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Tuesday, 1 February 1994
Page: 8


Mr BEVIS —My question is directed to the Prime Minister. Can the Prime Minister inform the House of progress in relation to enterprise bargaining? Does he believe that the new relations between labour and management in Australia are assisting the economic expansion?


Mr KEATING —I am delighted to inform the House that nearly 1,600 workplace agreements have been formalised within the Australian Industrial Relations Commission over the last few years. We have heard a lot from the opposition about labour market reform. With Fightback in tatters, the one refrain we hear from members of the opposition and some of the conservative journalists, the Reaganite republicans who editorialise in the Australian Financial Review every morning, who support the opposition is: `Yeah, yeah, yeah'—like cockatoos—`but what about the labour market?'.

  We have had 1,600 workplace agreements formalised over the past few years. That is truly astonishing coverage and a remarkable achievement, given the fact that the Australian labour market was centralised for so long in this country. With reforms which were announced late last year by the Minister for Industrial Relations coming into operation at the end of next month, we will see an opportunity for even greater flexibility within companies and enterprises in the federal awards area by variations to federal awards which we have indicated can be done without the presence of a trade union. That is not to say that most employees will not choose to be represented by a trade union or that it is other than desirable that they should be represented by a trade union, but a trade union does not have to be present.

  It means that, in the whole area of federal award coverage in the economy, all those enterprises can vary their terms and conditions of employment. They can do it with their employees. They do not need to do it with a trade union. There is all the flexibility in the world, with the one proviso that they cannot see detriments imposed upon employees by taking standards below where they would be with the underpinning of the award conditions that apply in that area. In other words, they have all the flexibility in the world. Yet what would we see from the opposition: individual wage contracts, no ceilings and no safety nets. It would simply be a matter of people taking the contract or taking the sack. We have now seen this tremendous spread of enterprise agreements across the country and we will see now a further move to flexibility through the reforms announced at the end of last year.

  It is instructive to see what the Chief Executive Officer of our largest industrial company, whilst remarking on this area, recently had to say. John Prescott of BHP said:

In broad terms, industrial relations is no longer a stumbling block in Australia.

Let me get that right for opposition members over there. These words are from BHP:

In broad terms industrial relations is no longer a stumbling block in Australia. In good companies it is no longer a break on productivity—

Let me repeat that:

In good companies it is no longer a break on productivity, on continuity of supply or cost effectiveness.

Mr Prescott said that the change was not a temporary response to economic crisis but a long-term structural adjustment. So here we have the Chief Executive Officer of our largest industrial company saying that there is a long-term structural adjustment in the labour market and, in broad terms, industrial relations is no longer a stumbling block in Australia.

  The opposition, of course, rejected that view, saying that, if we do not have a New Zealand style contract system, the competitiveness of Australian industry could not be guaranteed. That is despite the evidence of a massive lift in profitability in the stock market and in companies generally where the profit share is back to the highs of the late 1980s, which were themselves a record which had no historical precedence in this country. So we have to ask opposition members what they want—an even lower wages share and an even higher profit share than that which currently obtains, which is as high as any in our history? If that is what they want, they are not entitled to it. Good industrial relations mean that you can have productivity improvements and lower costs without lower wages. That is the point that Mr Prescott is making.

  During the 1980s, the number of working days lost in disputes was halved and the number of disputes dropped by two-thirds. Mr Prescott also said this which I think is worth recording:

Enterprise bargaining and lifts in efficiency had improved the BHP steel business, and that productivity in the last decade had grown from about 190 tonnes per employee to 600 tonnes per employee a year.

Mr Speaker, as an honourable member representing one of the great steel regions of this country, that change in attitude and lift in productivity would be no news to you. But it may be news to other members of the House and it should be news to the opposition that, basically, we have seen a trebling of products by employees of BHP. We have seen here a very important structural change to industrial relations; a change which is permanent. We are seeing higher productivity but Mr Prescott says that, in industrial terms, industrial relations are no longer a stumbling block in Australia and, for example, in his business, we have seen an extraordinary pick-up in productivity.

  Let us record that that 1.9 per cent inflation rate and part of that good news story on the economy is the story of wage and salary earners in this country being involved in a first-class industrial relations system. This gives them the opportunity of sharing in the productivity of the companies which they can improve by this attitude of mind and which, in the doing of it, have made Australian companies more profitable and have lifted the prospects for investment and employment.

  It is industrial relations making these things work and, in the making of their working, giving us a commensurately low inflation rate. Let me record along with the Treasurer not simply the recital of the structural changes for the better which we have been able to engender in this community of ours and which will stand us in good stead in the 1990s but let us record in one of the most difficult and intractable areas of reform—industrial relations—that we are seeing a sea change.