GM could face another fine

AN old email from a General Motors employee warning of a "serious safety problem" could help trigger another government fine against the automaker.

THE email, dated August 30, 2005, surfaced Wednesday during a House subcommittee hearing on GM's delayed recall of 2.6 million small cars with ignition switch problem. This email outlined a similar issue with a larger car.

Employee Laura Andres wrote that she was driving a 2006 Chevrolet Impala home from work when she hit a bump and the engine stalled on a busy road near Detroit. The car behind her had to swerve to avoid a crash. A GM mechanic told her the cause was likely a faulty ignition switch."I think this is a serious safety problem ... I'm thinking big recall," Andres wrote in an email to 11 GM colleagues.Yet it wasn't until Monday that GM recalled the Impalas, Buick LaCrosses and other models with the same switch, almost nine years after Andres' email. Safety regulators received dozens of similar complaints about the cars during that time.GM said that excess weight on a keychain could cause the ignition switch to move out of the "run" position if the car is jarred, like when it hits a pothole. The engine stalls, and the drivers loses power steering and power brakes.Under federal law, automakers must notify the National Highway Traffic Safety Administration within five business days of determining a safety defect exists. A maximum $35 million fine is possible if the agency finds an automaker took too long to report a problem.GM paid a $35 million fine last month for its 11-year delay in reporting defective ignition switches in the Chevrolet Cobalt and other small cars.Multiple fines are not without precedent. From 2010 through 2012, NHTSA fined Toyota Motor Corp. four times for a total of $66 million due to safety-related violations.GM wouldn't comment Thursday on the possibility of another fine. NHTSA also wouldn't comment on the Impala case, but said it reviews all recalls to make sure they comply with the notification law and it takes "appropriate action" when it finds problems.Andres's e-mail alone isn't enough to trigger the five-day rule, because it only suggests the ignitions are unsafe. But it's proof that some GM employees knew about a potential problem for almost a decade. GM has not yet submitted a required timeline to NHTSA that will say when it officially determined the Impala switches were defective.Andres, who still works for GM in design and engineering, could not be reached for comment. But in her 2005 email, she urged engineers to build a "stronger" switch.Andres' warning was brushed off by GM engineer Ray DeGiorgio, who replied that he had recently driven a 2006 Impala and "did not experience this condition." He also noted that the Impala had "a completely different column/ignition switch" than the one that was causing problems in GM's small cars.DeGiorgio is a central figure in the small-car recall saga. GM says he approved using the switches even though they failed to meet company specifications, and then took actions that hid the defect for years.Andres's email wasn't the only indication of problems. NHTSA's Web site lists more than 100 complaints about stalling for 2006-2009 Impalas alone. Those are complaints GM would have had access to.In one 2012 complaint, an Impala stalled in the middle of a large intersection. The owner took it to a dealer four times but couldn't get it repaired."I'm fearful I will be the one causing a fatal pile-up," the driver wrote.

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Man charged over NSW south coast death

FURTHER charges could be laid against a man accused of assaulting another man who was found dead in a NSW south coast home a day after he was attacked.

THE 41-year-old's body was on Thursday found in a Moruya unit and "officers were told the deceased man had been assaulted at the location the previous day," police said.

The man accused of assaulting the dead man and his 60-year-old male housemate was on Friday arrested and charged with two counts of assault occasioning actual bodily harm.But more serious charges could be laid against him."We're waiting on the results of the post mortem," a police spokeswoman told AAP.Police wouldn't say if the death was suspicious, whether the men were known to officers or if they were related.The accused was denied bail in Batemans Bay Local Court on Saturday and is due to reappear on Monday.Forensic officers are continuing their investigation and a report is being prepared for the coroner.

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Vic building workers face drug tests

BUILDING workers on Victorian government projects will face random drug and alcohol testing from July 1.

VICTORIAN Finance Minister Robert Clark said requiring all building companies that tender for taxpayer-funded projects worth $10 million or more to test workers for drug and alcohol use among measures he said would cut substance abuse, intoxication and drug dealing on building sites.

Head contractors must perform a minimum number of random tests on workers each month and identify what methods they will use, Mr Clark said on Friday.Contractors will determine the level of intoxication they deem unsafe and how workers will be sanctioned if drugs or alcohol are detected in their systems, he said.Tenderers will have to list site security measures, which may include CCTV, a swipe card access system and photographic or biometric security systems in a bid to stamp out criminal activity."We believe this will save taxpayers' money and it will help ensure law-abiding workplaces," Mr Clark said."We are introducing these guidelines to ensure that every contractor that tenders for Victorian government construction projects needs to commit to have processes in place to guard against drug and alcohol abuse in their workplaces and also to ensure site security."When the guidelines were first announced, Construction Forestry Mining and Energy Union (CFMEU) Victorian secretary John Setka said the guidelines would unfairly single out construction workers."There is no epidemic of drug taking on construction sites," he said.

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Westfield gets restructure gets go-ahead

Westfield's shareholders are set to approve a $70 billion restructure of the company. Source: AAP

WESTFIELD will leave its Australian shopping centres behind in search of growth opportunities overseas after winning a tough shareholder battle over its $70 billion restructure.

THE restructure got the green light on Friday after shareholders in Westfield Retail Trust, which owns half of the shopping centre giant's Australian and New Zealand assets voted in favour of the controversial plan.

Westfield Group will be split in two from June 25, pending final approval from the NSW Supreme Court, with the new Westfield Corporation taking on the company's international business and the Australian and New Zealand shopping centres transferred to a new company called Scentre.Both companies will be chaired by Westfield founder Frank Lowy and the Lowy family will maintain holdings in both businesses.But Australian shoppers won't notice any difference, with the Westfield brand to be maintained under Scentre Group.The move gives Westfield greater freedom to focus solely on growth opportunities overseas, without the distraction of its Australian shopping centre business, which has little room left to expand."The strategy of Westfield Corporation is to own, develop and operate iconic shopping centres in some of the world's great cities," co-chief executive Steven Lowy told reporters on Friday.That includes the massive Westfield World Trade Centre development, a planned development in Milan which the company is billing as "the best shopping centre in Europe" and major centres in the UK.But the move almost didn't go ahead.Westfield Group shareholders overwhelmingly backed the move at a meeting last month, but WRT investors looked set to vote down the proposal, with only 74.1 per cent of proxy votes cast in favour of the restructure.On Friday, the total vote was 76 per cent in favour.A significant minority of shareholders in WRT, which was itself spun off from Westfield in 2010, opposed the move on the grounds it would create a higher risk business with more debt than the passive property trust they bought into.Australian Shareholders Association spokesman Stephen Mayne said Westfield had run a well orchestrated campaign to win over institutional investors in the past few weeks."Ultimately they ran a very successful lobbying campaign against those institutions that voted against it or didn't vote," he told AAP."The question is, who flipped?"Steven Lowy downplayed concerns about debt levels, noting credit ratings agencies S&P and Moody's had already given Scentre A ratings."We felt that debate was well overplayed," he said on Friday.Fellow co-chief executive Peter Lowy said Westfield Corp would maintain its listing on the Australian stock exchange but is looking at the possibility of a dual listing overseas.

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$A at the mercy of two central banks

DOVES are meant to symbolise peace, but the Australian dollar is getting caught in a tug of war between two of them.

IN financial jargon, a dove is a central banker who prefers interest rates to stay low.

Record low interest rates in Australia should be helping Reserve Bank governor Glenn Stevens guide the stubbornly high Australian dollar lower to help the local economy.However his aim is being frustrated by interest rates in the US that are even lower, with Federal Reserve boss Janet Yellen signalling they will remain low for a "considerable time".The Aussie fell to a two-week low of 93.22 US cents on Tuesday after minutes of the RBA's June board meeting showed it wants to keep the cash rate at a record low of 2.5 per cent "for some time yet", and included a downbeat assessment on Australia's economic growth prospects.But the dollar bounced back up through 94 US cents early Thursday morning after Dr Yellen wound up the Fed's two-day policy meeting saying she would keep the federal funds rate steady despite a recent spike in inflation."There were some expectations that they would hint that they were concerned about inflation, but they didn't, and they reiterated they are maintaining their dovish stance," Easy Forex currency dealer Tony Darvall said.Mr Darvall said it was unclear if the Aussie dollar will rise to 94.60 US cents, its highest level this year, or fall towards 92 US cents if commodity prices remain under pressure."You'd think that the RBA at the next meeting would continue with the dovish talk," he said."The June minutes were crafted to try and stop the Aussie from rallying and if we get above 95 US cents it will probably be more explicit about the concern."BK Asset Management managing director Kathy Lien said investors were disappointed by Dr Yellen's policy announcement."When pressed for a definition of `considerable time' she refused to provide any details, saying only that there is no formula for what considerable time means," Ms Lien said."In other words, unlike other central banks that have recently expressed their desire to become more active, the Fed remains comfortable with their current course and has no desire to alter the market's expectations."

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House prices tipped to continue to rise

ONE of the country's largest property developers believes house prices will continue to rise for years to come, with the Sydney market set for a "golden decade".

STOCKLAND chief executive Mark Steinert expects nationwide house prices to rise by four to five per cent on average for the foreseeable future, with Sydney leading the charge.

Despite a sharp rise in house prices in the past 12 months, an undersupply of property and improving confidence meant the growth was set to continue, he said."At the moment it is fair to say there is at least three years of undersupply in every major capital city," Mr Steinert said."Because of this demand-supply fundamental, we anticipate at least four to five per cent compound growth in new house prices for the foreseeable future."Mr Steinert said the NSW government's efforts to increase housing supply and infrastructure plans would boost Sydney's new property market."We are particularly bullish on Sydney," he said."I think it's fair to say that we are going to see Sydney and to a certain extent NSW have a golden decade."Mr Steinert's optimism contrasts with warnings from economists and analysts that house prices are likely to flatten or slide over the next few years.Credit Suisse analyst James Ellis has said a collapse in prices was unlikely, but he expects prices to remain flat for several years, which would amount to a decrease in prices in real terms, relative to incomes."Our base case scenario is one of real erosion of house prices," he said.Recent figures from the bureau of statistics suggest the housing market boom is cooling, with no growth in home loan approvals in April.Meanwhile, house prices suffered their biggest monthly fall in five years in May, dropping 3.6 per cent across capital cities, according to research from RP Data.But prices remain substantially higher than a year ago, especially in Sydney, were prices have risen 16.6 per cent in the past 12 months.

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Child dead, 19 injured after US tornadoes

One person is dead and 16 more are in a critical condition after two massive tornadoes hit Nebraska. Source: AAP

A POWERFUL storm with tornadoes has ripped through northeast Nebraska, destroying more than half of the tiny town of Pilger, killing a five-year-old child and injuring at least 19 people.

THE National Weather Service said dual twisters touched down within roughly a 1.6 kilometres of each other.

Emergency crews and residents spent the evening sorting through demolished homes and businesses in the community of about 350, roughly 160 kilometres northwest of Omaha."More than half of the town is gone - absolutely gone," Stanton County Commissioner Jerry Weatherholt said."The co-op is gone, the grain bins are gone, and it looks like almost every house in town has some damage. It's a complete mess."Victims were taken to three regional hospitals, and at least one had died from unspecified injuries, hospital officials said.Jodi Richey, a spokeswoman for Faith Regional Health Services in nearby Norfolk, said one person died and 16 others were being treated at the hospital.Hospital officials initially described those patients as being in critical condition, but said later that some had been released after treatment.The Stanton County Sheriff's Office confirmed late on Monday that the person killed was a five-year-old child. It didn't specify the child's gender.One was transferred to a trauma centre in Omaha, while others required surgery, said Dr Doug Dilly, who was in the emergency room when patients arrived.Providence Medical Centre in nearby Wayne treated three tornado patients, including two who had lacerations, said hospital spokeswoman Sandy Bartling.Two were released Monday evening, and the third patient was in stable condition, she said.Stanton County Sheriff Mike Unger estimated that 50 to 75 per cent of Pilger was heavily damaged or destroyed in the storm.The local school is likely beyond repair, he said."It's total devastation," Unger said.Authorities said the first tornado touched down around 3:45 pm and downed several power lines before it levelled a farmhouse. Four people were trapped inside.While local crews removed them from the debris, a second tornado was spotted southwest of Pilger, according to the Stanton County Sheriff's Office.Shortly afterward, the town suffered a "direct hit" that levelled several buildings, including the Fire Department building, the sheriff's office said.Several people near Main Street in Pilger suffered critical injuries, including the child who later died.Nebraska Governor Dave Heineman declared a state of emergency, and the National Guard was preparing to assist local emergency responders and help with the clean-up.Pilger was evacuated for the night, and the Nebraska State Patrol closed all roads into town.

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Super funds continue to grow

SUPERANNUATION funds with the greatest exposure to international share markets posted the best returns in May.

AUSTRALIA'S $1.84 trillion super industry has posted solid growth in the past year, with the industrywide rate of return for large funds at 11.5 per cent in the year to March.

Investment researcher Morningstar says returns continued to grow in May, although at a slower rate than previous months, with the median growth fund in its latest survey returning 1.1 per cent.That takes median annual returns to May to 12 per cent.Listed property investments were the source of greatest returns in May, followed by international shares.Local shares and local listed property provided more modest returns.International shares were also the greatest source of returns in the year to May, at nearly 23 per cent.That reflects the strong performance of equity markets around the globe, driven by Wall Street, which has repeatedly hit new record highs as the US economy continues to show signs of sustained recovery.Growth super funds had more than 50 per cent of investments in equities in May, and almost half of that in overseas markets, Morningstar said.

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One in 10 homes sold at a loss

- Whether you make a profit selling your home depends a lot on when you bought it.

AND where.

In the three months to March, 90 per cent of homes sold fetched more than their purchase price, according to RP Data's "Pain and Gain" report.But the rest sold at a loss.A year ago, that figure was 12 per cent, or nearly one in eight, sold at a loss.The average loss on sales in the March quarter was $60,544, while the average gain was nearly four times bigger, at $225,088.These gains and losses don't include costs like maintenance or debt servicing, nor do they include rental income.While real estate agents are fond of saying the three most important attributes of a property are location, location and location, the timing of the purchase makes a huge difference too.Only 12 per cent of properties sold at a loss in the March quarter were bought within the past three years, and that proportion rises to over 19 per cent for properties acquired three to five years ago.The proportion of loss-making sales declines the further back the purchase was made, falling as low as 0.4 per cent for periods of 15 years or more.But location still matters.In Sydney, loss-making transactions made up only three per cent of total sales in the March quarter.At the other end of the spectrum, regional Queensland had 23 per cent of sales at less than the purchase price.The weakness in regional Queensland mostly reflected previously weak conditions in "lifestyle markets", and increasing weakness in areas linked to the resources sector, RP Data said.Those lifestyle markets included Wide Bay and Gold Coast, with more than one in four sales in the red, but things may be turning around in those areas."It is important to note that across lifestyle areas the proportion of loss making sales is reducing as we start to see some low levels of value growth return to these housing markets," RP data said.When the figures are broken down into local council areas, they show some wide divergences.At one extreme, Sydney's Hunters Hill had no loss-making sales, with the median (the middle in a ranked list) property yielding a gross profit of $400,000.At the other extreme, in Hobart's Brighton, one in three homes were sold at a loss, albeit at a median amount of only $8,000, while the median profit on the other two thirds was a modest $52,500.

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Iraq tensions weigh on kiwi dollar

THE New Zealand dollar may fall this week as growing Middle East tensions weigh on investor confidence.

THE kiwi increased to 86.84 US cents at 5pm in Wellington from 86.68 at 8am and 86.66 cents at 5pm in Wellington on Friday. The trade-weighted index edged up to 80.85 from 80.68 last week.

Investors have sought relatively safe assets, lifting the price of gold to a three-week high, as increasing violence in Iraq has markets nervous OPEC's second biggest producer of crude oil may plunge deeper into conflict."The kiwi will remain elevated, but I think the risk-off trade will be more of a problem in the market" as investors are spooked by the rising Middle East tensions, said Martin Rudings, senior advisor at OMF."The market is already long on New Zealand dollars so it'll be like a fire in a cinema, the first one out the door or a rush for the exit, so I am a wee bit wary, and I certainly wouldn't be buying kiwi dollars up at these levels with what's going on."Government data on Thursday is expected to show the economy grew 1.2 per cent in the first quarter of the year, from a 0.9 per cent pace in the fourth quarter of 2013, according to economists polled by Reuters."We're expecting a good number from GDP, even if it is slightly less than what's expected, it is still probably a pretty strong number compared to most other countries around the world," said Mr Rudings.The kiwi rose to 92.31 Australian cents at 5pm in Wellington from 91.99 cents on Friday, was almost unchanged at 88.32 yen from 88.31 yen and advanced to 64.09 euro cents from 63.92 cents.

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Firies cancer law not ruled out: Vic govt

Volunteer firefighters rally in Melbourne for access to compensation for cancer contracted at work. Source: AAP

THE Victorian government says it hasn't ruled out changing the way firefighters access cancer compensation as hundreds rallied in Melbourne to try to break down barriers to claims.

THE government says it simplified cancer claims for firefighters and encouraged both career and volunteer firefighters to lodge a claim if they believe they had contracted cancer as a result of their duties.

"The Victorian government is not ruling out presumptive legislation and will continue to consider new medical and scientific evidence as it becomes available," a government spokesperson said.Volunteer Fire Brigades president Bill Watson said firefighters wanted a law that lists the 12 typical "firefighter" cancers and presumes them to be work-related, providing the firefighter has enough years of service behind him or her and relevant risk exposure.Mr Watson said there is plenty of evidence firefighters are more likely to suffer certain cancers, but it can be difficult to prove which fire or chemical incident caused their illness."It's not like a broken bone where you know exactly when and where it happened," Mr Watson said."The burning car or house fire you attended today may cause a cancer that doesn't show up for decades, which makes it nearly impossible to prove it was work related."The federal government introduced presumptive legislation in 2011.Tasmania, Western Australia and South Australia also have laws that recognise the link between firefighting and cancer.Mr Watson said any legislation would have to include eligibility guidelines."We're not after a free ride," he said."We just want to make sure they're looked after if they get sick."The Victorian government has been under pressure to make changes to the way compensation is accessed after a 2012 report found firefighters who trained at the CFA Fiskville site had been exposed to dangerous chemicals going as far back as the 1970s.Last year they introduced a review panel to assist both volunteer and career firefighters seeking compensation for cancer caused by their work.Opposition leader Daniel Andrews said Labor would introduce the legislation if elected in November."I have committed to the introduction of presumptive rights," Mr Andrews said.

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Afghan voters defy Taliban threat

Afghans have braved threats of violence and searing heat to vote in the presidential elections. Source: AAP

THE United States praised millions of Afghan voters who defied Taliban threats and attacks to vote in a presidential run-off election securing the country's first democratic transfer of power, with counting set to begin.

WITH turnout higher than expected after a largely peaceful day of voting, Washington hailed the polls as a "significant step" for the country's democracy, commending "the voters, electoral bodies and security forces for their commitment to the democratic process".

"These elections are a significant step forward on Afghanistan's democratic path, and the courage and resolve of the Afghan people to make their voices heard is a testament to the importance of these elections to securing Afghanistan's future," the White House said.Ahead of the ballot, which decides the next president of the country ahead of the withdrawal of NATO troops later this year, the Taliban had threatened to kill voters and officials, saying the election was an American plot "to impose their stooges".Polling day saw no major attacks in cities, but there were at least 150 minor attacks - including a Taliban rocket that hit a house near a polling station, killing five members of the same family.Eleven voters in the western province of Herat had their fingers - which were dipped in ink to register their ballot - cut off by insurgents, Deputy Interior Minister Ayoub Salangi said on his Twitter account.The polls result, due out next month, will confirm whether former foreign minister Abdullah Abdullah or ex-World Bank economist Ashraf Ghani will lead Afghanistan into a new era of declining international military and civilian assistance.The two candidates came top of an eight-man field in the April first-round election, triggering the run-off as neither reached the 50 per cent threshold needed for outright victory.Abdullah secured 45 per cent of the vote with Ghani on 31.6 per cent.Counting the ballot will take weeks. The preliminary result is due on July 2 and a final result on July 22.The United Nations also praised the elections, congratulating the "courageous" Afghans who set out to cast their ballots in the face of Taliban threats."With the same determination, resilience and courage the world saw in the first round of elections, the people of Afghanistan today once again decided to take their destiny in their own hands and demonstrate their desire for a peaceful, prosperous, and united Afghanistan," the UN Secretary-General's Special Representative for Afghanistan, Jan Kubis, said.While high turnout may lend legitimacy to the winner if the gap between the two candidates is clear, a close count could mean a contested outcome.Both candidates swiftly alleged fraud after the closure of the polls Saturday."We know there has been fraud, you have seen it, we have seen it," Abdullah said.Ghani called for a full investigation into vote-rigging, saying "unfortunately there were cases of security forces involved in fraud, we have the evidence".A smooth handover in Afghanistan's first democratic transfer of power would be a major achievement for the 13-year US-led effort to establish a functioning state after the depredations of the Taliban era.President Hamid Karzai, who has ruled Afghanistan since 2001 and was re-elected in a 2009 vote marred by ballot-box stuffing, is constitutionally barred from a third term in office.

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