Archive for May, 2002

  • Fuji Xerox launches new education courses on Variable Data

    As part of its commitment to developing the use of variable information (VI) printing, Fuji Xerox Australia is rolling out its new VI educational courses. “Full colour variable printing is now a viable business option and we want to further inform the industry about how their business can profit from VI printing,” said Chad Pearce, Software Marketing manager, FXA.

    The new one day VI workshop, Profiting through Personalisation will provide printers with an in-depth knowledge of the VI workflow and business development.

    “Attendees to the course will be equipped with a business development guide along with marketing collaterals and VI applications to assist in developing and promoting their own VI strategies.”

    Also being launched, an introductory VI course, Make it Personal, which will focus on the facts, figures and benefits of personalised print. Information gained from both courses will assist print providers to use VI to differentiate their business from competitors.

    “Our range of applications, software and courses are all designed to help our customers profit in the new business of printing,” said Pearce.

    Anyone interested in the new Fuji Xerox Australia VI Educational Courses can contact Chad Pearce on 02 9856 5425 or e-mail
    Chad.pearce@aus.xerox.com

  • Printing Industries anti-budget campaign rolls on

    * News Flash *

    George Gatehouse, managing director of Mcpherson’s, one of the largest book printers in the industry, will debate Federal Minister Macfarlane on ABC radio, 9.30am Monday (27/05/02) morning on the axing of EPICS and PICS.

    There were 93 applications for assistance in the pipeline when the schemes were discontinued. There are calls for the establishment of a fighting fund and for printers in the electorate of Minister Macfarlane to apply pressure to get the Budget cuts reversed.

    The widespread industry reaction against the axing of EPICS and PICS (see Print 21 Online #10 Budget Special) is being co-ordinated by Printing Industries.

    Gary Donnison, CEO, highlights the Association’s campaign so far.
    “Response from the industry to our actions in fighting the Government’s decision has been overwhelming. Members have proposed the establishment of a fighting fund with the first $500 contribution received from Ainsley Lamb of Lamb Print in WA. We are continuing to address the issue on many levels.

    Members wishing to contribute to the figting fund should send cheques to:

    PICS/EPICS Fighting Fund

    Printing Industries Association of Australia

    Level 10, 99 York Street
    SYDNEY NSW 2000

    Cheques should be made out to Printing Industries Association of Australia.

    Where are we now?

    • We have met with the Minister’s advisor, Malcolm Roberts. While he strongly defended the Government’s decision, he offered to take our detailed concerns to the Minister and ask if he is prepared to meet a delegation from the industry. We will hear back from him after the Minister returns from Japan this weekend.
    • He indicated that our request to reinstate PICS and EPICS was unlikely to succeed, given the tough budget imperatives imposed by Treasury. He reiterated that Ministers Macfarlane and Minchin were both sympathetic but, at this stage, it had not been enough to persuade Cabinet in our favour.

    • After discussions with Senator Aden Ridgeway, the Australian Democrats have now agreed to oppose the abolition of PICS and EPICS in the Senate.
    • The Hon Craig Emerson, Shadow Minister for Innovation and Industry, has also raised this issue with the Leader of the Opposition, Simon Crean, on our behalf, and issued a Press Release in support.

    We have also:

    • Contacted printers in Minister Macfarlane’s electorate to stir up interest locally
    • Contacted the Prime Minister’s Office to see if he can meet our delegation
    • Approached the Treasurer and the Minister for Finance to push our concerns
    • Contacted the Australian Chamber of Commerce and Industry to ask them to support our case
    • Liaised with the Australian Publishers Association to coordinate our respective responses
    • Begun briefing State Government politicians seeking their support

    In the next week, we will be:

    • Meeting with the Shadow Industrial Relations Minister, Robert McClelland
    • Seeking to meet with the Leader of the Opposition, Simon Crean, to confirm ALP support to retain the schemes
    • Briefing the Shadow Parliamentary Secretary for Manufacturing, Senator George Campbell
    • Organising petitions and letter-writing campaigns in key electorates
    • Liaising with Central Goldfields Shire Council about a community campaign in Maryborough involving petitions, letter-writing and contacting local politicians

    What else can you do?

    One of the best things you can do is write to your local Federal Member of Parliament, in addition to the other politicians listed below. And, as importantly, get your employees to write to them as well.

    The Hon John Howard, MP
    Prime Minister
    Parliament House
    CANBERRA ACT 2600

    The Hon Ian Macfarlane, MP
    Minister for Industry, Tourism and Resources
    Parliament House
    CANBERRA ACT 2600

    Senator Natasha Stott Despoja
    Leader of the Australian Democrats
    Parliament House
    CANBERRA ACT 2600

    The Hon Simon Crean, MP
    Leader of the Opposition
    Parliament House
    CANBERRA ACT 2600

  • Letters to the Editor

    Simon Phipps, Director of Phillips & Father Printing .

    To the Editor,

    I wish to support the sentiments expressed in Print 21 Online – Issue 10 concerning the Budget axing of EPICS, etc. We at Phillips & Father Printing have poured many many hours into preparing for a submission since meeting with Andrew Goldsmith last year. It was our sincere expectation that we would be able to complete the process.

    With its precipitous budget decision the Government has neatly transformed an assistance scheme into an act of commercial terrorism – EPICS assumes the guise of a Trojan Horse – aid transmogrifies into blight.

    If Printing Industries can rescue this scheme, I for one will be grateful.

    Kind Regards,

    Simon Phipps
    Director
    Phillips & Father Printing Pty Ltd.

  • Overflow…extra news…more news…overflow…extra news…

    ___________________________

    Bennett’s Printing of Katoomba Blue Mountains, NSW, which was formerly Joseph Bennett & Son, has been sold to Michael Lewchenko of Wentworth Falls Printing. The business will still continue on under the name of Bennett’s Printing in the tradition of quality craftsmanship and service of the past 73 years.

    The company has thrived under the proprietorship of three generations of the Bennett family. Ann and Kevin Bennett, the present owners are retiring.

    Happy trails.

    ___________________________

    Agfa-Gevaert is in the throes of integrating the North American equipment manufacturing operations of Autologic with its main manufacturing facility in Wilmington, Massachusetts (USA). The integration follows Agfa’s acquisition of Autologic in December and the ongoing merger of the two organizations.

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    The final figures for IPEX are released, confirming that attendance at the Birmingham exhibition was well down on previous years. The published figure for the nine-day show is 65,451, down 30 per cent from Ipex 98. Organisers, of course, put the best face on the result. “Our exhibitors told us that the quality of visitors was very high and most of them met or exceeded their sales targets for the event. We hope that the contacts made and leads taken at the exhibition turn into solid business in the coming months and that IPEX 2002 will mark the start of an upturn for the industry,” said Ashley Whitworth, Marketing Director.

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    The latest edition of the Heidelberg E-news is out. Check out Bill Wall’s words of wisdom – and a whole lot more on . . .
    www.au.heidelberg.com/a3qrp.enews/issue2.htm

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    The scores are even -– Adobe one, Macromedia one. Macromedia has won a countersuit against Adobe that includes a damage award of US$4.9 million. Adobe was found to infringe three Macromedia patents relating to element blending in Illustrator, and editing in Premiere.

    `We’re very pleased with the jury’s ruling,’ said Loren Hillberg, Macromedia’s general counsel after the verdict. In October 2001, Macromedia brought a patent infringement suit against Adobe relating to additional patents that Macromedia believes that Adobe infringes.

    ___________________________

    Avery Dennison‘s acquisition of Jackstadt has been completed. The transaction, had a purchase price of $295 million, including assumption of debt. Jackstadt, based in Wuppertal, Germany, is a global manufacturer of pressure-sensitive materials with consolidated revenues of approximately US$400 million in 2001. US-based Avery Dennison is the sector’s largest manufactuer.

    “Today is an important day for both Avery Dennison and Jackstadt, as we complete our largest acquisition in a decade,” said Philip M. Neal, chairman and chief executive officer of Avery Dennison. “The combination of Avery Dennison and Jackstadt is an ideal strategic fit in our core pressure-sensitive materials business.”

    ____________________________

    Printing business conditions have improved in the US, but the perception of long-term health seems to be a function of the national economy, according to Vince Naselli, TrendWatch Graphic Arts. He says that currently optimists and pessimists are split 50-50, but this alone is a leap forward compared to last Autumn.

    “Though the industry may never return to the volumes of the late ’90’s, 15 per cent of the firms are reporting excellent conditions. Signs of future prosperity are there and we expect even greater evidence of market improvements late this year.”

    Contact Vince at www.www.trendwatchgraphicarts.com

    ____________________________

    Something Andersens overlooked. An electronic shredder that permanently eliminates electronic images on digital copier and printer hard drives is now available on Xerox’s Document Centre digital multifunction systems. The new option enables security-conscious organizations to overwrite hard disk drives of digital copiers and multifunction devices. Based on a U.S. Department of Defence three-pass overwriting process, the image overwrite security option eliminates the risk of access to information that remains on the hard disks after copying, printing, scanning or faxing a document.

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    And an Irish joke (courtesy of Terry Gardiner)

    The following is an advertisement in an Irish newspaper:

    • 1985 Blue Volkswagen Golf
    • Only 15 km
    • Only first gear and reverse used
    • Never driven hard
    • Original tyres
    • Original brakes
    • Original fuel and oil
    • Only 1 driver
    • Owner wishing to sell due to employment lay-off
    • Photo Attached

  • People on the move

    High profile industry identity, John Horsnaill, (left) is welcomed aboard Australian Plastic Card Company (APCC) by Charles Jeffrey.

    It’s an ill wind. APCC gains the digital printing experience and expertise of John Horsnaill following the demise of Colour Solutions Melbourne.

    APCC was the first Company in Australia to adopt Digital Super Print Technology (DSP), merging of variable information with high quality graphics through the medium of digital print onto plastic cards in full colour. Charles Jeffrey, Sales Manager, says that John’s addition to the company as production manager will contribute to its continuing expansion.

    “John’s expertise is a very valuable addition to our company. With our IT department, mailhouse, print and manufacturing facilities all under one roof we are continuing to expand by adding value to our client’s business through DSP technology into ticketing, postcards and other high impact promotional products.”

    _________________________

    Wayne McDougall is the new President of the Graphic Arts Services Association of Australia. He was elected at the annual general meeting held last weekend during the hugely successful GASAA conference at Port Stephens, NSW.
    Wayne (39) is Operations Director of the family -owned firm of Alfred Johns, Marrickville wher he works with father Roy and brother Ian. He was Vice President of GASAA before his elevation.
    “I look forward to helping continue the steady growth that GASAA has enjoyed over the past year. It is important that we get information out to our members, and to the industry, about the new and different type of business we are all working in now,” he said

  • Font copyright battle rages on

    From Peter Wayner.

    This just verifies what I’ve always thought The DMCA hurts the artists and the content-creation professionals the most because they’re the ones who must cut and paste to make a living. The rest of the world can go do something else if the VCR/DVD refuses to work.

    This was brought home to me one day when I spent an entire afternoon trying to change a semi-colon to a colon in a document I prepared. Why did it take so long? Because I created a Acrobat file and mailed it to a friend. Then the computer crashed and destroyed the original document. No problem, I thought. I’ll just change the Acrobat file. I own the pro version of Acrobat which allows editing. Not so fast, Font Pirate! said Acrobat. Apparently the font I used couldn’t be found. When I rebuilt the system file, it was missing.

    I don’t buy fonts. I’m not that sophisticated. It ended up on my disk because some software package gave it to me. Which one? I still have no freaking idea. There was no way I was going to spend an afternoon reinstalling every piece of software. Who knows where it came from? It might have been installed by a sample I download and then deleted and forgot.

    In the end, I was able to hack around this by extracting the Postscript from Acrobat, editing the postscript file and re-distilling it. It took me four hours to come up with this solution.

    Now I’m bitter about Adobe and I have deliberately begun avoiding my lawfully owned products like Photoshop, Acrobat, and InDesign. This was building after I discovered that their secret surveillance software kept crashing my Mac. The products are great, but open source alternatives have their advantages too. In the past, I would stick with Adobe because of their quality. Now I shun them because I’m worried that I’ll be abandoned and falsely accused in my hour of need. Open source code doesn’t do that.

    The Content Czars seem to think that we’re all just a bunch of pirating fiends out here who can’t wait to make a copy of something, anything, right away. Hah! I’m just trying to get my job done. There’s no way I’m going to buy professional grade Agfa or Adobe fonts now. There’s no way I’m going to buy Fontographer either. I don’t need their quality and they just seem to be a big hassle. There are plenty of free fonts that are good enough and easier to use.

    Contact Will Doherty on href=”mailto:wild@eff.org”>wild@eff.org or visit the EFFwebsite on www.eff.org/a>

  • Plan for end of year tax bill now

    For many enterprises their accountant does not attend to their affairs until much later in the year and it is not uncommon for accounts not to be finalised until after Christmas. Ideally, accounts should be prepared much earlier than this as finding out that you have incurred significant losses six months down the track can often be too late to implement a program of recovery, says Geoff Ball Financial Controller, Printing Industries.

    We have all seen in the past 12 months major companies collapsing virtually overnight. But the causes of such collapses do not happen overnight and newspaper reports of late show how financial situations can be manipulated to hide the true picture.

    While there may be extenuating circumstances for these high profile collapses, in a normal business, provided accounts are prepared regularly and collection of debtors policed, downturns can be assessed and acted upon. If regular financial statements are not prepared, you should at least make some assessment of the results to May 31 so that appropriate planning can be put into place. This not only applies to a loss situation but also to minimise tax liability if a significant profit is on the cards.

    Implementing these steps before June 30 can minimise the likelihood of the taxation authorities considering them to be bogus. Additional superannuation contributions, prepayment of expenses, and a range of other options become more credible if processed before June rather than having some accounting entry processed six months after the event.

    Bad debt expense is another item that needs to be addressed prior to the end of the financial year. To ensure there is no question as to the validity of your claim, bad debts should be actually written off prior to June. Remember also that a provision is not tax deductible, so providing for the possible loss, while showing a correct picture in the profit and loss account, does not provide a tax deduction.

    This raises the issue of Provisions and Accruals. A provision is generally not an exact amount and the timing for the actual payment is indeterminable, as such a provision is not tax deductible.

    An accrual is a specific amount and is due and payable within a relatively short time after year end, hence it is tax deductible. It is important that you provide your accountant with all of those expenses not actually paid in June but are in fact due and payable, eg Electricity, telephone, payroll tax, superannuation etc.

    It is important that you meet with your accountant prior to June 30 to discuss these types of issues, to preview your possible results for the year, and to take all steps to minimise your tax liability.

  • Budget dishonesty damages printing industry

    National President of the Printing Industries Association of Australia, Chris Segaert (pictured), said the Federal Government stood condemned for reneging on its commitment to the ailing book production industry. He points out that only $15.9 million of a $48 million four-year rescue package for the industry had been paid before being prematurely terminated in the 2002/03 Federal Budget.

    “No explanation has been given for termination of the highly successful EPICS which had more than $9.2 million in current business assistance applications scrapped yesterday,” he said. “Expectations by many companies that their business viability would be helped through this scheme and PICS have been shattered by the withdrawal of $25 million promised in a fanfare of publicity at its launch on July 1, 2000.”

    Mr Segaert said that the Minister for Industry, Tourism and Resources, Ian Macfarlane, has misled the public in his Budget press release terminating EPICS. Mr Macfarlane suggested that the book printing industry had benefited from tax reform which replaced the 22 per cent sales tax with GST-free business inputs.

    “Prior to the introduction of the GST, book production was exempt from Sales Tax. The Government’s preferred econometric modeling consultant, Econtech, had demonstrated that a GST on books would result in a three per cent reduction in Australian production,” said Mr Segaert.

    “Recognition of this led the government to introduce the EPICS to compensate for projected negative impact of the GST on books. The GST on books was not scrapped last night – but EPICS was. This occurred in a very cynical and dishonest way that will now seriously compromise the future viability of the Australian book-printing sector.

    “Abolition of the PICS, the second Budget blow to this industry, means that Australian book printers lose compensation for tariff inflated prices of paper and paperboard raw materials.”

    Mr Segaert said the Association would lobby the Democrats (who were party to the original GST compensation package) and the Opposition to oppose the premature termination of the successful EPICS. (See letters in this bulletin.)

  • Fact sheets for EPICS and PICS

    EPICS facts

    • The Enhanced Printing Industries Competitiveness Scheme (EPICS) commenced on 1 July 2000 and was intended to operate until 30 June 2004. EPICS was the by-product of the GST compensation package as agreed between the Commonwealth Government and the Australian Democrats to compensate the book production industry for the imposition of the Goods and Services Tax (GST) on books.
    • Under the previous sales tax regime, books (along with other items of printed matter such as newspapers and magazines) were exempt from sales tax.
    • Given that the demand for books is price sensitive, EPICS was introduced to make book printers more competitive and help partly offset the negative impact that the GST had on the demand for books.
    • EPICS was jointly administered by AusIndustry and the Printing Industries Association of Australia

    The objectives of the EPICS were the following:

    • Enhance the competitiveness of firms involved in the Australian book production industry through encouraging innovation, infrastructure development, business development, training and skills formation.
    • Increase industry linkages and best practice dissemination.
    • Improve the capacity of the industry to satisfy consumer demand.
    • Improve the book production industry’s contribution to the national economy, which may increase employment opportunities in regional Australia.
    • EPICS has been a successful program that helped to change the prevailing industry culture. A number of achievements and progress have been witnessed at both industry and enterprise levels.
    • At the enterprise level, more and more companies engaged in book production activities are formulating strategic business plans and actions to improve their competitiveness.
    • At the industry level, a number of projects have been finalised that aim to boost the overall competitiveness of the industry.

    The EPICS funded projects at the industry level have covered:

    • Industry analysis and market development.
    • Training and education development.
    • Innovation, R&D and market development.

    PICS Facts

    • The Printing Industries Competitiveness Scheme (PICS) was a four per cent rebate scheme introduced on 1 January 1999 to help offset the tariff inflated prices of paper and paper board used in the production of eligible books.
    • The scheme was scheduled to operate until 30 June 2003.
    • The scheme was introduced to help partly offset the penalties that book printers suffered from paying import duties on a host of raw materials used in the production of a book.
    • The importation of books into Australia attracts no import duties. Australian book printers are thus placed in a non-competitive position when they pay a duty on the raw materials used in the manufacture of the book.
    • While through PICS Australian book printers received a four per cent rebate for paper and paperboard used in book production, other raw materials used in the manufacture and production of books continue to attract the import duty.
  • Letters to our Politicians

    To Simon Crean, Leader of the Opposition, and Natasha Stott Despoja, Leader of the Australian Democrats.

    The Printing Industries Association of Australia condemns the Commonwealth Government’s budget decision to prematurely end the Enhanced Printing Industry Competitiveness Scheme (EPICS) and the Printing Industry Competitiveness Scheme (PICS).

    EPICS formed an integral part of the Book Industry Assistance Plan which is a GST compensation package drafted by the Australian Democrats and the Commonwealth Coalition Government as part of an agreement to ensure the passage of the GST legislation.

    EPICS was introduced to help offset the projected negative impact of the GST on the Australian book printing sector. Economic modelling work by Econtech prior to the introduction of the GST on books indicated that book printing production would fall by three per cent following the imposition of the GST. Under the Sales Tax regime, books and other types of printed matter conveying knowledge and information were exempt from Sales Tax.

    While EPICS was intended to operate until 30 June 2004, both the Association and the industry were confident that a review of the program would have recommended an extension of the scheme beyond 30 June 2004. The Government has now prematurely terminated the EPICS without conducting a review.

    The other scheme prematurely terminated in yesterday’s budget was the PICS scheme which provided a four per cent rebate on the cost of paper and paperboard used in the production of eligible books.

    Yesterday’s budget decision represents a double blow to the Australian book printing industry as it will no longer be able to access EPICS funds to help offset the negative impact that the operation of the GST is having on industry activity nor will it be able to implement knowledge management programs that are critical in raising the international competitiveness of the industry. The industry also now faces the prospects of receiving negative assistance following the loss of compensation for tariff inflated raw material prices of paper and paperboard raw materials for which PICS was established to address.

    The Association remains hopeful that your party (parties) will oppose this cynical and dishonest move by the Government to prematurely end EPICS and PICS which also represents a reneging by the Government of its 1998 election commitments to the Australian book printing industry.

    I will be in touch with your office to arrange an appointment to discuss the issues raised in this correspondence. In the meantime, I attach for your information and use some background material on the EPICS and PICS.

    Yours sincerely,

    Gary Donnison

    Chief Executive

    Printing Industries Association of Australia

    c.c. Bob McMullan, Craig Emerson, Peter Cook, Senator Aden Ridgeway

  • Letter to Minister Macfarlane

    17 May 2002

    The Honourable Ian Macfarlane
    Minister for Industry, Tourism and Resources
    Parliament House
    Canberra ACT 2600

    Dear Minister

    The Printing Industries Association of Australia (Printing Industries) would like to express its profound disappointment at your Government’s decision, announced in the 2002-2003 Federal Budget, to terminate the Enhanced Printing Industry Competitiveness Scheme (EPICS) and the Printing Industry Competitiveness Scheme (PICS). Not only was the decision to prematurely terminate the schemes made without any industry consultation, but no coherent or cogent justification was given. This compounds the damage done when your Government terminated the Book Bounty scheme in a similarly abrupt manner.

    The termination of EPICS and PICS means that the Australian book production industry faces the prospect of receiving negative assistance. It will no longer receive the 4% paper rebate to compensate for tariff-inflated raw materials prices, while facing the prospect of declining production, as books show a high sensitivity to price rises.

    There is objective evidence to show that, under the GST, book prices have gone up. Under the previous sales tax regime, books were exempt from sales tax – contrary to the public statement you made in your Press Release of 14 May. Book printers now also suffer GST-related compliance costs. While the rest of the printing industry may have benefited from the introduction of the GST, the book printing sector certainly did not. Indeed, modelling conducted by Econtech shows that book production will fall by 3 per cent as a result of the GST.

    The Government’s decision is all the more an affront to the prospects of the Australian book production industry since EPICS has proven to be a strategically successful scheme for the industry. It should be noted that more than 90 funding applications were in the pipeline when your Government’s ill-considered decision was announced.

    EPICS has played a pivotal role in assisting companies engaged in the book production value chain to reposition themselves, enter the digital age and benefit from new value-adding opportunities. This process has now come to a sudden halt following the Budget decision.

    This has seriously compromised the plans of numerous companies who had devoted financial and non-financial resources to preparing EPICS applications, with the knowledge that the scheme was to have operated at least until 30 June 2004. Printing Industries estimates that, collectively, these companies are now ‘out of pocket’ to the tune of $3 million.

    It is imperative that the Government realises that when commercial decisions are being taken, industry needs certainty about government policy. Rash government decisions are not conducive to proper business planning or confidence. In an industry like book production, investment plans are made many years in advance, based on the expectation of assistance provided by schemes like PICS or EPICS. Removal of the schemes is now threatening the financial viability of projects that would have seen Australia become the centre of high-quality book production in the Asia-Pacific area. The impact on our export efforts will be devastating.

    We have spent the last day consulting with all the major stakeholders in the industry, from publishers through to printers and booksellers. They are united in opposition to your decision to terminate PICS and EPICS.

    There will be a significant fallout from the Budget decision, which will translate into reduced production in Australia, increased levels of imports, higher prices to Australian consumers and unemployment in regional and rural areas. We have indicated to you previously that the book production and printing industry is larger than the car and TCF industries combined, but now receives precious little support from this Government. This will not go unnoticed by the industry.

    The Association has taken some comfort from some of the statements you have made in your Press Release, and to us directly, that the Government remains strongly committed to the industry through the PRINT21 Action Agenda. Printing Industries, the 6,000 companies and 120,000 employees who make up the industry are now keen to find out what exactly that commitment entails.

    If your Government is interested to support an industry which will form the core of the knowledge economy and be a significant provider of high skill jobs in the economy, then Printing Industries invites you to work urgently with the industry to restore PICS and EPICS and help restore its confidence and trust in the Government.

    Yours sincerely

    Chris Segaert

    National President

    Printing Industries Association of Australia

  • Defence and border protection $2.7 billion turnaround

    Despite consistent claims by senior members of the federal government that the budget is in surplus, the budgeted surplus of $1.5 billion has now been revised to include an estimated budget deficit of $1.2 billion in cash terms ($3 billion in accrual terms) for financial year 2001-2002. This turnaround in the fiscal position of some $2.7 billion is attributed to measures undertaken in the areas of defence and border protection. The decision to abolish petrol indexation, and the rejection by the government of a report recommending an overhaul of fuel taxes that may have allowed it to reintroduce petrol indexation, have also contributed to the budget deficit.

    The good news is that the 2002-2003 budget is forecast to deliver a cash surplus of $2.1 billion ($200 million in accrual terms) with stronger economic growth accounting for the expected turnaround in the fiscal position. The stated fiscal strategy of the federal government is the maintenance of a balanced budget over the course of an economic cycle. This means that it will strive to maintain budget surpluses during periods of strong economic growth.

    With the latest budget estimates placing economic growth for financial year 2001-2002 at 3.75 per cent, following a more modest growth rate of 1.9 per cent in the preceding year, fiscal stimulus has clearly had the affect of pushing the budget into deficit and has prevented a major slowdown in economic activity. The fiscal stimulus combined with a competitive currency explains why the Australian economy in recent times defied overseas trends and surged ahead strongly.

    Budget Forecasts

    The Australian economy is forecast to grow by 3.75 per cent during financial year 2002-2003 with growth forecast to be driven by business investment and household consumption. Total business investment is forecast to rise by 12 per cent with a surge expected in investments in machinery and equipment. Household consumption is expected to rise by four per cent.

    With domestic demand expected to grow more rapidly than overall economic growth, a surge in imports and a widening of the current account deficit as a proportion of gross domestic product is being forecast.

    Inflation at 2.75 per cent is forecast to remain within the target band of the Reserve Bank. Stronger employment growth is expected to lower the unemployment rate to around 6.25 per cent and increase average earnings by 4.25 per cent.

    The outlook for the global economy has also improved since the beginning of 2002 with recovery underway in the United States and a moderate pick up of economic activity in Europe. Global growth is expected to rise from 2.75 per cent in 2002 to around 4 per cent in 2003.

    Australia’s major trading partner’s growth is expected to be only around 2.25 per cent during 2002 (mainly due to continued weakness in Japan), rising to around 3.75 per cent in 2003. Exports are forecast to grow by six per cent while imports are expected to increase by 11 per cent.

    The factors that may undermine the budget forecasts

    Budget forecasts are based on a series of economic assumptions. The budget acknowledges a number of uncertainties that may compromise the economic outlook.

    The possibility of a weaker recovery in the US and/or financial instability in Japan would undermine economic activity in the East Asian region. On the domestic front, if the anticipated downturn in the housing sector proves to be sharper than anticipated then such a downturn will impact negatively on the economy with implications for employment growth and household consumption.

    A stronger investment outcome also has the risk of causing in a surge in imports resulting in deterioration in the current account deficit.

    The budget papers also warn that firms may be tempted to rebuild their profit margins in sectors that have experienced a reduction in competition levels such as in insurance, telecommunications and the airlines. Such developments, combined with higher global petrol prices, could begin to exert upward pressures on the inflation rate.

    Concluding comments

    If forecasts materialise, then the 2002-2003 budget should prove to be a good budget for the printing and associated sectors. Economic growth of 3.75 per cent, continued low rates of inflation, falling rates of unemployment and increased household consumption are all positive forecasts.

    In a budget lacking strategic direction and focus, the only innovative work concerns the Intergenerational Report which provides a basis for considering the Federal Government’s fiscal outlook over the long term (40 years), and identifying emerging issues associated with Australia’s ageing population. Critics will no doubt question the validity of a report that makes 40 year forecasts and projections when the government can not even make accurate projections over a 12 month period.

    The real shortcoming of the Intergenerational Report however is that it tells us nothing that we already do not know. The report, for example, states that if government policies are not adjusted, the current generation of taxpayers, who will join the ranks of the ageing population of the future, are likely to impose a higher tax burden on the next generation.

    It is interesting to observe that the government has decided not to include in its revenue figures money raised by the GST. The government argues that since the money is collected on behalf of State governments, it should not form part of federal revenue proceeds. I suspect the reason the government is refusing to include the GST revenue in its total revenue figures is to avoid being labelled a high taxing government.

    According to the budget papers, during the 2001-2002 financial year total Commonwealth government revenue as a proportion of GDP was 23 per cent, which is expected to fall to 22.6 per cent of GDP during financial year 2002-2003. However, if the GST revenue is also included as it should be, then total Commonwealth government revenue for financial year 2001-02 will account for about 26.9 per cent of GDP, and for financial year 2002-2003 it is expected to account for about 26.6 per cent of GDP (as apposed to the forecast of 22.6 per cent of GDP with the exclusion of the GST proceeds).

    The real irony of the 2002-2003 federal budget, is that a diverse and economically significant sector like printing which employs more than 120,000 people, and which has a physical presence in every region of Australia, will not be getting any direct assistance from the government to help it become more innovative, productive and internationally competitive, while sectors that have been going backwards and declining for more than a decade like textiles, clothing and footwear, and who employ significantly less number of people than the printing industry, continue to be beneficiaries of government assistance worth hundreds of millions of dollars.

  • Little joy for printers in this budget

    This budget does not contain much joy for the printing industry particularly for the book printing sector which has been savagely battered by some of the measures announced in the budget. Some of the specific measures concerning the printing industry are:

    • The Federal Government has decided to prematurely terminate the PICS. All claims lodged under PICS prior to the announcement of the termination of the scheme (14 May 2002) for paper to be used in the production of eligible books by 30 June 2002 will be processed and paid as normal.
    • The budget also closed down the successful EPICS. All proposals for EPICS grants approved before 14 May 2002 (budget night) will be processed and paid as normal. PICS, which provided a four per cent rebate on the cost of paper used in the production of eligible books was scheduled to operate until 30 June 2003. EPICS, which was part of the GST compensation package for the book production industry, funds projects that aim to increase the competitiveness of the Australian book printing industry was scheduled to operate until 30 June 2004.
    • From 1 July 2003, printing companies will be required to make Superannuation Guarantee (SG) contributions on behalf of their employees on at least a quarterly basis. Currently, they are only required to make SG contributions on an annual basis.
    • The government is allocating more than $2.9 billion over the next four years to the taxation office to implement the next phase of business tax reform, and for GST administration and general tax administration purposes.
    • The government has announced that employers willing to take on a new apprentice while they are at school will receive $750. A further $750 will be paid to those employers who continue to employ the young person as a new apprentice within six months of them completing Year 12.
    • An additional incentive of $1,100 will be provided to employers taking on new apprentices in information technology and other highly skilled occupations.
    • Funding for state and territory Industry Training Advisory Bodies (ITABs) will be reduced in 2002-2003 and will cease entirely in 2003-2004.
    • The government has announced an additional 8,500 work for the dole places will be funded per year.
    • The government has announced that it will be increasing the minimum grant under the Export Market Development Grants scheme from $2,500 to $5,000 for those exporters claiming marketing expenses of between $15,000 and $25,000 per annum.

    The budget offers very little other than the modest apprenticeship measures to the printing business community while taking away two vital programs, EPICS and PICS. The EPICS was not only operating successfully, but it was also helping the Australian book printing sector reposition itself and become internationally competitive.
    The premature loss of EPICS and PICS will not only have an impact on the book printing sector, but will also have an impact on general commercial printing, especially if increased excess capacity forces book printers to encroach on the markets traditionally served by commercial printers.

  • Association’s response to Budget decisions

    The Commonwealth Government has, without notice or consultation, terminated the Printing Industries Competitiveness Scheme (PICS) and the Enhanced Printing Industry Competitiveness Scheme (EPICS).
    This has taken away $25 million promised to the book production industry. These funds had been promised over a four year period to help the industry adjust to the introduction of GST and to position itself as a world-class competitor.

    The impact of this decision is disastrous and widespread, and threatens the viability of many companies in Australia. It will affect long-term investment plans that relied on funding being available for some years to come. It will also affect employment in the industry, particularly in regional Victoria.

    As an immediate consequence of the government’s actions, the four EPICS Client Service Managers have had their contracts terminated. These consultants were employed by the Association through the scheme to assist members develop applications for funding and act as mentors for the successful implementation of the projects. The four are Richard Vines, Phillip Boyle, Tony Freeman and Andrew Goldsmith.

    Printing Industries is coordinating the industry response, organising a campaign in order to have the funding restored. Thus far we have:

    • Briefed key figures in the Opposition parties and the Democrats to seek their assistance in the Senate (see letters this bulletin)
    • Briefed State and Commonwealth MPs in affected electorates in Victoria and South Australia
    • Met and discussed the issues with the Minister’s senior departmental staff
    • Briefed Victorian State Ministers and the Victorian Department
    • Contacted all major companies affected by the decision, asking them to write to the major political parties outlining the adverse impacts on their companies
    • Met with the largest book printer in Australia to quantify impacts on production and employment
    • Briefed the AMWU about potential employment losses
    • Briefed journalists, radio and TV stations in regional Victoria
    • Organised this special on-line briefing through Print21Online
  • In the next few days we will be:

    • Contacting the Prime Minister’s Office
    • Meeting with Minister Macfarlane’s chief advisor
    • Keeping the industry updated through Print21Online and direct member consultations
    • Organising a delegation of publishers, printers and other key stakeholders to go to Canberra to put the industry’s case to the government, if required
    • Encouraging industry participant’s to lobby their local members in protest.
  • Touchstone Colour buys Frank Daniels in Perth

    The emergence of Touchstone Colour as the successful buyer in the long anticipated sale of the much-awarded quality printer took industry observers by surprise. According to Terry Stone, founder and director of Touchstone Colour, in the hothouse atmosphere of Perth graphic arts the company was not considered to be a contender.

    “They did not get us into the cross hairs until the very last weeks. We had signed a confidentiality agreement but I was surprised that our competition did not realise how much business we were doing,” said Stone.

    The new company, which has a projected turnover of over $19 million, has now completed its first month of business and Stone professes himself well pleased with the results. No purchase price has been released but speculation in the financial press puts the deal at $4 million.

    The takeover is the second stage in the transformation of Touchstone from a pure prepress house to being a major printer. It follows its successful absorption of West Coast Printing two years ago.

    Stone indicates “outstanding synergies” as the main reason for his move, with Frank Daniels having little prepress capacity and Touchstone Colour having a brand-new Osaka stitcher working less than half the day. Between the two companies they won almost half of the PICA awards in this year’s WA competition.

    “We planned our entry strategy long before our bid was successful. We’re not looking at going in and cutting costs, we prefer to concentrate on sales protection and customer retention,” he said.

    With the business now spread across two manufacturing sites and one warehouse, a new green field site is on the cards although no decision has been taken yet. It is likely that Frank Daniels will remain the major corporate identity.

  • Letters to the editor – Tasmanian stoush part two.

    Dear Sir,

    Your article Tassie printers stoush with government hots up is blatantly one sided. It is extremely disappointing that the Print21 site is being used in this manner to project a one sided inaccurate opinion on issues associated with the Printing Authority of Tasmania.

    Surely your site and indeed the Printing Industries should be focussing more on assisting the Tasmanian and national printing industry to address more important issues as identified in the Print 21 strategy. Print 21 support is sadly lacking in Tasmania and I would encourage you to
    consider providing support to the local industry in future.

    Garry Duffield,
    Chief Executive Officer,
    Printing Authority of Tasmania.
    garry.duffield@pat.tas.gov.au

    ________________________

    Dear Sir,

    At the outset, let me correct the assertion that Print21Online is one-sided or biased. The Printing Industries Association of Australia has no influence over its editorial policy, nor does it wish to. Print21Online is an independent forum for the industry.

    More importantly, I agree that the industry’s future and the PRINT21 Action Agenda are the primary focus of the Association. Our concern with the Printing Authority of Tasmania is that, by operating from an unfair market position, there will not be an industry left in Tasmania to take up the benefits of PRINT21. And, if our understanding is correct and the PAT is operating in the Victorian market, then the viability of that section of the industry may be threatened as well.

    We have no problem with fair competition, but the Tasmanian Government has not demonstrated that the PAT operates without Government subsidy. Until then, we will continue to oppose the way the PAT goes about its business.

    Gary Donnison,
    Chief Executive,
    Printing Industries Association of Australia

    From Patrick Howard, publisher and editor of Print21Online.

    Print21Online is an independent industry news service published by blueline media. It provides a forum for issues that affect the industry and strives to accommodate the broadest possible spectrum of opinion. All views expressed, unless otherwise attributed, are mine.

  • GASAA Annual Conference is on next weekend

    Other speakers include Sean Gardiner, prepress consultant, Roger Morgan, General Manager, Sales and Marketing Fuji Xerox, Jordan Reizes, Adobe Systems Marketing Manager Asia Pacific and Tyrone Carlin, Lecturer in Management Macquarie Graduate School of Management

    A good turnout of industry professionals is expected with pre-conference registrations running strongly, according to Gary Knespal, executive secretary of GASAA. Topics to feature at what is generally regarded as the industry’s premier technology conference include:

    • The best from IPEX 2002
    • Design from a prepress view
    • Making money from cross media
    • CTP the true cost
    • Improving your digital workflow
    • D.A.M. -how to make it pay?
    • Proofing . . still the key
    • The ins and outs of digital print
    • Standards, ICC, CIP4, PDFX who needs them?
    • Moving a business up or down stream?

    There will also be a number of strategic management sessions scheduled over the three-day period.

    Further information at: www.gasaa.asn.au/eventsl