The Queensland governing administration will supply $150 million in loans to the state’s university sector, which has endured in the wake of the coronavirus pandemic.
“Countless numbers of persons right throughout regional Queensland count on universities for a task,” Premier Annastacia Palaszczuk said on Sunday.
“This package will aid to hold all our universities open, safeguarding these positions.”
Universities will be able to implement for financial loans with five-calendar year compensation terms to support dollars stream, retain employees and retain exploration assignments.
Queensland universities, and universities throughout the region, have dropped profits for the duration of the pandemic soon after Australia’s borders were being shut, limiting the movement of global learners.
The Queensland university sector has reported it will drop much more than $1 billion this 12 months, putting 4000 work at hazard.
Until finally the pandemic strike, the worldwide university student current market in the state was well worth $3 billion a yr.
Individuals in Australia must continue to be at the very least 1.5 metres absent from other people. Look at your state’s limitations on accumulating restrictions.
If you are encountering cold or flu signs or symptoms, keep dwelling and set up a exam by contacting your doctor or speak to the Coronavirus Health and fitness Facts Hotline on 1800 020 080. Information and facts is offered in 63 languages at sbs.com.au/coronavirus
A fossick into the Coalition’s new university fees policy reveals a schedule increasingly onerous for students, inconsistent in government contributions, shallow in economic rationales and not serious about equity issues.
This package tabulates current and proposed, government and student contributions, for 22 fields of tertiary study.
In most fields, the government contributes $13,500 or $16,500 a year, with four outliers on $1,100, and four on $27,000. In most fields, students chip in $7,700, $11,300, or the brand-new high of $14,500. Seven outliers go to a brand-new low of $3,700, supposedly based on ‘private returns and national priorities’.
The Minister and the Education Department offer various alibis for their contributions mash-up including that:
student fees are still reasonable;
combined course contributions better match course costs;
degrees in higher “growth” areas deserve lower fees; and
the package includes disadvantage measures.
Student fees are onerous, in the current national situation
The Minister says (local) students will pay less than they do in “similar” countries like the U.S. and the UK. Now more than ever, who wants to be compared with those coronavirus-infected nations?
A recession with high unemployment is a tough time to saddle local youth with up to $23,100-43,500 for a three-year degree and $30,800-58,000 for four years.
Not what mildly egalitarian European nations would do. For locals, even internationals in some cases, they still offer low-fee or free degrees. Quaintly, they perceive education as something of a basic human right, or equality marker. Rather than a pricey private investment, or market commodity.
Glossing the economic train-wreck, the Education Minister claims 60% of students will pay the same or lower fees. While eligible students access the oxymoronic “world-leading” income-contingent loan scheme.
Yet it appears students will now cover even more of overall course costs.
Uneven government v student course contributions
The second alibi, according to Tehan is that total (government plus student) funding will better match “contemporary” delivery costs, in each field. Satisfying stuff — for bean-counters.
In most fields, the government picks up more of the total costs. In just a few, the student. According to Tehan, the student contribution for law and commerce will increase by 28% and for the humanities by 113%. But those domains aren’t really comparable. Only the first two are well-trodden avenues to higher “private returns”.
Why hoist humanities (or communications) to $14,500 student contribution, with only $1,100 government top-up? As English and languages plummet to $3,700, with $13,500 and $16,500, respectively, from the government. Surely the last two aren’t vastly more costly to deliver, or crucially larger “national priorities”.
Perhaps Tehan doesn’t want students to miss out on language study? As he did. The predictable outrage over humanities is a bonus.
Shallow rationales for lower v higher student contributions
Tehan’s key alibi is lower student contributions, in predicted areas of employment “growth”. He settles on health, science and technology, education, and construction.
This early into COVID-19, why base policy intricacies on what 73 professors call “untenable assumptions” about future industry-growth patterns?
Nevertheless, courses in Tehan growth-areas go “cheaper” because the Government wants the “best outcomes” for the broader public. Because the Department guards over “private returns” and “national priorities”.
As the professors retort, increasingly differentiated student contributions teem with “unintended consequences”. In crude paraphrase, universities suddenly shriven of colossal overseas-student revenues will game the system more than usual.
“Teachers, nurses, engineers, scientists—these are the workers our economy needs—will see significantly lower student contributions.”
Indeed, nursing nearly halves, to $3,700 annually. Different story elsewhere in the health industry.
“Allied health” and “other health” are still $7,700. The prized medical, dental and vet science courses drop $55, to $11,300. Enough for a couple of ales at the uni bar.
These days, medicine is more open. But the entitled kids still have the inside run.
Science (also environmental studies) and engineering student contributions are still sizable, at $7,700. And the Government is cutting its contributions to all three.
As we’re “looking over there” at nursing, Tehan also discounts teaching, agriculture, mathematics and clinical psychology — to the bargain-basement $3,700 category.
These disciplines will perhaps train the “workers” we “need”. But why position the last three science-related on half the student contributions of six other science-related courses?
Package shirks social mobility and private reward issues
Tehan promises a “regional education commissioner” with“$500 million a year to universities to support Indigenous, regional and low socio-economic students”. On less than 5% of Federal university funding, the commissioner won’t jolt inequalities of learning opportunity. He’s a band-aid over big schooling disparities.
Compare us with socially-mobile Finland — strangely reluctant to emulate our world-leading divisive and discriminatory school system. Like other Finnish degrees, teaching doesn’t rack up student fees. Entry is keenly sought, though other professions earn more.
In equity terms, graduate starting salaries say little. Novice nurse and teacher salaries are competitive. More telling are (private sector) occupational earnings. Three years after graduation, medicine, dentistry, engineering and law have already jumped ahead.
Then really lucrative careers cluster in law, business and finance, medicine and engineering. Despite Malcolm Turnbull’s cautionary tale, lucky graduates can glom eye-watering loot. No surprise, students heft big contributions for these types of degrees. Law and economics, also management and commerce, go onto $14,500 annually. At $11,300 and $7,700 per annum, medicine, dentistry and engineering are still substantial.
Chump change, in well-heeled households. Tougher ask, for ordinary families and students.
Maybe it doesn’t matter. Two-fifths of school-leavers already attend university. “World-leading” loans, so they say, neutralise big tickets on desirable degrees. Debates about elite students, they also say, are “stale”. After all, none of us likes the “politics of envy”.
While Australian women (especially private school alumnae) keep on acing university entry, then, as graduates, earn much less than the men. You guessed it, a lot of them do nursing and teaching. Tehan’s discount courses.
More than likely, the traditionally lucrative degrees will still offer solid earnings premiums. Other COVID-era graduates – Tehan patronises them as the “Costello Baby Boom” generation – might be in hock for a while. Fortunately, no $100,000 degrees. Not just yet…
It’s less than likely, that Tehan will agree to “shelve” legislation for the package as the professors suggest. Let’s hope the parliamentary deliberations instil more consistency and fairness.
Stephen Saunders is a former public servant, consultant and Canberra Times reviewer.
House Speaker Nancy Pelosi of Calif. speaks at a news conference on Capitol Hill in Washington, Friday, July 24, 2020, on the extension of federal unemployment benefits. (AP Photo/Andrew Harnik)
OAN Newsroom UPDATED 3:45 PM PT — Saturday, July 25, 2020
The House of Representatives has passed one of two major spending packages for the 2021 fiscal year. It was passed largely along party lines.
The $259 billion legislation was made up of four smaller bills. Each section outlined the budget for individual departments, including State, Foreign Operations, Agriculture, Interior, Environment, Military, Construction and Veterans Affairs.
“I am proud of the work we have completed under the incredibly difficult circumstances of the COVID-19 pandemic,” stated Rep. Nita Lowey (D-N.Y.). “This appropriations package addresses urgent national priorities.”
The foreign operations aspect of the package will provide assistance to countries such as Israel and Egypt. The agricultural bill outlined the allocation of $1 billion, which will be used to expand rural broadband and nutritional assistance programs.
FILE – In this May 21, 2020 file photo, a man looks at signs displayed of a store closing due to the coronavirus pandemic in Niles, Ill. (AP Photo/Nam Y. Huh, File)
The interior bill will fund arts and humanities programs, as well as museums. It will also designate funds for the National Endowment for the Humanities.
However, the package also called for funding to the World Health Organization. This controversial move came after the president vowed to cut ties with the group, which he has blamed for the pandemic.
Additionally, it would increase funds for the Environmental Protection Agency, which President Trump has attempted to roll back. The package also sought to block the president from using military construction funds to build the border wall.
Republicans lawmakers have offered praise for the bill, but raised concerns about what they are calling “fatal flaws.”
“I hope members on both sides of the aisle will agree it is more productive to fund programs of bipartisan support than to fund partisan efforts that have no chance at becoming law,” said Rep. Kay Granger (R-Texas).
Senate Minority Leader Sen. Chuck Schumer of N.Y., center, joined by Sen. Richard Durbin, D-Ill., right and Sen. Debbie Stabenow, D-Wis., speaks during a news conference on Capitol Hill in Washington, Tuesday, July 21, 2020. (AP Photo/Carolyn Kaster)
The House also adapted amendments to block President Trump’s use of emergency authority, which he has used to keep meat plants open during the pandemic. These additions would also prevent drilling in the Arctic National Wildlife Refuge and ban any government contracts with President Trump’s businesses.
Overall, the budget surpassed expectations by $40 billion, which Democrats claimed will address some emergency supplemental spending in the wake of the pandemic.
Moving forward, the Senate Appropriations Committee will take up the matter. They’re expected to push back against some of these provisions.
The second spending bill will be up for a House vote next week.
EU leaders on Tuesday authorised a landmark stimulus bundle to battle the withering aftershocks of the coronavirus outbreak that has sunk Europe into its deepest recession in record.
The 750-billion-euro (AU$1.2 trillion) deal was sealed just after four days and nights of rigorous negotiation that noticed threats of walkouts and intense intransigence by the Netherlands.
“Offer!” tweeted EU Council Chief Charles Michel, whose occupation was to guide the tortuous talks about far more than 90 several hours.
The bundle, seen by AFP, was produced possible by the critical backing of Germany and France and includes the greatest ever joint borrowing by the 27 associates of the bloc, a little something that had been resisted by Berlin for generations.
The offer is a particular victory for French President Emmanuel Macron who came to business office in 2017 committed to fortify the European Union, but had struggled to produce against member states with much less ambition for the 7-ten years-outdated EU undertaking.
He hailed “a historic working day” for Europe.
The offer will mail tens of billions of euros to international locations toughest hit by the virus, most notably intensely indebted Spain and Italy that had lobbied tough for a main gesture from their EU companions.
Germany’s Chancellor Angela Merkel gestures as she speaks with France’s President Emmanuel Macron and Sweden’s Prime Minister Stefan Lofven
Their get in touch with for solidarity was fulfilled with the intense opposition of the “Frugals”, a team of small, northern nations led by Netherlands, who believed strongly that the stimulus deal was needless.
The frugals ended up also deeply apprehensive of sending income to southern nations that they see as too lax with general public investing.
To fulfill their worries, payouts from the package deal will occur with crucial strings attached — a challenging tablet to swallow for Rome and Madrid who deeply resisted everything resembling the harsh bailouts imposed on Greece, Portugal or Eire throughout the debt crisis.
The frugals ended up also enticed with heavy rebates on their EU contributions, furthering a apply first presented to Britain a long time back, when it was continue to a member.
The restoration package will complement the unparalleled financial stimulus at the European Central Lender, that has largely succeeded in reassuring the monetary markets even with a catastrophic economic downturn in Europe.
All round, the offer will dole out 390 billion in the kind of grants to pandemic-strike international locations.
That was reduced than an unique 500 billion euro proposal made by France and Germany. One more 360 billion euros was to be disbursed in loans, repayable by the member point out.
Leaders met in the largest meeting place to observe social distancing
The stimulus payments will not be blank cheques to member states.
Paying will be carefully controlled and ought to be devoted to guidelines observed as compatible with European priorities, such as politically difficult financial reforms as perfectly as the environment.
The European Fee, the EU’s executive arm, will be in demand of distributing the money, with the 27 member states equipped to turn down a shelling out system if a weighted majority of them choose to intervene.
The rescue package was agreed alongside with the EU’s extensive-expression spending budget, bringing the agreed paying to 1.8 trillion euros by 2027.
The plan was practically upended by Hungary and Poland due to a desire that EU payouts be tied to the “Rule of Legislation”, Brussels jargon for upholding legal guidelines on liberty of speech and an impartial judiciary.
Budapest and Warsaw are under fireplace for offending EU norms, but a proposal to tie the EU finances to those problems was watered down to the gratification of Hungarian Key Minister Viktor Orban and his Polish counterpart.
The bundle now requires far more specialized negotiations between member states as very well as a ratification by the European Parliament that could transpire as quickly as Thursday.
Individuals in Australia must continue to be at least 1.5 metres absent from other folks. Check your state’s restrictions on collecting limits.
If you are experiencing cold or flu symptoms, stay property and set up a check by contacting your medical professional or call the Coronavirus Health and fitness Details Hotline on 1800 020 080.
Lorna Jane’s ‘protective’ lively use, the federal government’s new employment offer, and far more of the most up-to-date coronavirus news.
The authorities announces yet another task deal. The lively dress in promising to shield versus viruses and germs. Queensland is now home to all Victorian AFL groups. And chaos still reigns in the US.
(Health and fitness center) trousers on fire
The Royal Australian Faculty of Basic Practitioners (RACGP) has accused energetic use brand name Lorna Jane of exploiting consumers’ fears about COVID-19 with a new line of clothes it claims protects wearers against viruses and micro organism.
The business advertises that a non-chemical, h2o-centered mist sprayed on the apparel produces a lasting shield to be certain microbes, mould and “infectious illnesses like COVID-19”.
As major media outlets pulled out of their country operations during the coronavirus crisis, a handful of smaller start-ups stepped in to help tell local stories, but some media experts are concerned a $50 million Federal Government grant will not be enough to keep them in business.
The Public Interest News Gathering fund is this week offering financial assistance to five TV and 13 radio stations, and 92 newspapers
The Country Press Association says the money will mostly benefit major media companies and not support smaller start-ups who are attempting to fill the void in local news
The Media, Entertainment and Arts Alliance is not confident newspaper titles will return to print, but is hopeful they will do so to comply with the fund conditions
In order to be eligible for the financial assistance, media companies were required to demonstrate a history of delivering public interest journalism and details of previous financial year income.
That is, any first-time publisher keen to start a local newspaper in their town during the regional coverage stand down was excluded from the fund regardless of qualification, experience or community connection.
Of the 107 applicants found to be eligible this week, are major media companies Southern Cross Austereo, Prime Media, Nine Entertainment, Seven West Media, and Australian Community Media.
It has left some media experts concerned that the fund falls short of supporting regional newspapers, and that small towns left without local coverage during the public health crisis might not want major players back.
‘Social media does not fill that gap’
Journalist, photographer, editor and media trainer Andrew Hennell said he was disappointed the fund could not help support his interest in starting up a weekly print and online local paper, the Yass Courier.
Yass, about an hour’s drive north-west of Canberra, had been serviced by a twice-weekly Australian Community Media title, the Tribune, until the company stood down its reporter and stopped its press in April.
The Yass Valley is home to more than 16,000 people, with about a third living in the main town. The Tribune had a printing lineage, under various owners and names, that dated back to 1854.
Newspapers are “critical for regional areas in particular,” Mr Hennell said.
“It’s difficult to know what’s going on in the town without that,” he said.
“Local business, local council, even MPs, state and federal: since the Tribune stopped publishing here, there’s been a huge vacuum in that information, and social media does not fill that gap with any credible source.”
The fund had seemed “really good” because “media is an expensive game to be in,” Mr Hennell said.
“With media outlets closing and that vacuum of local and regional news, the Government [needs to] look at ways of supporting new initiatives to fill that gap.”
‘How much does the government value journalism?’
President of Country Press Australia, a peak body for regional newspapers, Bruce Ellen said media corporations operating out of larger Australian cities were “just a business”.
In the country, however, local newspapers were “part of the community; and without them, that sense of community would just be very much diminished”, Mr Ellen said.
He said while Country Press Australia members were grateful that the Government “acted fairly quickly and got some funding out”, they were disappointed about the proportion of funds allocated to regional publishers.
“The large majority of the funds, $38.6 million … were diverted from [funds] already allocated in the Regional and Small Publishers Job and Innovation Package, that was specifically for regional and small publishers,” Mr Ellen said.
“The effective result … is that the money already allocated has been halved.
“In fact, it’s less than half because some of the large groups, such as Australian Community Media, wouldn’t have been eligible for that previous funding pool because there was a turnover [upper] threshold of $30 million.”
Mr Ellen said he was not suggesting that ACM — which is not a Country Press Australia member — was not “worthy of funding”, but said they should have been funded with new money.
“Compare this [fund] to regional airlines, which got $300 million; one airline alone, $80 million,” he said.
“The question is: how much does the government value independent and local journalism?
‘A local paper in print is really important’
President of the Yass Valley Business Chamber and regional realtor Andrew Curlewis said Australian Community Media’s stand down of the Tribune was “a very short-sighted decision”.
“It’s ridiculous, that they just walked away without an end date,” Mr Curlewis said.
“[But] it’s fabulous that we’ve had locals step up to fill that void. It’s a pretty gutsy move.
Merren Gregg, co-owner of the Yass newsagency, shares his view.
“A local paper in print is really important,” she said, especially for the town’s ageing population, but also for the viability of her business.
“People love to read about themselves, like to keep up with what’s happening; things the metropolitan papers don’t cover, like livestock, sport, anything to do with the schools. All of that was missing,” she said.
For weeks, customers kept asking Ms Gregg when “the Trib” was coming back.
“I said, ‘Well, I really don’t know,’ but I don’t believe it’s ever going to.'”
Instead she points customers to the third-ever edition of the Yass Valley Times.
“We sold a bit over 500 for the second week; and today, the sales again are quite strong,” Ms Gregg said.
Ms Jones has applied for the Public Interest News Gathering fund, and is waiting to hear the outcome.
When she saw a death notice for a local resident on the newsagent’s shop front, “that really crystallised it for me, that our community deserved better. They needed a place for their stories to be told.”
Ms Jones’s business model relies on low overheads: no shopfront office, contract staff, small print runs, local contributors largely volunteering their submissions, as well as advertising revenue.
“We’ve crunched our numbers. We believe we can make this work,” she said.
Ms Jones said she had also given a lot of thought to her dual roles as a councillor and editor of a local newspaper.
“If there are any stories that we want to put in the paper that involves a decision of Council yet to be made, I won’t be editing it or contributing to it in any way,” she said.
‘A town needs an historical record’ as well as news
Former Tribune journalist Katharyn Heagney parted ways with then-owner Fairfax Media after 19 years before setting up Scoop Yass Valley as an online paper in 2014. She sold its Facebook page to Ms Jones this year.
With “no intentions” other than a love of her local community, where she lived for two decades, “I just kept on getting these really good stories” for Scoop, she said.
“I had good contacts locally; they would tip me off. I had photography skills from small papers, where you take your own photos.”
Ms Heagney eventually expanded Scoop to include a print edition, becoming a sole trader.
“I had a lot of support from the local community, and people came to me wanting to advertise. The demand was there [but] I didn’t draw a profit,” she said.
Scoop closed in its second year.
“It would have been good to have these kind of grants when I started up,” Ms Heagney said.
“A town needs an historical record [as well as] news.
‘The papers belong to the local communities’
In April, the projected date for the Yass Tribune’s return was late June, but Australian Community Media reporters outside of large town centres have since been told to anticipate late September, just as the Federal Government’s JobKeeper scheme expires.
ACM chief executive officer Allen Williams said the as-yet undisclosed sum granted by the Public Interest News Gathering fund “reflects the scale of our commitment to regional media in Australia” and the return of suspended titles would be subject to “advertising recovery”.
It is a condition of the fund that publishers put suspended publications back into print.
Director of the media section for the Media, Entertainment and Arts Alliance union Neil Jones said he was “not confident, but hopeful” that titles such as the Tribune would return to print.
There are phone calls for range quotas to be introduced for the distrubution of the government’s $250 million arts help package deal to be certain the coronavirus pandemic does not worsen the less than-representation of culturally and linguistically numerous artists.
The struggling sector is established to receive $250 million truly worth of grants and loans around 12 months less than a COVID-19 restoration deal unveiled by the federal authorities on Thursday, to kick start the industry immediately after the pandemic.
Artists have been amongst the very first employees impacted by COVID-19 as activities and festivals were cancelled, and they continue on to battle due to limits on mass gatherings envisioned to keep on being in put for some time.
Primary Minister Scott Morrison announced the arts funding bundle alongside singer Male Sebastian at a theatre in Sydney’s western suburbs.
Lena Nahlous, director of Variety Arts Australia, informed SBS Information that it was crucial that a part of the funds flowed to culturally and linguistically varied (CALD) staff.
“We’ve been contacting for grants and funding to be equity tested and there requirements to be embedded into people grants, not only a way to guarantee culturally various artists get funding, but also that those massive institutions and organisations that are supported and offered bailouts… that they actually have range quotas embedded into these grants so that it would not even further widen the hole,” she claimed.
Ms Nahlous said that even in advance of coronavirus strike, there was already beneath-illustration of “culturally diverse artists, or artists of color at all ranges of the arts, monitor and inventive sectors in Australia”.
A Variety Arts Australia report found 51 per cent of all key cultural organisations had no CALD representation at the management level and only nine per cent of the 1,980 leaders were being CALD Australians.
These figures are frustrating taking into consideration 39 for every cent of Australia’s populace has a CaLD qualifications, in accordance to the Human Rights Commission.
Hopes for a more inclusive article-COVID-19 industry
Ms Nahlous hoped the restart of the industry put up-COVID-19 would direct to much more CALD artists currently being provided a reasonable go in any establishments in the arts sector.
“This is a truly awesome possibility to rebuild a sector, [to] embed equity and inclusion that signifies the genuine breadth of the range of Australia,” she explained.
“There desires to be higher guidance, not significantly less for individuals groups… I experience like this is an prospect to reset.”
The govt has rejected calls to increase the JobKeeper wage subsidy to far more in the arts sector.
Instead, the offer contains $75 million in grants for new festivals, concerts, tours, and activities, $90 million in concessional loans, $50 million to help producers unable to get insurance coverage and $35 million for direct monetary aid for Commonwealth-funded organisations.
“This bundle is as a lot about supporting the tradies who create stage sets or personal computer specialists who make the hottest unique effects, as it is about supporting actors and performers in key productions,” Prime Minister Scott Morrison explained on Thursday.
“Many in the sector will locate a new way to function whilst the existing social distancing actions continue to be in place and although that will not likely be uncomplicated, I know there is certainly a solid drive among the all Australians to see the return of gigs, performances, and situations.”
But the director of Sydney’s Sacred New music Competition, which showcases CALD artists, is not optimistic about the government’s most up-to-date announcement.
“A great deal of that dollars won’t reach us, they go to the founded organisations… there is not plenty of dollars aimed at sites like us,” festival director Richard Petkovic said.
Because of coronavirus limits, the concert has experienced to cancel its regular September occasion, which will see a decline of about $50,000 in funding.
But Mr Petkovic was established not to let the pandemic consider the stage absent from culturally various performers and will maintain a few on the net concert events as a substitute.
“We’re just funding it from little scraps of revenue we have obtained remaining in our bank account, but not undertaking a festival was not an choice this yr.
“It’s our 10th yr, these artists rely on us to create these prospects, so our board is actually adamant that we experienced to do anything.”
‘People will issue us’
Film producer Maria Tran has experienced to move her firm Phoenix Eye Productions, formerly utilizing eight culturally numerous folks, from its Fairfax base to her father’s residence to help save on expenses.
“If we do not have a area what do we do? But then I imagined, well Alright my father has a space, it can be not accurately the most significant, it doesn’t look specialist, marketplace typical, but it is still a house,” Ms Tran stated.
Maria Tran has shifted to functioning at her dad’s house.
The team of 8 has had to acquire a 50 per cent wage cut to stay afloat.
“To be genuine there are situations when I have to finance via my possess very little piggy financial institution just to retain the income circulation going…it unquestionably has been seriously rough,” she explained.
She stated that as a team of CALD creatives, they have been pigeon-holed in the sector, and for the reason that of the data seeming to do the job from CALD creatives, she fears her vocation enhancement could be stunted.
“A great deal of the do the job we do is on migrant tales, and I like carrying out migrant stories, but we are the go-to for that and outside the house of that, individuals will issue us,” she claimed.
“We conclude up getting typecast and trapped with just carrying out distinct projects and over time with the hope and dreams of carrying out something more substantial later on, but we you should not know if that is going to occur in Australia or not.”
Compared to other firms in the sector, Ms Tran reported “we don’t get a possibility to play on the same amount actively playing field”.
She fears for the company’s long term write-up-COVID-19.
“If I am not intelligent sufficient or impressive or creative adequate …the company may go down.”
Montreal-based plane and train maker Bombardier Inc. is shedding 2,500 employees as the pandemic takes a toll on the business, which is also under fire from proxy advisory firm Glass Lewis over compensation practices.
Industry-wide business jet deliveries are expected to be down 30 per cent year-over-year, Bombardier said in a statement Friday, adding that the majority of the job reductions would be in Canadian manufacturing operations and would be rolled out “progressively” through 2020.
The firm, which has 60,000 employees across two business segments, will take a $40-million charge to cover the workforce reduction.
Glass Lewis, which advises institutional investors on how to vote on shareholder issues, criticized Bombardier in a report this week for paying outgoing chief executive Alain Bellemare as much as $17.5 million in severance and other compensation.
The plane and train maker’s “lagging returns over Mr. Bellemare’s tenure as CEO pose an uncomfortable juxtaposition for this eight-figure separation package,” Glass Lewis noted.
Bombardier posted a loss of US$1.61 billion in 2019.
Glass Lewis criticized the payments to Bellemare, who was replaced in March, which included a special $4.9-million award following the completion of the sale of Bombardier’s rail business to France’s Alstom SA. The package also included severance of about $10 million, plus share awards of up to $2.7 million.
The “total possible separation cost” is more than double the termination amounts calculated for him at the end of 2018, Glass Lewis noted.
The proxy advisory firm was also critical of Bombardier’s “single-trigger” special transaction awards, a benefit payable “solely” upon a transaction.
“These awards are also quite significant in size, reflecting material proportions of recipients’ total pay levels in recent years and in all cases handily exceeding $1 million,” Glass Lewis said it its report, adding that recipients are being rewarded “for tasks that we already consider to be intrinsic to the job of leading a public company.”
Benoit Poirier, an analyst at Desjardins Securities, characterized the workforce reductions announced by Bombardier on Friday as neutral.
“While a difficult decision, we believe the workforce adjustments are necessary in light of COVID-19 to protect profitability,” the analyst wrote in a note to clients.
Poirier estimates Bombardier’s workforce reduction will affect about 15 per cent of Bombardier Aviation’s business jet workforce, and he forecasts a 35 per cent reduction in deliveries for Bombardier in 2020 excluding the Global 7500 business aircraft. Deliveries of that aircraft would reduce the overall decline in deliveries to 20 per cent.
Further details on Bombardier’s market outlook are expected when the firm reports second quarter financial results on August 6, the analyst said.