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Election '96: will there be a wages break-out if the Coalition wins government? -

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KERRY O'BRIEN: So is the union movement entitled to say to Australian voters that there will be industrial warfare if they elect a Coalition government? In the studio with me is ACTU President-elect, Jennie George, and Shadow industrial relations spokesman, Peter Reith. And before we come to some of the points that were raised in that report, I'd like to go first, Jennie George, to those comments of Bill Kelty yesterday.

What right does the union movement have to declare war on the Coalition before they're even elected to government as a kind of a threat to voters in advance?

JENNIE GEORGE: Well, I've just looked at the transcript and that's certainly not what Mr Kelty was saying. He was saying that if the Coalition were elected and if the Coalition wanted to wage war, wanted to bring in anti-worker legislation, wanted to destroy the collective bargaining strength of the union movement, then we would fight back, and that Weipa was just a little prelude of what would come. He didn't say that would happen on the election of a Coalition government if they were to be elected. He qualified it consistently by saying 'if'.

KERRY O'BRIEN: All right. Well, take the 'if'. In what circumstances would the ACTU or individual strong unions pursue a wages break-out of, as he said, 10 per cent, 20 per cent or 30 per cent increases?

JENNIE GEORGE: Well, I think the 10, 20 and 30 per cent were examples of the -I think it was a little parody on what John Howard was saying about feeling comfortable and relaxed and how important that would be. Certainly, for a lot of working people they'd feel much more comfortable with wages increases of 10, 20 or 30-that's not the issue.

KERRY O'BRIEN: No, but in what circumstance would we see a wages break-out?

JENNIE GEORGE: Well, precisely in the circumstance that Mr Reith and Mr Howard have foreshadowed. They are the ones that said that there will be no accord agreement with the union movement. The accord agreement has been the framework by which responsible wage claims have been pursued in the national interest. Mr Reith constantly condemns and disparages the contribution that workers have made to the economic transformation in this country, and under your nirvana, Mr Reith, all I'm saying, if there's no accord there's no wage responsibility in the national interest, and it will be what the market determines. I've been saying this for the last few weeks. Business doesn't seem to have understood that we are serious about this.

KERRY O'BRIEN: Okay. Peter Reith, how can you guarantee that there will not be a wages break-out?

PETER REITH: Well, there are number of answers to that. I mean, this is the usual political propaganda before every election, State and Federal, in the last 10 or 15 years. If you look at the States, for example, Kerry, where exactly the same claims have been made, in Western Australia, for example, that was said before Richard Court was elected and, after he was elected, in the 12 months following his election, the number of days lost per thousand employees due to industrial strife actually fell. It was lower than what it was under Carmen Lawrence.

KERRY O'BRIEN: The sense certainly was that there was quite massive industrial dislocation on more than one occasion.

PETER REITH: Sure. There's no doubt that is the propaganda.

KERRY O'BRIEN: There was disruption.

PETER REITH: There's no doubt there was disruption, but if you look at the number of days lost compared to what it was under the Carmen Lawrence regime, in fact, the level of industrial disputation fell. I mean, those are the ABS official statistics. Look, at Victoria.

KERRY O'BRIEN: How will you prevent ....

PETER REITH: Now, let me just give you ....

KERRY O'BRIEN: How will you prevent a wages break-out is what I'm asking you?

PETER REITH: Well, let me just-I'll just give you one more, make one more point. It's the same in respect of Victoria. It's said that Victoria would be a State where's little co-operation between the trade union movement and the Victorian Government. The level of disputation in Victoria is the same as the national figure. Now ....

KERRY O'BRIEN: How many workers have left the Victorian award system?

PETER REITH: Well, you've had a number transfer to the Federal system.

JENNIE GEORGE: About 400,000 plus, Mr Reith.

PETER REITH: Well, you've had a number ....


PETER REITH: ... but the point is you're not saying that you're not going to undertake a dispute with the Federal Government for those people in State awards-don't give me that nonsense.

Now, let me answer your question in respect of whether or not there's likely to be any reality to this. The strongest reason, I think, is that when you look at what's happened in recent years, a lot of workers have actually left unions, and one of the reasons they've left unions is that in many businesses-not all but in many businesses-there's been a real effort, sometimes under competitive pressures, to improve their relations with their workforce.

And in fact, in the clip that we've just seen with individual contracts, collective agreement arrangements, we've seen businesses actually try go get down on a direct one-to-one relationship with their workforce and improve that relationship. And as I think we've seen in the community today, there's a very adverse reaction to this return to the rhetoric of the old.


JENNIE GEORGE: And who's using that rhetoric? It's your party that's using that rhetoric.

PETER REITH: Well, you declared war yesterday, Jennie.

JENNIE GEORGE: Sorry. All the threats ....

PETER REITH: Don't back off on it tonight. Your position is ....

JENNIE GEORGE: Can I have my say, thank you?

KERRY O'BRIEN: Hang on, hang on, hang on. Peter Reith.

JENNIE GEORGE: I'm used to you talking over me constantly. It's my turn. I'm not talking hypotheticals. Look at the last years when John Howard was Treasurer in this country-double digit inflation, double digit unemployment, high levels of industrial disputation, which Labor and the union movement worked together, constructively, co-operatively with employers, to lock in low inflation, to create jobs, to have sustainable wage increases. That's been done under the Accord. You walk away from it. You're the one that's been making all the threats. I've not made one threatening statement.

KERRY O'BRIEN: Hang on a second. What confidence do you have with a significantly declining union membership? Can you threaten a wages break-out? What industrial muscle can you bring to bear if your worst expectations bear fruit?

JENNIE GEORGE: Kerry, can we stop using the word threatening? All I'm saying is if there's no accord, if there's no agreement, there is no understanding about the wage claims that we will pursue with government, so we are open to test what we can in terms of the gains we can achieve in the marketplace.

KERRY O'BRIEN: But very quickly,you don't think Bill Kelty sounded threatening in that brief clip that we saw?

JENNIE GEORGE: Well, I wasn't there, but I've read the transcript and it doesn't sound threatening to me. I think what he was saying is what I'm saying. No accord, no wages agreement, no low inflation being locked in, impact on interest rates, back to the bad old days that we had under John Howard. That's what we're saying.

KERRY O'BRIEN: Peter Reith, on your record in the past in Federal Government-that is the Coalition's-what comfort can workers take from that record?

PETER REITH: Well, I don't think this election is about our record. That is ....

KERRY O'BRIEN: Well, it's one of the things I would assume people might look at.

PETER REITH: Well, they might want to go back 15 years ....

KERRY O'BRIEN: Thirteen.

PETER REITH: Well, okay. But I think, more realistically, people will look at the last 13 years and-you know, the argument is, well, there was higher industrial strife in the Fraser government. That's true, as it was in every other country in the OECD. The level of disputation has fallen and one of the factors ....

KERRY O'BRIEN: Why isn't it relevant to look back at the five years when John Howard was Treasurer? And let me just ask you one point about that: When did he support a general wage increase before the Arbitration Commission?

PETER REITH: Well, according to Mr Keating, he keeps saying that he's supported on a couple of occasions, but I would say that we have been supporting wage increases for most of the period of this government. The argument we've always put is that there ought to be wage increases but they ought to be backed up with the productivity improvements that would pay for them.

You see, what's happened in the last 13 years, and one of the reasons that the union movement has been losing members is that, for the average family, they've actually been going backwards. A lot lost their jobs during the recession that we had to have. Now, we can debate the figures but there were some independent figures out the other day that showed family living standards had actually fallen by ....

JENNIE GEORGE: Mr Reith ....

KERRY O'BRIEN: You know as well as I do, there are many recipes you can assign to that.

PETER REITH: Well, I just said that, Kerry. I mean, the ABS figures on income show a decline in real wages of 1.4 per cent. So if you look at the views of the rank and file, the fact is they're not pleased with what's happened in recent years and they don't want an industrial ....

KERRY O'BRIEN: Okay. Jennie George.

JENNIE GEORGE: Let's look at where your party stands. When we last met, Mr Reith, I said to you that I wanted a commitment from the Liberal Party in terms of safety-net wage increases for the low paid. I said: Will you match the Labor commitment, $11 to $14? You said no, you couldn't do that; that would be up to the commission. On every issue when you're put under pressure, you talk on the one hand about workers wanting-under your scenario you want workers to be better off.

When we actually say we're going to pursue wage increases, then you adopt a double-speak and it's a different scenario. You have consistently opposed every national wage increase, bar two, since Labor came to power. You will not commit on the size and the quantum of the safety-net increases for the next three years if you were to be elected.

PETER REITH: Well, let me answer that.

JENNIE GEORGE: So I think there's a lot of double-speak that goes on.

PETER REITH: Well, there's no double-speak here.

KERRY O'BRIEN: Very briefly.

PETER REITH: Our policy is to retain the commission. We believe that the commission and awards should stay. We believe ....

JENNIE GEORGE: For those that are lucky enough to stay ....

PETER REITH: No, no. Now, let me finish this.

KERRY O'BRIEN: How much are you going to commit for the commission's budget?

PETER REITH: No, let me finish this. We believe in an independent commission. You keep attacking us on the basis that we're going to get rid of the commission. We're going to keep the commission ....

JENNIE GEORGE: You're going to set up a parallel system of private contracts.

PETER REITH: ... but we actually respect its independence, and as the Commonwealth Government itself said in your latest accord, they will make a submission at the time based on the economic circumstances at the time. Now, that's the responsible thing to say and we have exactly the same view.

KERRY O'BRIEN: A very brief response, Jennie George, and you might also include in your answer: On what basis would you defy a mandate from the people if they vote the Coalition in?

JENNIE GEORGE: Look, it's not up to me to be defying any mandate that the Australian people give any government. All I'm saying is that in the unlikely event that Mr Reith were to occupy the government benches, I'm saying quite clearly: I and the other ACTU officers have an obligation and a responsibility to protect and defend the interests of workers and, in the absence of an accord, you have no wages agreement with the union movement ....

PETER REITH: There'll be no accord, Jennie.

JENNIE GEORGE: ... no locking in of low inflation.

PETER REITH: But there will be no accord, I can tell you now. We're not having an accord, so what's your reaction to that?

JENNIE GEORGE: And don't come back whingeing when we review the wage claims beyond that which we have been pursuing.

KERRY O'BRIEN: Okay. At that point, we're out of time. Thanks for joining us.