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Transcript of the Hon John Howard, MP, Shadow Minister for Industrial Relations, Employment and Training, addressing the National Press Club



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JOHN HOWARD MP MEMBER FOR BENNELONG

SHADOW MINISTER FOR INDUSTRIAL RELATIONS, EMPLOYMENT AND TRAINING

E & OE

TRANSCRIPT OF THE HON JOHN HOWARD, MP, SHADOW MINISTER FOR INDUSTRIAL RELATIONS, EMPLOYMENT AND TRANING, ADDRESSING THE NATIONAL PRESS CLUB ON WEDNESDAY, 7 OCTOBER 1992

Thank you very much, Ken Randall. My parliamentary colleagues, and Ladies and Gentlemen.

When I accepted the invitation to address the National Press Club today, I had absolutely no idea of how special and how unique this appearance would turn out to be. I had absolutely no idea that I was to have the honour of being the first person to address the National Press Club since the recession ended.

(laughter).

Ladies and Gentlemen it is almost nine years since I addressed the Press Club on one of my earlier appearances, and then in the capacity as Deputy Leader of the Opposition and Shadow

economic spokesmen of the Liberal and National parties in August of 1983 and on that particular occasion i addressed a lot of my time to Australia's industrial relations and wage fixation system. And I said that the time had come to turn Mr

Justice Higgins on his head. And that, at a political level, helped in a very substantial way, to inaugurate a very long debate, both within my party and the National Party and also within the broader community about the shape of Australia's

industrial relations system.

Mr Justice Higgins, of course, was the founder of comparative wage justice. The man who made what with the distance of time now seems that remarkable declaration that it is better that a firm go into bankruptcy than that the employees of that firm be paid less than the going rate. That is clearly not the view of the employees of the Gazal Company on the Queensland

Sunshine Coast who, in recent weeks have booed and jeered the Federal Secretary of the Textile Clothing and Footwear Union who has presumed to superimpose her view on to the views of the individual members about the survival of their jobs and

the survival of their company. _____________

COMMONWEALTH PARLIAMENTARY LIBRARY M IC AH

CANBERRA OFFICE: RG 113, Parliament House, Canberra 2600 TEL: (06) 277 4885 FAX: (06) 277 2062 SYDNEY OFFICE: Level 11 ANZ McCaughan House, 70 Phillip Street, Sydney 2000 GPO Box 36, Sydney 2001 TEL· :02) 251 son FAX: (02) 251 4800 ' "

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It is worth reflecting on the derision with which the invitation to re-arrange the remains of Mr Justice Higgins was greeted at the time. Anne Summers, then the chief political correspondent for the Australian Financial Review, said that I

faced an uphill task in persuading the industrial relations club to change its attitude and that an uphill task was faced by those within the Liberal Party at a parliamentary level and outside the parliament who wanted to bring about a change in Australia's decade old addiction and commitment to a centralised wage fixation system.

That, of course, was a totally accurate observation by Anne Summers. It has been a very long and protracted political battle, a great battle of ideas but it is no exagerration to say that dramatic and radical deregulation of Australia's

industrial relations system is now clearly an idea whose time has come and the change that has occurred in the attitude of the Australian community over that nine year period, the change that has occurred however reluctantly on the part of people in the Australian Labor Party and in sections of the trade union movement who a few years ago even disavowed the use of the words "enterprise bargaining" and "workplace bargaining" but are now caught in the great ambivalence of on the one hand saying you shouldn't vote for the Liberal Party because it has a (inaudible) radical industrial relations policy that will destroy your basic working conditions that is one addition. The other addition is that you don't need to vote for the Liberal Party because we've already carried out

all the reform that is necessary. And this ambivalent, rather divided approach to the issue of industrial relations indicates just how much the government and their friends in the broad labour movement have been left behind in the great debate about industrial relations reforms.

There is no doubt in my mind - and there is no doubt in the minds of anybody in the Opposition - that as John Hewson has said frequently the centrepiece of fundamental economic reform in Australia is undoubtedly changing our industrial relations

system.

If there is only one thing a future Coalition government can do, and there will, of course, be many more than one thing that a future Coalition government can do, by far the most important reform is to change Australia's industrial relations system. That will do more to liberate the productive capacity of individual men and women in this country, it will do more to enhance Australia's international competitiveness, it will do more to create job opportunities as we go through the

1990s, especially in service industries and some of the new and emerging industries within our society.

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And the reason it will do that is that it recognises the fundamental failure and the fundamental weakness of the present system. This has always to me been an astonishing fact that the present industrial relations system in this country is based upon the notion that the working men and women of this country are too stupid to know what is good for

them and what is valuable and important about their future.

We live in a society that, on occasions, exhibits what some describe as an almost obsessive preoccupation with issues of discrimination and individual rights. I share that obsession. I share an obsession with individual rights and I share an obsession with the right of men and women in a free society to decide what they believe is good for themselves and is good

for their future.

And that is why the cornerstone of our industrial relations approach is that every man and woman in this country should have the right, if they so desire, to reach an agreement with their employer in their workplace without the mandatory

intervention of a trade union or an industrial relations tribunal.

And that is the first of the great principles on which our industrial relations policy is built. It is not revolutionary. When you think about it it is almost elementary. It is almost fundamental in a Liberal democracy that men and women if they want to, of adult age, should have the right to decide what is best for them, without being told that they don't know what is good for themselves and being told that they have to adopt some other approach.

So the first great principle of our industrial relations policy is that every employee in Australia should have the right to make a direct workplace agreement with their employer without the mandatory intervention of a trade union or an

industrial tribunal.

That doesn't mean they can't use a trade union or a trade union official to bargain on their behalf. That doesn't mean they can't call into (inaudible) some other people in the

community to bargain on their behalf. That doesn't mean that they will lose the right to belong to trade unions or to other industrial organisations. But what it does mean is that they will have a freedom which has been substantially denied to them for almost 90 years to assume total control over what is good for them and is good for their future. And I have always believed that one of the great strengths of the industrial relations policy of the Liberal Party and of the National Party is that it has been grounded on a great principle and

that principle is the right of free men and women in a free society to make agreements about their own future. And

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because of the policy grounded on sound principle it is a policy that has won very wide acceptance in the Australian community.

We will have certain prescribed minima written in to the relevant legislation. There will be a minimum hourly rate of pay. Let me make it very clear in anticipation of the lies and the distortions and the scare campaign that will undoubtedly be conducted there will be a minimum hourly rate of pay which must be respected by every workplace agreement that will be made under our policy. There will also be minimum stipulations relating to such things as annual leave,

and sick leave and maternity leave. But things like the length of the working week - and I will return to that in a moment because in many ways the abolition of the concept of the fixed working week is one of the more breathtaking

elements of our industrial relations programme. But such things as the fixed working week and whether or not there are penalty rates or holiday loadings, those things will be matters of negotiation. And I can't for the life of me, Ladies and Gentlemen, think of anything that is more likely on the industrial front to change the investment climate than to say to the business men and women of this country if you make a capital investment you will be able to run that investment 24 hours a day, seven days a week, 365 days of the year if you want to without penalty as to the time of the day or night that you run that investment.

Now that will bring about an enormous change in the industrial atmosphere in this country. The abolition of the fixed working week recognises a number of modern realities. It recognises the fact that the days when traditionally work was performed between nine and five, five days a week, those days

are gone. And the sooner we bury an industrial relations system that is rooted in that practice, the sooner we will catch up with the needs and the competitive pressures of a modern society.

And to provide to the workforce of this country the flexibility to decide not only how long their working week is, but also when it will be worked will be to inject an enormous amount of flexibility into the industrial relations system. And it will also enable families in Australia to blend the

responsibility of parenthood and the responsibilities of work far more easily and far more efficiently and far more effectively than they can at present.

So that, without any argument, is the most important element of our reforms and the first of the great principles on which our reforms are built.

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We will have a policy that allows both employers and employees to decide that they will both desire to remain within the award stream. We are not going to abolish the Industrial Relations Commission, although I do predict that the role of the Industrial Relations Commission will be infinitely less prominent under our policy than it is at present. But we will be changing the rules under which the Industrial Relations Commission operates in an open, and not in a covert, deceitful, fashion as has been the practice and the wont of the present government.

And if those employers and employees wish to remain within the award stream they will be able to do so but my prediction is that there will be a mass exodus out of the award stream out of workplace agreements. And we will be providing a mechanism to deal with situations where there is disagreement between an employer and an employee as to whether they go outside the award stream or remain within it. And the details of that mechanism will be announced on 20 October.

But the second of the great principles on which our policy is built is once again something that is rooted in fundamental freedom, and that is the freedom of association. It is a very simple proposition. It is not revolutionary, it is not

dangerous. It oughtn't to scare anybody in Australia to say that under the law in Australia you should have the freedom to say whether you belong to an association or not. And we are,

therefore, going to abolish compulsory unionism, the closed shop and preference clauses within awards throughout Australia within the limits of our constitutional power.

Now that is once again a very simple and fundamental freedom. And it has always amazed me about our industrial relations system that the one section of the Australian community which

under the laws of this country have a guaranteed market share are registered trade unions. Political parties don't have guaranteed market shares, I can tell you (laughter) you've got to work very hard to keep your market share. Churches don't have guaranteed market shares, they've got to work very hard to get their communicants and retain them. Nobody starts a business with a guaranteed market share but under the present

laws of Australia a trade union has a bargaining monopoly so far as the coverage of members in a relevant classification is concerned. Now that is the fundamental change that we are going to make, along with the abolition of compulsory unionism

that will affect trade unions. We are not going to attack their rights to exist, we are not going to attack the right of people to join, we are not going to launch a broadside against the whole union movement in this country, but what we are going to say is that you are going to lose the legal privileges you have under the present system, no more, no

less. We will abolish the conveniently belong principle under

· %.. . . * ^ ,

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the Industrial Relations Act. We will allow for the emergence of workplace or enterprise unions and we will remove the bargaining monopoly, the stranglehold on the future of the working lives of men and women in this country currently held

by trade unions.

And let me make it clear, in case there is any doubt in anybody's mind, that the principal of voluntary membership of associations will not be restricted to trade unions. It will also be applied to professional bodies. I certainly don't

intend to go around this country arguing that there should be no compulsory unionism but turn a blind eye to compulsory membership of professional bodies like the law societies of the various states of Australia. And I make that comment as a

fully paid up member of the Law Society of New South Wales (laughter).

So that is the second of the principles. And the third is that we are going to maintain the authority of the ordinary civil courts of Australia over certain forms of industrial conduct. And one of the great advances, one of the hard-won

gains, dare I use that phrase, of the industrial relations debate in the 1980s has been the way in which attitudes have changed towards the authority of the civil courts. It used to be the view, expressed as recently as five or six years ago when the Hancock Report was brought down, a report

commissioned by the (inaudible) into Australia's industrial relations system, that you couldn't sue a trade union because it was strong enough to disobey the decision of the court. Now as a result of the landmark decision in the Mudjinberry

(phon.) case, the Dollar Sweets case, and in a sense, politically-speaking, most lovingly of all, the pilots' dispute, when the former President of the ACTU urged the airline companies to sue a union, a very interesting precedent

for the future, I might say, because of the changed attitudes of the courts it is now accepted, and the community has now accepted that (inaudible) injury inflicted by irresponsible union conduct can be the subject of ordinary civil action and

so it ought to be because once again you have a very fundamental, simple principal involved, and that is equality before the law. And I have always held very strongly to the view that one of the hallmarks of a free society is the accountability of all of us before the ordinary courts of this country administering ordinary laws.

And coupled with the great success of Section 45(D) of the Trade Practices Act, we have seen over the last ten years a redressing of the legal imbalance away from a situation where the idea of ever suing a union, no matter what the damage

inflicted, was something never contemplated towards the situation not where there is capricious resort to litigation against trade unions, not where there is any restriction on a

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right to strike properly and responsibly exercised, but rather a recognition that if unreasonable and significant damage is inflicted on somebody's business then the victim has a right to go to law irrespective of whether that damage has been inflicted by an individual, a company or a trade union.

And the fourth great principle on which our policy is built is a recognition that those men and women in Australia who want to join trade unions should have the right to join the trade union of their choice. In other words, they can join an industry union, a craft union, or most importantly a workplace union. And I see one of the big changes that we can bring about is the facilitation of the emergence of unions built around individual workplaces. There will always be in our society a percentage of the workforce that will want to join a trade union. And I have no argument, no quarrel and nobody in the Liberal Party has any argument or quarrel with that. We do have a lot of argument and a lot of quarrels with the present law that says that you can't join a union that has

fewer than 10,000 members, and it seems to me to be a grievous contradiction for the government to be saying to the Australian community, look we believe in workplace bargaining, we believe that the enterprise is king, and that we all have

to get together at the enterprise, but if you can't associate or congregate as unionists around an enterprise union you must belong to an enormous trans-industry union whose leadership is

remote and removed from the interests of your individual workplace.

And we are going to change that as well. And that is the fourth of the great principles upon which our industrial relations policy is built.

And can I just in my remaining moments say a couple of things about the broad industrial relations scene between the Federal and State governments.

As all of you know, Australia has a divided industrial relations system. The Commonwealth's direct industrial relations powers - the conciliation and arbitration power - is limited and is based upon the creation of interstate

industrial disputes. And, therefore, the election of a Liberal government in Victoria last Saturday which, of course, is a source of enormous satisfaction and pleasure to me and to all of my Federal Liberal and National Party colleagues, is a very significant development because what it means is that come the election of a Hewson/Fischer government in Canberra

some time in the next few months you will then have Federally, and in the two most populous States in Australia, you will have governments sharing identical views, give or take a comma here or there. Identical views on industrial relations.

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And there is one thing that has united the Coalition all around the nation, even through some of the more difficult times that have passed in the 1980s, one thing that always united us was a common commitment to industrial relations reform. And I therefore see through the election of that government in Victoria, coupled with the continued and renewed strength of the Coalition government in New South Wales, I see the opportunity for co-operative effort at a Federal level and a State level to bring about belated industrial relations reform, at least across something approaching eighty percent of the entire population of Australia. And, of course, there are many of us who confidently look to changes of government in South Australia and Western Australia also over the next year to eighteen months.

And the constitutional importance of that is immense. Because what it means is that a pooling of constitutional power removes some of the doubts that might otherwise exist, although let me make it clear that the advice that has come to

the Coalition steadily over a period has been that there is a very extensive constitutional power available to a Commonwealth government to extend the benefits of the policy that I have outlined even in the face of opposition from State

governments. But the knowledge that we will have the co­ operation and the enthusiastic co-operation at least in New South Wales and Victoria and, of course, in Tasmania and potentially also in Western Australia and South Australia is of enormous significance because it is an area where there can be no doubt at all, Ladies and Gentlemen, that the parties across the nation will be moving together.

Can I just finally say to you, Mr President, and Ladies and Gentlemen, that the policy that I have outlined to you again today and which will, I believe, move very close to the centre of the political debate over coming weeks and months is ultimately a policy not about anything other than a belief that a more productive and a more competitive Australian economy will result over time in the generation of more jobs and more job opportunities.

There will be a lot of things said by our opponents about this policy over the coming months. Let me tell you what it is. It is a job policy, it is a policy about generating more jobs for Australians through removing the barriers to job creation

that are now presented by the existing industrial relations system. It is a high real wage policy, and not a low real wage policy. No economist or industrialist or businessman

worth his salt will dispute the proposition that the only real basis, and the only sustainable basis of real income increases except at the cost of massively higher unemployment is an increase in productivity. And therefore the great black mark of low productivity that can certainly be found against the

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Accord through the 1980s when removed by the introduction of our policy must create the circumstances of higher productivty and, therefore, over time higher real income.

And, finally, it is a policy not of confrontation but a policy of co-operation. Not co-operation, corporate-state style, between the power constellations in our community, the narrow representatives of organised labour, organised capital and the government, but a more meaningful co-operation and that is at the level of the hundreds of thousands of individual enterprises and workplaces all around Australia.

The only way that this nation will ever achieve greater national productivity is to see a resurgence of individual workplace productivity and more than anything else this policy is about creating the circumstances where that can occur and

about creating circumstances where the latent desire of so many Australian men and women to co-operate with the workplace and to conclude workplace agreements is allowed to come about.

Thank you.