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Wednesday, 30 May 2007
Page: 38


Mr CREAN (11:55 AM) —I rise to support the second reading amendment moved by the member for Lalor. I must say at the outset that I am intrigued by the title of this bill. It is called the Workplace Relations Amendment (A Stronger Safety Net) Bill 2007. A stronger safety net? There is no safety net under Work Choices—never has been, and there is no intention for there to really be one in the future. The truth, though, is that any concession by this government, in its desperation, that advances fairness will be supported by us but it will not end the unfairness of its Work Choices system. This House will have the opportunity—and members opposite will have the opportunity to join with us in supporting amendments to this bill later—to advance even further the test of fairness. Let us see if they are prepared to do it. Let us see if they genuinely believe in the need to advance fairness.

Work Choices is an unfair workplace relations system. Work Choices offers no choice. If in fact the employer decides he will not bargain in good faith, that employer does not have to. The system of workplace relations that this government has introduced reweights the whole equation in favour of the employer. It is a take it or leave it approach: take the AWA or take the sack. Work Choices abolishes the independent umpire. It destroys collective bargaining. It does not protect the right to freedom of association. It does not require good-faith bargaining. This bill is an inherent admission of the failure and the unfairness of Work Choices.

Whilst I am on the topic of Work Choices, I note that we still talk about it but the government does not. The government has dropped the term. So poisoned is ‘Work Choices’ in terms of what it conveys—no choice, and work chances but certainly not work choices—that the government has dropped it from its advertising and marketing direction. Now the great policy that was supposed to lift productivity and help workers dare not speak its name. The government has disowned it; it has become an orphan. Yet this government would have you believe that this was going to be the great panacea in terms of lifting productivity. I will come to that issue a bit later.

Here we have an advertising campaign on which $5 million has already been spent before we even have the legislation. How can we be advertising anything if we do not know what it is that is being introduced by way of legislation? But $5 million has been spent before they knew what they were advertising only to promote what they weren’t as they had dropped the title. And the $5 million which they have already spent on this flawed approach is estimated to rise to about $40 million—just on this advertising campaign alone.

Why do we have this legislation before us? We know the system is unfair. It is acknowledged by the government that they have to do something. How far they will go, I will come to in a minute. The truth is that the Prime Minister fundamentally does not believe that his system of workplace relations is unfair. Why? Because he has never believed in encouraging a system of industrial relations in this country that fosters cooperation. I remember when the current Prime Minister was shadow minister for industrial relations when Labor was in office and Labor was developing the Prices and Incomes Accord with the trade union movement of this country, which I had the privilege to lead as President of the ACTU. John Howard came to the office to try to understand what the accord mechanisms were about. I took him through at great length what we were involved in—sharing the commitment to growing the wealth of this country, but on the basis that in whatever we created together, there should be fairness as to its distribution. That is a fair deal. It was the Prices and Incomes Accord that laid the basis for the prosperity in the country. It was the accord that controlled inflation and brought interest rates down. It was the accord that gave distribution to the workforce other than through money wage increases. It was the accord that gave this nation superannuation. It was the accord that understood the importance of trading the social wage for the money wage and reducing the cost to the employer so that we could lock in low inflation and keep the low interest rates.

Let’s remember that, when Labor came to office, John Howard had left an economy as Treasurer in 1983 with 11 per cent inflation and 11 per cent unemployment and interest rates at around 16 per cent. He never wants to talk about that. He will talk about what Labor did, but he will never talk about what his record was. Who ensured that this economy laid the basis for its sustained recovery? It was the Labor Party in cooperation with the trade union movement. That is what comes from a cooperative system. But it is also a system that delivered its own fairness. It is a system that John Howard never sought to understand because he didn’t believe in it. He believed in re-weighting the system in favour of the employers, of seeing workers as costs, not as human beings who have to earn a decent income and bring up families, not as skilled workers and contributors to a productive workforce who need to be invested in, not a partnership that needs to be fostered at the enterprise level. The Prime Minister wants none of that. He wants to turn us into a dog-eat-dog society, to drive individualism. Workforces do not operate as groups of individuals; they operate as teams. Why shouldn’t we be fostering collective bargaining, the collective approach? That is Labor’s way, but it is not this government’s way and it is not what this legislation does.

So why the change? On 4 May the Prime Minister had read the polls—and they have got worse for him since. Fearful, and building on his ‘annihilation’ message, he announced he would introduce a new ‘fairness’ test to the poison that is Work Choices. I ask the House to note that it is not a no disadvantage test; it is just a fairness test. Labor supports a no disadvantage test and so did the Prime Minister until he got control of the Senate, but the fact is that he does not believe in it. To define ‘fairness’ we have legislation and an explanatory memorandum of 150 pages. What is fair about that? Also, what is fair about the government announcing the legislation on 4 May, almost a month ago, but not introducing it into this House until Monday night? So they take four weeks to draft this cobbled together hotchpotch, and then only give the House one day to debate it. What is fair about that? As for whether people should trust this government to deliver this message, why should we believe them? After all, it was the Minister for Finance and Administration who, at an HR Nicholls Society function, said about Work Choices:

There will have to be more reform ...

Last week the Treasurer was asked if he could guarantee whether there would be no further changes if the government were re-elected and he was Prime Minister. These were the Treasurer’s words:

Well, I’m not going to speculate on what might happen after the election.

If you need any further confirmation that this legislation will be changed if the government is returned, you only have to look at what was said by the henchman of the outfit, Peter Hendy, who heads up the Australian Chamber of Commerce and Industry. He was Peter Reith’s right-hand man, people might remember, in the waterfront dispute, involving that sinister midnight raid that stripped workers of all their wages and conditions. Peter Hendy is now running one of the major employer operations in this town. He said in a press statement yesterday:

Yesterday’s amendments—

having criticised them and expressed disappointment about them—

will need to be monitored over time.

What is that code for? That is code for ‘Re-elect this government, and even this sham of a fairness test will be stripped away.’

Labor is for fairness. But this fairness test does not go anywhere near far enough to restore the fairness and balance in the system. There is some improvement, with the ability to investigate unfair conditions imposed on workers, but it does not take away the unfairness of what is in place. The reason we are prepared to support this in the end is that it does make a marginal improvement. I will tell you how it makes a marginal improvement. People might remember the circumstances of Darrell Lea. Everyone knows the chocolate company Darrell Lea; we buy their chocolates, we enjoy them. Just before Easter they offered AWAs to all of their casual employees, some 150 people. Those AWAs cut casual loading, weekend and public holiday penalty rates, rostering protections and sick leave for no compensation—not one cent.

Under this legislation, that cannot happen in future. Unfortunately, nothing can be done for those 150 Darrell Lea workers because this legislation is not retrospective. The legislation introduces a fairness test that says, ‘If conditions are to be stripped away there has to be fair compensation.’ I point out it is not ‘full’ compensation, but ‘fair’ compensation. I will come to the question of how we define fairness in a minute. The Darrell Lea circumstance could not be repeated under this legislation—something would have to be offered in return. That is why, in the end, we are prepared to support the legislation, but the trouble is that it does not go anywhere near far enough. What we want is a system that does restore the right to collectively bargain, that does restore the requirement for employers to bargain in good faith and does restore the independent umpire. That will not happen under this legislation. That will happen under a Rudd-led Labor government.

Let us look at the detail of the legislation. What is this new fairness test? As I say, it takes almost 150 pages to try and describe it. What does it do? This legislation still does not protect crucial award conditions. The only fairness that has to be addressed is in relation to any changes over the 11 protected award matters—rest breaks, shift allowances, overtime, penalty rates and public holiday pay, for example. It does not cover other crucial award conditions, such as redundancy pay, long service leave and flexibility in rosters. Understand what that means: even under this new fairness test, if an employer strips away those benefits there is no requirement for any compensation at all in relation to those aspects. As I said, fair compensation—even in relation to the 11 matters—does not mean full compensation.

But there is another question. How does the government assess what is fair? We do not know. The legislation establishes a secret process. It is up to the Workplace Authority director to make a judgement as to whether there has been fair compensation for the stripping away of just 11 conditions. There is no requirement for a time frame on the decision, which means an employer can be started under unfair conditions and, if they are found to be unfair, restitution made later. So the employer can still start people working unfairly and there is no time frame for decision, no ability for the employee to have input, no ability to have their say as to whether they think they are being compensated fairly or not. No reasons are required to be given when the Workplace Authority director hands down their decision. There is no right of appeal and, as we have seen with the Darrell Lea case, a workplace agreement, once struck, can last for five years—five years of entrenched unfairness.

The body that is going to undertake these secret investigations comes at a cost of $370 million over the forward estimates and has 600 assessors. Can you believe the system the government is putting in place? This is a government that has effectively abolished the conciliation and arbitration system in this country—the independent umpire which has served this country well, which hears both sides, holds open hearings, gives reasons and all of those sorts of things. It has abolished the independent umpire and instituted a secret police organisation to determine fairness. That is what this government means by introducing fairness.

Let me come to the question of productivity, because the government asserts that productivity will increase under its workplace relations system. I have made the point that Work Choices is an unfair system, but it is also bad for the economy. It is bad for the economy because it does not drive productivity at the workplace. I talked earlier in this address about the contribution the trade union movement had made through the accords to productivity. Let us look at the comparisons. The cooperation that Labor was able to produce through those accords produced big dividends for the economy. The 1990s saw the biggest step up in productivity ever in the history of the country. Between 1991 and 1996 labour productivity improved from 1.9 per cent to 2.5 per cent—the biggest increase ever. Do you know what the budget papers forecast productivity to be? Zero. Not only have they not increased it but also they have reduced it to zero.

The big upward trend that we experienced up until we lost office in 1996 continued for another four years. Why? Because the government could not get their changes to industrial legislation through the parliament. It was not that they did not try. The then minister, Peter Reith, tried—his first wave of industrial relations reform, his second wave, his third wave—but there was a Senate that kept blocking it. Between 2000 and 2005, when they started to get the changes to their workplace relations system into place, productivity, which peaked at 3.1 per cent under our system—Labor’s system—plummeted to 1.7 per cent, almost half. Now the budget is projecting it is going to go to zero. When we are a hugely fast growing economy why would you introduce a system that was working against our interests in terms of advancing productivity? The Productivity Commission has estimated that, if the productivity growth that Labor oversaw could be maintained now, the decline in productivity that comes about because of an ageing population could largely be contained.

Labor had an intergenerational solution, through the workforce, to our ageing population and it came about through cooperation and fairness. The government blew it. Not only has productivity plummeted but their obsession with reducing union influence, rather than working to a more productive economy, is costing us in terms of the economic sustainability of this country. Compare productivity in Australia with New Zealand, which went down the AWA route. Compare productivity in the iron ore industry in Western Australia, which has AWAs, with productivity in the coal mining industry in the Bowen Basin—which I have recently come back from—which has collective agreements. Productivity in the coal industry is significantly higher, greater than double that in the iron ore industry.

This legislation does not make the system fairer. Work Choices is an inherently unfair system. It is bad for workers and it is bad for their families. It strips away their rights and entitlements and the time they have to spend with their family, but this legislation is not just about unfairness. This legislation, whatever it attempts to do, does not correct the fundamental flaw. It is an unfair system. It is bad for workers. It is bad for the economy and that is why—(Time expired)