important events and debates, and can be cathartic.

Closing these spaces risks not only a loss of user community bases, but also a loss of this valuable community knowledge on a range of issues.The Conversation

Stan Karanasios, Senior Research Fellow, RMIT University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

New tax treaty will close loopholes that allow multinationals to avoid tax

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Miranda Stewart, Australian National University

Australia, with another 70 countries, has signed a multilateral treaty to create more coherence in fighting tax avoidance by large multinational corporations. The Multilateral Convention to Implement Treaty Measures to Prevent Base Erosion and Profit Shifting, or BEPS Convention, aims to close loopholes in the international tax system that result from differences in individual country tax systems.

Countries are fiercely protective of their own tax sovereignty and claim the right to set their own company tax rate and base. But this can result in lower company tax around the globe, as multinational enterprises can move capital investment to lower tax jurisdictions and take advantage of tax havens to reduce their global tax bill. This latest treaty will help to overcome this problem.

Since the global financial crisis, nearly a decade ago, the G20 countries have tried to reform international tax with a Base Erosion and Profit Shifting (BEPS) project. Australia has been a strong supporter of the BEPS project since it started, including as chair of the G20 in 2014.

This project resulted in 15 actions that were endorsed by the G20 in 2015. The signing of this tax treaty implements action number 15 to amend existing tax treaties to limit international tax planning.

The other BEPS actions aim to strengthen enforcement, remove inconsistencies in national tax rules, enforce disclosure of corporate tax profits in havens and encourage sharing of tax information between country revenue agencies.

Australia can’t go it alone on international tax

International tax cooperation remains critical and this BEPS Convention enables an anti-abuse framework to be embedded in Australia’s treaty network.

In the last century, countries around the world have negotiated bilateral tax treaties, producing a network of thousands of treaties. Australia alone has about 45 bilateral income tax treaties.

The main goal of bilateral tax treaties has been to prevent double taxation of international business where it operates in more than one country. But the terms of tax treaties can also be used to minimise tax. For example, a company may have significant business sales in a country – like Google in Australia – but under a treaty rule, it may not be treated as having a business presence there.

How does the BEPS Convention amend tax treaties?

Without this multilateral convention, it could take decades for countries to renegotiate these bilateral tax treaties. Where countries sign up, the new rules will take effect as soon as each country has ratified the convention.

The BEPS Convention is the first ever multilateral tax treaty that modifies substantive tax rules. Even the speed of signing the BEPS Convention is unprecedented: from treaty mandate to signature has been only 18 months. Most multilateral treaties take much longer, such as the Trans-Pacific Partnership, which has been in negotiation for more than nine years (and may not ever be agreed).

A leading British tax lawyer observed that the BEPS Convention is “not tax peace in our time”. But it is still significant.

The convention inserts a new anti-abuse rule which states that tax treaties are not to be used to abuse national tax laws, if a taxpayer uses a treaty rule for the principal purpose of reducing its tax liability in a country. The convention will also make changes to prevent mismatches in treaty tax rules and to end the artificial avoidance of a business tax presence in a country, for example by using a separate company to do its operations under a contract.

To push governments to resolve tax disputes, the convention inserts an arbitration clause into treaties. If two countries cannot resolve a treaty dispute, then after two years (and if no court case is on foot), it will go automatically to an independent arbitrator who can make a decision that binds the governments and taxpayer. Its controversial and many countries may not agree to arbitration but Australia has signed up to it.

Australia has adopted most of the BEPS Convention measures, as being consistent with its current tax treaty policy. But many countries, including Australia, will need to enact domestic legislation to bring the convention into law.

Once countries sign up, the treaty changes will take place immediately – this could amend as many as 30 of Australia’s treaties.

The future international tax architecture – but without the US?

The BEPS Convention was signed by more than 70 countries. This includes leading signatories such as China, Germany (the current G20 Chair), the United Kingdom, France and Japan and also several low tax financial centres like Singapore and Ireland. But the United States did not sign.

The US failure to sign is hardly surprising. It comes one week after President Trump withdrew the US from the Paris Climate Agreement. It’s another example of the US retreating from multilateral cooperation on issues affecting all nations.

The US also did not sign the Tax Administrative Convention, now with 111 country members, which provides the legal basis for the country by country exchanges of information about global profits for billion dollar companies, including with the Australian Tax Office. Instead the US insisted on “going it alone” with its Foreign Account Tax Compliance Act, or FATCA regime, which demands foreign countries provide data on US citizens.

Many US tax treaty provisions are in line with the BEPS Convention. But surely that misses the point of multilateralism in tax or any other field of global concern. Instead, we see China is taking a leading role in multilateralism. It is unclear what the US stance will mean for international tax in the longer term. However, this treaty will give some help to other countries aiming to tax global profits of US multinationals, including Google, Apple and Uber, while those companies lobby for the US to reform its own company tax laws.

The ConversationThe pace of international tax change is usually glacial and most country co-operative efforts go nowhere. The BEPS Convention provides, for the first time, an international legal architecture for future multilateral tax reform.

Miranda Stewart, Professor and Director, Tax and Transfer Policy Institute, Crawford School of Public Policy, Australian National University

This article was originally published on The Conversation. Read the original article.