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Wednesday, 9 November 2005
Page: 117


Mr BARTLETT (5:14 PM) —The debate on the Workplace Relations Amendment (Work Choices) Bill 2005 has been marked by a very clear contrast between rhetoric and fact. On the one hand, we have had hyperbole, exaggeration and scaremongering from the Labor Party and their trade union partners. Supposedly, there will be massive job losses, wages will be slashed, working conditions will worsen, there will be widespread industrial unrest and anarchy and the very fabric of society will be threatened. These claims are almost identical to the ridiculous claims we heard in 1996 from the Labor Party and the union movement prior to the first round of industrial relations reforms. These misleading claims have been backed up by a series of union advertisements that are clearly factually incorrect and blatantly misleading.

Compare that rhetoric, scaremongering and hyperbole and those exaggerated claims with the facts. The facts are these. First of all, let us look at the record of what has been achieved since the first round of industrial relations reform under this government. We have had over 1.7 million jobs created in the last nine years, with more than half of those being full-time jobs. We have had a rise in average real income of 14.9 per cent, compared with just 1.2 per cent over Labor’s 13 years. We have had a rise in minimum real wages of 10.7 per cent, compared with a fall of around five per cent over Labor’s 13 years. We have had the lowest level of industrial disputation since records have been kept—around 90 years. We have had a fall in unemployment—from 8.5 per cent to 5.1 per cent. In fact, Access Economics estimated that if it had not been for the reforms that this government has introduced, unemployment probably would be about two to 2½ per cent higher than it currently is. So the record very clearly shows that the first round of industrial relations reforms delivered improved working conditions, wages and employment prospects for the people of Australia.

The other fact that is worth considering is this: on average, people on Australian workplace agreements, those agreements introduced under the first round of reforms to introduce more flexibility, are earning 13 per cent more than people on certified agreements and 100 per cent more than people on awards. These earnings are not just restricted to one or two industries. For example, a comparison between the average total weekly earnings of people on AWAs and the earnings of those on awards indicates that the earnings of people on AWAs are 30 per cent higher in the mining industry; 68 per cent higher in manufacturing; 49 per cent higher in electricity, gas and water; 78 per cent higher in the construction industry; 126 per cent higher in the wholesale trades; 37 per cent higher in accommodation, cafes and restaurants; 40 per cent higher in the retail trade; 47 per cent higher in transport and storage; and 254 per cent higher in communications services. The fact is that right across industry, right across the different sectors in this country, people on Australian workplace agreements are earning substantially more than people in the award system. The facts stand in very clear contrast to the rhetoric and the scaremongering that we have heard right through this debate from the other side.

However, we cannot rest on our laurels. We need to continue to build on these reforms. Almost every independent economic commentator says that this is what needs to happen, that we need to take it further. The IMF, for instance, says:

... this improvement in flexibility, supported by increased competition ... and other structural reforms, has been an important contributor to Australia’s excellent record of job creation and productivity growth during the past 14 years ...

                         …                   …                   …

... the proposed industrial relations reforms are further steps in the same direction which will improve the functioning of the labor market and help sustain Australia’s strong economic performance in future ...

                         …                   …                   …

... the benefits of economic reforms in Australia, including improvements in the functioning of the labor market, have been substantial, and this gives a sound basis for expecting positive results from further labor market reforms.

The Reserve Bank says the industrial relations reforms so far have:

... meant that the economy can run faster without generating inflationary influences to the extent that used to be the case.

The Governor of the Reserve Bank says:

So I think there’s undoubtedly value in industrial relations reform.

The World Bank, looking at evidence from around the world, says:

Heavy regulation of dismissal—

in other words, the unfair dismissal type of regime—

is associated with more unemployment ... flexible labour markets, by contrast, provide job opportunities for more people, ensuring that the best worker is found for each job. Productivity rises, as do wages and out put.

So there are more jobs and higher wages with industrial relations reform. The OECD says:

To further encourage participation and favour employment, the industrial relations system also needs to be reformed so as to increase the flexibility of the labour market, reduce employment transactions costs and achieve a closer link between wages and productivity.

                         …                   …                   …

The Government is now in a position to address these issues and should proceed as soon as practicable.

That is exactly what we are trying to do, and if the opposition would support us we would do it even more quickly.

A number of other commentators have been looking at the legislation over the last week. An editorial in the Australian just last week said:

The workplace reforms are necessary to keep the economy expanding so it generates more and better paying jobs. For all their arguments about equity, advocates of the old labour system do the poor no service. Rather, they protect the 20 per cent of workers who prosper under the industrial awards system that assumes all workers and workplaces are exactly the same.

The Adelaide Advertiser said:

The industrial relations reforms are long overdue and this package appears to protect workers while offering much-needed flexibility, particularly for small business.

Terry McCrann, from the Telegraph, said:

The government’s industrial relations reforms are sensible and moderate. They are the minimum necessary for Australia to survive and prosper in the 21st century.

                         …                   …                   …

We needed one national system 30 years ago; in the globalised world of today, sustaining overlapping federal and state systems is sheer and uniquely Australian lunacy.

We could go on. The Labour Prime Minister of the United Kingdom, Tony Blair, said:

... fairness at work starts with the chance of a job in the first place, because if we ... do not make Britain—

and the same thing applies to Australia—

a country of successful businesses, a country where people want to set up and expand, and a country that has the edge over our competitors, then we are betraying those we represent.

Could I say to the Labor Party that that is what their opposition is doing: they are betraying those they purport to represent. The best chance of a job, of higher wages and of improved living standards comes with a strong economy with higher productivity. The first round of these reforms has already delivered those things and these reforms will continue to build on that.

There is a raft of protections built into these reforms to make sure that workers are protected. The fair pay standard and the enhanced role of the Office of Workplace Services will ensure that workers are protected. Contrary to the claims of the other side, we are not removing workers’ rights, we are not cutting minimum wages, we are not removing awards, we are not allowing workers to be sacked at will, we are not removing the right to join a union, we are not outlawing union agreements and we are not taking away the right to strike. These are ridiculous claims. Rather, we are protecting the rights of workers, while at the same time introducing the flexibility that will allow increased productivity and economic growth.

The bottom line is this—and the Labor Party and anyone who is honest knows it: the evidence shows very clearly that an overly rigid, overly structured and overly regulated labour market cannot provide protection for workers. We saw this in the recession in 1990-91, the recession we supposedly had to have, in which one million workers were thrown out of work. We saw it with the reduction in minimum real wages over Labor’s 13 years. A rigid, inflexible labour market cannot protect workers. The evidence around the world shows it. In France, Germany and Spain, those heavily regulated members of the OECD, unemployment is running at around 10 per cent. In countries with more flexible labour markets, such as Australia, New Zealand and Britain, unemployment is around four per cent—in Australia’s case, five per cent. A heavily regulated labour market cannot protect workers. The best way to enable workers to improve their chances of a job, to achieve higher real wages and to achieve higher living standards is by freeing up our market and increasing flexibility. Those opposite can continue to stick their heads in the sand, but the reality is that, unless we continue to encourage flexibility and improve productivity, we cannot build on the living standards we have seen in this country. These reforms are the best chance of continuing to strengthen our economy, the best chance of securing Australia’s economic future and the best chance of delivering higher wages, greater job security and higher living standards to Australian workers and their families.