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Thursday, 13 August 2009
Page: 7799

Mr RANDALL (11:39 AM) —I am here today to speak on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. Sadly, this is a bill that completely waters down the strong regulatory regime put in place by the previous government over the thuggish building and construction unions. The building and construction industry is led by one of the most militant unions in this country. We have all seen them on TV, and the Cole royal commission, which I will go into shortly, provided some home truths about the blatant disregard for the law held by the unions, particularly the CFMEU. Here the government wants to amend the law to water down the powers and independence of the Australian Building and Construction Commission, or ABCC, the construction industry watchdog or ‘tough cop’.

Before I go any further and while the member is still in the chamber, I would just like to point out that he does need to actually get it right. The commitment from the Labor Party in opposition was that they would not get rid of the ABCC. In fact, the minister quite categorically said that she would not do this and would allow there to be the ‘cop on the beat’. You need to tell the truth in this place and not mislead, because that is just not true.

The ABCC was established by the former coalition government following the recommendations made by the independent royal commission, which found that lawlessness, intimidation and corruption were rife in the building and construction sector. The coalition government wanted to ensure that there was a strong cop on the beat to stop this unlawful behaviour, improve working conditions, protect the rule of law and dramatically increase productivity. That is the key to this: the dramatic increase in productivity.

While Labor promised—I again reiterate: they promised—to retain the ‘tough cop’ attitude, maintain the full powers of the ABCC, as I remind the member, until February next year and carry through existing principles to the specialist inspectorate division of Fair Work Australia, it is once again all spin and no substance. The minister sneakily issued a directive on 17 June limiting the powers of the ABCC from August. This was not the deal that was subsequently disallowed in the Senate.

From next year, the watchdog will be moved to the specialist inspectorate at Fair Work Australia. This legislation provides the minister with greater powers, restricts the independence of the inspectorate compared to the ABCC as it is now, reduces the penalties for unlawful behaviour and really makes coercive powers optional. The watered-down version pays only lip service to the strong principles the ABCC was founded on—not surprising from a minister who, as a lawyer at Slater and Gordon, was once employed to represent the interests of the militant unions that the ABCC has now clamped down on. Under this legislation, penalties for not obeying the law are drastically reduced and previously unlawful action is now acceptable. The bill allows for construction laws to be switched on or off for particular building sites. If people were already following the law, there would be no need to vary the laws at a whim, would there? Is this really Minister Gillard taking a tough stance against militant construction unions? It is not. In fact, it is just laughable. This is really Labor thanking its mates the unions for helping it win the last election and funding it with in excess of $30 million in that campaign, so this is payback time: ‘We’ll help you because you got us $30 million to run the last election and now, because you’ve given us the dough, we’re going to help you.’

The coalition cannot support the watering down of this watchdog. We cannot afford a return to the dark old days of workplace unrest, strikes, bullyboy tactics, coercion and organisations looking after their mates. Labor’s plans could set Australian workplace relations back decades and certainly will hurt our economy. We must make sure that unlawful activity, intimidation and threats do not return to the building and construction industry—or, if they do, that there is a strong enough body to take them on.

The Master Builders Association chief, Wilhelm Harnisch, said:

The specific building and construction industry reforms—

he was referring to the ABCC—

have assisted the building and construction industry to increase productivity, bring industrial harmony and to provide benefits to employers and employees.

Labor is hell-bent on reversing this position and taking Australia back in time, as I have said. Before the 2007 election, Minister Gillard indicated that the existing laws had ‘balanced the rights of employers and unions’ and that Labor did not want to jeopardise this productivity or cause industrial unrest. That is what she said before the election, and what is she doing now? The abolition of the ABCC and the watering down of its powers will not only encourage industrial unrest but also destroy productivity.

The coalition supports the retention of the ABCC, as you can see from all the speakers on our side today. The outcomes it has produced for the industry and the economy—and this, I might add, is supported by Econtech research—speak for themselves. These are some of the figures produced by Econtech: a10 per cent increase in industrial productivity; massive reductions in industrial disputes by 91.9 per cent to record lows; and increases in average weekly earnings for workers in the construction sector between 2004 and 2007 of 25½ per cent, compared to 15.7 per cent for all other industries. It has improved the levels of health and safety, and I want you to remember this about the safety aspect when I come to it shortly. There was a 7.3 per cent productivity gain in commercial building relative to residential building since 2004. Not only has the ABCC been effective in maintaining a degree of harmony but it is overwhelmingly cost effective. In fact, it costs the taxpayers a relatively meagre $32 million per year but returns $5.5 billion in terms of economic gain—in other words, $167 generated for each dollar spent by this administration.

But the bottom line is that we have a more workable and effective body to watch and manage the industry, and that is why the unions hate the ABCC. Unions lost their control, their tight grip on power, and they were suddenly accountable and held responsible for all the things that these people had gotten away with for years—the unconscionable conduct. Under the previous Labor government, the average number of working days lost to strikes per year was 22.6 per thousand employees—I repeat, 22.6 working days per thousand employees. In September 2007, by way of comparison, this was down from 22.6 working days to a negligible 1.2 working days per thousand employees. What a vast improvement! But, as we know, with 70 per cent of the Labor Party’s front bench being ex-union officials and with union spending in excess of $30 million in Labor’s campaign, it is clear why the unions are getting an absolute armchair ride on this bill.

By neutering the ABCC, Labor is simply reinforcing the longstanding belief that they are more interested in looking after their mates than in maintaining law and order and protecting local jobs. There is nothing more important than creating and sustaining jobs. In fact, 2.2 million jobs were created under the coalition’s watch, with around 60 per cent of them being full-time positions, unlike the casualisation that is going on now. Labor inherited an unemployment rate of 4.3 per cent. In 1996, Labor had left us with a rate of 8.1 per cent. So that is the difference. We inherited 8.1 per cent in 1996. They hit Lotto: they had 4.3 per cent when they assumed government.

Real wages increased under the coalition by 21.5 per cent, compared to them actually decreasing by 1.8 per cent under the 13 years of the previous Labor government. In fact, you will recall former Prime Minister Bob Hawke bragging about the accord and driving down wages. Unemployment in my electorate got down to 4.1 per cent, compared to 8.4 per cent in December 2004, when I became the member for Canning. Canning, particularly the younger population of Canning, is susceptible to higher levels of unemployment, and that is where government energy should be focused, not on handing back power to the union thugs.

Paul Kelly wrote in the Australian a while ago:

… standing immovable is Labor’s support for greater trade union power, more costly restriction on employers, a greater role for the revamped commission, an effective end to individual statutory contacts, a revival of arbitration, and a sharp weakening of direct employer and non-union employee bargaining.

And this is what businesses are up against. As an aside, I would like to mention that I recently spoke at a local Gosnells Small Business and Tourism Association breakfast. A number of those business owners raised their grave concerns to me about the government’s Fair Work changes. It is a bit Orwellian, isn’t it—fair work changes? Small business is the lifeblood of the Australian economy, and, while I am pleased that Canning has a raft of small businesses, unfortunately many of these businesses’ trading conditions have never been tougher. Yet in these tough economic times the government is trying to make it even harder for them with these archaic workplace reforms.

As we said previously, the ABCC was established under the independent royal commission by Mr Justice Cole, and he found extensive evidence of disgraceful lawlessness, intimidation and thuggery in the construction sector. Before I go on, the member for Wills, as they do on that side, called the Cole royal commission biased. What a disgrace. Not only do they besmirch Mr Cole himself but here is a 22-volume report, well researched and the benchmark of industrial harmony going forward in this country, which those on the other side—and the member for Wills said it the other day—said it was a biased report. It is a disgrace that they would try and drag his reputation through the mud.

Commissioner Cole’s report was tabled in 2003. The report found that the industry was rife with lawlessness. In fact, there were more than 100 types of unlawful behaviour, which included the following: favouritism for union members, widespread industrial pressure and taking and making inappropriate and questionable payments. I remind the House that I recently raised concerns about the issue of the Australian Workers Union but was swiftly interrupted by the member for Bruce. The issue I raised in the House here, can I inform the House, has now been taken up by the Australian Electoral Commission, and they are investigating an unusual slush fund in and around the Alcoa worksites in my electorate. I will be looking forward to the AEC’s report on their investigations of these so-called site allowance moneys and where they went.

I continue: the commission found unlawful strikes, the rorting of employers, threatening and intimidating conduct, disregard for laws and regulations at all levels, actions by unions—particularly the CFMEU—to regulate the industry, and unions pressuring government departments. Does the government really want to return to this sort of behaviour? I am sure there are a lot of responsible members of integrity on the other side who really do not want to return to those days of lawlessness. Labor seems intent on taking the construction sector back to the past, where thuggery and militant construction unions prevailed over the rule of law.

Being a Western Australian, I am all too familiar with the antics of the CFMEU’s self-proclaimed heavyweights in the likes of Joe McDonald and Kevin Reynolds. The type of behaviour uncovered by the Cole royal commission was seen in eight minutes of footage from an ABCC worksite, which he had entered illegally, where he was hurling obscenities and threatening bosses and workers who would not join the union. In the earlier Forward with Fairness legislation, I spoke about union bosses claiming bogus safety issues to get themselves on a worksite and then wreaking havoc on that site. After his re-election in Western Australia, Kevin Reynolds, in his Che Guevara T-shirt and wearing bib and brace overalls, claimed that he had a mandate for militancy and it seems the Deputy Prime Minister could be giving him the green light by dismantling the ABCC.

Mr Martin Ferguson interjecting

Mr RANDALL —He’s a cute little bloke, isn’t he! Both Joe and Kevin worked on the Canning Vale polling booth at one of my elections. And by the way, Joe McDonald wouldn’t pay a bet he had with me; he still owes me $20.

In May 2007, Joe McDonald made his position about the ABCC pretty clear:

I live for the day when (the ABCC staff) are all working at Hungry Jack's or Fast Eddy's or Kentucky Fried Chicken. That is what's waiting for them. They're all ex-policemen and they can go and do whatever ex-coppers do. I'd suggest that John Lloyd and his mates will be unemployed before I will be.

I wonder if he got a wink and a nod from the minister to be able to say that. Kevin Reynolds likened the ABCC to the Gestapo, and Dean Mighell said the creation of the ABCC was a stunt by the coalition government. They will all be jumping with joy now when this legislation goes through the House—if it does. In April of this year, the ABCC reported intimidation and cost blowouts increasing. Shouldn’t this be all the more reason for its retention? In Western Australia, the Director of the Master Builders Association made the point that if $2 billion in state government infrastructure projects were blown out by just 5 per cent because of union antics, this would waste $100 million of taxpayers’ money. I do not think our state can afford to waste this sort of money when we are all screaming for more infrastructure and essential services like policemen, teachers and nurses.

An April editorial in theAustralian hit the nail on the head, when it said:

Julia Gillard says the ABCC will be replaced in January with a new unit to watch the industry. Good, but not good enough. The ABCC and the powers it possesses should stay.

I know those on the other side like watching. With regard to the coercive powers in the legislation, basically the government wants to be able to compel at convenience. Coercive interrogation powers are able to be switched off on the order of the independent assessor. So we know that one site could have powers initiated on them and then, at a whim, they could be switched off again. It is one site on and one site off. It will be very interesting to see how this ever stacks up in law. While the government gives the appearance that they are not completely caving in to the unions by retaining the so-called coercive interrogation powers, it is really nothing more than a thinly veiled attempt to hide the fact that the powers are so bogged down in red tape that they will rarely be used. It is important to remember that these powers exist for a reason. Powers available under the current laws to compel witnesses to give evidence are needed to provide protection to those people who want to give evidence to the ABCC without the fear of payback or retribution by the union for having done so—and it was very clearly pointed out by the member for Warringah in his speech why coercive powers are needed. In fact, the ABCC Commissioner, Mr Lloyd, recently said that he had no reservations about his power to use coercive powers because people preferred that in order to give testimony rather than feel the wrath of the union should they be seen to be cooperating. So of course they would love to give evidence. When it was voluntary before and there was a show of hands and they could be identified, we knew that they were penalised for doing so.

Existing powers are capable of being used against everyone in the sector—employees and employers. Even Justice Wilcox, who was asked by Minister Gillard to report on the powers of the ABCC, recognised that the investigative powers are integral to ensuring that law and order is maintained in the construction sector. These powers would not be necessary if the sector had the same culture and history as normal, everyday workplaces. The truth is that construction is a special case. Labor has no real intentions of creating a tough cop overseer or being tough on the construction unions. The Deputy Prime Minister said:

A future Rudd Labor Government will not tolerate intimidation or violence by any party in the building and construction industry. The practices of the past are not part of Labor’s future for industrial relations.

Labor promised it would maintain the existing ABCC arrangements until February 2010, but we should not be surprised that this government says one thing and does another. It is racking up quite a long list of backflips on commitments. While the minister talks tough, the reality is that the unions have already won this debate as the proposed act reduces the penalties for unlawful action and gives a green light for a return to the bad old days.

Claims that the ABCC has affected occupational health and safety levels are also misguided. ABCC Commissioner John Lloyd has stated:

The ABCC is committed to do all it can to improve the industry’s poor occupational health and safety record and to support those specifically charged with this task …

As the member for Mayo said in his contribution to this House, it is the state governments who actually administer this, and where were the state Labor governments when occupational health and safety was an issue? The truth is that the independent building industry police are in real danger of losing their powers, losing their independence and being nothing more than a token body with no ability to stop a return to lawlessness and intimidation on the building sites of Australia.