Troubled times are often said to unite adversaries and so it is with the continuing decline in Victoria’s influence. According to Paul Austin in The Age today, the long-running feud between Liberal heavyweights Jeff Kennett and Michael Kroger is over and it’s all about working together to restore Melbourne’s rightful place driving national affairs. The key quotes were as follows:
Mr Kennett said he and Mr Kroger shared “a concern about Victoria as it positions itself with the rest of the country.” “By that I mean Victoria’s ability to continue to lead the national reform agenda, to continue to lead the advocacy of that agenda, to continue to deliver results, to use its assets well, to encourage growth,” he said. “Most people I speak to are interested in and concerned and educated about Victoria.”
Mr Kroger, now a Collins Street merchant banker, told The Age: “Yes, we are getting on well – the best we’ve got on since I was state president between 1987-92.
“We’ve put a lot of things in the past now that there are some big issues to be concerned about.”
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Asked which issues, he replied: “A mutual concern about Victoria’s place in the nation, about the fact that Sydney seems to be rapidly becoming the capital of Australia – we both have a desire to ensure Victoria returns to its former greatness.”
CRIKEY: So what exactly has Treasurer Peter Costello done for Victoria over the past decade given that he keeps dudding his own state on Federal funding. Keep the feedback coming to [email protected].
Meanwhile, a senior business commentator writes:
I’ve long been a student of the decline of Melbourne/rise of Sydney phenomenon and I’ve isolated the catalyst which swung the pendulum against Melbourne. The trend was probably on before this incident which occurred at a time when financial markets were deregulating and superannuation and funds management was emerging as a force, but noticeably accelerated after it.
It was John Elliott’s April 1986 raid of the BHP register which netted Elders IXL 17.5% to prevent Perth-based Robert Holmes a Court taking control of the Melbourne-based corporate icon.
Then there was the formation around this time of Australia 2000 which was basically a defence club of Melbourne-based companies pitching in to help each other defend themselves from voracious corporate raiders. Discussions I had with investors at the time gave me the clear impression that this was not a popular development and exposed the clubby and fairly inward nature of Melbourne’s business and stockbroking fraternity at the time.
Separately, but partly as a result of its decision to commit capital unwisely (Harlin Holdings attempt to beat AMP), the near-failure of National Mutual in 1992-3 hobbled the city’s largest investor. As the rest of the super funds management industry grew bigger into the 1980s and 1990s the new players set up shop in Sydney, where 90% of Australia’s super pool is managed, and these guys have a lot of influence on corporate decision making. No doubt there were other factors, but I believe these related factors were the most catalytic.