A rich history

Consider this. The amount of money needed to get onto the first BRW Rich 200 was slightly less than the average wealth of the top 84,000 households across Australia.

The Rich 200 is not quite as old as BRW itself but has been regularly published since the first Rich 200 edition hit news-stands in 1984. Then, the cut-off for inclusion was $10 million.

Fast-forward 27 years and much has changed. Anyone wanting to make the list now needs at least $215 million. Most highly paid business people do not get close.

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Recent estimates suggest that the average net wealth of our richest 84,000 households (or 1 per cent of the total number in Australia) is $11.2 million.

The BRW Rich 200 provides a unique insight into the lives of the wealthy elite. Some are well known while others are rarely mentioned in the media apart from their annual inclusion on the Rich 200.

The first list, the BRW One Hundred Richest People, was actually published in 1983, a year after the trend started in the United States. The average wealth on the BRW 100 was $32.2 million. In the same year, average net personal wealth was $28,000. (By last year, this had grown to $253,000.)

In 1984, the list doubled in size to 200 names and the Rich 200 was born.

Despite the list doubling in size, a significant increase in BRW’s commitment to wealth reporting meant that the average wealth of Rich List members in 1984 rose to $35.3 million. Collectively, the Rich 200 were worth $7.3 billion or about 70 per cent of the wealth of Australia’s richest person in 2011, (Gina Rinehart, with $10.3 billion).

After topping the 1983 edition outright with $250 million, former Australian Rupert Murdoch shared first place on the Rich 200 in 1984 with the Fairfax family. Murdoch’s fortune was valued at $300 million, the same as the collective wealth of James, Sir Warwick, Vincent and John B. Fairfax.

Although some members of the Fairfax family remain on the Rich 200, Murdoch’s fortune has shown much more growth. Murdoch gave up his Australian citizenship in 1985 to appease US ownership laws and this led to his removal from the Rich 200. Despite recent difficulties, including the closure of the News of the World and being hauled before a British parliamentary committee, Murdoch’s News Corporation shares are still worth about $5.2 billion.

Third and fourth positions on the 1984 list were taken by poultry kings Bob and Jack Ingham ($220 million combined). Bob remains on the list and his fortune is valued at $1.12 billion. Jack died in 2003.

In fifth place on the 1984 list was Kerry Packer with $200 million.

No one epitomises extreme wealth in Australia over the course of the Rich 200’s history like Packer, who dominated the list for more than 20 years.

The media baron became a billionaire in 1987 and reached a peak of $8.2 billion in 2000. Packer’s last year on the Rich 200 was in 2005 ($6.9 billion). Following his death, his son James replaced him at the top of the 2006 list with $7.1 billion.

Although Kerry Packer was already near the top by the inaugural issue, many of those who now regularly hold high positions were much further down the list.

Frank Lowy, who co-founded the global Westfield shopping centre empire with John Saunders after running a small delicatessen at Blacktown in Sydney’s west in the 1950s, made the first Rich 200 with $29 million. He is now worth $5 billion.

Sydney-based apartment developer Harry Triguboff was worth $25 million in 1984 but this has since grown to $4.3 billion.

Other modern-day billionaires to make the inaugural list include media investor Kerry Stokes ($30 million in 1984 and $2.6 billion in 2011) and trucking magnate Lindsay Fox ($25 million and $2.1 billion in 2011).

Gina Rinehart rose from second to first this year and sits atop a $10 billion resources empire that was started by her father, the late Lang Hancock. He was included on the 1984 list with $50 million.

Although Rinehart didn’t inherit the business from her father until 1992, her role in it was already well established by 1984, as evidenced by the Rich 200 entry for Hancock in the inaugural issue: “His only child, daughter Gina Hayward, is now prominent in the running of his enterprises.”

Four of the top five people on the 2011 list made their money in mining and resources. They are: Rinehart, Ivan Glasenberg ($8.8 billion), Andrew Forrest ($6.2 billion) and Clive Palmer ($5.1 billion).

In 1984, the media industry dominated the top three spots on the Rich 200 but the sector has since fallen away in its positioning. Journalist and broadcaster Phillip Adams even made the first list with $10 million.

The property sector has become much more prominent on the Rich 200 over the course of its history. Although property prices have risen strongly over the past decade, the rising prominence has as much to do with the ageing of the list.

The rich don’t retire, they just change asset classes and property is a common place for the rich to park their money.

In many ways, the Rich 200 is a slow-moving beast. Vast wealth is normally accrued over decades. Most members of the list don’t make regular changes to their business strategies or needlessly risk money. Not that all rich listers have enjoyed smooth runs.

Alan Bond was a regular feature on the list in the 1980s but fell off in 1990 before declaring bankruptcy with debts of $1.8 billion in 1992. Like all good entrepreneurs, he fought his way back and reclaimed a spot on the 2008 edition of the Rich 200, with $265 million, before falling off again the following year.

Christopher Skase was another 1980s high-flyer. He reached his peak on the 1988 list with a $65 million fortune but his wealth quickly unravelled the following year when high interest rates hurt his already overextended operations.

In 1990, he turned up in Spain and spent the last years of his life fighting extradition attempts.

The rich list is made up of people from all walks of life, but they all share an unending desire to build or at least maintain their wealth.

Former FAI Insurance chairman Larry Adler spoke for many when describing his dedication to his career.

“I absolutely love it,” he said in 1985. “If another heart attack is the price I have to pay to keep going at this pace, then I’ll gladly pay it.” Sadly, he died three years later.

BRW

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