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Former Prime Minister criticises proposed changes to industrial relations laws.

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Tuesday 19 July 2005

Former Prime Minister criticises proposed changes to industrial relations laws


TANYA NOLAN: Paul Keating says he fundamentally rejects the notion that the industrial relations system needs further reform, and he says the prosperity seen in Australia in the past decade is a result of his government's shift to enterprise bargaining. 


The former Labor Prime Minister says the federal Workplace Relations Minister Kevin Andrews has omitted a key quote from his speech which upholds the value of collective bargaining. 


Mr Keating has granted a rare interview to Karen Percy. 


PAUL KEATING: We certainly did start it. The Keating Government did start it, but we did more than Mr Andrew says. In his press statement he said, "Paul Keating took some first small steps down this path." 


Well of course that's rather paltry and condescending because in fact the government I led abolished centralised wage fixing for the first time in a hundred years, and went to a completely new model for the country.  


And that new model has underwritten a decade, now 14 years of growth without inflation, and that is a system built not around centralised wage fixing and the arbitration commission and awards, but rather the ability for employees to bargain with employers in enterprise bargains and for these bargains to become effectively silos, sitting beside one another in the wages system, rather than the old award system which was a contagious set of arrangements which carried one wage increase right across the whole economy.  


KAREN PERCY: You were talking about fewer awards and fewer clauses. How many fewer? What would you be proposing to Kevin Andrews right now on where he might go with fewer awards and fewer clauses? 


PAUL KEATING: The key point is that the labour market does not fundamentally need reform.  


The changes made in 1993 by me and the government I led, basically it was game, set and match on the old, dismal legacy of wage jumping that went on in the comparative wage justice system in the old, federal, centralised system. That hasn't happened.  


What we've seen is rising real wages right through the 90s and falling unit labour costs. And the proof of the pudding is in the fact that in the 14th year of the (inaudible) this last year, wages growth was 3.4 per cent. Now, had it not been for the 1993 changes, we'd be now looking at eight or nine per cent probably, in wages growth.  


Why would you want to push ordinary people out of the safety net into individual workplace agreements so you pay them, you know, dumb them down to pay them six to eight bucks an hour. 


I mean, Australia has one chance and one chance only. That's to sell our creativity, not our time.  


KAREN PERCY: Mr Keating, what Kevin Andrews is quoting here in your speech - "it is a model which places primary emphasis on bargaining at the workplace level" - couldn't that be interpreted as individual contracts? 


PAUL KEATING: No. No it can't. Bargaining at the workplace level is a right of workers to collectively bargain in an enterprise and there are now, I remind you there are now I think 22,000… 15,484 federal registered enterprise agreements as of December last year.  


Now, this is covering the great bulk, this is covering a very large proportion of the workforce.  


By contrast, there's about 250,000 workplace agreements. You know, in other words covering a very small percentage, these are the Reith changes, a very small percentage of the workforce.  


So, you know, the fact of the matter is that, you know, that you cannot get… people who are pushed onto individual workplace agreements will ipso facto be taken out of the enterprise bargaining stream. And what's more, they will not get the benefit of the safety net because the safety net adjustments are going to go to, now, this Fair Pay Commission. 


And the Liberals and bodies like the ACCI should understand this. If they believe the corporations power of the Constitution can be used to set up a Fair Pay Commission, well a Labor Government in the future, once this precedent is established, will use the same powers and the same commission to legislate wages.  


Now, I would have thought the Liberals would have wanted to run a thousand miles away from that, and the ACCI with them.  


But you see, people like the ACCI, you know they're the Balkans of Australia - learned nothing and forgotten nothing. You know, here they are, a decade of low inflation and three and a half to four per cent wages growth and it's not good enough for them.  


They want to hop into some poor little character on six to eight bucks an hour. I mean, the stock market, the profit share and the economy are at a record high. The stock market is at a record. No. They still don't want to pay someone $12 an hour. They want to take them down to eight. You know, it's all the old Fightback Policy.  


KAREN PERCY: But the Government says the minimum wage won't fall.  


PAUL KEATING: Well, Mr Howard said in 1996, he gave a rock solid guarantee there'd be no losses against existing positions. He's now since walked away from that.  


TANYA NOLAN: He's lost none of his fight. Former Labor Prime Minister Paul Keating speaking there to Karen Percy.