The Master Electrician Magazine Summer 2009

themaster

the interview Julia Gillard talks business

economic downturnYour survival guide

head to headCFLs vs LEDs

insiDE

our nEwEst powEr

stationgood things

come in small packages

wE put thE nEw trD

hiLux to thE tEst

2 www.masterelectricians.com.au 3the master electrician : SummeR 09

It is hard not to notice the panic emitting from various sources over the current economic climate and rise in unemployment. One cannot turn on the television or open a newspaper without seeing some doom and

gloom story on how the global economy is deteriorating.

All is not lost! In this issue of The Master Electrician we feature a number of interviews on what this means for Australia and specifically how this affects business owners. Stephen Horton, of financial planning practice Whittaker Macnaught, gives us his tips on successful business strategies for managing the downturn on page 8.

Deputy Prime Minister and Minister for Education, Employment and Workplace Relations, Julia Gillard also spoke to The Master Electrician on the economy as well as the changes to the workplace environment with the new Fair Work bill. Turn to page 34 to find out what the new workplace relations system means for you.

In November Master Electricians Australia and the Electrical and Communications Association recognised exceptional talent in our industry at the 2008 Excellence Awards. Students through to industry veterans were among eight awards winners on the night including Luke Pritchard the first ever Master Electrician Of The Year. Turn to page 28 for all the highlights.

Jessie BadgerAssociAte editor

Editor’snotEWelcome to the second issue of The Master Electrician magazine.

Disclaimer: The statements and opinions expressed in this publication are offered solely in pursuance of the objects of the electrical and communications association and master electricians australia to provide an informative service to contractors in the electrical industry on legal, commercial and other issues and problems related to the industry. The electrical and communications association and master electricians australia are not aware that any person intends to act or rely upon such statements and opinions contained in this publication or the manner in which it might be possible to do so. The electrical and communications association and master electricians australia issues no invitation to any member or other persons to act or rely upon such statements or opinions or any of them and it accepts no responsibility for any of them. it intends by this provision to exclude, to the extent permitted by law, all liability for any such statements and opinions.

Editorial Contacts & Contributors

General Enquiriesmaster electricians australia

57 Berwick street, Fortitude valley

po Box 2438, Fortitude valley Bc

Queensland 4006

phone 1300 889 198

fax 07 3251 2400

email magazine@masterelectricians.com.au

web www.masterelectricians.com.au

abn 97 131 416 183

editor malcolm richards

associate editor Jessie Badger

advertising enquiries Jeff mullin

phone 1300 889 198

fax 07 3251 2400

design and print pomo 07 3844 3873

kEEpup-to-datE

yEarly subscriptions

(4 issuEs) just $38.50

EConomiC Downturn

Your survival

guideread more paGE 8

our nEwEst powEr

stationgood things come in

small packagesread more paGE 16

thE intErviEw

Julia gillard talks Businessread more paGE 34

www.masterelectricians.com.auor call 1300 889 198

contents04 up front with the regulators

14 work life balance

20 recognition for Australia’s new masters

23 meet a master electrician

25 news from distributors

28 excellence awards

32 the buzz

38 technical talk

40 workplace relations

42 news from head office

44 gadget guide

46 test drive

48 events calendar

49 your best (or worst) day on the job

49 your best (or worst) photo

50 last word cover photo: newgen kwinana power station

It is hard not to notice the panic emitting from various sources over the current economic climate and rise in unemployment. One cannot turn on the television or open a newspaper without seeing some doom and

gloom story on how the global economy is deteriorating.

All is not lost! In this issue of The Master Electrician we feature a number of interviews on what this means for Australia and specifically how this affects business owners. Stephen Horton, of financial planning practice Whittaker Macnaught, gives us his tips on successful business strategies for managing the downturn on page 8.

Deputy Prime Minister and Minister for Education, Employment and Workplace Relations, Julia Gillard also spoke to The Master Electrician on the economy as well as the changes to the workplace environment with the new Fair Work bill. Turn to page 34 to find out what the new workplace relations system means for you.

In November Master Electricians Australia and the Electrical and Communications Association recognised exceptional talent in our industry at the 2008 Excellence Awards. Students through to industry veterans were among eight awards winners on the night including Luke Pritchard the first ever Master Electrician Of The Year. Turn to page 28 for all the highlights.

Jessie BadgerAssociAte editor

Editor’snotEWelcome to the second issue of The Master Electrician magazine.

Disclaimer: The statements and opinions expressed in this publication are offered solely in pursuance of the objects of the electrical and communications association and master electricians australia to provide an informative service to contractors in the electrical industry on legal, commercial and other issues and problems related to the industry. The electrical and communications association and master electricians australia are not aware that any person intends to act or rely upon such statements and opinions contained in this publication or the manner in which it might be possible to do so. The electrical and communications association and master electricians australia issues no invitation to any member or other persons to act or rely upon such statements or opinions or any of them and it accepts no responsibility for any of them. it intends by this provision to exclude, to the extent permitted by law, all liability for any such statements and opinions.

Editorial Contacts & Contributors

General Enquiriesmaster electricians australia

57 Berwick street, Fortitude valley

po Box 2438, Fortitude valley Bc

Queensland 4006

phone 1300 889 198

fax 07 3251 2400

web www.masterelectricians.com.au

abn 97 131 416 183

editor malcolm richards

associate editor Jessie Badger

advertising enquiries Jeff mullin

phone 1300 889 198

fax 07 3251 2400

design and print pomo 07 3844 3873

kEEpup-to-datE

yEarly subscriptions

(4 issuEs) just $38.50

EConomiC Downturn

Your survival

guideread more paGE 8

our nEwEst powEr

stationgood things come in

small packagesread more paGE 16

thE intErviEw

Julia gillard talks Businessread more paGE 34

www.masterelectricians.com.auor call 1300 889 198

contents04 up front with the regulators

14 work life balance

20 recognition for Australia’s new masters

23 meet a master electrician

25 news from distributors

28 excellence awards

32 the buzz

38 technical talk

40 workplace relations

42 news from head office

44 gadget guide

46 test drive

48 events calendar

49 your best (or worst) day on the job

49 your best (or worst) photo

50 last word cover photo: newgen kwinana power station

up front w

ith the regulators : state

decided it was safe to perform the work “live”.

The victims have made good recoveries, but it

could have been much worse for them.

WorkSafe Victoria has launched a new

campaign targeting young workers aged between

15 and 24, their families and employers in a bid

to reduce the rate of workplace injuries among

this age group. Research has revealed that the

likelihood of younger workers being admitted to

hospital emergency departments compared to

their older counterparts is close to double.

It is hoped the incidents serve as a reminder

to the electricity industry that everyone involved in

the supervision and training of apprentices - and

the apprentices themselves - exercise proper care

and responsibility at all times.

new south wales

New South Wales unlicensed electrician puts consumers in danger again

the Commissioner for Fair Trading, Lyn Baker,

issued a public warning to New South Wales

consumers on 16 December 2009 regarding an

unlicensed trader, mr George Harellis of Sans

Souci, who purports to be an electrician but is

unlicensed and whose work is defective and

potentially life threatening.

The Commissioner said consumers should

not deal with mr Harellis, who is believed to be

trading as Georges electrical. His work vehicle

is a 1995 Toyota Town Ace van with NSW

registration number uAZ 140.

The Commissioner advised that anyone who

has had work done by mr Harellis should contact

the NSW Office of Fair Trading immediately on

13 32 20 and get a qualified electrician to check

that work for defects.

Fair Trading investigated mr Harellis in

2004 and he was subsequently prosecuted

for unlicensed electrical work (installation of a

switchboard) and fined $4,000.

It is evident that mr Harellis has continued

to carry out unlicensed specialist work

despite having been previously spoken to and

prosecuted by Fair Trading Investigators.

In April 2008, a further complaint was

received by Fair Trading, advising that

George Harellis, again trading as Georges

electrical, had contracted and carried

out unlicensed specialist work (electrical

wiring) at a residential property in east Hills

between November 2007 and January 2008.

Covert surveillance by Fair Trading building

investigators positively identified the offender

as George Harellis. upon investigation, the

work was again found to be defective and

Statements were obtained from the consumer

and the rectifying qualified electrician, and

photographic evidence of the defective work

was obtained.

A qualified electrician carried out a physical

inspection of all accessible electrical wiring

and fixtures at the east Hills property. During

that inspection he observed evidence of recent

electrical wiring work which did not comply with

the Australian and New Zealand Standard AS/

NZ:3000 and AS/NZ:3008. He noted that the

defective electrical wiring work was a safety

hazard and extremely dangerous. The defects

included one circuit being connected before

the main switch (potentially life threatening); no

main earth system; no water bond, no earth

rod, an instance where an earth wire had been

used instead of a live wire; exposed live wires

lying in the roof cavity; all visible connections

of live wires bound only with electrical

insulation tape instead of being encased in a

victoria

energy Safe Victoriaongoing investigations in victoria regarding recent injuries

energy Safe Victoria (eSV) and the state’s

electricity industry are concerned that there

have been four serious electricity-related incidents

in recent months involving apprentices and

young workers. The incidents are currently under

investigation.

In two of the incidents, the victims had to be

revived after their hearts stopped beating. Apart

from determining what happened, investigations

are also focusing on whether it was inexperience

and carelessness on the part of victims themselves

, or whether a lack of appropriate supervision by

those responsible for the safety of apprentices

and young workers was responsible.

The injuries have prompted eSV to remind the

Victorian electricity industry of the comprehensive

and well established “Supervision Guidelines for

Apprentices Working on electrical Installations”

which explain quite clearly what apprentices can

and cannot do at each stage of their apprenticeship

and the level of supervision which is required.

The guidelines are available on the eSV website

at www.esv.vic.gov.au. They can be accessed

easily under “Quick Links” on the right hand

column of the home page.

the incidents involve:n A 20-year-old electrical apprentice

suffered a severe electric shock working

on a switchboard at an outer melbourne

shopping Centre.

His heart stopped beating and he was

revived by a security guard using a

defibrillator.

n A 17-year-old carpentry apprentice was

reported to be “clinically dead” by an

ambulance official when he received a severe

shock performing non-electrical work at a

community hall in the regional centre

of Wodonga. n A first year electrical apprentice, aged 20,

received a severe electric shock while

changing a light fitting at a major melbourne

hotel. It turns out the lights in question had

been imported directly from China and were

unapproved in Australia. n A 25-year-old electrician spent almost a

week in hospital recovering from his injuries

after receiving a shock when working “live”

changing over a circuit breaker at a busy

restaurant in a northern suburb of melbourne.

He had very little experience working solo.

He admitted he was under pressure from

the customer to keep things operating and

regulatorsup front with the

up front w

decided it was safe to perform the work “live”.

The victims have made good recoveries, but it

could have been much worse for them.

WorkSafe Victoria has launched a new

campaign targeting young workers aged between

15 and 24, their families and employers in a bid

to reduce the rate of workplace injuries among

this age group. Research has revealed that the

likelihood of younger workers being admitted to

hospital emergency departments compared to

their older counterparts is close to double.

It is hoped the incidents serve as a reminder

to the electricity industry that everyone involved in

the supervision and training of apprentices - and

the apprentices themselves - exercise proper care

and responsibility at all times.

new south wales

New South Wales unlicensed electrician puts consumers in danger again

the Commissioner for Fair Trading, Lyn Baker,

issued a public warning to New South Wales

consumers on 16 December 2009 regarding an

unlicensed trader, mr George Harellis of Sans

Souci, who purports to be an electrician but is

unlicensed and whose work is defective and

The Commissioner said consumers should

not deal with mr Harellis, who is believed to be

trading as Georges electrical. His work vehicle

is a 1995 Toyota Town Ace van with NSW

registration number uAZ 140.

The Commissioner advised that anyone who

has had work done by mr Harellis should contact

the NSW Office of Fair Trading immediately on

13 32 20 and get a qualified electrician to check

that work for defects.

Fair Trading investigated mr Harellis in

2004 and he was subsequently prosecuted

for unlicensed electrical work (installation of a

switchboard) and fined $4,000.

It is evident that mr Harellis has continued

to carry out unlicensed specialist work

despite having been previously spoken to and

prosecuted by Fair Trading Investigators.

In April 2008, a further complaint was

received by Fair Trading, advising that

George Harellis, again trading as Georges

electrical, had contracted and carried

out unlicensed specialist work (electrical

wiring) at a residential property in east Hills

between November 2007 and January 2008.

Covert surveillance by Fair Trading building

investigators positively identified the offender

as George Harellis. upon investigation, the

work was again found to be defective and

Statements were obtained from the consumer

and the rectifying qualified electrician, and

photographic evidence of the defective work

was obtained.

A qualified electrician carried out a physical

inspection of all accessible electrical wiring

and fixtures at the east Hills property. During

that inspection he observed evidence of recent

electrical wiring work which did not comply with

the Australian and New Zealand Standard AS/

NZ:3000 and AS/NZ:3008. He noted that the

defective electrical wiring work was a safety

hazard and extremely dangerous. The defects

included one circuit being connected before

the main switch (potentially life threatening); no

main earth system; no water bond, no earth

rod, an instance where an earth wire had been

used instead of a live wire; exposed live wires

lying in the roof cavity; all visible connections

of live wires bound only with electrical

insulation tape instead of being encased in a

victoria

energy Safe Victoriaongoing investigations in victoria regarding recent injuries

energy Safe Victoria (eSV) and the state’s

electricity industry are concerned that there

have been four serious electricity-related incidents

in recent months involving apprentices and

young workers. The incidents are currently under

investigation.

In two of the incidents, the victims had to be

revived after their hearts stopped beating. Apart

from determining what happened, investigations

are also focusing on whether it was inexperience

and carelessness on the part of victims themselves

, or whether a lack of appropriate supervision by

those responsible for the safety of apprentices

and young workers was responsible.

The injuries have prompted eSV to remind the

Victorian electricity industry of the comprehensive

and well established “Supervision Guidelines for

Apprentices Working on electrical Installations”

which explain quite clearly what apprentices can

and cannot do at each stage of their apprenticeship

and the level of supervision which is required.

The guidelines are available on the eSV website

at www.esv.vic.gov.au. They can be accessed

easily under “Quick Links” on the right hand

column of the home page.

the incidents involve:n A 20-year-old electrical apprentice

suffered a severe electric shock working

on a switchboard at an outer melbourne

shopping Centre.

His heart stopped beating and he was

revived by a security guard using a

defibrillator.

n A 17-year-old carpentry apprentice was

reported to be “clinically dead” by an

ambulance official when he received a severe

shock performing non-electrical work at a

community hall in the regional centre

of Wodonga. n A first year electrical apprentice, aged 20,

received a severe electric shock while

changing a light fitting at a major melbourne

hotel. It turns out the lights in question had

been imported directly from China and were

unapproved in Australia. n A 25-year-old electrician spent almost a

week in hospital recovering from his injuries

after receiving a shock when working “live”

changing over a circuit breaker at a busy

restaurant in a northern suburb of melbourne.

He had very little experience working solo.

He admitted he was under pressure from

the customer to keep things operating and

regulatorsup front with the

up front w

junction box or connectors; the light circuit was

not protected by a RCD or safety switch; and

the power source to the external in-ground pool

was incorrectly installed and defective.

At a considerable cost to the owner, the

qualified electrician carried out extensive

rectification works to make the electrical wiring

compliant and safe.

A brief of evidence is being compiled by Fair

Trading against George Harellis for breaches

of the Home Building Act 1989, electrical

(Consumer Safety) Act 2004, and associated

Regulations.

Fair Trading holds grave concerns that

mr Harellis will continue to seek work as an

electrician, putting the public at further risk.

Accordingly the Commissioner issued the

public warning statement to alert members of

the public and hopefully avert a potential future

tragedy.

Photographs of mr Harellis and his vehicle are

available at www.fairtrading.nsw.gov.au.

south australia

SafeWork SA safe working distances for overhead powerlines

safeWork SA and the Office of the Technical

Regulator have developed a joint safety

guideline, in consultation with construction

and power distribution industry stakeholders,

to clarify safe working distances when working

near overhead powerlines.

Currently, the Occupational Health, Safety

and Welfare (OHSW) Act and Regulations

administered by SafeWork SA, makes

reference to one set of safe working distances

and the electricity Act and Regulations

administered by the Office of the Technical

Regulator stipulates another set of safe

working distances.

This has created confusion in the industry,

as information provided on safe working

distances varies depending on which

authority is contacted.

In order to clarify this situation, an

understanding has been reached between

the Office of the Technical Regulator and

SafeWork SA, whereby any work being

carried out near overhead powerlines by

employees, contractors and sub-contractors

is considered as undertaken in a workplace

and therefore the requirements of OHSW

legislation shall apply at all times.

two separate scenarios applY:

work environment 1 (we1)

All work activities must comply with the safe

working distances, as required under the

OHSW Regulations 1995, the Approved Code

of Practice (AS/NZS2550) and the applicable

Australian Standard (AS/NZS4576).

Where compliance with Work environment 1

is not possible or reasonably practical, the

safe distances specified in the electricity

Act/Regulations may be applied if all of the

following requirements are satisfied:n Written permission from the electricity

network operator has been obtained;

and -n All conditions specified by the electricity

network operator and Technical Regulator

are complied with;

and -n The electricity network operator is notified

before commencing work;

and -n A spotter (competent person with the

duty of observing and warning against

unsafe approach of the crane, its lifting

attachments or its load to powerlines)

carries out spotting duties at all times;

and -n A documented risk assessment is

carried out before any work commences

in consultation with all relevant parties

involved in the work.

more information can be found at

www.safework.sa.gov.au.

western australia

energySafety WA reporting electrical accidents

regulation 63 of the electricity (Licensing)

Regulations 1991 requires that ‘immediately

after a person becomes aware of an electrical

accident (including ‘electric shocks’), the person

must report the matter to the relevant network

operator.’

This is a change to the requirements that existed

before 1 July 2008 when the person had to report

to the network operator and to the Director of

energy Safety.

Where the report is to be made to Western

Power or Horizon Power, the incident should be

directed to the relevant call centre:n call 13 13 51 Western Powern call 13 23 51 Horizon Power

The call centre, upon receiving notification, will

direct the information to the appropriate area of

the network operator for appropriate investigation.

The network operator will also advise the Director

of energy Safety of the occurrence.

An employee who becomes aware of an

electrical accident must also report the incident

to his or her employer. employers will then report

the incident to the network operator and other

relevant agencies, such as WorkSafe, Resources

Safety etc.

Where the network operator cannot be identified,

the incident must immediately be reported to

the Director of energy Safety [energySafety] by

telephoning 1800 678 198.

“THIS HAS CReATeD CONFuSION IN THe

INDuSTRy, AS INFORmATION PROVIDeD ON SAFe

WORkING DISTANCeS VARIeS DePeNDING ON WHICH

AuTHORITy IS CONTACTeD.”

Renewable energy technologies and safety

the surge of renewable energy technology

in the marketplace has prompted the

electrical Safety Office (eSO) to investigate

the electrical safety issues of new technology

and initiate a project to ensure safety issues

are understood by industry and government

partners.

Society’s push to reduce its carbon footprint

has seen an increase in the use of renewable

energy technology like photovoltaic solar

panels, wind turbines, motor generator sets

and associated batteries typical for individual

remote area supply.

eLeCTRICAL SAFeTy RISkS HAVe BeeN

IDeNTIFIeD, INCLuDING THe RISk OF FIRe

CAuSeD By: n arcing of solar panelsn electric shock from contact with ‘live’

solar panelsn electric shock to line workers if power is

fed back into the supply grid.

OTHeR POTeNTIAL SAFeTy ISSueS ARe:n live workn protection of electricity distribution

workersn installer qualifications and competencen remote area workn operating voltages.

The eSO is working on a number of

initiatives to minimise the electrical safety risk

and will keep readers informed.

the electrical Safety Office (eSO) and other

electrical safety regulators across Australia

are monitoring fire safety, particularly fires

caused by recessed down-lights which

operate at very high temperatures.

In October 2006 a fire occurred after an

insulation business filled a roof space of a

home with loose fill cellulose-type insulation,

covering the transformer and dichroic down-

lights, the smouldering insulation causing

charring to the house trusses. The magistrate

fined the company $15,000 and ordered it to

pay investigation and court costs.

The eSO recently wrote to members of

the Queensland insulation industry with

information to highlight their responsibilities

under the Australian Standard for thermal

insulation (AS/NZS3999:1992) and to inform

them of their obligations under the electrical

Safety Act 2002 to ensure their business is

conducted in a way that is electrically safe.

The eSO has also been undertaking

statewide audits targeting businesses

installing thermal insulation in roof spaces.

These audits assess the knowledge and

operational aspects of insulation installers

who install insulation near electrical

equipment.

queenslanD

Insulation installers and down-light dangers

up front w

junction box or connectors; the light circuit was

not protected by a RCD or safety switch; and

the power source to the external in-ground pool

was incorrectly installed and defective.

At a considerable cost to the owner, the

qualified electrician carried out extensive

rectification works to make the electrical wiring

compliant and safe.

A brief of evidence is being compiled by Fair

Trading against George Harellis for breaches

of the Home Building Act 1989, electrical

(Consumer Safety) Act 2004, and associated

Regulations.

Fair Trading holds grave concerns that

mr Harellis will continue to seek work as an

electrician, putting the public at further risk.

Accordingly the Commissioner issued the

public warning statement to alert members of

the public and hopefully avert a potential future

tragedy.

Photographs of mr Harellis and his vehicle are

available at www.fairtrading.nsw.gov.au.

south australia

SafeWork SA safe working distances for overhead powerlines

safeWork SA and the Office of the Technical

Regulator have developed a joint safety

guideline, in consultation with construction

and power distribution industry stakeholders,

to clarify safe working distances when working

near overhead powerlines.

Currently, the Occupational Health, Safety

and Welfare (OHSW) Act and Regulations

administered by SafeWork SA, makes

reference to one set of safe working distances

and the electricity Act and Regulations

administered by the Office of the Technical

Regulator stipulates another set of safe

working distances.

This has created confusion in the industry,

as information provided on safe working

distances varies depending on which

authority is contacted.

In order to clarify this situation, an

understanding has been reached between

the Office of the Technical Regulator and

SafeWork SA, whereby any work being

carried out near overhead powerlines by

employees, contractors and sub-contractors

is considered as undertaken in a workplace

and therefore the requirements of OHSW

legislation shall apply at all times.

two separate scenarios applY:

All work activities must comply with the safe

working distances, as required under the

OHSW Regulations 1995, the Approved Code

of Practice (AS/NZS2550) and the applicable

Australian Standard (AS/NZS4576).

Where compliance with Work environment 1

is not possible or reasonably practical, the

safe distances specified in the electricity

Act/Regulations may be applied if all of the

following requirements are satisfied:n Written permission from the electricity

network operator has been obtained;

and -n All conditions specified by the electricity

network operator and Technical Regulator

are complied with;

and -n The electricity network operator is notified

before commencing work;

and -n A spotter (competent person with the

duty of observing and warning against

unsafe approach of the crane, its lifting

attachments or its load to powerlines)

carries out spotting duties at all times;

and -n A documented risk assessment is

carried out before any work commences

in consultation with all relevant parties

involved in the work.

more information can be found at

www.safework.sa.gov.au.

western australia

energySafety WA reporting electrical accidents

regulation 63 of the electricity (Licensing)

Regulations 1991 requires that ‘immediately

after a person becomes aware of an electrical

accident (including ‘electric shocks’), the person

must report the matter to the relevant network

operator.’

This is a change to the requirements that existed

before 1 July 2008 when the person had to report

to the network operator and to the Director of

energy Safety.

Where the report is to be made to Western

Power or Horizon Power, the incident should be

directed to the relevant call centre:n call 13 13 51 Western Powern call 13 23 51 Horizon Power

The call centre, upon receiving notification, will

direct the information to the appropriate area of

the network operator for appropriate investigation.

The network operator will also advise the Director

of energy Safety of the occurrence.

An employee who becomes aware of an

electrical accident must also report the incident

to his or her employer. employers will then report

the incident to the network operator and other

relevant agencies, such as WorkSafe, Resources

Safety etc.

Where the network operator cannot be identified,

the incident must immediately be reported to

the Director of energy Safety [energySafety] by

telephoning 1800 678 198.

“THIS HAS CReATeD CONFuSION IN THe

INDuSTRy, AS INFORmATION PROVIDeD ON SAFe

WORkING DISTANCeS VARIeS DePeNDING ON WHICH

AuTHORITy IS CONTACTeD.”

Renewable energy technologies and safety

the surge of renewable energy technology

in the marketplace has prompted the

electrical Safety Office (eSO) to investigate

the electrical safety issues of new technology

and initiate a project to ensure safety issues

are understood by industry and government

partners.

Society’s push to reduce its carbon footprint

has seen an increase in the use of renewable

energy technology like photovoltaic solar

panels, wind turbines, motor generator sets

and associated batteries typical for individual

remote area supply.

eLeCTRICAL SAFeTy RISkS HAVe BeeN

IDeNTIFIeD, INCLuDING THe RISk OF FIRe

CAuSeD By: n arcing of solar panelsn electric shock from contact with ‘live’

solar panelsn electric shock to line workers if power is

fed back into the supply grid.

OTHeR POTeNTIAL SAFeTy ISSueS ARe:n live workn protection of electricity distribution

workersn installer qualifications and competencen remote area workn operating voltages.

The eSO is working on a number of

initiatives to minimise the electrical safety risk

and will keep readers informed.

the electrical Safety Office (eSO) and other

electrical safety regulators across Australia

are monitoring fire safety, particularly fires

caused by recessed down-lights which

operate at very high temperatures.

In October 2006 a fire occurred after an

insulation business filled a roof space of a

home with loose fill cellulose-type insulation,

covering the transformer and dichroic down-

lights, the smouldering insulation causing

charring to the house trusses. The magistrate

fined the company $15,000 and ordered it to

pay investigation and court costs.

The eSO recently wrote to members of

the Queensland insulation industry with

information to highlight their responsibilities

under the Australian Standard for thermal

insulation (AS/NZS3999:1992) and to inform

them of their obligations under the electrical

Safety Act 2002 to ensure their business is

conducted in a way that is electrically safe.

The eSO has also been undertaking

statewide audits targeting businesses

installing thermal insulation in roof spaces.

These audits assess the knowledge and

operational aspects of insulation installers

who install insulation near electrical

equipment.

queenslanD

Insulation installers and down-light dangers

Barely more than 12 months ago the

stock markets were at all-time highs

and the party had every reason to

continue because, according to the

experts, companies were strong and Australia

had plenty of the resources the rest of the world

needed. Unemployment was at record lows,

Australia was banking record budget surpluses,

and the economy was humming along so soundly

that our biggest problem was the prospect of

further interest rate rises as a mechanism to keep

us from racing along too quickly.

But how quickly this has all turned on its

ear. Those of us who keep an eye on our

superannuation investments know that the

financial markets have been in turmoil since late

2007, but the speed at which this has spread to

the general economy has been staggering.

The Reserve Bank’s official Cash reached a

high of 7.25 percent in March 2008 and was still

at 7.0 percent as recently as September 2008.

Just a few months later, at the time of writing,

the cash rate is 3.25 percent with further

reductions tipped throughout 2009. Some

analysts are forecasting the rate to drop as low

as 2.75 percent.

Oil prices and the Australian/US dollar exchange

rate have also reversed direction dramatically,

reflecting the speed at which global conditions

have impacted on the economy. As recently as

July 2008 oil reached US$147 per barrel yet four

months later it traded below US$50 per barrel.

And over the same period of time, the Australian

dollar fell by 32 percent against the US dollar

reflecting the flow of capital out of Australia and

around the globe.

These statistics show how suddenly things

have hit the wall, generating a sense of great

uncertainty in the business community. Exactly

how a US housing and debt crisis had a world-

wide economic ripple-effect is a story on its

own. The issues are real and they are now

staring us in the face.

what now for australia?

Clearly our economy is slowing down along with

those of every other developed country in the

world, and most economists believe this will be

the case throughout 2009 and into 2010.

Whether or not we will officially enter a

recession – two consecutive periods of negative

growth for those interested – is academic and at

this stage there are equal ‘yes’ and ‘no’ camps.

The ‘no’ camp, at least until very recently, included

major players such as the RBA, the Treasury, and

the big banks so we can find comfort in this from

a domestic viewpoint. It is clear, however, that

the US and a number of European economies are

in a recession or headed there very quickly.

The sheer enormity of foreign economies,

particularly the US economy which makes

up about 30 percent of the global economy,

means we must take notice of what happens

elsewhere. It means we are influenced by

them, but there is positive news to be found

for Australians and our economy.

n Our government will inject large sums of

cash into the economy courtesy of the multi-

billion dollar budget surpluses of recent yearsn Our interest rates were high enough at 7.25

percent that the government can afford to

stimulate our economy via interest rate cutsn Consumer sentiment now seems to be

improving through a combination of lower

interest rates, lower fuel costs, and the recent

cash payments to pensioners and parents.

There is debate about what method of

stimulus is best, but at least action can be and

is being taken.

n On the global front, the world’s governments

and central banks have finally begun to take

decisive, unified actions to ensure banking

systems do not failn They have moved to pump large sums of

money into the networks to improve liquidity

and this will flow through domestically and

with their trading partners. For example,

the Chinese government’s injection of

nearly a trillion dollars into infrastructure

projects with large packages also planned

in the US n Improved ‘credit spreads’ show the banks are

starting to feel more comfortable dealing with

each other which will free up more funding n Growth in China has slowed but many

economists are predicting this may be

short-livedn The change in government in the US. Events

such as this are often a catalyst for a change

in sentiment.

Is is almost irrelevant whether we ‘officially’

go into recession or not, but it means there

are enough reasons not to talk ourselves into

What is significant is the part that sentiment

plays in the state of the economy. Whittaker

MacNaught founder and respected author

Noel Whittaker often recounts a story to point

out the importance of sentiment in financial

markets and economies. It is a story about an

old man who lived by the side of a road and

sold hot dogs.

He had no radio and he didn’t read the

newspapers, but he did sell great hot dogs.

He put up signs telling people how good

the hot dogs were and business grew so

he increased his meat and bun orders and

eventually bought a bigger stove to handle

the increasing demand.

But one day it all changed. He had a visit

from his son who was on university holiday.

The son said, “Haven’t you been reading

the newspapers? There’s a big recession. The

European situation is terrible. The domestic

situation is worse.”

Whereupon the father thought, “Well,

my son’s been to university, he reads the

newspapers and he listens to the radio. He

ought to know.”

So he reduced his orders, took down

advertising signs - and sales fell almost

overnight.

“You’re right, son,” the old man said to

his boy. “We’re certainly in the middle of a

great recession.”

what can business owners Do about it?

We may officially enter recession or we may

narrowly avoid one. The truth is, it really doesn’t

matter because what we do know is leaner

times are upon us and businesses that operate

effectively stand a better chance of surviving the

inevitable downturns. And, unfortunately, casual

or undisciplined practices often developed

through the good times come back to haunt

us when we really need to be at our peak

performance levels. As investment guru Warren

Buffett says, “it’s only when the tide goes out

that we see who’s been swimming naked”.

Recent events in the child-care industry have

shown no business is recession proof so, as you

would expect, it all comes back to management

ability and being prepared. Identify those areas

of your business that need improvement and

set about fixing them, quickly. Similarly, identify

what your business does well and maintain those

standards, and even strive to improve on them.

More than ever you will need to manage

your time carefully and get organised. Ensure

the important tasks are addressed in a timely

manner. Do not allow yourself to be distracted

by minor matters when, for example, you need

to be chasing debtors. And on the subject of

debtors, have a clear credit policy and stick to it.

Do not allow the cashflow problems of others

to become your problems. Plenty of profitable

businesses go under in tough times due to lack

of cashflow.

In their book, Driving Small Business (Simon &

Schuster, 2002) Des Knight and Noel Whittaker

observe that unfavourable market conditions

put business operators under pressure and bad

decisions are commonly made because operators

take a short term view. Emotions often play a part

too. This is understandable when you have put so

much effort into building a business. But it is true

decisive and sensible decisions are rarely made

when emotion is involved. Make your decisions

with a clear purpose in mind. Your main focus

must be the business and the task at hand.

Don’t be afraid to seek professional advice.

Accounting, HR, legal, marketing or insurance

matters – advice should be viewed as an

investment in your business that will repay you

many times over.

And finally, it is vital you build and maintain

open and honest communications with your

staff, customers, bank, and suppliers. You’ll

need their support and assistance when times

are tough and stretching credit terms without

making prior arrangements and avoiding phone

calls is the single fastest way to alienate those

you depend on most.

feature : ec

survivalguide to the economic downturn

It seems like only yesterday we were reading the reports of booming

economies, businesses and export commodity exports.

10new year’s

resolutions for your business1 Be disciplined and committed to your business, staff, and customers

2 Stay focused on the core business tasks - don’t allow yourself to be distracted

3 Get organised and manage your time properly

4 Work towards achieving flexibility in all areas of your business - flexibility equals freedom of choice

5 Focus on staff training and mentoring of apprentices - they will be your most valuable asset through good times and bad

6 Review your Business Plan. Redefine your business goals and measure actual achievements against your list of goals

7 Reassess your customer base, reacquaint yourself with your customers’ needs, and re-evaluate your reasons for being in business

8 Constantly monitor systems and procedures - aim to achieve continuous improvement

9 Seek professional advice. Good advice will pay for itself many times over

10 Review your business structure with an insurance expert - what happens if one partner dies, falls ill, divorces, or retires?

* Stephen Horton is an adviser with Whittaker Macnaught, a division of CBA. This advice is general in nature and readers should seek their own expert advice before making financial decisions.