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Wednesday, 15 February 2012
Page: 1454

Mr TEHAN (Wannon) (18:01): I rise to oppose the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2011, and I take issue with the previous speaker. The bill is not about trying to outlaw organised labour in this country. It is about trying to deal with illegal activity by organised labour in this country, and in particular in the building industry.

The bill will do three things: it is going to hurt Australia's productivity; it is going to set up a new body that, sadly, will be a toothless tiger; and, it will give more power to the new workplace relations minister, which is like putting a kid in charge of the candy store, or, to put it another way, like putting a factional boss in charge of determining the Labor leadership—it will be a debacle.

Let us turn to the issue of productivity. The ABCC has been a tough cop on the beat, but it has required a tough cop on the beat to deal with the issues identified by a royal commission. The inquiry that led to the formation of the ABCC was not a normal one—it was a royal commission. Since the ABCC was set up we have seen building and construction industry productivity increase by 10 per cent; it has provided an annual economic welfare gain of $5.5 billion per year; it has reduced inflation by 1.2 per cent and increased GDP by 1.5 per cent; and the number of working days lost annually per 1,000 employees in the construction industry has fallen from 224 in 2004 to 24 in 2006. At the same time, building costs have fallen by 20 to 25 per cent and long project delays have been dramatically reduced.

At a time when the Australian economy is struggling, due to the incompetence of this Labor government, the last thing we need is another step in the direction of lessening Australia's productivity. That is what this bill will do. The Australian Chamber of Commerce and Industry summed it up quite nicely in the letter they wrote to the secretary of the Senate Education, Employment and Workplace Relations Committee when this bill was being looked at. They took the opportunity to thank the committee for having the inquiry and noted:

The outcome of the Bill is a matter of particular significance, not just for the building and construction sector, but for the broader Australian economy. Approximately one million Australians work in the building and construction industry. Their output contributes around 10% of Australia's GDP.

This issue is dealing with 10 per cent of Australia's GDP. You want to harm the productivity in 10 per cent of Australia's GDP. This decision will lead to long-term consequences for the Australian community. You should think again about having kowtowed to the Greens and having agreed to go down this path.

This was emphasised by the minister in his second reading speech on 3 November 2011 when he indicated:

The building and construction industry remains a critical sector of our economy, with immediate and direct impact on jobs, growth and productivity. This was particularly so during the global economic recession, during which the government's Nation Building and Jobs Plan ensured that the Australian economy remained one of the strongest in the developed world.

The minister continued:

The government understands that the industry contains unique challenges for both employers and employees, and as a result we have always supported a strong building industry regulator to ensure lawful conduct by all parties.

The minister then went on for a few more paragraphs detailing why the industry is so important.

However, the only effective response has come from the establishment of the Australian Building and Construction Commission. This concerns dealing with the illegal activities that have existed in this industry. It has had a dramatic impact on the industry and on the sorts of behaviour and attitudes we have referred to. The impact has been quantified in a range of different ways, in particular by significant reductions in lost time in the industry and big improvements in productivity and efficiency, estimated at more than $5.5 billion per annum.

The decision taken by the Howard government to set up the ABCC was not a liked one. To have a royal commission look into an industry requires a lot of evidence that something drastic needs to occur. That is exactly what the Cole royal commission found. What has been the result of the Cole royal commission? We have seen the ABCC set up and we have seen huge productivity increases come out of the sector. But we should not now say to ourselves, 'Okay, the job is done,' because the evidence is still there that it is not. There have been productivity increases, but all the alarm bells are there. If we reduce the amount of regulation in the industry at the moment then the illegal activity will grow once again, and, sadly, we are seeing examples of that in Victoria, and we have seen it in the last few years. Just when we are getting on top of this issue, what does this Labor government want to do? It wants to step in and put at risk all the gains that we have made.

Getting to the second point, what they are replacing the ABCC with is a toothless tiger. I will turn to what the Australian Industry Group had to say about this.

A government member: Who have you got?

Mr TEHAN: We have got ACCI; we have got the Australia Industry Group. What I am trying to do here is give a balanced perspective.

Government members interjecting

Mr TEHAN: All right, so we should not have business in Australia, should we?

The DEPUTY SPEAKER ( Mr KJ Thomson ): Order! Members on my right will cease interjecting. The member for Wannon has the call.

Mr TEHAN: I am happy to listen to those interjecting from the other side that we should just have the union bosses ruling the country. They have done a great job with their factional people here in this parliament, haven't they! Look at the unholy mess they have got us in at the moment. We have got a Prime Minister who cannot be trusted, we have got the Minister for Foreign Affairs trying to seek her job and we have got a factional impasse because no-one knows who should lead the country.

Government members interjecting

Mr TEHAN: That is right. We should just let the big union bosses rule everything! What we are trying to do here is make sure that illegal activity by organised labour does not get out of control, especially in the building and construction industry. What are you going to replace the ABCC with? Sadly, a toothless tiger. The AiG says:

The compulsory examination powers are needed at the present time as much as ever. While the reforms introduced after the Royal Commission addressed the unlawful and inappropriate conduct that permeated the industry, industrial unrest and disputation has been steadily increasing in the industry and damaging and unproductive industrial relations practices have been creeping back onto building and construction sites across Australia.

They go on to quote the foreword to the annual report of the ABCC for the financial year ending 30 June 2011, in which the ABC Commissioner, Leigh Johns, identified that:

During 2010-11, unlawful industrial disputes, the traditional ‘bread-and-butter’ work of the ABCC, continued to occur at levels that underscored the need for strong enforcement of workplace laws. The pernicious effects of unlawful industrial action are unacceptable, particularly so on projects of social and national significance like the Monash Freeway, the Melbourne Markets relocation, Gold Coast University Hospital or the Wonthaggi Desalination Plant.

One only has to look at the record days lost on the desalinisation plant in Victoria to see why the ABCC needs to remain and needs to continue to do its job.

The new body that has been established within Fair Work Australia to replace the incredibly successful Office of the Australian Building and Construction Commissioner is not an independent body. So not only will it be toothless but it is not an independent body. It is controlled by the minister. And who is our new minister? Where does he come from? How independent will he be? How objective will he be? We have got the kid back in control of the candy store. That is what this bill will do. What we will see is a complete imbalance in the way these issues are dealt with. The sad fact is that ultimately that will lead to a productivity decline in this country. That is the last thing that we need at the moment. Our manufacturing sector is about to get hit by one of the biggest hits to their productivity that you could imagine—the carbon tax. This is especially so in the state of Victoria because it is going to impact on power, which is the competitive advantage that our industries and especially our manufacturers in Victoria have over our international competitors. Combine that now with this bill.

Those opposite, and I have been listening to their speeches as they have gone on, have said that all this will do is redress an imbalance. Yet no-one has been through and systematically examined what the Cole royal commission found—the intimidation and the thuggery, and the fact that if there was not some sort of body set up with powers to deal directly with it that none of this would stop. Even though we have had the ABCC there, we have still seen examples of this occurring. So why won't the government allow it to finish its job? Why don't they make sure that it has all been stamped out? It is illegal activity that we are trying to get rid of here. It is not, as those opposite say, designed to get rid of organised labour in this country. It is designed to get rid of the illegal activity. Those on the other side should be supporting the work that the ABCC is doing, because the more we can do to stamp out this type of activity the better it will be across the nation for organised labour in general. The coalition strongly opposes the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2011. In many ways the title of the bill is a complete misnomer. Sadly, at a time when we should be looking to do everything we can to increase the productivity of this nation, it will do the exact opposite. It will set up a body which they have deliberately given no teeth to. Basically, it will become an irrelevant bureaucracy—another one created by the government. Not only that; it gives power not to an independent body but back to the minister and, as we know, the new minister is going to find it very difficult to be independent and objective. He will be dealing with his union mates and he will be conflicted in trying to continue to stamp out illegal activity. I would hope the starting point that we can all agree on when it comes to this bill would be that there is no place for illegal activity anywhere in the Australian economy and in particular the building and construction industry.