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Monday, 22 September 2008
Page: 8111


Mr COMBET (Parliamentary Secretary for Defence Procurement) (5:26 PM) —Like for the previous speaker, my colleague Dr Kelly, the Parliamentary Secretary for Defence Support, occupational health and safety has also been a constant feature of my working life. I started in underground coalmining just west of Lithgow and learnt very quickly the importance of having a strong regulatory environment and effective workplace organisation, particularly in workplaces such as underground coalmines. I continued through my mining engineering work and ultimately ended up working for an organisation in the western suburbs of Sydney which was known as the Workers Health Centre and which did a lot of work on occupational health and safety on behalf of unions in New South Wales in many different industries and workplaces. It was there in the early 1980s that I first became involved with asbestos victims groups, the diagnosis and compensation challenges for people who had been exposed to asbestos and, of course, trying to prevent further exposure in many different industries such as the building industry. That started a long association with people exposed to asbestos. I worked on their behalf, but I also worked as a national official with the Waterside Workers Federation of Australia, many of whose members had been exposed to asbestos, as well as many other toxic substances, over the years and where compensation was a constant and difficult issue to resolve. I became involved with the ACTU in more recent years in the effort to bring about justice for victims of the James Hardie company, which had exposed people to asbestos over many years. I also, as Dr Kelly indicated a moment ago, knew Bernie Banton very well and worked closely with him.

At a regulatory level, in the 1980s I did a lot of work lobbying the Hawke government on the establishment of the National Occupational Health and Safety Commission. In some respects, the subject of the Safe Work Australia Bill 2008 and the Safe Work Australia (Consequential and Transitional Provisions) Bill 2008 is a potential successor organisation to the National Occupational Health and Safety Commission. What followed then were Worksafe Australia and the Australian Safety and Compensation Council. This bill considers the establishment of Safe Work Australia.

Every year in this country over 140,000 Australians are seriously injured at work and at least four times as many suffer less-serious injuries. Tragically, each year more than 300 Australians are killed at work and many more die as a result of work related disease. This equates approximately to a fatality rate of 3.5 per 100,000 people. That is a tragic enough figure as it is, but it is also important to note that the figure is in fact higher, and getting worse, in some sectors. For example, 7.4 per cent of workers in the construction sector suffered a workplace related injury in 2000, and by 2005-06 this figure had unfortunately increased to 8.6 per cent of that workforce. That is nearly one in 10 workers who are injured in the construction industry, an unacceptably high rate of injury. Workplace safety obviously has a big impact on workers, their families, their colleagues and their friends. Apart from the obvious human cost there is also the economic cost to the community, which has been estimated to be approximately $34 billion per year. Given the importance of this area to the individuals involved, their families, the broader community and economy, it is important that we get the occupational health and safety system in this country right.

Occupational health and safety systems are aimed at preventing workplace accidents, while the workers compensation system is concerned with delivering the support needed to workers and their families when such accidents do occur. Historically, both occupational health and safety and workers compensation arrangements have been fragmented across nine jurisdictions—the Commonwealth, the six states and the two territories. Each state and territory has historically had its own health and safety laws. The Commonwealth currently has two statutes, and there are also state based industry-specific safety laws. This jurisdictional jigsaw puzzle has been driven by our constitutional arrangements historically since Federation. The High Court judgement in the Work Choices case in late 2006, though, provides the potential for change in this area of regulation by endorsing the capacity of the Commonwealth to rely upon the corporations power to a greater degree to legislate in this type of field.

While the current health and safety laws are in some ways consistent, there are still, with so many jurisdictions, enough fundamental differences between them to make many elements of them unique. This can be a very unsatisfactory position for workers who, in an increasingly mobile economic environment, might move from one jurisdiction to another and be subject to different rights and entitlements—particularly in relation to compensation entitlements, in my experience. Indeed, as the Deputy Prime Minister noted while introducing this bill:

Inconsistencies between jurisdictions mean that some workers are at risk of poorer safety standards than their counterparts in other states.

Of course, that is evident when you have differing standards in different jurisdictions.

But this circumstance is also bad for business, which faces different rules and the costs of complying with different systems. This is why the Labor Party, the Rudd Labor government, supports the harmonisation of these systems, and that requires the leadership that has been shown by the government. Unfortunately, currently there is no national body that is able to demonstrate leadership on these issues in a specific way or move the agenda of harmonisation forward through cooperative federalism. The body that is currently meant to be fulfilling that role is the Australian Safety and Compensation Council. That council was established by the Howard government in 2004. It replaced the National Occupational Health and Safety Commission, or Worksafe Australia, which had been set up, as I mentioned in my introductory remarks, by the Hawke government in the mid-1980s. The National Occupational Health and Safety Commission was a tripartite body that had real responsibilities and powers and played a valuable role in the formulation of workplace safety elements.

Unfortunately, and perhaps as a sign of the previous government’s unwillingness to genuinely deal with this issue, the Australian Safety and Compensation Council’s powers were limited only to coordinating, monitoring and promoting, and it lacked sufficient teeth to have a substantive role in promoting occupational health and safety across the Australian workforce. That is why, at the last election, Labor committed to:

  • replace the existing Australian Safety and Compensation Council with an independent and authoritative institution to drive an inclusive approach to improving health and safety standards and delivering the reform agenda.

Labor promised to do so by applying the following principles, which are extremely important in guiding the approach to this bill: an inclusive approach to the harmonisation process, where the concerns and suggestions of the states, unions and employer groups would be properly considered; consideration of the implication for compliance efforts required to ensure any increased consistency extends to enforcement of standards; the consideration of the resource implications for all levels of government in administering any increase in harmonised laws; and, also, the observance of COAG’s current directive that there be no reduction in safety standards or current levels of support for injured workers. Particularly with my background, I believe that commitment is extremely important in approaching this issue, and for the harmonisation of occupational health and safety arrangements in the future it is critical that employee rights and entitlements in relation to compensation, not just in the regulation of occupational health and safety, are not diminished.

The substance of the bill now before the parliament delivers on these commitments and stays true to the principles that were outlined in Labor’s policy. But before I explain in greater detail the substance of the bill, I would like to place it in the context of two broader aims of the government, which are, firstly, to improve safety outcomes and workers compensation arrangements and, secondly, to move toward what has been described as a seamless national economy. Firstly, the government is committed to improving safety outcomes and workers compensation arrangements across Australia. To achieve this, the government has already undertaken a review of the Comcare scheme. It set up an independent panel of experts to conduct a national occupational health and safety review and it has developed a landmark intergovernmental agreement with the state and territory governments to harmonise occupational health and safety legislation nationally. These are extremely important steps which the government has taken, and the establishment of Safe Work Australia, consequent upon the enactment of this bill, will illustrate concrete progress in the government’s commitment to these objectives.

The second element that I wish to place in context is the Rudd government’s commitment to establish a seamless national economy. The government aims to do this by removing unnecessary state duplications, overlaps and differences through cooperative federalism. As I have already stated, the current health and safety and workers compensation systems are fragmented across nine jurisdictions, making them an obvious candidate for reform, albeit with a careful approach. It also makes good business sense to move towards a new harmonised system and, if appropriate in the future, to utilise the corporations power of the Constitution to help build on the harmonisation of the occupational health and safety arrangements.

Over 39,000 companies now conduct their business across different jurisdictions. That imposes upon them a significant cost in complying with different rules and regulations. In submissions to a 2004 examination of occupational health and safety systems, undertaken by the Productivity Commission, a number of companies quantified the cost of a failure to harmonise these laws. For example, CSR estimated the cost of maintaining and renewing five self-insurance licences at over $700,000 per annum, compared to $200,000 for a single licence. Insurance Australia Group estimated that the existence of multiple schemes added $10.1 million to the one-off cost of setting up a single national IT platform. In total, it estimated that having to comply with multiple jurisdictions added about $1.7 million to IT costs annually. Further, it estimated that a national scheme could offer to the group overall operating cost savings of $1.2 million per annum and could reduce actuarial costs by $400,000 per year. Skilled Engineering, another company with which I am very familiar, estimated that the annual cost savings to a company operating under a single set of national OH&S laws and workers compensation rules would be in excess of $2.5 million. That represents 15 per cent of a company’s annual costs for OH&S and workers compensation premiums. Those are just three examples from companies which would stand to benefit from a sensible harmonisation of the proposed laws. Multiply that across the 39,000 businesses doing business over different jurisdictions in Australia and it is obvious that there would be significant economic savings and efficiencies to be gained.

However, it is very important to note that any savings delivered through harmonisation must come as a result of a reduction in red tape and multiple systems. In no way should savings come as a result of any diminution of either workers’ rights or the occupational health and safety duties and responsibilities of employers to their employees.

The purpose of this bill is to establish Safe Work Australia as an independent Commonwealth statutory body in order to improve occupational health and safety outcomes and workers compensation arrangements. As I indicated earlier, Safe Work Australia will replace the Australian Safety and Compensation Council. In contrast to the ASCC, Safe Work Australia will have substantive powers and responsibilities. It will develop national policy relating to occupational health and safety and workers compensation and, in the process, will advance the cause of harmonisation. It will also prepare, monitor and revise model occupational health and safety legislation for consideration by all relevant parties. It will develop a compliance and enforcement policy to ensure nationally consistent regulatory approaches across all jurisdictions. It will develop proposals relating to the harmonisation of workers compensation arrangements. It will collect, analyse and publish occupational health and safety and workers compensation data and will undertake and publish research. It will drive national communications strategies to raise awareness of health and safety at work, which is extremely important, and will further develop the national occupational health and safety strategy that was developed to cover the period 2002-12. Finally, Safe Work Australia will have the responsibility of advising the Workplace Relations Ministerial Council on these matters.

The bill before the House also creates mechanisms for reviews and revision of Safe Work Australia so that the government can ensure that this body is able to fulfil its intended role and purpose. Importantly, Safe Work Australia will be a tripartite body. It will comprise 15 members, including an independent chair, nine members representing the Commonwealth and each state and territory, two members representing the interests of employees and two representing the interests of employers and executives. The bill allows for the Minister for Employment and Workplace Relations to make these appointments on advice from each representative organisation.

To ensure that the best expertise is utilised when required, the bill also allows for Safe Work Australia to constitute committees to draw upon a wide range of expertise for the performance of its functions. That will be an important part of its work, due to the breadth and complexity of occupational health and safety issues, the identification of hazards and the drafting of policy responses, particularly for prevention, which is often one of the most difficult areas in this field.

Demonstrating the government’s approach to cooperative federalism, the body will be jointly funded by the Commonwealth and the states and territories and its work will be focused on the intergovernmental agreement between the Commonwealth and our state and territory counterparts to harmonise occupational health and safety legislation nationally. I think the commitment of the states and territories to jointly fund, with the Commonwealth, the organisation is testament to the success to date in fostering consensus on the importance of this effort to harmonise occupational health and safety arrangements nationally.

I think there is evidence—and one would hope that there is—at a greater level than has been experienced previously in our Federation of a recognition of the necessity and importance for employers and employees throughout the national economy of having an increasingly consistent set of occupational health and safety arrangements and, ultimately, standard workers compensation arrangements.

On that issue, in my experience of dealing with people who have contracted asbestos related diseases it has always escaped me how the differential outcomes that are frequently the result of compensation proceedings in the different jurisdictions could be just and fair. It is important that we work towards a nationally fair and decent system that is equitable for all people unfortunate enough to be injured at work or exposed to a hazard to their health.

Occupational health and safety is an area of policy that is extremely important for the government and that has been unfolding at the federal level for some years. It is extremely important at a national level because it affects the lives of literally millions of Australians and their families. As a decent society we must ensure that we have decent and fair occupational health and safety regulation. It has always been a passion of mine, working in this area, and I have been a strong advocate of strong occupational health and safety laws and decent workers compensation schemes which offer appropriate financial security for injured employees and their families. I am also on the public record supporting a harmonisation of these laws across Australia and have held that view for a considerable period. It is for all of those reasons that I am proud to support the bill before the House today, because it does take us much closer to achieving those goals.