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Wednesday, 9 March 2005
Page: 65


Senator WONG (2:20 PM) —My question is to Senator Abetz, the Minister representing the Minister for Employment and Workplace Relations. I refer the minister to the recent collapse of Walter Construction Group, which has left non-construction employees reliant on the government’s General Employee Entitlements and Redundancy Scheme for any redundancy entitlements. Is the minister aware that some of these employees have worked for Walter Construction Group for over 40 years? Isn’t it the case that, under the award system, employees are entitled to up to 16 weeks’ redundancy and in some cases more? Can the minister therefore explain why, under the government’s GEERS scheme, employees have their redundancy capped at just eight weeks, regardless of how long they have worked for their employer?


Senator ABETZ (Special Minister of State) —I indicate that the government is actively monitoring the progress of the Walter Construction Group administration. The government’s concern is to ensure that any employees terminated because of the insolvency have their outstanding employee entitlements met. However, the primary responsibility for entitlements must always remain with the employer.

The Howard government is proud to have been the first government in Australian history to address seriously the issue of employee entitlements lost in cases where the employer is unable to make these payments. In reference to the GEERS scheme, I understand that the state Labor governments are somewhat reluctant to come on board to assist us in a very important social justice initiative. This initiative is something that the federal Labor government did not do in its 13 years. The workers of Australia had to rely on the election of the Howard Liberal government to get some social justice in these sorts of circumstances.

For the Labor Party to now come into this place and seek to champion the cause is somewhat two-faced, because when they had the opportunity they did not do it. Their state colleagues in government all around Australia in the states and territories have not assisted us in this regard. Through its basic entitlements scheme, GEERS and its predecessor, the employee entitlements safety net scheme, the federal government has delivered over $237 million in assistance to over 37,000 Australian workers.

I am advised that the Walter Construction Group appointed Korda Mentha as controller and administrator on 1 February 2005, just a little over one month ago. I understand that the administrator has indicated that it will sell off the profitable operations of the group. The Commonwealth stands ready to provide GEERS assistance to eligible employees of the Walter Construction Group who are made redundant. The Commonwealth will then stand in the shoes of the employees and seek to recover those funds through the insolvency process. This is a central tenet of GEERS and is clearly understood by insolvency practitioners.

The advice from the department is that the administrators need to protect the Commonwealth’s right to recover taxpayer funded GEERS advances in the event that moneys become available from the administration. The department is awaiting a response from the administrators. I understand that the administrators have estimated the entitlements owing to the group’s employees as being in the order of $24 million and that the call on GEERS funding could be around $12 million. I also understand that the administrators’ preliminary estimate is that there will be between $17 million and $25 million in recoverable assets. I am informed that approximately 350 employees have been made redundant, with the possibility of more to follow. The department has so far received 200 claims for GEERS assistance from former Walter Construction Group employees. I am aware that the administrators have contacted the department and indicated that they propose to hold the second creditors’ meeting on 30 March 2005. They have also indicated that they are likely to place the company into liquidation.

In relation to the award, I simply indicate to Senator Wong and the Senate that, under the award, but for our legislation, if the company went bankrupt they would have no redress whatsoever. At least under our scheme they have a substantial redress. (Time expired)


Senator WONG —Mr President, I ask a supplementary question. Minister, is it not the case that the only workers who were ever paid their full entitlements by the Howard government were those made redundant by Stan Howard? Is this a record that the Howard government is proud to keep intact?


Senator ABETZ (Special Minister of State) —Let us just assume for a moment that what Senator Wong is saying is right. Then the Howard Liberal government has the record of paying at least one lot of employees their full entitlements, because under Labor not a single one got their full entitlements, did they? No, they did not, Senator Wong. So your policy position is to condemn us for doing something for one company and then putting in a scheme that assists every other Australian worker when you failed to do it when you had the possibility of doing something during your 13 years in government. Apart from that, each and every state Labor government in this country has refused to come on board with this very important social justice scheme. So the Labor Party can call out social justice all the time, but we actually do something about it.