Speaker: Carren Smith

HINTERLAND CONNECTS is back! On Tuesday October 11 there’s a night of organised networking with coastal and hinterland businesses and a mini trade show. Maleny Commerce is also delighted to have secured one of Australia’s most dynamic speakers – Carren Smith – to host a free seminar.

Through dramatic and violent, life-changing incidents, Carren Smith has developed a message of determination that is inspirational. Carren explains the personal tragedies of recent years and how she used public speaking to find a way through her pain.

“As a survivor of the 2002 Bali Bombing, I have spent the last three years travelling the country sharing my story of hope, inspiration and sheer determination to overcome the depression and injuries which threatened to rob me of a high quality of life.

“In 2001 my partner committed suicide, and in 2002 I lost my best friend in the Bali Bombing and I sustained massive head injuries. My heart was broken in two! My sister’s life hung in the balance as a result of the 2004 Tsunami and depression was an old friend I’d come to know well. Finding a purpose and a reason to go on eluded me more and more as each day passed,”

“I decided to start speaking professionally in an effort to give meaning to my experiences in the hope that others suffering would see themselves in me and they would know they could find peace again too, if they chose to go looking for it.”

When I first started speaking I was terrible. I truly was. I stumbled and stuttered and often lacked direction, going off on tangents. However I pushed past my humiliation and fear of speaking because I knew that when I had conquered my fear of speaking and had become confident and proficient in sharing my story I could educate and support others to tell their stories.” Join your business colleagues and take a trade stall to showcase your wares at the Hinterland Connects network night. It’s at The Big Barrel (Maleny Mountain Wines, Landsborough Maleny Road, Maleny at 5.30 – 7.45pm. Registration 5pm.

Cost is $20 per person ($60 per trade stall) includes one entry to networking.

To book contact Carrie Shaw Ph: 0434 817 301 or email events@malenycommerce.org.au, or book and pay online: www.malenycommerce.org.au

Terry Ryder goes property hotspotting in his comfortable motorhome.

Terry spoke with HT Editor, Michael Berry about how he became a real estate journalist with attitude.

THERE HAS TO BE a good reason for one seasoned journalist to interview another. (I am still waiting to hear back from Rupert Murdoch by the way). However, in Terry Ryder’s case I was intrigued to read his recent Hotspotting column in the Property section of the Weekend Australian. I was impressed that Terry could be so confident of his position vis a vis interest rates that he could … well … shaft the head of the Reserve Bank, Glenn Stevens.

I will acknowledge that the bald-headed Mr Stevens has a faint likeness to Mr Spock, but breathtakingly, Terry asserts he is an android with a head full of wires and computer circuitry. He went on to say that Stevens delivers robotic sermons that have a “steely logic and utter dependence on analysis of cold hard facts”.

Ouch! I guess Mrs Stevens might have something to say about that, but this criticism lies at the core of Terry Ryder’s philosophy. Before taking life-changing decisions on our behalf, Terry asks, do mandarins like Glenn Stevens actually get down on the shop floor to talk to real people about consumer and household pressures?

“ I am always looking for the human element,” he says. “You can’t do everything purely by the numbers which is the reason why economists are so consistently wrong about real estate. Media for some reason think that the best place to go for analysis of real estate are economists. It’s like going to an AFL expert for an analysis of State of Origin Rugby League. You might get an interesting perspective but you’re not going to get expertise because it’s not their area of expertise. And economists get it wrong in real estate continually because they do it by the numbers. If I did that, I would get it wrong every time.”

Clearly, Terry is getting it right because his mainly internet business is flourishing, based on quarterly reports about the likely growth of towns, suburbs, regional areas throughout Australia. His clients are increasingly mum and dad investors who prefer the bricks and mortar of real estate investment to the rigours of the stock market.

“I look for articles and Google alerts that announce drivers of growth,” says Terry, “like a new motorway to be built or a power station. It’s not rocket science. For example, Gladstone is a no-brainer. There is over $100 billion worth of projects coming up in Gladstone – LNG processing facilities, expansion of the port, a new steel mill. So you add up the tens of thousands of jobs being created and these people are going to be looking for somewhere to live. You don’t have to be particularly clever to predict that rents and house prices are going to rise in Gladstone. It is that sort of factor that I am looking for. Sometimes it is more intuitive and not so easy.

“So, we have the quarterly, top ten Queensland hot spots report, and reports for all the other states and territories. Then there are national reports under certain themes such as Ugly Ducklings which looks at the

cheaper areas of capital cities that have potential to grow into a real estate swan. For example, Bulimba in Brisbane has become gentrified in a short space of time.”

Terry doesn’t see the Sunshine Coast hinterland as a hot spot. “It’s growing too fast. It’s a classic ‘hill change’ area which I think is a stronger growth factor than sea change. There’s been a lot of media about sea change moves as great places for capital growth. In fact, it hasn’t worked out that way, because of developer over-supply. The Gold Coast is a classic sea change destination but it’s the worst performer in capital growth in Queensland. In iconic locations like Surfers Paradise for example, prices are lower there than they were five years ago.

“You go to say Byron Bay and it’s a very mediocre performer, but you go inland to the Murwillumbahs and Mullumbimbys and they have really gone ahead. And that’s partly because the inland towns are cheaper and there’s more community. People are looking for affordable lifestyle with community, and I think you get that more in a place like Maleny than you do on the Coast where you’ve got growth problems.”

Terry’s confidence in making predictions in the property industry is based on 30 years experience. In the 1980s he was property editor for the Courier Mail before switching to the Financial Review as a property specialist. Private consultations followed from commercial companies at the big end of town. Along the way he started to write books on property and how to navigate the real estate jungle.

“Hotspotting started five years ago,” says Terry. “I’ve had almost thirty years as a specialist in real estate and I had learnt along the way that what people want to know most of all is what area is going to go next. They want to buy in areas that will show superior capital growth – even when they’re buying their house. And there was nothing out there telling them what were the hot spots of the future.”

Books on real estate help mum and dad investors navigate the property market

With experience has come a confidence to be critical of the real estate industry when it counts.

“The real estate industry is full of shonky operators,” says Terry, “ and the building industry as a lobby continually complains about government artificially controlling land supply. But it’s actually developers who control land supply because most of the land out there is in the hands of the big developers like Stockland, Lend Lease, Australand and others, and they certainly drip feed it to the market.”

Hotspotting is a mixture of experience, analysis of research and what Terry calls gut feel. It is based on getting out there at the coal face, talking to people and seeing what’s happening.

“That’s what the motor home is for,” adds Terry with a smile. “That’s my mobile office. I like to get around the country which is a cost effective and durable way of doing it. When you visit places you see growth signs that internet research hasn’t turned up. Economists don’t do that and Glenn Stevens doesn’t do that. “

Terry is considering inviting Glenn Stevens to join him on his next motor home trip to Adelaide and South Australia.

The online presence and DVD video shows visitors the Hinterland’s beautiful countryside, amazing destinations and country hospitality.

This unique project was initiated by local tourism cinematographer, Mike Middleton who says, “there are four regional drive areas featured and 100 Hinterland businesses who have had the faith and patience to be part of this totally entrepreneural production which showcases the entire Hinterland region, from Glass House Mountains (Drive 1), Blackall Range (Drive 2), Mary Valley (Drive 3) and Yandina-Eumundi (Drive 4) as one unified but very diverse destination.”

The presentation has been designed to help discerning visitors find the very best B&Bs, art galleries, retail outlets, cafes, restaurants, pubs and outdoor activities that even some locals don’t know about.

Mike says it is a first for the region to be promoted as one package and is a totally new vertically integrated strategy for the entire Sunshine Coast Hinterland’s benefit.

The DVD at $19.95 also includes a four colour 112 page Traveller’s Companion with maps and contacts that all fits neatly into the glovebox for easy reference.

Filmed by Mike Middleton, over 12 months, he estimates the budget at more than one million dollars.

“This package can be used by all tourism organisations,” says Mike. “Also we are currently talking with TV stations and have been approached by hotel chains to place hundreds of these DVDs in the rooms as a benefit to their visitors.”

Scenic D

rives of Australia has independently produced this package without any government assistance or any help from the tourism groups. Mike Middleton hopes the package will lead the recovery of the Hinterland tourism industry.

Go on line to view the Scenic Drives of Australia DVD and purchase copies of this highly attractive tourism promotional tool: http://www.scenicdrivesofaustralia.com.au/

The question now is, can the passion and the commitment to MCU be rekindled in the current cut and thrust of a strongly regulated financial market. Hinterland Times Editor, Michael Berry looks at where the MCU came from and where it might go.

ONE OF THE most amazing aspects of this story of the Maleny Credit Union are the constant changes that brought this organisation to where it is in 2011. Over its 27 years, the Maleny Credit Union has raced to change, trying to keep pace with an increasingly diverse, vibrant and engaged community. For the Credit Union it was always a case of keep up or shut down; initiate or be left behind.

It is said that there is nothing wrong with change as long as it’s in the right direction. Of course, time will tell whether the MCU decision not to merge with Credit Union Australia has been in the right direction – right for the Maleny community, right for MCU members, right for the continuation of ethical and sustainable financial principles. These are big questions and I am no oracle. The future will provide those answers.

The Maleny Credit Union was born in 1984 when community change agent Jill Jordan was inspired by permaculture author Bill Morrison to gather support for a credit union in Maleny that directed local cash into ethical investments and employment opportunities.

To propose a credit union that put “people before profit” was a daring idea during the early 80s with the steady decline of a Queensland dairy industry that had sustained the local region throughout most of the 20th century. At the same time the financial times were changing in Australia and the stranglehold of the major banks was being challenged. Communities wanted more loan and credit options, and just as importantly, they wanted those finance options from more socially responsive organisations.

In common with world credit union culture, members of the new Maleny Credit Union, set up in April 1984, were linked by a bond of association – an association of members with mutual interests, hence the term mutual to describe all credit unions. Maleny members were to be bonded by their district and their desire for a more socially co-operative, and supportive community environment.

But it didn’t help that the 80s was a period of wild investments and entrepreneurial madness. Banks like Tricontinental and Rothwells collapsed and cowboy entrepreneurs lost huge personal fortunes. Governments looked on uneasily and realised the need to create a more stringent regulatory framework for the finance market.

The new credit union entered the highly competitive financial marketplace backed by astonishing passion and selfless commitment of early members to getting the Maleny Credit Union up and running. For years members staffed the tiny credit union office in Maple Street for absolutely no pay, and worked hours that often stretched their belief in this fledgling organisation.

It was this selfless commitment by staff and the passionate belief in its ethical core that drove growth in the Maleny Credit Union. Equal pay, decisions by consensus, donations to worthy causes and disadvantaged families, ethical investments and loans to those who were considered risks to the traditional banks – all were unique features of this adventurous project. And what an achievement to read in the conservative Financial Review in 1986 that the Maleny and District Community Credit Union was rated as the fastest growing ethical financial institution in Australia!

However, state and federal governments were slowly pulling credit unions into line with traditional banks. As one staff report said, “ We now have forms for things that we had never heard of!”

Through the 90s, there were constant tensions with increasing government regulation, the need for more IT support in Maple Street, and holding onto a socially inclusive philosophy. Fundamentally, the need to make the necessary levels of profit was uncomfortably at odds with the declared ethical mission of the Credit Union, which made it difficult to maintain competitive loan rates.

It was not surprising that the fierce financial competition in the late 90s started the merging of credit unions and building societies so that they could remain efficient and viable businesses. When the new federal, Australian Prudential Regulation Authority (APRA) was created it led one long-time Maleny Credit Union director to comment in the national media that, “We now have to have the same kind of procedures and policies as Westpac.”

Of course, no-one questions the government’s right to protect our money. Indeed, we saw graphic evidence of that regulatory protection during the recent global financial crisis. But at the same time that protection was closing off the community support policies of small community credit unions like MCU. Regulations also led to the appointment of professional managers with financial experience, more familiar with the profit motive than co- operative motivations. Credit Union directors, however passionate, dedicated and local had to be financially literate and ‘fit and proper’ to meet the demands of APRA.

The decision to merge the Maleny Credit Union with a much larger mutual came as a brutal shock in late 2010. Opposition soon gathered into Friends of Maleny Credit Union who asked questions about a serious lack of communication with members. They also expressed doubts about the Board’s willingness to explore alternatives, or to maintain the Maleny Credit Union as a going concern.

It is disappointing to say the least that the MCU board did not create, many months ago, the kind of “conversation” with its members that the Friends of Maleny Credit Union have instigated in recent weeks. Indeed, it was the board’s failure to communicate that caused the crisis of confidence.

No wonder then that emotions ran deep, friends argued with friends, and sadly, members of at least two co- operatives were seen to be publicly fighting with members of their own family – the Maleny Credit Union. One wonders what Jill Jordan would have made of this crisis of confidence.

So what of the future? Well, the trend in Australia is towards a small number of large credit unions that adhere to the mutuality principal but often lose the small co- operative community ethos. If the Maleny Credit Union wants to buck this trend, it must show once again, that a small town credit union is sustainable, ethical and a viable financial support for its citizens.

THE FIGURES …

(At a special general meeting on June 25, 22 per cent of MCU members (total membership 5,500) voted on the Board resolution to merge with Credit Union Australia. 637 members (57%) voted against the merger. 464 members (42%) voted for the merger. 78% of the MCU membership chose not to vote.

Local author, Elaine Green has written a history of the Maleny Credit Union which is due for publication by the end of July. Contact MCU for further details. www.malenycu.com.au Tel: 5499 8988.

Matilda has energy to burn – she runs the African Cottage and The Rondawel – a charming South African cottage and self contained accommodation for one. She’s also just produced her second easy recipes cook book called Cooking for pleasure, and her product range of chutneys, spices, marinades and sauces are sold Australia- wide under the Figtree Cottage label.

After the Hinterland’s Real Food Festival in September, Matilda takes off on her Gourmet Culinary Tour around South Africa.

The tour starts with a bang at the Pilanesberg Game Reserve where you’ll experience lions, buffalo, rhino, hippo and leopards before retiring back each night to your rondawel (hut) to experience a Boma (pronounced Borma) – traditional cooking over open fires in large black pots. Over the three weeks Matilda takes her guests through the wine regions of Stellenbosh, Franschhoek and Montague, where many of the vineyards are over 400 years old. Guests can prepare food at an African cooking school built to help local underprivileged children gain the skills needed to get a cooking job.

There’s a day of bliss listening to the “Maggie Beer of French South African food, Topsy Venter. Matilda says you can listen to this 85 year-old for days. “She loves to tell stories and often forgets what she is cooking as she gets engrossed in her wonderful tales to the hilarity of her guests and staff, who take over the cooking as the stories continue.”

Following the food trail of the many South African cultures, the next stop is a Malay cooking class in the BoKaap before heading on to Cape Point and Table Mountain.

The West Coast is a highlight as guests wait for local fishermen jammed into a very very small boat to bring back lobsters for Matilda and her guests. They can take them up to their house on the beach where Niel, the tour guide, cooks them alongside “snoek” (a local fish) on an open fire.

Before heading back to Cape Town for the final three days, there’s a stay in the Kagga Kamma nature reserve. Sleeping in caves, this is the Bushmen area and where, says Matilda, “you are so high up in the mountains you can just about touch the milky way, bright overhead.”

Matilda has two spots left for this year’s trip and if you want to get a pre-taste of her cooking visit her at the upcoming Real Food Festival at the Sunshine Coast Hinterland in September.

“I will be selling my cook books and some of my more popular products,” says Matilda. “People can take them home and make dishes with simple, local products that will give a great taste of Africa here on the hinterland.”

Matilda says that the main stay of all South African meals is a combination of spices and dried fruits. Aromatics like cardomon, cloves, cinnamon, nutmeg and garlic marry alongside locally dried apricots and peaches to name a few.

One of the most traditional meals is Bobotie – A mince dish with onion, turmeric, ginger, bread soaked in milk and drained, tomatoes and dried raisins. It’s all poured into a lasagna dish, baked and then a glaze of apricot jam put over the top.

Another simple, but tasty dish is Lamb Skewers – lamb and baby onions marinated in a mix of apricot jam, curry, garlic, ginger, turmeric and vinegar, then skewered alternating with dried apricots and grilled.

“Simple, aromatic and tasty, rather than hot” is how Matilda would describe South African Food from locally grown or produced ingredients.

Check to see if Matilda has places left on her 2011 South African Gourmet Tour. Email: africancottage@optusnet.com.au or go to www.malenyqueensland.com/africancottage

ARCHITECT DAVID GOLE says that living in Maleny helps get him into the right head space when it comes to designing homes for the Blackall Range. He must be right because his firm, Riddel Architecture has just been awarded House of the Year by the Sunshine Coast Regional Architecture Awards for David’s design of the Maleny Grove Live Life Village. David spoke to HT about his design concept.

DAVID GOLE has a passion for good design, but design that is also appropriate to its environment. He is particularly pleased that the Australian Institute of Architects has recognised the importance of good design for retirement living, as these environments are often uninspiring and developer-driven.

“I was surprised at this win because we were competing against all those high end homes along the Coast,” says David. “I think they viewed the idea of having a better quality environment for retirement living as being something worth pursuing.”

The first stage of Maleny Live Life Village on Palm Street, Maleny consists of 24, two and three bedroom detached villas and duplexes arranged in groups or hamlets. There is also a spacious community centre and the whole area is landscaped and interlinked by gently curving single lane roads and footpaths.

The villas are fundamentally two or three bedroom homes with two different types of roof line – the scissor truss and the skillion. The duplex villas bring both rooflines together.

“ We group the villas around single lane roadways into hamlets and each villa has a different entrance,” says David. “Within each grouping there is a distinct colouring and there are different versions of garages depending on villa orientation.”

One advantage of living in Maleny is that David knows its climate. “All villas have the long part of the building facing north. Each has an outdoor entertaining area with one bedroom at least facing north. So, we have maximised space for breezes, ventilation and weather.” David read his brief for the village as

breaking a mould for retirement living. He tried to get inside the head of the 21st century retiree who was downsizing but not entering God’s waiting room.

“ My view,” says David,” is that people who retire will spend more time in their homes, so it’s even more important to have lovely qualities in these places.”

David interpreted lovely qualities as soft, muted colours outside that blend with the environment and cool whites inside to suggest airiness and space. High and sloped ceilings add to the sense that you have all the space you need, important perhaps if you are retiring after 40 years in a sprawling farmhouse on 200 acres.

“It was important to give a sense of home and not a pokey apartment or duplex with low ceilings. So, I was trying to achieve something that was uplifting, with qualities of light, ventilation, all providing spaces that were generous but not overly so.

“Part of my brief was that the village should be attractive in the way that the grandchildren would want to come and have a party here, or even have a wedding because it is such a lovely environment.”

The home itself provides a number of options for how you want to live. So, some villas have a multi-purpose space off the living room for craft, computer or reading area. The garage could become a workshop or study and there’s a massive communal shed in the village which will be left in the hands of residents to fit out and use.

The community centre is set up with craft, billiards, library and gym areas and generous community space. And there’s a big fire place.

“The other aspect of this place is that I thought it should be welcoming to the community,” says David. “The entrance roadway connects onto Palm Street, and if you felt like walking in you would be welcome. There is no gate and this is not meant to be an isolated community.

“I am committed to designing buildings and making places that are site and culturally relevant because otherwise what have you got to anchor you?” questions David. “How do you feel a sense of belonging if the building you are in could just be a generic building that could be anywhere?”

Maleny Grove Live Life Village will go on to the Queensland State Architecture Awards announced on June 24.

Award-winning jewellers Ashley Naumann (left) and Jim Goulton of Maleny Jewellers.

WITH GOLD PRICES at an all time high (around

US$1,500 an ounce), award-winning jewellers Jim Goulton and Ashley Naumann of Maleny Jewellers say now more than ever is the perfect time to refine and remodel family heirloom jewellery.

“It makes sense to use the gold you already have” says Jim. “You may be pleasantly surprised to find that you are literally sitting on a goldmine without knowing it.”

Feedback has been amazing from customers who have had Jim and Ashley remodel their family treasures. “People appreciate what we’ve done for them and it is very gratifying to make a piece that will always have special memories for a customer,” said Ashley.

Jim mentions a couple who have come to Maleny Jewellers for all the big milestones in their lives. “We designed a custom engagement ring for them during their courtship, followed by specially designed wedding rings for their marriage and now we are remodelling an heirloom piece which commemorates the birth of their first child. It is something that will be handed down to the next generation,” Jim added. Janis is another satisfied customer who writes:

“Does the fact that I can’t stop looking at my new engagement ring tell you how much I LOVE it! Thank you so much for your advice, expertise, time and effort and outstanding craftsmanship. Your customer service is A++++”

So sort out your old gold and precious stones, and let Jim or Ashley come up with a unique design that will delight you. You’ll be surprised – it’s cheaper than you think!

MALENY JEWELLERS Shop 4 Riverside Centre Maleny Ph: 5494 3477 www.malenyjewellers.com

Maleny Accountant David Bromet says the three biggest impacts in his almost 40 years of taxation and accounting practice are technology, the growth of taxation law and the arrival of GST. From starting as a sole practitioner, David Bromet & Associates now has three fully qualified Certified Practising Accountants (CPAs), making it a well experienced and highly qualified practice on the Hinterland.

KYLIE SCOFIELD and David’s daughter Christina Moore recently gained their public practice certificate which is the highest qualification for practising accountants through CPA Australia. The office is run smoothly by administrator and office manager, Janean Proctor.

“We have grown with Maleny,” says David, “and although we are Maleny-centric many of our clients who have moved away from Maleny over the years have stayed with us. We are fully computerised so we can meet the needs of our clients whether they are on the Coast, interstate, overseas and here in Maleny.”

Christina started working with Dad while still at high school. “I began by shredding documents at home; that was my first role,” she says with a smile. Now Christina is gathering a reputation as an auditor of community associations.

“I help treasurers understand the governing rules and how to present their records,” says Christina. “Sometimes they are given the job without an understanding of their role and its requirements. I can show them how to set out their records and what to present in their treasurer’s report each month to the members.”

David says the compliance burden for people has increased over recent years. “People now have to do BAS, tax returns, workers compensation returns and various other returns for government authorities. We assist and explain the compliance requirements and we provide business advice to enable clients to grow their business.

“We charge on a time basis and therefore the old ways such as the ‘shoe box’ approach to accounting and/or taxation returns can become costly, we are here to save clients’ money and to provide the best advice. We advise them that it is a far better way of managing a business if they are up to date with their accounting as they can then make timely and informed decisions. Two thirds of businesses fail within three to four years. The primary cause is that the accounts are not being reviewed on a regular basis and so clients cannot react to changing needs, or the environment quickly.”

David believes the growth in his practice is due to over 20 years of working with Maleny people and their businesses. Ninety per cent of the business comes from word of mouth and the practice has built a solid reputation for integrity and reliability.

These are values echoed by Kylie Scofield who has five years experience with David, but has lived in the community for 15 years. “What I like about working here is that you are working in the community that you live in. I think that helps build a long term relationship with your client.”

With a mix of youth and experience, there is clearly a succession plan at David Bromet & Associates. David believes this is important in a profession where taxation law has ballooned in recent years.

“When I started at the Tax Office many years ago, the first Tax Act of 1936 was no more than a centimetre thick. Now it has ballooned out to many thousands of pages; plus the 1997 Act which has ballooned out as well. Everyone is staggered by how much tax law there is and how complicated it has become.”

What David finds most pleasing and sometimes surprising is the change in client demographics. While there is still the certainty of ‘mum and dad’ businesses and individual wage and tax returns, the faces have changed.

“Years ago clients came in with babies in their arms. I am now doing tax returns for those children who are becoming the new business owners on the Range.”

THERE HAS been a lot of press coverage and advertising recently from the banks who are competing for the mortgage market, BOQ included. There are great discounts to be had and incentives galore to move your home loan to another lender, but how do you know which one is the best deal for you? With the variety of features and benefits of different home loans, in the past it has been hard to compare apples with apples, so to speak. But in recent years the government has introduced ‘comparison rates’ to help people understand what they are getting and work out what the best deal is for them.

A lot of people don’t understand comparison rates and how they work, so I want to explain what they are and how you can use them to make sure you’re getting the best rate. Essentially, a comparison rate is a tool to help consumers identify the true cost of a loan. It includes both the interest rate and fees and charges relating to a loan, reduced to a single percentage figure. For example, a bank’s advertised interest rate may be 5.49% and its comparison rate 6.75%.

Comparison rates are calculated in accordance with a standard formula, which takes into account the:

• amount of the loan;

• term of the loan;

• repayment frequency;

• interest rate; and

• fees and charges connected with the loan (there are some exclusions here; your bank will be able to give you more detail.)

To help you understand how your bank’s rate compares to another financial institution’s, your bank has to provide you with a comparison rate schedule.

This is simply a table of comparison rates for a standard range of loan amounts and terms by a number of lenders. By using this table you can quickly see which lender is offering the best rate. But before you jump on the best rate, it also pays to consider the other non-rate based features such as fee free banking, or flexible repayment arrangements, which may make a loan more attractive. Or you may prefer one financial institution over another because you have a great relationship with the manager and receive fantastic customer service.

The combination of features and rate, as well as choice of building society, credit union or bank that suits you best will be a personal decision based on your own preferences and your financial situation. But if you’re in the market for a loan and looking for somewhere to start, a comparison rate schedule could be the way to go. The information contained in this article is of a general nature only and does not substitute for professional advice. Professional advice should be sought before any action is taken based on the content of this article.

1 Maple St, Maleny Phone 5499 9855

Greg Stevens CEO - MCU Ltd

The partners answer the questions

The proposed merger of Maleny’s MCU credit union and CUA – the largest credit union conglomerate in Australia, created concern amongst MCU membership when it was announced earlier this year. Was this the loss of a unique, community-centric organisation or a bright new economic future for credit union members? The Hinterland Times put detailed questions to Greg Stevens and Chris Whitehead – the CEOs of MCU and CUA – about the proposed merger of their two organisations.\

For how long has it been apparent that MCU Ltd was not going to sustain itself as a credit union?

There is no suggestion that MCU cannot sustain itself as a credit union. The issue is the degree to which it would be uncompetitive and inefficient moving forward.

The Board determined that it is in the best interests of members for them to have access to all the financial products and services they may need without the constraints, such as maximum loan amounts, that our structure currently requires due to our capital position.

What are the financial considerations that convinced the board that MCU could not continue as before?

The Board made a thorough assessment that all elements that impact on the sustainability of MCU, including industry trends, the cost of funds and increasing costs of compliance, regulation and unsustainable management expenses and the significant limits to growth given MCU’s business model.

The Board also considered a number of financial models with different parameters designed to show a variety of likely outcomes. None of these indicated that MCU could reach its Core Capital target of 10% by 2013.

Ultimately, the Board was of the unanimous view that there was not a sustainable financial future for MCU Ltd that would provide reasonable and competitive benefits to its members and resolved that it would be in the best interests of MCU and its members to progress a merger.

When did the Board approach CUA … and why CUA, and not another financial institution?

MCU approached CUA on the 20th October 2010 with its merger proposal, and on the 18th November 2010 a Memorandum of Understanding was executed between the two credit unions.

The Board and senior management evaluated a number of mutuals and were of the view that CUA had a broad cultural fit for MCU members.

CUA has its origins in Queensland and has a significant Queensland footprint, particularly in the Sunshine Coast region. It also has a national presence, offers superior loan and deposit rates, provides a low fee environment and has a BBB+/A2 Standard and Poor’s credit rating.

CUA has also been consistently awarded by the industry, most recently winning ‘Credit Union of the Year’ awards in 2010.

There appear to be many upsides to the merger. Do you see any downsides?

Whilst there are downsides that will inevitably come with this merger, such as Maleny losing its own credit union, these are minor compared with the benefits that will be delivered.

Critically, it will ensure members retain access to competitive mutual financial products and services.

Are you confident that the special green ethics of the MCU will be retained by CUA?

I am confident that CUA will consider the retention of these products with an open and rational approach.

Where do you see yourself once the merger is complete?

At this point in time, I am uncertain as to what my future holds either with CUA or, if there is a merger, whether I will be a resident on the Sunshine Coast. It is all dependent on our members approving the merger. I will say however, that I am very proud to have been part of MCU over the past 2 1⁄2 years.

Have you been surprised by the emotional attachment that members have to MCU?

Not at all, in fact it is exactly what I would expect from our community given the background and history of MCU, and understanding as I do the views of Credit Union visionary, Jill Jordan.

That said, I fully expect that once members fully understand the implications of the proposed merger with CUA, the energy will shift to supporting the sustained provision of mutual financial services in the local community.

With hindsight, would it have been better to have a public meeting at the time of the signing of the MOU with CUA rather than three months later?

Chris Whitehead CEO - CUA

Whilst the execution of the MOU is a key milestone in the merger process, the commercial realities mean that it is inappropriate for discussions relating to the merger to be made public prior to completing due process, including commercial negotiations, the completion of due diligence and the securing of governance approvals. This is to protect the interests of both parties; particularly if a decision is made not to proceed.

MCU always planned to hold an Information Forum for the local community, however scheduling was dependent on both this process being completed and the impacts of the holiday season.

There is some community disquiet about whether this is a ‘merger’ or a ‘takeover’. What is the difference in terms of what Maleny people will see and experience in the future?

The Board of MCU approached CUA to merge and we are honoured to be its preferred merger partner.

The mutual structure of a credit union means that its members own the business and therefore any change proposed, including this merger, must be approved by a 75 per cent majority of the voting members. MCU members ultimately have absolute control over the outcome of any potential transaction.

Should MCU members approve this merger, they will retain the ability to access credit union products and services, but have an enhanced range from which to choose. A number of those products would also offer more competitive rates and fees.

MCU members would also benefit from CUA’s national presence, given we have branches across QLD, NSW, VIC and WA. Importantly, they will also continue to be part of an organisation with a strong community focus and commitment.

There is some emotional attachment to the MCU building in the heart of the town. Will it remain the CUA branch office?

We recognise the importance of the local branch and moreover MCU’s office at Bunya House. At this early stage a decision has not been made and any change would be advised with plenty of notice.

How are MCU Ltd member investment shares affected by the merger?

Member Investment Shares are a capital program that supports MCU’s financial status in a way that is relevant only to MCU. As CUA does not currently need such support, these investments will be repurchased by MCU as part of completing the merger with CUA. The Member Investment Shares are not the same as Member Shares which will not be paid out.

Full details of this process will be outlined in the Information Document which will be presented to our regulators, APRA and ASIC, for their approval. Once this documentation is approved, it will be distributed to MCU members for their review and consideration.

Are there CUA products and services that will be attractive to MCU members that were previously unavailable to them?

CUA has a comprehensive range of products and services that will be available to all MCU members should the merger be completed. Details of all CUA’s products are available on our website and of course, specific details will be included in the Information Document.

We are confident that some of the stand-out benefits for MCU members should they become members of CUA include: • Access to a wider range of competitive credit union

products and services • Access to CUA’s multiple award winning products • Greater network access – CUA has 78 branches

nationwide and 3 across the Sunshine Coast and its Hinterland region and also offers banking services through 24/7 telephone and internet banking, SMS banking, mobile lenders and Australia Post outlets

• Longer branch trading hours • Access to CUA Direct, CUA’s Australian based contact centre, six days a week

MCU members were proud of the fact that MCU member deposits are primarily reinvested in the community using locally developed policies.

The MCU website says, ‘By performing this role we help to prevent the leakage of capital from our bioregion’. How is this principle affected by the merger with CUA?

This principle remains the same despite CUA being a larger business. However, CUA’s scale can in fact improve the access to funding in the local community because MCU is constrained in its capacity to lend, by its ability to fund in the local market. CUA can access funding from across the country from personal, corporate and institutional investors.

Simply said, CUA would have fewer constraints to fund a significant lending portfolio in the Maleny region than MCU currently does. In addition, CUA’s lending policies are similar to MCU’s.

Another important principle is the gifting of up to 10 per cent of pre-tax profit in the form of community grants; and fostering micro finance groups. As a future CUA branch, is it likely that Maleny will not be able to continue with such community-centric principles?

As CUA has an active community engagement program, this principle would continue should a merger be approved. Specific examples of CUA’s community involvement include CUA’s Community Investment Programs, Staff Community Leave, Community Alliances and Partnerships. CUA branches are also empowered to support local community programs.

We are aware that CUA has been partly attracted to MCU because of its ‘sustainable banking’ image and the range of its ethical ‘green’ loans (some of which have won Money magazine awards.) Will CUA strive to maintain this sustainable ethic when it merges with MCU?

MCU’s Green Loan propositions are very attractive however, prior to making a firm decision on continuing to offer these products, CUA is working with MCU to understand the dynamics.

How will current MCU staff numbers be affected by the merger?

CUA promotes a values based workplace and as part of that approach, matters relating to staff are treated with respect and confidentiality. At this stage, should the merger be approved, we can say is that CUA is committed to continuing a physical presence in the Maleny area and is also committed to developing the management and staff.

How this evolves would be determined in due course for each individual.