Business Review – Sydney

The Reserve Bank of Australia (RBA) has finally acknowledged what critics of mass immigration have long argued—Australia’s high immigration rates are eroding productivity. Last week, the RBA’s Michael Plumb admitted that the bank’s productivity forecasts had been overly optimistic for a decade. He pointed to ‘capital shallowing’—where population growth outpaces business and infrastructure investment—as a key factor.

“Labour productivity depends on two things,” Plumb stated. “The first is how much capital each person has to work with. Providing workers with more or better capital—like machines or faster computers—can increase output. This is known as ‘capital deepening.’” The second factor is multifactor productivity (MFP), which improves when labour and capital are used more efficiently.

However, both MFP and capital deepening have stagnated. “Capital per worker was broadly unchanged for around five years leading up to the pandemic and is now slightly below those levels,” Plumb noted. “Overall investment has not kept pace with strong employment growth.”

Economic commentator Ross Gittins has explicitly linked declining productivity to Australia’s high immigration rates. “Economists love high immigration, as it grows the economy. But what they forget to mention is that growth in material living standards depends on productivity,” Gittins wrote.

“If you increase population without ensuring enough investment in capital—extra machines for workers, extra houses, roads, schools, and hospitals—everyone’s standard of living declines. In economists’ jargon, immigration must not reduce the ‘capital-to-labour ratio.’ Without sufficient investment in ‘capital deepening’ and ‘capital widening,’ productivity falls.”

This failure to match immigration with infrastructure spending has left Australia in a productivity crisis. Independent economist Gerard Minack highlighted this last year, stating that rapid population growth and declining investment have led to a collapse in per capita capital stock. “Less deepening means less productivity growth,” Minack warned. “Low investment and fast population growth are crushing productivity, leading to structurally weak income growth.”

The problem is set to worsen. Treasury’s Centre for Population projects that Australia’s population will grow by 4.1 million in the next decade, mostly in major cities. The Intergenerational Report forecasts a staggering increase of 13 million people—nearly 50%—in 38 years, primarily due to high immigration.

Despite these warnings, the federal government remains committed to an aggressive immigration policy, ignoring the lack of investment needed to support such growth. The mismatch is clear: Canberra controls immigration, while state governments bear the burden of providing infrastructure and services. The result is a continuous productivity decline.

Now that the RBA has acknowledged the issue, will it pressure the federal government to curb immigration? Given the political and economic inertia, Australians shouldn’t hold their breath.

Australian Army, CASG and RMMV officials at the handover. Photo: ADF.

The final unit of more than 3,500 heavy trucks has been delivered to the Australian Defence Force in Queensland, marking the completion of a significant logistics capability program.

The vehicles, supplied under Project LAND 121 Phase 3B/5B, were assembled and delivered in multiple configurations, with the majority completed at a dedicated military vehicle facility in Ipswich. The program included the delivery of 3,580 medium and heavy military logistics trucks along with 3,165 modules and protected cabs, fulfilling requirements for recovery vehicles, transporters, self-loading hook-lifts, fuel trucks, tractors, and tippers. The HX series trucks, powered by a six-cylinder in-line diesel engine, can reach a maximum weight of 41,000 kg.

As the primary logistics vehicle for the Australian Army, these trucks provide essential transport capabilities for personnel, supplies, and equipment. The first of these vehicles entered service over a decade ago, playing a critical role in military and humanitarian operations.

The trucks were manufactured in Austria, with final assembly completed in southeast Queensland. Additional support was provided by teams across Victoria and Queensland. With the fleet now fully delivered, ongoing maintenance and sustainment will be managed through a national network of industry partners and suppliers.

A dedicated team of service representatives will continue to support Army personnel across Australia to ensure the reliability and operational effectiveness of the vehicles. More than 20,000 of these trucks are currently in service with various NATO member and partner nations, including New Zealand, Germany, the UK, Denmark, Norway, Sweden, Austria, Singapore, and Canada.

The introduction of these trucks has enhanced the Army’s transport and logistics capabilities, making them a visible and integral part of operations both domestically and internationally. They are widely used for transporting equipment, towing artillery, and supporting humanitarian missions in times of crisis. The successful collaboration between Defence and industry partners has resulted in the timely and cost-effective delivery of this essential capability.

Our thoughts are with the entire Northern NSW community as they face the devasting impact of Cyclone Alfred.

RSL LifeCare is committed to supporting veterans and their families affected by this severe weather event. Our Disaster Assistance Payment is available to veterans and their families whose residences have been impacted by the disaster, providing initial financial assistance of up to $3,000 per household. This support will be available for up to three months from the date the disaster is officially declared.

RSL LifeCare will activate the Disaster Assistance Payment as soon as the NSW Government formally declares the disaster. Information regarding disaster declarations, including the Australian Government Reference Number (AGRN), disaster type, and affected areas can be found here: NSW Government Disaster Declaration.

If you know a veteran affected by this natural disaster who requires financial assistance, please reach out to RSL LifeCare Veteran Services via our website or call (02) 8088 0388.

To all veterans and their families in cyclone-affected areas: we stand with you, and we are here to support you through this challenging time.

Best regards,

David Anderson Executive General Manager – Veteran Services

RSL LifeCare

RSL LifeCare, Level 5, 120 Pacific Highway St

Leonards, NSW, Australia 2065

eWise Blog

Earlier this month, the Australian government made its first payment of $500 million toward acquiring U.S. nuclear-powered submarines under the 2021 AUKUS agreement. Given the immense budgetary, organisational, and personnel hurdles involved, that payment should be Australia’s last. Instead, Canberra should adopt an AUKUS Plan B that prioritises emerging defence technologies, such as uncrewed systems and hypersonic weapons, to enhance security faster and at a lower cost.

Funding the nuclear submarine program poses a significant challenge. Australia’s defence budget is currently $35 billion USD and is projected to reach $63 billion by the end of the decade. With each Virginia-class submarine costing over $3 billion, their acquisition would consume a substantial portion of the budget, potentially at the expense of other vital defence priorities. A former senior officer has already warned that the program could “cannibalise” investments in surface warships and ground forces.

Beyond cost, Australia lacks the infrastructure and workforce to sustain a nuclear submarine program. The U.S. Naval Nuclear Propulsion Program employs over 8,000 personnel, whereas the Australian Submarine Agency has only 680. Establishing a sovereign nuclear capability would require thousands of additional highly skilled workers. The Royal Australian Navy (RAN) also faces recruitment and retention issues, making it difficult to crew a nuclear submarine fleet with the necessary 1,000-plus personnel.

Despite these obstacles, the AUKUS agreement can still succeed with a revised approach. Plan B would cancel Australia’s nuclear submarine purchases while strengthening deterrence through increased cooperation with U.S. and U.K. submarines operating from Australian ports. This initiative is already underway, with allied submarines regularly visiting HMAS Stirling near Perth and the establishment of a Submarine Rotational Force-West.

Instead of spending over $13 billion on Virginia-class submarines, Australia could extend the lifespan of its Collins-class fleet while accelerating investments in next-generation defence technologies under AUKUS Pillar Two. AI-driven uncrewed systems, autonomous undersea vehicles, and hypersonic weapons could offer effective alternatives to nuclear submarines at a fraction of the cost. These advancements would not only strengthen Australia’s defence but also support a growing domestic defence industry with export potential.

While nuclear submarines may remain an option in the long term, Australia must prioritise cost-effective and immediate solutions. Pursuing Plan B would ensure Australia maintains a strong deterrent, enhances alliance interoperability, and maximises its defence budget. This pragmatic shift should be central to future discussions with the U.S. and U.K.

More proof why Solar & wind are CON JOB.

Dr. Patrick Moore co-founded Greenpeace in the early 1970s. He was only 24 years old at the time. He was the driving force behind many of the environmental activist group’s influential campaigns, such as to stop nuclear testing, protect endangered whales, and prevent toxic dumping. Moore left Greenpeace in 1986 after the group became more interested in “politics” than science.

A new Veterans’ and Families’ Hub will be established within the Playford Health and Wellbeing Precinct in Elizabeth Vale, enhancing access to support services for more than 11,000 South Australian veterans and families.

This Hub’s location will enable seamless integration with existing health services and facilitate comprehensive support for veterans, closer to home.

The new Northern Adelaide Hub will also be conveniently near the Edinburgh Defence Precinct, a ‘super base’ with more than 3,500 Royal Australian Air Force and Australian Army personnel.

Hubs provide a welcoming space where veterans and families can receive integrated, holistic, wrap-around support – this can include mental and physical health services, wellbeing support, advocacy, employment and housing advice, and social connection.

All current and former serving ADF members, including reservists, and families can access support at any Veterans’ and Families’ Hub.

In January 2024, the Australian Government awarded a $5 million grant for Lives Well Lived to lead the development of a new Hub in Northern Adelaide.

Lives Well Lived is working closely with the veteran community, ex-service organisations and veteran service providers to design a Hub and service model that meets the needs of the local community.

Eight Hubs are already operating across the country in Adelaide, Burnie, Caboolture, Darwin, Nowra, Perth, Townsville and Wodonga.

The Northern Adelaide Hub is part of the Australian Government’s $46.7 million commitment to establish eight new Veterans’ and Families’ Hubs across the country, to ensure even more veterans and families can access supports closer to home.

Hubs are also being established in Tasmania, Queanbeyan and the Hawkesbury, Hunter and Tweed/North Coast regions (NSW), Ipswich (QLD), Surf Coast/Geelong (VIC), and Southwest Perth (WA).

All new Hubs are expected to be operational by mid-2026, with services to veterans and families likely to start before then.

Learn more at the Veterans’ and Families’ Hub page.

On 7 February, alongside RSL New South Wales Deputy President David McCann, I presented to the Senate’s Foreign Affairs, Defence and Trade References Committee regarding the Defence Honours and Awards System. Our submission seeks to enhance the Defence Honours and Awards System to better recognise the service of our Defence personnel who have served and continue to serve our nation with distinction. Among a range of recommendations, the RSL proposed that no medal or citation be pre-emptively stripped from a veteran until all allegations of misconduct are lawfully investigated, substantiated, and the matter concludes.

We also supported the independence of the Defence Honours and Appeals tribunal, proposed wider communication of eligibility criteria for honours and awards through the veteran network, the recognition of physical and mental injury as a result of service, effective consultation when recommendations for awards and commendation are downgraded or overturned, and the automatic awarding of milestone awards to Defence personnel.

ED: Copied from the RSL President’s Newsletter

ED: This from my inbox – Thanks to Luke Washman

I understand why some argue for the United States to withdraw from NATO, but I believe it would be a serious mistake. The lack of strong defence capabilities in the European Union is no accident. After World War II, the United States emerged as the dominant global power, and it was in its best interest to maintain that influence. With Europe devastated and focused on reconstruction, the US stepped in to fill the security gap. Over time, this has led to the EU becoming overly dependent on American military power, a situation that may not actually be to Europe’s long-term benefit.

One of the greatest challenges to US dominance in the region is the potential for the EU to become both militarily and economically independent. Whether this outcome was intentional from the beginning is uncertain, but it has certainly evolved into a strategic advantage for the United States. The US has a vested interest in keeping the EU reliant on its military protection and weapons sales, ensuring continued influence.

A good example of this dynamic is South Korea. From 1979 until 2020-2021, the US imposed strict limits on South Korea’s missile capabilities, capping their payload and range. The range restrictions were gradually relaxed, increasing from 300 kilometres in 2001 to 800 kilometres in later years. While one justification for these limits was preventing regional tensions from escalating, another factor was the United States’ control over military capabilities in the region. If the US didn’t want South Korea to have certain weapons, why sell them in the first place? This mirrors the situation in Europe, where the US ensures that its allies remain dependent on American military support.

If the US were to withdraw from NATO and allow the EU to become more militarily and economically independent, American influence in the region would almost certainly decline over the next decade or two. The longstanding security “subsidy” that the US has provided to Europe may not be an act of generosity, but rather a strategic move to maintain its global dominance. Walking away from NATO could mean sacrificing that leverage, which would have profound consequences for America’s role in the world.