Australia

Treasury has warned the federal government that the river of company tax revenue that has supported the budget for the past eight years is drying up, with payments falling massively short of budget projections, The Australian reported. A Treasury executive minute to Wayne Swan has blamed the strength of the Australian dollar and the run of Reserve Bank rate rises for the shortfall, and says the government should not expect the minerals boom to bring a quick turnaround.

One of Australia's largest solar panel installers has gone into administration leaving debts understood to be worth millions of dollars and unfulfilled contracts with customers in Canberra, Adelaide, Melbourne, Sydney and Brisbane, The Canberra Times reported. DCM Green went into voluntary administration on March 10. Administrator Alan Hayes said on Friday the company was insolvent, had ceased trading and all staff had been dismissed. He was investigating whether it would be possible to resurrect the company but it was too soon to tell.

Ferrier Hodgson, voluntary administrators for Whitcoulls' parent, REDgroup, yesterday sought High Court approval to extend the time available to consider its options, The New Zealand Herald reported. Under the voluntary administration rules, a so-called "watershed" meeting, where creditors are advised of the state of play with the company, needs to be held five weeks after the appointment of a voluntary administrator, which would have made it March 24.

Private equity group TPG and its partners won't be the biggest losers if Alinta Energy's dissident shareholders vote down their $2 billion bailout plan for the company next week, The Australian reported. Alinta chief Ross Rolfe has made it clear the company, with 5 per cent of Australia's electricity generation capacity spread across 10 power stations and more than 500,000 retail gas and electricity customers in Victoria and WA, will be placed in administration if the deal does not succeed.

Bond sales by companies outside the financial industry are so scarce in Australia that the nation’s largest retailer, Woolworths Ltd., is paying less to borrow than banks and General Electric Co., Bloomberg reported. Relative yields on Australian company bonds are the lowest in three years, reflecting the paucity of non-financial corporate debt in the nation’s credit market, at less than three percent of the A$32 billion of notes sold in 2011, Bloomberg data and Bank of America Merrill Lynch’s Australian Industrial Index show.

Australian toll road operator RiverCity Motorway said it will consider appointing an administrator later Friday after lenders refused to give it a reprieve on $1.3 billion it owes, Reuters reported. RiverCity, which operates the Clem Jones Tunnel in Australia's third-largest city, Brisbane, said in a statement lenders did not approve its request for a standstill agreement by a Feb. 24 deadline.

In a blow to the Australian banking industry, ratings firm Moody's Investors Service unexpectedly placed the country's four largest banks on review for a possible downgrade, citing their dependence on global lending markets, The Wall Street Journal reported. A downgrade from their current investment grade rating of Aa1—one notch below Moody's top rating—could increase their costs even as they worry that Australia's rising interest rates will crimp profitability.

The tough times afflicting the fashion and retail industry have claimed a high-profile scalp, ABC News reported. Covers, founded by the design duo Marilyn Said and Barry Taffs in 1978, has gone into voluntary administration. The editor of Ragtrader magazine, Assia Benmedjdoub, says it is a sign of the times. Management at Covers did not respond to interview requests from the ABC. But it is clear they are not the only ones struggling. Benmedjdoub says even businesses that survived the global financial crisis are still trimming their margins in order to make ends meet.

Australia’s cost of living, having already outpaced inflation, is about to surge, according to economists at JPMorgan, The Australian reported. The cost of living for Australian workers rose 60 per cent faster than the official inflation rate of 2.8 per cent in the year to October, 2010, when workers needed 4.6 per cent more after-tax income to compensate for higher living costs, according to the Australian Bureau of Statistics' latest cost of living index.

The pay television arm of Wollongong-based WIN Corporation has collapsed after several years of trading unprofitably, leaving a multimillion-dollar debt trail, the Illawarra Mercury reported. Satellite-based broadcaster SelecTV, headed by Andrew Gordon, son of WIN Corp owner Bruce Gordon, went into voluntary administration last week. WIN Corp seized control of SelecTV in 2006 in a $46.9 million takeover bid and has reportedly sunk more than $10 million into the business. Industry sources last year estimated it was losing $1 million a month.