Carbon Tax - Price Rises

Ai Group came up with the estimate from 485 surveyed businesses, but the heated debate over the carbon pricing reforms adopted last July may have been behind that result in the November survey.

A survey that shows businesses have estimated a 14.5 per cent jump in energy costs due to the carbon tax underlines why the impost must be scrapped, Tony Abbott says.

The federal opposition leader says the Australian Industry Group (Ai Group) survey shows company power price rises are well above the 10 per cent increases the federal government has so far been prepared to concede.

He says the additional cost is an example of how the carbon tax is worsening job uncertainty and elevating the cost of living.

"It just goes to show that if you want to get this economy going again, if you want to make people's jobs more secure, (and) families' cost of living lower, get rid of the carbon tax," Abbott told reporters in Melbourne on Tuesday.

"That will be the first thing that an incoming coalition government does."

Pointing to Australian Bureau of Statistics figures showing a smaller 6.7 per cent increase in power prices for the September quarter, the Ai Group report said "the high profile of the carbon tax appears to have led to some over-estimation by business (of its impact)".

The lobby group's report is based on a series of surveys conducted with businesses in the construction, manufacturing and services sectors.

In another survey, 49 per cent of businesses said their energy and other input costs had risen since the July introduction of the tax.

The impact across the economy has been uneven, with 61 per cent of manufacturing businesses, 36 per cent of service businesses and 52 per cent of businesses in the construction industry reporting a rise in costs.

Ai Group chief Innes Willox said food manufacturers were hardest hit and were restricted from passing on the increased costs to consumers due to a host of factors, including competition from imports unaffected by carbon pricing.

"Food manufacturers do not qualify for the trade-exposed industry assistance program and are currently facing substantial resistance to price rises from the major retailers," he said in a statement.

Of those surveyed, he said just 42 per cent intended to increase their prices.

A spokesman for Climate Change Minister Greg Combet said a previous Ai Group study had found most businesses spent just two per cent or less of their total revenue on energy expenses.

"This makes the carbon price impact on total costs an increase of around 0.2 per cent of revenue," the spokesman said.

"The Ai Group report confirms that carbon pricing is a manageable economic and environmental reform.

Julia - Budget Surplus Guarantee

Prime Minister Julia Gillard must use her National Press Club address on Wednesday to reveal the true state of the federal budget, shadow treasurer Joe Hockey says.

Hockey said Gillard had avoided tough questions on the economy since the government dumped its "iron-clad" budget surplus guarantee in December.

He said the prime minister won't say how much the fifth successive Labor deficit will be, or how much the debt is projected to rise to.

She must also come clean about how she intends to pay for unfunded promises, such as the $8 billion a year needed for the National Disability Insurance Scheme and the $6.5 billion needed for the Gonski education reforms, he said.

"Now that Labor have dumped their 2012/13 surplus 'guarantee', when does Labor now say they will deliver a surplus?" Hockey asked in a statement on Tuesday.

"Will the prime minister give another-iron clad guarantee to return the budget to surplus?"

He also wanted Gillard to explain how she intended to keep her promise of paying off net debt by 2020/21, given that would require surpluses of almost $30 billion a year from 2016/17.

Hockey said if she didn't answer his questions she would fail the standard she set in April 2011 when she said, "You can't run this country if you can't manage its budget".

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Mining Services Companies

Mining Services Companies are adapting to lower comodities prices.

Heavy equipment maker Caterpillar has failed to impress analysts with its 2012 profit, after accounting fraud and writedowns hit its bottom line.

While the company posted a 15 per cent rise in 2012 net profit, the result was below market expectations, with revenue falling 6.8 per cent to $15.44 billion.

The company also closed out 2012 poorly, with fourth quarter net profit down to $669 million compared with $1.5 billion at the same time last year.

A $557 million charge owing to accounting fraud at the recently acquired Siwei manufacturing plant in China led the disappointing result, but Caterpillar also said tough economic conditions had slowed equipment sales worldwide.

“Considering the weak economy in the United States, along with much of Europe in recession and China slowing, we had a solid year," Caterpillar CEO Doug Oberhelman said in a statement.

“Our incremental profit pull-through was very good, we made progress adjusting inventory levels and our quality and safety indicators continued to improve.”

Company officials said Caterpillar had reduced its inventory by slowing production rather than selling at a discounted rate, and while some economic indicators were improving the outlook for 2013 was clouded by uncertainty.

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