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Thursday, 30 April 1987
Page: 2071


Senator CHANEY —My question is addressed to the Minister representing the Treasurer. Is it a fact that today's release of the first official survey of business on-costs confirms largely the findings of earlier assessments conducted by private sector organisations, such as the Confederation of Australian Industry, that on-costs add significantly to the cost of employing people? Even though the first Australian Bureau of Statistics survey covers only one year, does the Minister agree that the earlier private sector surveys to which I have referred show clear evidence of a quite alarming rate of increase in on-costs? Further, is the Minister aware that the April bulletin of the Reserve Bank of Australia notes `evidence of an acceleration in earnings drift in the second half of 1986'? These factors confirm the following view of Syntec Economic Services Pty Ltd in its April `Business Outlook':

We have in wages an institutionally-constructed time bomb which will eventually blow this economy back on the course of devaluation with a chronic inflation rate double that of our trading world.

Given that view, what is the Government going to do to reverse this alarming trend?


Senator WALSH —The first thing that has to be done to resist the trend of wage rises in excess of award wages is to beat the greedy, irresponsible doctors union in the Australian Capital Territory, which has modified its demand to a modest $350 per week wage increase claim for a part time job. It is seeking an extra $350 a week for a part time job, and pursuing it with work bans as a form of industrial action. There has been not a word of concern from any member of the Opposition about the greedy, irresponsible--


Senator Reid —That is not true.


Senator WALSH —If Senator Reid has condemned the doctors, I am very pleased to hear that. I just wish that some of her front bench colleagues had as much courage-and the Australian Capital Territory does not even fall within their electorate. But, apart from Senator Reid, there has been not a word from anybody in the Opposition about the greedy, irresponsible doctors union which is trying to get a $350 a week pay increase for a part time job and is using work bans in an attempt to do that. So the first thing that has to be done is that the doctors union in the Australian Capital Territory has to be beaten, and it will be.

As to the other question that Senator Chaney asked, it is correct that the Australian Bureau of Statistics survey of labour on-costs is generally supportive of earlier surveys done by the Confederation of Australian Industry. If I may say so, I note on behalf of the Government with some pleasure that the Confederation of Australian Industry has by and large adopted a responsible attitude to questions such as this and has conducted serious and objective research into it-a fact which is, of course, confirmed by the high degree of corroboration by the ABS of the CAI's earlier surveys. Of course, the behaviour of the CAI stands in marked contrast to that of the Australian Small Business Association and people such as Andrew Hay. I am afraid I do not know whether the rate of increase has accelerated, but I will find out for Senator Chaney if he wants me to.

Finally, it should be noted that in the 15 countries for which data is available from Organisation for Economic Co-operation and Development sources-those 15 countries, incidentally, do not include Australia-the OECD estimated on-costs to average 35 per cent of total labour costs, which is significantly higher than the figure for Australia. So, although it is true that on-costs in Australia are a significant addition to wages-I think we all knew that, although we may not have known precisely how much-it is not correct that wage on-costs, compared with those of other major OECD countries, have made Australia non-competitive. In most of those major OECD countries on-costs represent a higher proportion of wages than is the case here.


Senator CHANEY —I ask a supplementary question, Mr President. I note the Minister's concern that the Opposition should solve the Government's problems. I ask him: What is the Government going to do to reverse the trends that are confirmed, for example, by the Reserve Bank of Australia with respect to earnings drift? Since he introduced OECD country on-costs, I ask him whether the 35 per cent figure mentioned is comparable, or whether that includes the additional payroll charges relating to unemployment and retirement benefits that are usually a feature of European employment systems.


Senator WALSH —In relation to the last part of the question, I believe the figures are comparable, but I have not had a chance to read the documentary material thoroughly. I will have that checked out. On the first part of the question, relating to what the Government is doing to defeat the wages claim by the greedy doctors union in the Australian Capital Territory, the attitude of the Opposition is important because, if the Opposition had the courage, decency and concern for the future of Australia to come out and denounce the Australian Capital Territory doctors union in the way that it should be denouncing it, it would be apparent to the doctors union that it has no support on either side of politics for the pursuit of its greedy $350 a week wage increase claim, supported by work bans and industrial action. What the Opposition does in this instance is important because denunciation by the Opposition would very quickly demonstrate to the doctors union that it has no support and, therefore, no hope, even under an alternative government, of getting away with its greedy, irresponsible claims.

I note from reading today's paper that Mr Willis made it very clear in the House of Representatives yesterday that the Government will not nod or wink at any sweetheart deal done by anyone outside the guidelines and the proper processes. But it makes it extremely difficult for a government to discipline unions or contain wage claims that are made by some unions when a union such as the doctors union is pursuing a wage claim that is absolutely outrageous-and apparently with the full support of members of the Opposition, with the exception of Senator Reid.