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Wednesday, 29 February 2012
Page: 2282


Mr TRUSS (Wide BayLeader of The Nationals) (12:22): The Road Safety Remuneration Bill 2011 and the Road Safety Remuneration (Consequential Amendments and Related Provisions) Bill 2011 trouble me greatly. If I could find a way to reduce the road toll I would grasp it immediately. If I could find a way to legislate to eliminate tragedies on the road, and the sufferings of families and the loss of livelihoods associated with road accidents, I would support it enthusiastically. If I could pass a law that delivered safer roads I would want to do that, and I think everyone in the House has a similar view.

I have read all of the reports that have led to the introduction of this legislation and I have read the explanatory memorandums and other information. I have to say that, even looking at this as objectively as I possibly can, I cannot find any evidence that higher pay for truck drivers will actually deliver safer roads. Nothing in any of the documentation I have read establishes any real evidence that there is a direct link between higher levels of pay and safety on the road. None of the various studies that have been done come to that conclusion in any provable way. It is of course true that a driver who is under pressure—whether it be because of troubles in the home or financial difficulties, because he is worried about his timetable or where his next load is coming from or because he is concentrating more on the football or the music in his truck—is not going to be as safe as somebody who is actually paying attention to the road and to the wheel. There is certainly a link between stress and safety on the road, but to suggest that that can be resolved by higher pay rates I do not think is provable.

At the beginning, I must express concern about the way in which the government is handling this legislation. It is being brought on for debate today even though the committee to which it has been referred for consideration, the House of Representatives Standing Committee on Infrastructure and Communication, has not yet reported. I do not know when the committee is going to report. It might be tomorrow; it might not be until the next sitting period. I do not think it is appropriate for the parliament to be asked to debate bills that have been referred to a committee before the committee has reported. It was supposed to be a part of the new paradigm that there was to be a better committee system in the parliament, and I have heard the member for Lyne talk and boast about how he thinks the committee system is working better. But in reality that new paradigm is not present in the way in which this legislation is being dealt with today. It was referred to the committee. As I understand it, the committee has had one public hearing, which went for a couple of hours. The member for Lyne is actually on that committee but did not attend that hearing. The debate is now being brought on before we have had the benefit of knowing what the members who considered this matter in detail actually think about it—whether they believe that amendments are required or whether or not the bill is worthy of support. What is the point of the committee bringing in its report after many of the members participating in this debate have already made their contributions? This is an unsatisfactory process which demonstrates a contempt for the proper processes of the parliament.

The public hearing that was held raised quite a number of significant issues and the submissions that were made to the committee also raised important issues. I would like to know how the committee has assessed those issues before I am asked to respond, on behalf of the opposition, to this piece of legislation. It is quite extraordinary that this issue has been around within Labor circles in state and federal governments for decades. The report that led to this piece of legislation was written in 2008. Now the legislation finally comes into the parliament and we are expected to deal with it before allowing just a couple of days for the committee to do its work. In my view, that is unsatisfactory. The government uses its numbers on the committee to curtail many of the examinations that go on and to choose the witnesses. For the debate to then be called on before the committee has reported shows that the government is out of touch and not really interested in the proper processes of a democracy.

In addition to that, it is my understanding that the government intend to move a series of amendments to their own legislation; but the amendments have not been made available to the opposition. Industry has been told that the amendments are out there, that they have been drafted. Industry is not allowed to see them and the opposition are not allowed to see them, yet we are being asked to undertake the debate. The government obviously know the legislation is flawed, because they are going to propose their own amendments, but they will not even tell the opposition what those amendments are. Yet we are expected to make our contributions to the debate today. In my view, that is completely unsatisfactory.

Compounding all of these suspicions is the way in which the government has handled the legislation. The Minister for Infrastructure and Transport introduced the bills into the parliament, but I am told that their passage has now been moved across to the minister for industrial relations. Any pretence that this legislation was actually about road safety and about having a safer transport network was blown aside when the bills were moved from the transport department across to industrial relations. The obvious conclusion one can draw is that this is legislation about industrial relations rather than road safety. The titles are misnomers—and indeed as you go through the contents of the bills it is clear that they set up a new tribunal and introduce a range of arbitration arrangements which are linked to industrial relations legislation.

In relation to the legislation itself, the coalition strongly supports improving road safety in the heavy vehicle industry and, in doing so, making roads safer for all road users. According to the Bureau of Infrastructure, Transport and Regional Economics, during the 12 months to the end of June 2011, 185 people died from crashes involving articulated and heavy rigid trucks. For articulated trucks this was a decrease by an average of 3.5 per cent per year over the three years to June 2011. For heavy rigid trucks, it decreased by an average of 14.7 per cent per year over the same period. This has happened despite the fact that the number of trucks on the road has increased enormously. Also, the length of distance that they travel has increased enormously over that period. So whilst any death on the road is more than is acceptable—any loss of life is unacceptable—the reality is that there has been a steady improvement in the safety record of the transport industry. That improvement needs to go further and initiatives have already been introduced which I think will continue to make a difference. But the need to introduce this bill at the present time is not supported by the statistics in relation to road accidents involving trucks.

Government, industry associations, trucking companies, truck drivers and all other road users must continue to do more to bring the road toll down. Of itself, the fact that the toll is going down is not a reason to oppose this bill. A reason to support the bill would be if it was in fact going to make an improvement; if it was going to make a difference. That is the key piece of evidence that the government has not yet provided. The question is: what will get the results that we all want? The coalition contends that this bill is fatally flawed for a number of reasons and therefore is unlikely to achieve its stated objective. It is not going to significantly improve road safety in the heavy vehicle industry.

By way of history, this legislation goes back to state and federal ministers for transport—I think all Labor ministers at the time—who commissioned a report from the National Transport Commission on what has been referred to as 'safe rates'. The document I am holding up is that report, and I have read it at some length. The first thing that disturbed me a little bit was the choice of people to undertake this inquiry. The Hon. Lance Wright, who was one of the committee members, was a former president of the New South Wales Industrial Relations Commission. He has a long history prior to that in the union movement, but obviously as an industrial relations commissioner and as a lawyer one would expect him to discharge his responsibilities to the committee in a fair and reasonable way. The second person who undertook this inquiry was Professor Michael Quinlan. Professor Michael Quinlan has a long history of support for 'safe rates'. He has written many, many papers on the issue. And, indeed, if you read this report, the most quoted authority for the findings of this report is Professor Quinlan himself. So Professor Quinlan is using his own previous work to support the recommendations of this inquiry. So the committee can hardly be considered to have been objective. It can hardly be considered to have been impartial.

It seems that the committee was chosen to achieve a desired outcome. The long cherished desire of the Transport Workers Union to have somebody interfering and deciding what the rates of pay should be for truck drivers has come to fruition through it. The way the inquiry was managed opens real questions about whether the issues have been dealt with objectively. When you have got to quote yourself time and time and time again to justify the conclusions at the end, you have really got to ask serious questions about whether or not this report has been properly objective.

The bill establishes a new Road Safety Remuneration Tribunal, which is to be given broad powers to investigate and set pay rates and conditions for any segment of the heavy vehicle industry. The bill will cover the broadly defined road transport industry, which includes: the road transport and distribution industry; long distance operations; the cash-in-transit industry; the waste management industry; and all road transport drivers, including independent contractors. The tribunal must prepare an annual work plan, 'with a view to making a road safety remuneration order' and, in doing so, must consult with industry. The tribunal can issue road safety remuneration orders with respect to 'remuneration and related conditions' either on its own initiative or at its discretion on application from an industry participant or an industrial association. RSROs may contain minimum remuneration and employment conditions additional to those contained in the award and can address any number of industry practices, including loading and unloading, waiting times, working hours, load permits, and payment methods and periods.

The tribunal can also make an order to 'reduce or remove remuneration-related incentives, pressures and practices that contribute to unsafe work practices, for example speeding and excessive working hours'. It is important to note that an RSRO will override a Fair Work Australia award or agreement if the RSRO is more beneficial than the Fair Work Australia document. So the government has just set up its iconic workplace relations legislation, the Fair Work legislation, and now it is setting up a tribunal that can actually override the Fair Work Act. The tribunal is also empowered to deal with disputes on remuneration or related conditions between employers-hirers and employees-independent contractors, where the dispute is not before the FWA. The dispute can be dealt with by conciliation or mediation and, if an agreement cannot be reached, by arbitration.

The legislation is declared a 'workplace law', giving drivers covered by enforceable instruments the rights of employees under the Fair Work Act. The Fair Work Ombudsman and FWA have general jurisdiction to ensure compliance with the act and its enforceable instruments. This, together with the fact that the development of this bill has been moved from the Department of Infrastructure and Transport to the Department of Employment and Workplace Relations—not to mention the fact that the bill was introduced, as I said before, by the Minister for Infrastructure and Transport but it is now being dealt with by the Department of Education, Employment and Workplace Relations—just goes to show that this bill is not about road safety. It is not a transport measure. It is an industrial relations measure, and that is how it is now coming through to the parliament.

It is clear that this legislation is the payback to the Transport Workers Union for loyal and faithful service to the Labor Party over many years. The Transport Workers Union have been driving this legislation, and this is the reason it has come into the parliament. Road safety in the heavy vehicle industry is an important issue and more needs to be done to address it. However, introducing industrial relations measures under the guise of road safety enhancements is not the way to address serious issues faced by the industry. As I said earlier, the bill results from the 2008 National Transport Commission report, which states that there is a link between remuneration rates and methods and safety. As I also said, it was based mainly on the previous writings of one of the committee members. The TWU and the minister have strongly argued that the legislation is designed to improve safety in the heavy vehicle industry because there is a link between remuneration and conditions and safety. However, the existence of this causal connection has been heavily questioned by a number of industry representatives, truck drivers and small business owners. That, ultimately, led me to question whether the bill will be effective at all in improving road safety in the heavy vehicle industry.

Indeed, the government's own regulatory impact statement on the bills questions the existence of a link between remuneration and road safety. It says at page IV:

Speed and fatigue are often identified as the primary cause for a crash but it is a much harder task to prove that drivers were speeding because of the manner or quantum of their remuneration …

It goes on to say:

… data at this point in time is limited and being definitive around the causal link between rates and safety is difficult.

It is clear that several subjective judgments are being made to make the claim that there is a definitive link between road safety and remuneration. The amount of money that a person earns before they decide they have a sufficient salary is of itself a subjective concept and, as such, will depend on the individual. One person will be satisfied with $1 more; somebody will want $5; somebody else will want $100. If you are going to reduce stress by paying people more, how much money do you have to pay them? If you are going to stop an accident, what is the price of stopping each of those accidents? If a driver is worried about his schedule, his income, his next load, his family or his sick children he is not as safe on the road as somebody who is concentrating on the road and his wheel.

The Australian Logistics Council and the Australian Industry Group clearly state in their submissions to the House of Representatives Standing Committee on Infrastructure and Communications that they do not believe that the link between road safety and remuneration rates and conditions has been definitely proven. Additionally, Independent Contractors Australia notes:

There is no proven link between pay rates and the incidence of road transport safety. There is, however, a direct link between driver behaviour and road safety.

The National Road Transport Operators Association—NatRoad—in their submission provides an analysis of the bill through the eyes of classic economic theory. They explain that it is generally agreed that workers will, for a time, increase their labour availability in response to higher wages because the higher rewards will generally increase their incentive to work while decreasing the relative attractiveness of leisure time, because the opportunity cost becomes greater. NatRoad argues that this is particularly true for the lowest paid and states their belief that 'these workers are likely to increase, rather than decrease, their labour availability in response to a Road Safety Remuneration Order which marginally improved remuneration levels for these workers'.

The Ai Group picks up the same point and states:

Even if a causal connection between remuneration and unsafe practices is presumed to exist it does not follow that establishing higher minimum rates or prohibiting certain methods of payment will result in drivers changing their unsafe practices. Rather, if it is accepted that an individual’s on road behaviour is influenced by the quantum of their remuneration it is conceivable that increased rates may further incentivise individuals to engage in behaviours such as the working of excessive hours in order to reap the greater rewards.

Additionally, NatRoad makes the point that research by the New South Wales RTA concludes that the heavy vehicle driver is at fault in only 31 per cent of fatal crashes involving a heavy vehicle. They say:

It cannot be expected that driver remuneration would have any bearing on the remaining 69 per cent of fatal heavy vehicle crashes.

How does this bill address road safety in these circumstances? The simple answer is that does not. For all of these reasons it is a fair conclusion that the underpinning assumption for the bill is still far from settled. What is a 'safe rate'? Even if it is accepted that paying drivers a 'safe rate' would improve safety in the trucking industry, then the next question is: what would be a safe rate? Can you ever determine what a safe rate is?

Noel Porter, the owner of Porter Haulage, from Victoria, has been involved in local and interstate road transport since 1976. He says in his submission to the House committee that it is his firm view that, 'There is no such thing as a safe rate.' Dallas Brookfield, from Brookfield's Transport Services, in his submission to the House committee agrees. He spent time on his submission outlining the complex, fixed and variable costs involved in operating a B-double truck, including registration, insurance, loan repayments, fuel, tyres, repairs, maintenance, wages, administration, cleaning and various other costs which vary according to the amount of kilometres driven. He concludes, 'How on earth can a committee decide on what a safe cartage rate will be?' He goes on to say:

To have someone, or a body of only a few so called experts, sit and decide what our minimum or “safe rate” is would be a joke as it just cannot be done.

In addition to these general points in the 'safe rates' debate, the bill has the potential to conflict with others already being developed and undermine much of the good work that has been done in improving standards in the heavy vehicle industry. This point is picked up by the New South Wales government in its submission where it notes the good work that is being done through COAG processes to implement the National Heavy Vehicle Regulator and the National Heavy Vehicle Law. The NHVR has taken years of development, consultation and negotiation by successive governments and will standardise a number of previously conflicting legislative requirements. Importantly, it will include national chain-of-responsibility provisions which would make companies directly responsible for the unsafe behaviours of their drivers. This has the potential to be a much more powerful influence for safety than does any new pay rate.

It should also be noted that the model Work Health and Safety Act commenced operation in some Australian jurisdictions on 1 January 2012. These laws require a business to ensure that workplace risks are as low as reasonably practicable. Not only has this legislation not been given the opportunity to prove its effectiveness but the Australian Logistics Council notes about the bill:

There is a direct collision between the philosophy of this Bill, which raises the spectre of inserting command/control regulation in an areas where other laws require the application of ALARP principles - which in one way places greater burdens on operators as ALARP implicitly requires implementation of ‘best practice’ and continuous improvement.

Additionally, the Ai Group have suggested that the regime undermines the operation of the Fair Work Act by overriding decisions of the existing industrial tribunal. In doing so, the bill questions the effectiveness of Labor's modern award process as being able to produce appropriate outcomes. Either the minister believes that the Fair Work Act provisions are not working or the bill is an attempt to push up wages for truck drivers.

This is another layer of red tape for business. In terms of red tape, the heavy vehicle industry is already subjected to numerous regulations and legislation at both a state and a national level. These include the independent contractors legislation, workplace health and safety legislation and the soon-to-be-implemented National Heavy Vehicle Regulator, which commences on 1 January 2013. As NatRoad points out, there are existing laws that apply to wages, conditions, contracting agreements, road use, vehicle standards, fatigue, speed, mass, dimension, loading, substance abuse and record keeping as well as general workplace health and safety obligations. The bill will add further complexity to an already bureaucratic area.

In New South Wales, for example, the bill will be the fourth layer of regulation for driver fatigue. This point was raised by a number of small businesses in their submissions to the House committee inquiry. Ross Ingram, from Bonaccord Freightlines, in Victoria, states:

After 20 years in the freight business, with 35 trucks travelling in 4 different states, we are often frustrated at the lack of consistency with various legislation and road laws between the states.

He goes on to discuss the complex documents and conflicting information that he believes make operations more difficult.

Ken Wilkie talks about the 'complicated compliance requirements currently demanded by government and its agencies' as a major cost burden on operators. The Civil Contractors Federation is also concerned about the administrative and compliance burden and argues that a further developed regulatory impact statement is required before the bill should be considered any further at all.

The bill, if successful, will certainly make the industry less flexible, as RSROs have the potential to stifle efficiency gains and innovation, with RSROs reflecting the standards in force at a particular time rather than current provisions which allow adaptability and flexibility. Additionally it will remove the ability of the industry to respond to changing conditions such as fuel prices.

The bill would also cover independent contractors who are currently outside the jurisdiction of the Fair Work Act. In doing so, the bill will create a new class of employment relationship that is neither employer-employee nor hirer-independent contractor. This will remove the independence of owner-drivers and will significantly reduce their autonomy.

Independent Contractors Australia argues that the actions of a small number of dangerous drivers who are already breaking existing laws are being used to justify making owner-drivers subject to provisions similar to those in the Fair Work Act. The Civil Contractors Federation also argues this point very strongly in its submission. The point is also picked up by the ICA, who argue that the price-fixing element will reduce competition, increase prices and lead to a less efficient and less effective transport sector in Australia. There is no doubt that this bill will lead to higher costs for Australian industry and higher costs in every store in every town, and particularly for regional Australia, which relies so much on the transport sector.

NatRoad notes that the floor price concept has the potential to lower pay and conditions for some owner-drivers who have negotiated a better agreement through superior service or a longstanding relationship. If the floor price becomes the standard rate for all freight movements, this may well be the case. NatRoad argues:

Many consignors will immediately question why they should offer more than the standard rate contained in an RSRO when tendering contracts to the market.

By reducing the autonomy and independence of owner-operators, the bill will have a significant impact on the state of employment relations in Australia. We will, for the first time, have a new type of employment relationship whereby independent contractors in the heavy vehicle sector are treated differently from independent contractors in any other industry.

It should also be noted that the bill is flawed in its coverage. The Department of Education, Employment and Workplace Relations estimated that, due to constitutional limitations, the bill will only cover approximately 80 per cent of employees and 60 per cent of owner-drivers. This is a curious statement in the light of the fact that both the Queensland and the New South Wales governments have stated their opposition to the bill. The Queensland Labor government is opposed to this bill and has made that clear at every stage, and now New South Wales and other state governments feel the same. New South Wales, Victoria and Western Australia already have their own laws in relation to this matter. Why are they being duplicated through this legislation? The reality is that harmonisation of any laws in the heavy vehicle sector has been a lengthy and difficult process, so to expect the states to refer their powers in this area is incredibly naive, and to expect the states to sign up to something which overrides their own legislation also fails to reflect reality.

There are many other industry organisations that have serious concerns about this legislation. The Post Office Agents Association in their submission said:

It seems unlikely that the Bill would improve road safety for Mail Contractors.

Their industry has a number of particular issues it could assist, but the tribunal, they say, 'offers very little in the way of improved road safety'. So the reality is that this is not a solution.

The coalition has an alternative. We favour a multifaceted, holistic approach to improving road safety in the heavy vehicle industry. This will include building better roads, awareness programs, education initiatives, industry codes of conduct, building more rest stops and passing lanes, and looking at ways to use new technology to improve road safety. The coalition in principle supports initiatives such as GPS tracking devices, mandatory safe-driving plans and compliance with work health and safety regulations, fatigue and speed laws, including the chain-of-responsibility requirements, as well as the adoption of suitable industry codes of practice. These are the greatest way to deliver enhanced safety and fairness in the road system.

This bill will not deliver safer roads. It is an industrial relations measure, not a measure about road safety, and is therefore very difficult to support. (Time expired)