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Wednesday, 9 November 2005
Page: 19


Ms KING (10:09 AM) —This industrial relations legislation before the House today, the Workplace Relations Amendment (Work Choices) Bill 2005, is the most extreme attack on working families we have seen in this country. The Work Choices bill—or, as it is now being referred to, the ‘What Choices?’ bill—is not about strengthening the economy. It is not about productivity or employment. It is purely about ideology, an article of Liberal Party faith—unfinished business for a tired Prime Minister who clearly, judging by the Treasurer’s Mr Happy Face demeanour, has done a deal for his retirement and is looking to his swan song, the final jewel in his prime ministerial crown: the crushing of 100 years of fair industrial relations. This is not reform; this is one little man’s obsession.

These laws undermine pay and conditions and they undermine family life. They have all been brought to you courtesy of a $55 million taxpayer funded propaganda campaign that has not been about providing information. Rather, it has been about spreading disinformation. The government, unwilling to tell the truth about these laws and trying to avoid public scrutiny, has gone to its favourite fallback position: ‘Trust us; it’s about the economy.’ The government is, however, unable to make the case that the laws will create jobs, lift productivity or boost living standards. It is using these laws to distract from its own economic policy laziness.

The government in its nine long years in office has failed to tackle the real economic challenges facing this country. That is no more evident than in its abandonment of the manufacturing sector. It has squandered the economic reforms of the 1980s and coasted along on the coat-tails of Labor’s decisions in government. This mob are not economic reformers; they have squandered our economic growth and have failed to tackle the real challenges facing this country. And this nasty, regressive legislation that reduces wages, removes working conditions and makes it easier for people to be sacked is the best they can come up with. This government’s great idea for economic reform is to drive wages down so that we can compete with India and China on the wages front. It is a race to the bottom.

In this debate, I want to look at some of the most worrying aspects of the legislation for working families and to raise some of the economic issues we should be focusing on. But first I want to tackle some of the lies the government have told about this legislation and their failure to be honest with the Australian public as to its impact on families.

It has now become second nature for this government to avoid scrutiny. It shows little regard for the processes of the parliament and, by doing so, little regard for the people who elected us to represent them. The government can spend sometimes up to a year debating and inquiring into issues. A current example is its decision to release a discussion paper on telemarketing rather than to bring on for debate the member for Chisholm’s private member’s bill, which actually provides a way forward on these issues. Yet it has introduced these 1,252 pages of legislation and explanation, with debate brought on in less than 24 hours. The government is now seeking to limit that debate, with a number of members on this side of the House likely to be denied the opportunity to make a contribution.

You have to ask: if the government are so proud of this legislation, why do they seek to limit debate? Regardless of what we on this side of the House do, the government have the numbers. Why not just let the debate run? What an act of contempt for the parliament to guillotine debate on these, the most profound changes to the rights of working families. It is the Telstra legislation all over again: rush it through parliament, take some early hits, but, once it is through, hope the media furore and the disquiet will just go away and disappear.

For people whose skills are in high demand, it will take time for the personal effects of this legislation to filter through. But, for the thousands of workers in precarious employment situations and in regional and rural areas where unemployment is higher than the national average and wages are already lower, it will take little time at all. Regional areas such as mine with highly concentrated economies are the first to feel the brunt of an economic downturn, and they will be the first to feel the harsh effects of this law.

This is why the $55 million of taxpayers’ money spent on spreading disinformation about these laws is so obscene. I can just see John Howard almost rubbing his hands with glee as he talks to the Liberal Party admen who have constructed these ads. It is Strengthening Medicare all over again: do not focus on what you are ripping away from people; focus on what they get to keep, and make it sound so safe and so protected that they will thank you for being so generous.

These ads are full of disinformation. It is what they do not tell you that is the real story. They do not tell you that fairness has been removed from the national wage case. They do not tell you that the legislation takes rights against unfair dismissal away from almost every worker in my electorate. They do not tell you that the legislation allows employers to dismiss workers, with no compensation, for ‘operational reasons’. They do not tell you that, in destroying the no disadvantage test, the foundation against which enterprise agreements and AWAs are tested, your capacity to have a whole raft of conditions will now be gone.

The Liberal Party ads try to give the impression that these laws give stronger protection than what is there now, feeding off people’s confusion about their current work rights, when nothing could be further from the truth. Under the award system, which the government has now said that it wants to review—read ‘abolish’—there are currently 20 pay and conditions standards protected by law. Under this bill, there are just five. Taken away, or able to be bargained away, are rights like redundancy pay and penalty rates.

The ads also seek to confuse people by saying that employees’ rights against dismissal are protected by law. They are seeking to confuse people and to confound the difference between unfair dismissal and unlawful dismissal, two very different things. Your right to seek recompense if unfairly dismissed will go in 99 per cent of workplaces, and the grounds on which someone can be unlawfully dismissed will be narrowed. Even then, you will have to take your employer to court, with costs potentially being awarded against you, instead of to the cheaper, faster Industrial Relations Commission.

The arrogance of the Prime Minister in using millions of dollars of taxpayers’ money on ads that mislead them about the nature of these laws is frankly obscene. The government have only allowed a limited inquiry into this bill, and they have again reneged on their commitment to Family First by not undertaking a family impact statement.

These laws erode the living standards and security of working families. Coupled with the draconian cuts to welfare introduced into this place today, they undermine the capacity of the unemployed and low- and middle-income earners to get ahead. The government tries to argue that these laws make it more flexible for families to choose their hours and to balance work and family under individual contracts. This flexibility exists now, under the current system. What these laws do is provide greater flexibility for the employer to set conditions and remove a number of obligations on employers to work with employees to develop the best outcome for them and for the enterprise in which they work. As Professor Steven Frenkel of the Australian School of Graduate Management says:

These proposed laws really lead towards the low road and there is nothing in the legislation that I have seen that has a vision of the workplace as a decent place to work.

The debate about this legislation is not about some minor technical changes or even about some academic arguments about labour market supply and demand. This debate is about the kind of country we want to live in. It is about the basic value of whether we believe parents should have the capacity to manage the difficult balance between work and family life. It is a debate about whether we will continue to be a fair and equal society, one that values families and our relationships more than anything and one that values a fair go, justice, tolerance, respect and the right, no matter whether you are the lowest paid cleaner or Kerry Packer, to make the most of your circumstances.

These laws finish the job that John Howard set out to do in 1996. Then, when he tried to introduce similar laws, the Senate stopped him. They moved some 200 successful amendments to the laws in 1996. The Australian people were protected by the Senate in that instance but they are protected no more. I have no doubt that these laws will get passed. I have no doubt that the minor murmurs of dissent coming from one Nationals senator will again be bought off. There is no protection from this government’s laws from the Senate.

These 1,252 pages represent some of the most extreme reforms Australian families and workers have ever seen. They are unfair, they are divisive and they bring no economic benefit. These pages are an assault not only on the living standards of ordinary working families but on our basic values, such as fairness. Nothing more clearly illustrates this than the removal of fairness as a matter that the so-called Fair Pay Commission has to take into account when it makes wage decisions. Under the current system, the Industrial Relations Commission makes wage decisions based on fairness. That is explicitly stated in section 88B of the current law. But this legislation removes fairness as a factor in wage case decisions. The government was happy to pulp some half a million copies of its glossy WorkChoices propaganda pamphlet to insert the word ‘fairness’ on the cover but, when it comes to actually putting it into law, it is gone.

This legislation removes the power of the Industrial Relations Commission to set the minimum wage. It hands it over to a government-appointed board ironically—or perhaps cynically—called the Fair Pay Commission. This board will be appointed by a government that has consistently said that minimum wages are too high. The Prime Minister asks us to take him on his record on these matters, claiming that under his government real wages have risen. What he is not prepared to say is that real wages have risen in this country not because of the government but despite the government.

The Prime Minister has opposed every single increase to the minimum wage that has been handed down by the Industrial Relations Commission. Since 1997 the Prime Minister has recommended on every occasion an increase to the minimum wage below what the commission has agreed. Workers on the minimum wage would be $50 a week or $2,600 a year worse off if John Howard had had his way in setting minimum wages. Had the Prime Minister had his way since 1997, there would have been a real reduction in the minimum wage, not the increase granted by the Industrial Relations Commission.

The government has confirmed that the next national wage case to be determined by this so-called Fair Pay Commission will now be delayed. This means that Australia’s lowest paid workers will have to wait at least 18 months before any pay increase above their current $484.40 a week is even considered.

In defence of this so-called Fair Pay Commission, the government tries to point out that the Low Pay Commission in the United Kingdom is similar and that we should not be too worried about this, disingenuously trying to make out that the commissions are somehow even remotely similar. They are not. In an article in the Age on Monday, Robyn May blew the whistle on this argument. She states:

Britain’s LPC was created to recommend to government the level at which to set national minimum wages for adults and youth.

That is where the similarities end. She continues:

It is genuinely tripartite, with three trade union, three employer, and three academic representatives.

Trade union and employer groups were consulted on the appointments. She argues that the most critical difference between the Fair Pay Commission and the Low Pay Commission is one of context and political intent. She states:

The British LPC was established within a broad agenda of ‘social partnership’ and the reinstatement of a minimum wage was part of wider social and industrial relations policy changes that included broad poverty-fighting measures.

…            …            …

Rather than being an instrument to improve low pay, the commission, with its narrow economic and ideological focus, seems designed more as an instrument for lowering wages.

Exactly. The reality of John Howard’s record on the minimum wage is that he thinks it should be lower. The Prime Minister has absolutely refused to give a guarantee that no worker will be worse off under this legislation. He will not give that guarantee because he knows that he cannot. He says that he will not give a guarantee but that we should just judge him on his record. His record on the minimum wage is that, on every occasion, he has opposed the increase that has been granted by the Industrial Relations Commission. A reduction in the real value of the minimum wage is nothing but bad social and economic news for nearly 20 per cent of Australians in the work force and all the families they support.

The Howard government’s public policy objective here is partly driven by the belief that, if the minimum wage is reduced, more jobs at the bottom end of the scale will be created. The government will not state it as clearly as that because there is no international or domestic evidence that makes this claim even the least bit credible. This ‘trickle-down effect’ economics was highlighted by the Prime Minister with regard to the choice of the fictional unemployed person Billy, who, if he wants a job, has to accept an individual contract that takes away penalty rates, leave entitlements and other benefits. The Prime Minister’s response—dog whistling, as usual—when asked about this in parliament, smacked uncomfortably of ‘beggars shouldn’t be choosers’. That is exactly what the case is under these new industrial relations laws.

Research done in Australia by the Centre for Industrial Relations Research and Training suggests that, at best, it is an assertion only that lowering wages will create more jobs. Why is it that, over the past five years of annual minimum wage increases, unemployment has fallen? International comparisons show exactly the same trend. In the UK jobs growth has been at 4.4 per cent, despite an increase in the minimum wage. The reverse has occurred in the US, with the minimum wage falling by almost 12 per cent and with jobs growth at only 2.2 per cent. Robyn May, in the same Age article referred to previously, claims that, under the UK’s Low Pay Commission:

What is emerging is strong evidence on the effects of minimum wage rises on employment. In short, the rising minimum wage has had no negative impact on employment. Indeed, the LPC says employment has grown in the sectors where the minimum wage has had most impact.

 The government has also tried to assert that, by driving the minimum wage down, productivity will be boosted. Again, it simply cannot mount any plausible argument on this front. In fact, it is more correct to argue that companies that take solely the low-pay approach are more likely to become caught up in a low productivity cycle. The government would like us to aim for the labour prices of New Zealand. The radical reforms of New Zealand did exactly what the government wants to do here: they drove wages down—but they did not lift productivity.

Tim Colebatch, in an article in the Age yesterday, argues that, since 1990, the OECD estimates that productivity has grown only by half as much in New Zealand as it has here in Australia. He states:

Work Choices confers choice on employers. It give more workers nothing they do not have already, and slowly strips them of group bargaining power ... and it is a deception to tell people they will be better off with a law clearly designed to make them worse off.

It is wrong to argue that these laws will increase productivity, when there is clear evidence that they will not.

Other provisions in this bill are equally worrying. Under current law, all employees have access to unfair dismissal provisions. The government for some years has been trying to remove this for small businesses with up to 20 employees. The government gave no indication of this in the last election, but it has snuck into this legislation a provision that removes unfair dismissal rights for employees and businesses with up to 100 staff. For businesses with over 100 staff, it has also included a provision that it is not a ground for unfair dismissal if you are sacked for ‘operational reasons’. Essentially, the Treasurer has got what he asked for when he said that he had an open mind on abolishing unfair dismissal laws altogether. According to the bill, ‘operational reasons’ are:

... reasons of an economic, technological, structural or similar nature relating to the employer’s undertaking, establishment, service or business, or to a part of the employer’s undertaking, establishment, service or business ...

This provision in section 170CE(5D) is so wide that virtually anything goes. An employer can terminate an employee for so-called ‘operational reasons’ and it will be justified. The only recourse people will have is if they believe they have grounds for unlawful dismissal. Unlawful dismissal cases can take up to 18 months and require expensive legal representation that can run up to thousands of dollars in the Federal or Supreme Court, depending on what law it is to be tested under.

There are problems with the existing unfair dismissal procedures. As the daughter of a small businessman who has now retired, I have much sympathy for the plight of small businesspeople and the stress they are under. But let us fix those procedures. Let us not remove the right of 99 per cent of the workplace to unfair dismissal laws. Let us work to remove vexatious claims from the system and be more sympathetic to the needs of small business. These provisions do not make businesses immune from legal actions or their associated costs. If that is the only recourse open to people, it is more likely and not less likely that, under these laws, they will take such action. The Work Choices bill also fundamentally attacks the no disadvantage test, but I do not have time in this debate to go into all of that.

The government has completely failed to make the case for these laws. It has failed on the economic front and it has certainly failed to support our manufacturing sector in this country. It has not addressed the skills crisis. It has not invested in research and development or in innovation and design; it has not looked at the issue of trying to develop industry plans.

In his contribution to the debate, Kim Beazley quoted Alfred Deakin. As Deakin is a former member for Ballarat, and someone whom we in Ballarat claim as our own, I would like to finish my contribution by quoting him. It was Deakin as Attorney-General who introduced the Conciliation and Arbitration Bill. He said:

We have trusted for centuries to the various tribunals erected for the administration of civil justice, and I hope that we shall begin from this day forth to trust to these courts for industrial justice.

This government is destroying 100 years of industrial relations history. (Time expired)