Poor English 'saved Japan bankers' in GFC

JAPAN'S banks emerged from the 2008 global credit crisis largely unscathed because senior employees did not speak English well enough to have got them into trouble, the country's finance minister says.

Taro Aso, who also serves as deputy prime minister, said bankers in Japan had not been able to understand the complex financial instruments that were the undoing of major global players, so had not bought them.

"Many people fell prey to the dubious products, or so-called subprime loans. Japanese banks were not so much attracted to these products, compared with European banks," Aso told a seminar in Tokyo.

"There was an American who said Japanese banks are healthy, but that's not true at all.

"Managers of Japanese banks hardly understood English, that's why they didn't buy," he said.

Aso's comments are the latest in a line of pronouncements that have raised eyebrows.

The one-time prime minister said in January the elderly should be allowed to "hurry up and die" instead of costing the government money with expensive end-of-life medical care.

In 2007 he had to apologise for a quip about patients with Alzheimer's disease and for making light of flood damage in central Japan.

But the deputy prime minister, who is known as a dapper dresser and is often seen sporting a jauntily-angled hat, on Friday boasted he had managed to keep his foot out of his mouth since Shinzo Abe came to power as premier in December.

However, the boast was somewhat undermined when he initially got the name of the prime minister wrong.

"I have made no gaffes in the past half year even as newspapers said the Aso administration's... No, the Abe administration's biggest problem is Taro Aso's gaffes," he said.

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NSW public servant wages to pay for super

PUBLIC servants will have to pay for superannuation increases out of their own wage packets after the NSW government tinkered with a loophole in its wages policy.

The move circumvents a ruling by the industrial umpire, which earlier this week found the mandatory superannuation increases didn't have to be absorbed into basic wages.

Unions claimed the Industrial Relations Commission (IRC) ruling was a victory for public sector workers, saying they were entitled to both their pay rise and the quarter per cent superannuation increase.

But in a statement on Tuesday, NSW Treasurer Mike Baird said the government had "clarified the regulation" informing its wages policy.

It also intends to appeal against the IRC decision.

"The NSW government makes no apologies for taking every effort to ensure fair and affordable wages are provided across the public sector," Mr Baird said.

This means the 0.25 percentage point increase in super due to begin on July 1 will now be absorbed into the 2.5 per cent cap on wage increases for public servants, effectively giving them a 2.25 per cent increase

Mr Baird said the move could prevent the loss of 8,000 public sector jobs.

He conceded the IRC had upheld a submission by unions, but said it had "simultaneously suggested ways the regulation could be reworded".

The IRC had also confirmed superannuation was an employee-related cost, he added.

"It is therefore within the 2.5 per cent wages policy".

Unions NSW Secretary Mark Lennon said the government had shown an appalling lack of good faith in overturning the IRC's decision.

"The government has lost its moral compass when it comes to its employees," he said.

"This is a highly cynical move, announced late on a Friday afternoon while the public attention is fixed on Canberra."

Mr Lennon accused the government of trashing proper process.

"How does this government think it is going to attract the nurses, teachers, police and firefighters this state needs when wages are effectively stagnating or going backwards?" he asked.

Health Services Union NSW secretary Gerard Hayes said the government was making a mockery of the state's industrial laws.

The union has written to Mr Baird to request the government reimburse some of the union's legal expenses.

"If the government does not intend to live by the decisions of the Industrial Relations Commission it ought to refund the tens of thousands of dollars we have to spend in legal fees fighting their odious decisions," Mr Hayes said.

Opposition industrial relations spokesman Adam Searle said this was typical of a government that can't accept the decision of the independent umpire.

"This is a mean and tricky manoeuvre which will see the O'Farrell government dip its hand into the pockets of every public servant in the state," Mr Searle said.

"Superannuation is a basic condition that should never be used to offset the guaranteed 2.5 per cent wage increase public sector workers were promised."

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Russia police arrest 1400 illegal migrants

RUSSIAN police have detained almost 1400 illegal migrants living in a makeshift village in Moscow, police say.

The raid targeted a settlement in the city's southeast, where some 1380 migrant workers from Central Asia lived in crowded rooms, the Interfax news agency reported.

According to police, each room housed eight or nine men in bunk beds, who cooked meals on electric stoves.

The fenced settlement of two- and three-storey houses was built by Turkish firm Enka instead of what should have been an office and shopping complex, police said.

The illegal dwellers were mainly form Uzbekistan and Tajikistan, the report said.

They were taken to police stations where they were fined for administrative violations before being released.

The raid is the latest in a police campaign against migrant labourers in Moscow.

Police said earlier this month that they uncovered a vast underground complex, in which migrants kept a canteen, cinema and chicken coop.

Experts believe that illegal migrants add another five million to the Russian capital's official population of 12 million.

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Market rally comes to an end

AUSTRALIAN shares fell flat on the last day of trade in the financial year as cautious investors sold mining and insurance stocks.

Australia's share market gained 17 per cent over the past year, but the final week of 2012/13 proved a roller coaster ride as global markets worried about an end to US stimulus measures.

The local market plunged on Monday, rallied on Wednesday and Thursday, then lost momentum on Friday.

Insurers were out of favour with investors, with AMP losing 14 cents to $4.25, QBE dropped 23 cents to $15.09, IAG shed seven cents to $5.44 and Suncorp closed 10 cents lower at $11.92.

Miners also fell, with BHP Billiton losing 10 cents to $31.37, Fortescue dropped six cents to $3.04 and gold miner Newcrest shed three cents to $9.87.

Rio Tinto was firmer though, adding 58 cents to $52.37.

RBS Morgans senior private client adviser Bill Chatterton said the rise in big banks' share prices over the financial year showed stocks with high dividends were maintaining their favour.

"Investors, they're quite cautious at the moment and they're still quite focused on yield," he said.

"The yield theme, which has been quite dominant, certainly in the last 12 months, I think that will continue."

Three of the big four banks made gains on Friday, with Westpac putting on seven cents to $28.88, as ANZ added seven cents to $28.58 and Commonwealth Bank gained two cents to $69.18.

NAB lost seven cents to $29.68.

Elsewhere, Caltex shares fell heavily after the oil refiner and distributor forecast a weaker net profit.

Its shares dropped by $2.42, or 11.8 per cent, to $18.05.

Seven Group shares were also sold off as its heavy machinery dealer WesTrac announced 350 job cuts in response to challenging market conditions.

Its shares ended at $6.90, down 23 cents.

KEY FACTS

* At the close on Friday, the benchmark S&P/ASX200 index was down 8.7 points, or 0.18 per cent, at 4,802.6.

* The broader All Ordinaries index was down 9.4 points, or 0.2 per cent, at 4,775.4.

* The September share price index futures contract was seven points lower at 4,767, with 28,821 contracts.

* The spot price of gold in Sydney finished at $US1,204.00, down $US35.43 from Thursday's close at $US1,239.43.

* National turnover was 2.02 billion securities worth $7.4 billion.

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Journo wanted to help abuse victims

A JOURNALIST has told an inquiry that she wrote a series of newspaper articles about child sexual abuse by priests because she wanted to help the victims.

Newcastle Herald journalist Joanne McCarthy's articles, over two years from 2010, led to the establishment of the special commission of inquiry into child abuse allegations in the Hunter region and won her a top national award for investigative journalism.

"It was my only objective," Ms McCarthy told Commissioner Margaret Cunneen in the Newcastle Supreme Court on Monday.

"It was about having the victims and their families looked after.

"I didn't want to go the police.

"I wanted the police to investigate."

Ms Cunneen is examining how police and Maitland/Newcastle Catholic Church priests and officials handled child sex allegations, particularly those involving Fr Denis McAlinden and Fr James Fletcher, who are now dead.

Some of Ms McCarthy's articles were based on information from whistleblower Detective Chief inspector Peter Fox who asserted that church leaders covered up crimes and were assisted by a "Catholic mafia" within police ranks.

A succession of police took to the witness stand during the commission's first session last month denying Det Insp Fox's allegations.

Ms McCarthy, who will continue giving evidence on Tuesday, said the community, the media and politicians had to overcome a "but-this-is-the-church" attitude and ensure child sexual abuse crimes were appropriately investigated and victims cared for.

Earlier on Monday the officer in charge of a taskforce investigating complaints by four alleged victims of the two priests, Detective Sergeant Jeffery Little, said a police report on the matter by Det Insp Fox was "written on a saddle of lies".

Sergeant Little said the report included "significant" inaccuracies and comments made by Det Insp Fox were "a manipulation of the truth".

"I was absolutely mortified by (his) comments that the strike force was a sham and set up to fail," Sgt Little said.

Ms Cunneen is scheduled to report her findings to the state government by September 30.

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12 soldiers killed in Lebanon clashes

Three soldiers died in a clash with supporters of anti-Hezbollah sheik Ahmed al-Assir in Lebanon. Source: AAP

TWELVE soldiers have been killed in clashes with supporters of a radical Sunni cleric in southern Lebanon, the army says, in violence tied to rising sectarian tensions fanned by the Syrian conflict.

The fighting began on Sunday on the outskirts of the city of Sidon and intensified on Monday morning, witnesses and local media said, spreading to parts of the nearby Palestinian Ain al-Helweh camp.

It is the worst violence to hit Lebanon since the beginning of the Syrian conflict, which has exacerbated sectarian tensions in the country, particularly between Shi'ite supporters of the Syrian regime, and Sunni backers of the uprising.

The Lebanese press warned that the country "finds itself before a decisive test", evoking the spectre of the civil war that devastated the nation between 1975 and 1990.

The violence in Sidon began when supporters of Salafi cleric Sheikh Ahmad al-Assir opened fire on an army checkpoint on Sunday afternoon.

Witnesses said the fighting had intensified on Monday, reporting heavy gunfire and the sound of mortar and rocket fire in the Abra neighbourhood on the eastern outskirts of the coastal city.

"The clashes are very violent, we can hear intense rocket fire and gunfire every few minutes," an Abra resident told AFP.

An army spokesman told AFP that 12 soldiers had been killed since the fighting began on Sunday, and medical sources reported at least 35 wounded, mostly civilians.

A source close to Assir said at least five of his supporters had been killed in the fighting.

Assir's brother told AFP that the cleric and his supporters were inside Abra's Bilal Bin Rabah mosque, where Assir preaches, with the National News Agency saying the army was "metres" away.

"There has been a decision taken to finish us off, but we're resisting up until now," Amjad al-Assir told AFP by phone.

"Sheikh Assir will stay in the mosque until the last drop of blood."

Assir was a virtual unknown before the conflict in Syria began in March 2011, but has made headlines for his vocal criticism of Lebanon's Shi'ite group Hezbollah, and its alliance with the Syrian regime.

He has accused the Lebanese army of backing the powerful movement and turning a blind eye to both its weapons and its dispatch of fighters to battle alongside Syrian troops against rebel forces.

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Hearings wrap up for ex-Gunns boss

FORMER Gunns chairman John Gay has been remanded on bail until the beginning of his trial on insider trading charges.

Mr Gay is scheduled to front the Tasmanian Supreme Court in Launceston from August 5 after preliminary proceedings hearings were concluded on Monday.

He has pleaded not guilty to two charges of insider trading in which it is alleged he sold 3.4 million shares, worth around $3 million, with knowledge about Gunns' performance that was not generally available to the market.

Defence lawyer Neil Clelland SC cross-examined corporate valuer Wayne Lonergan, who prepared two reports for the Australian Securities and Investment Commission on how a "hypothetical investor" would behave with information known only to the company's board.

Mr Lonergan told the Launceston magistrates Court such an investor would have been "seriously disturbed" by information the board held on the company's performance in October and November 2009.

"The company had been historically profitable," Mr Lonergan said.

"What they're now looking at ... is a very significant deterioration.

"That's a very serious situation."

Mr Lonergan said stockbrokers were forecasting a modest downturn in profits, while Gunns management was expecting a decline of more than 100 per cent.

Gunns reported a 98 per cent deterioration in half yearly earnings in February 2010 and its share price plummeted.

Mr Lonergan said stockbrokers had described the unexpected result as "a shocker".

The court had previously been told Mr Gay had disposed of the shares to organise his affairs after being diagnosed with prostate cancer.

He kept another eight million shares in the company, which collapsed into administration last September.

Mr Gay's trial is expected to run for two to three weeks.

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Another Dreamliner makes emergency landing

A BOEING 787 Dreamliner jet was forced to make an emergency landing during an internal US flight because of a problem with its brake system, United Airlines says.

"United flight 94 from Houston to Denver returned to Houston on Sunday due to a brake indicator issue," the US carrier said in a statement.

"Following standard operating procedures, as a precautionary measure, the flight landed in emergency status. The aircraft landed safely at 11.58am CT and our maintenance team is conducting a review of the aircraft," the statement continued.

The flight had departed nearly three hours earlier, at 9.12am local time (0014 AEST Monday).

A spokeswoman for Boeing, which makes the Dreamliner, said the problem with the braking system forced the plane "back to base", without giving details of the malfunction or how long it might take to repair it.

Leach said a Boeing field service representative was on the scene in Houston to help the airline with the issue, including getting the aeroplane back into service and dealing with stranded passengers.

It marks the latest problem to plague Boeing's flagship plane and at least the third in a month.

An All Nippon Airways flight on the Dreamliner was cancelled on June 12 when an engine would not start. A day earlier, a Singapore-bound flight operated by Japan Airlines had to turn back mid-flight because of a problem with the anti-icing system.

The worldwide fleet of Dreamliners was grounded for four months earlier this year when problems were discovered with its battery systems.

A global grounding order was issued in January after lithium-ion batteries overheated on two different planes, with one of them catching fire while the aircraft was parked.

Boeing admitted in April that despite months of testing it did not know the root cause of the problems, but rolled out modifications it said would ensure the issue did not recur.

Nevertheless, in a bid to show it was back on track after the technical issues with the jetliner, the aerospace company announced at the Paris Air Show on June 18 that it was launching a new version of the Dreamliner, with over 100 orders worth about $US30 billion ($A32.71 billion).

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