LOlJVI JJIOII..-:J ,+,"'VVIII

health cuts to helpplug $4.5bn drop intax revenue. Page 3.

be-ieftout of consolidation;CEODavid Gonski vows topursue alliances. Page 43

on·Barack Obama in deal toavoid shutdown, page 14.Wall Street, page 21

The Australian Financial Reviewwww.afr.com. Monday 11 April 2011

Letters

Price $3.00 (incl GST)

ASX will find other opportnnitiesTreasurer Wayne Swan's measuredannouncement of the reasons forprohibiting the acquisition of theASX Ltd by the Singapore StockExchange provides a solidexplanation of the reasons why thedeal was turned down, and clearexposition of what is required for anarrangement between the ASX andanother global exchange.

The terms the Treasurer has setout that any proposed deal mustmeet are substantial andconvincing: protecting the integrityof Australia's financial architectureand regulatory framework; buildingAustralia's standing as a significantfinancial services centre in Asia;increasing Australia's integrationinto global capital markets andexchange networks; meaningfullyboosting access to capital forAustralian businesses; supportinggrowth in high-quality financialservices jobs; and being consistent

with increased competition betweenfinancial exchanges in Australia.

These are all vital prerequisitesfor confidence in any consolidationof the ASX with other exchangesoverseas. To suggest that the ASXhas missed the boat in not beingtaken over by the sax is facile.

There will be many opportunitiesin future for tne ASX to prove itsenduring robustness and significantcontribution to the Australianeconomy. There will be otheropportunities to work towards anagreement with a major overseasexchange for greater collaboration.

The London Stock Exchange'scurrent bid for the Toronto StockExchange, and Deutsche Boerse'sbid for NYSE Euronext, with therival Nasdaq OMX bid, indicate ahighly fluid cpntext.

It is perfectly possible that theASX will be able to negotiate in thefuture a far more attractive merger

with a much better establishedglobal player than the Sax. Andto respect the requirements theTreasurer has insisted on regardingthe regulatory and competitiveimplications, together with theambitions to promote Australia as afinance centre, and enhance accessto capital

The beat-up on Swan over hisconsideration of this ASX-SaXdeal, which is of the greatestsignificance to the strategic futureof Australia's economy, has attimes seemed opportunist andunprincipled.

It is rare that all of Australia'sregulatory ducks line up in a neatrow, but here we have theAustralian Securities andInvestments Commission, theReserve Bank of Australia, theForeign Investment Review Boardand Treasury all accepting that"the opportunities that were offered

under the proposal were clearly notsufficient to justify this loss ofsovereignty".

Many will agree with theTreasurer's comment on the ASX·sax deal that "the claimed benefitsof this transaction are likely to beoverstated". The apparententhusiasm for the takeover of theASX by the smaller sax from thescions of the Australian businessestablishment, which has beenmaintained from the firstannouncement of the bid to theannouncement of its failure (TheAustralian Financial Review, April7), is slightly baffling.

If the opportunities are asconsider~ble as leading businesspeople are claiming, why was therenot an ASX bid for the SaX?

Thomas ClarkeCentre for Corporate Governance

UTS Sydney NSW

Hooke stretchescouncil's credibilityNo surprise to see Mitch Hooke ofthe Minerals Council of Australiamounting another attack on apollution price ("Miners wantmore", April 8).

It's a predictable attempt toprotect the big profits of the bigminers, some of Australia'swealthiest and dirtiest companies.

But what about the credibility ofthe Minerals Council? In 2009 itreleased a report claiming anemissions trading scheme wouldslash 23,500 jobs in the miningsector. A closer look at the reportshows that under an ETS, jobswould increase by 50,000 by 2025,whereas they would grow by 73,000with no carbon price at all

Rio Tinto, despite tripling itsprofits in 2010, complained aboutthe "excessive" cost of the carbonpollution reduction scheme -$3 billion over 10 years.

Our analysis shows that underthe CPRS, Rio was set to be thetop recipient of taxpayer-funded""mnensation. receivin~

The Australian Financial Reviewwww.afr.com. Monday 11 April 2011

LettersASX will find other opportrnritiesTreasurer Wayne Swan's measuredannouncement of the reasons forprohibiting the acquisition of theASX Ltd by the Singapore StockExchange provides a solidexplanation of the reasons why thedeal was turned down, and clearexposition of what is required for anarrangement between the ASX andanother global exchange.

The terms the Treasurer has setout that any proposed deal mustmeet are substantial andconvincing: protecting the integrityof Australia's financial architectureand regulatory framework; buildingAustralia's standing as a significantfinancial services centre in Asia;increasing Australia's integrationinto global capital markets andexchange networks; meaningfullyboosting access to capital forAustralian businesses; supportinggrowth in high-quality financialservices jobs; and being consistent

Here's a few ideasfor the budget

with increased competition betweenfinancial exchanges in Australia.

These are all vital prerequisitesfor confidence in any consolidationof the ASX with other exchangesoverseas. To suggest that the ASXhas missed the boat in not beingtaken over by the SGX is facile.

There will be many opportunitiesin future for the ASX to prove itsenduring robustness and significantcontribution to the Australianeconomy. There will be otheropportunities to work towards ailagreement with a major overseasexchange for greater collaboration.

The London Stock Exchange'scurrent bid for the Toronto StockExchange, and Deutsche Boerse'sbid for NYSE Euronext, with therival Nasdaq OMX bid, indicate ahighly fluid c9ntext.

It is perfectly possible that theASX will be able to negotiate in thefuture a far more attractive merger

with a much better establishedglobal player than the SGX Andto respect the requirements theTreasurer has insisted on regardingthe regulatory and competitiveimplications, together with theambitions to promote Australia as afinance centre, and enhance accessto capital.

The beat-up on Swan over hisconsideration of this ASX-SGXdeal, which is of the greatestsignificance to the strategic futureof Australia's economy, has attimes seemed opportunist andunprincipled.

It is rare that all of Australia'sregulatory ducks line up in a neatrow, but here we have theAustralian Securities andInvestments Commission, theReserve Bank of Australia, theForeign Investment Review Boardand Treasury all accepting that"the opportunities that were offered

under the proposal were clearly notsufficient to justify this loss ofsovereignty".

Many will agree with the _Treasurer's comment on the ASX-SGX deal that "the claimed benefitsof this transaction are likely to beoverstated". The apparententhusiasm for the takeover of theASX by the smaller SGX from thescions of the Australian businessestablishment, which has beenmaintained from the firstannouncement of the bid to theannouncement of its failure (TheAustralian Financial Review, April7), is slightly baffling.

If the opportunities are asconsiderable as leading businesspeople are claiming, why was therenot an ASX bid for the SGX?

Thomas ClarkeCentre for Corporate Governance

UTS Sydney NSW

\H'~(v\oNOfoU( ..ffRt~c:r fo\2- Pr &OOP~rCrWr( SU;8'

A-tJD OCLA-nVNkLU{ SMO'fttfiZ:fNG-~o'M~ON(__.

..../

Hookestretchescouncil's· credibilityNo surprise to see Mitch Hooke ofthe Minerals Council of Australiamounting another attack on apollution price ("Miners wantmore", April 8).. It's a predictable attempt toprotect the big profits of the bigminers, some of Australia'swealthiest and dirtiest companies.

But what about the credibility ofthe Minerals Council? In 2009 itreleased a report claiming anemissions trading scheme wouldslash 23,500 jobs in the miningsector. A closer look at the reportshows that under an ETS, jobswould increase by 50,000 by 2025,whereas they would grow by 73,000with no carbon price at all.

Rio Tinto, despite tripling itsprofits in 2010, complained aboutthe "excessive" cost of the carbonpollution reduction scheme -$3 billion over 10 years.

Our analysis shows that underthe CPRS, Rio was set to be thetop recipient of taxpayer-fundedcompensation, receiving$2.8 billion in the first five years.

It's what the big polluters don'ttalk about that is most revealing.

Australian taxpayers currentlyfund $12 billion worth of subsidiesthat encourage greenhousepollution. The mining industryalone receives an annual taxpayer-funded gift of. $1.7 billion from thefuel tax credits scheme, at a costof $200 to every Australianhousehold.