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Thursday, 13 August 2009
Page: 7804

Mrs GASH (11:59 AM) —The Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009 is all about neutering an agency that was making a difference in addressing a dysfunctional industrial culture that has been synonymous with the construction industry in Australia. It is a bill representing the payoff to the building unions for their generous support in getting the Prime Minister, Kevin Rudd, across the line. The Australian Building and Construction Commission represents an effective response to the decades of banditry that the building industry was forced to endure. The Master Builders Association says this:

The building industry has enjoyed unprecedented industrial harmony and improvements in productivity following the five years that the ABCC has been in existence. These benefits are measured at $5.5 billion per annum and are particularly important in the current economic circumstances to help the government’s strategy to lift the Australian economy out of recession.

The dilution of the powers that were vested in the ABCC will place a greater reliance on the assumption that these maverick unions will continue to play fairly. That is a big call, and you need only look at the history of the building unions in Australia to gather a sense of foreboding that that is not going to happen. The Master Builders Association has reported significant improvements in efficiencies since the advent of the ABCC:

The Econtech Construction Industry Productivity 2009 report card shows that there have been significant improvements across a range of productivity measures including a 6.2 per cent productivity gain in commercial building relative to residential building since 2004. There has also been a 9.4 per cent addition to labour productivity in the construction industry due to the ABCC and other associated reforms, and a 10.2 per cent outperformance in the construction industry labour productivity compared to predictions based on historical performance to 2002.

Those statistics cannot be denied, yet this government is prepared to sacrifice the gains made on the back of political expediency. And of course there have been attempts to discredit the Econtech research. For instance, the Mitchell report and another report said that gaps in costs between domestic and commercial building costs were due to factors other than restrictive work practices; the second says there was no gap in the first place. These attempts to attack the ABCC and the hard facts that it has improved sector productivity are nothing more than union propaganda hiding behind a veil of easily discredited academic research. Econtech compares costs of the same tasks in the same states over time, and does not attempt to cherry-pick the figures to suit union or minority interest group needs.

Richard Bunting, a partner at Blake Dawson, suggested that the ABCC legislation was not a result of any new or recent industrial misbehaviour. He said successive federal and state governments, both coalition and ALP, have found it necessary to deal with the very poor industrial relations in the building and construction industry, including an industrial culture which from time to time has involved considerable lawlessness. He went on:

It is well known that there was considerable industrial misbehaviour involving officials and some of the members of the Builders Labourers Federation in the 1970s and early 1980s.

The BLF was deregistered as a consequence in 1974 and only registered again in 1976 after giving specific undertakings to abide by decisions of the Australian Conciliation and Arbitration Commission and to participate fully in the prevention and settlement of disputes through conciliation and arbitration. In 1981, the Victorian and Commonwealth governments announced a royal commission into the Builders Labourers Federation. The royal commissioner was Mr John Winneke QC. His subsequent 1982 report into activities of the Australian Building Employees and Builders Labourers Federation recommended prosecution of various persons.

In March 1983, following the election of the federal Labor government, further BLF deregistration proceedings were adjourned. The federal government subsequently withdrew as an applicant in the deregistration proceedings after the BLF gave certain undertakings about its industrial behaviour. However, in 1986 the Labor government deregistered the BLF for five years and similar action was taken by the New South Wales and Victorian governments around the same time. The further development of industry unions in the late 1980s and early 1990s ultimately resulted in the principal industrial coverage for building industry employees being assumed by the CFMEU and to a lesser extent by the AWU.

In the early 1990s a New South Wales government royal commission into the state’s building and construction industry, the Gyles royal commission, recommended the establishment of a task force in New South Wales to examine and investigate illegal activities in the industry. The task force commenced operation in 1991 and continued until mid-1996. The Gyles royal commission’s 1992 final report summarised the commissioner’s views as follows:

The public and confidential submissions received, with very few exceptions, identify and complain about various aspects of union militancy. The complaints were from so many disparate sources and are so consistent that they amount to a powerful body of evidence in themselves to establish the proposition that the conduct of the members and officials of the former BWIU (NSW Branch) severely affect productivity and efficiency of the industry in this State, both because of the persistent disruption of projects and businesses and because of the restrictive work practices instituted and defended whilst work is actually proceeding. The evidence reveals nothing less than industrial anarchy in which any pretence of the rule of law or the application of principle has been abandoned.

Mr Gyles recommended the deregistration of the BWIU. Ultimately, the application to pursue deregistration of the union was withdrawn and the union gave various undertakings, including to operate within the law and to comply with the NSW code of practice.

There were some similar developments and attempts at imposing more orderly industrial relations for the building and construction industry in other states. For example, in Western Australia a building industry task force operated between 1993 and 2001. At Commonwealth level, Mr Terence Cole QC was appointed by the federal government in August 2001 as a royal commissioner to inquire into certain matters relating to the building and construction industry throughout Australia. The Cole royal commission cost the Australian taxpayer over $60 million. Yet here we have a move to start the reversal process taking us back to the bad old days. I did see newspaper reports recently reporting that the Rudd government was talking tough, but really, is that just show? I think it is. Their intent was clearly expressed in the course of the 2007 campaign where they vowed to ‘roll back’ tough new laws that were prickling the unions. The public cannot be misled by the show of fabricated dissent between the unions and the Rudd government. After all, Mr Rudd promised the unions. It beggars belief that he would dishonour such a significant promise made to his paymasters. What I anticipate is the continued dilution of this agency, whatever form it takes, to the point of eventual redundancy. I am just not buying the line that this government is going to seriously oppose the will of the unions, and neither should any freethinking individual.

The Australian on 6 July quoted the Prime Minister as saying:

This government will not tolerate violence, threats of violence, or intimidation in any part of the industry.

Yet this is just what is beginning to happen in my electorate of Gilmore. When you take into account previous tough talk on grocery prices, petrol prices and reining in the banks, you have got to take this latest resolution with a very large grain of salt. I am betting a secret deal has already been stitched up and all we are witnessing is a very well-rehearsed public show of false indignation. After 2010, all bets will be off and the watchdog will be as effective as Labor’s much-vaunted petrol commissioner.

Despite the wide acknowledgement that there is still a lot to be done, this bill is, candidly, premature if the health of the industry is the prime objective. Justice Murray Wilcox, in his report Transition to Fair Work Australia for the building and construction industry, said that the ABCC should remain in place for at least another five years. He was quoted as saying that there was still work to be done to restore industrial sanity in the sector. Yet the government dismisses the recommendation of its own appointee and starts the process of dilution.

It is inevitable that under the hand of this government the ABCC copy will certainly remain, if only as a symbol of toughness. What appears to be happening is a concoction of semantics in the bill that creates the impression of toughness but in fact will be hampered by red tape sufficient to frustrate the process, again adding to the costs of anyone with a genuine concern. It is a clayton’s bill that sets out to appease the public without actually doing anything.

Mr Deputy Speaker, just listen to this: penalties for not obeying the law are diluted; previous unlawful action is now acceptable; and provisions are made for switching off the laws, when it suits, for specific building sites. On 18 September last year, in an interview at the National Press Club, the minister, Julia Gillard, was asked a question by Nick Butterly from the West Australian. He asked:

You’ve said that the ABCC will remain in place until 2010. But can you just guarantee that the powers of the ABCC will not be watered down before then, either by a carbon budget, cuts in staffing or by other methods? And also, what do you make of this push within Caucus to defame the ABCC before 2010?

What did the minister—and I notice the minister sitting opposite me at the table—say in reply?

I can guarantee we’ll deliver on our election commitment, which is that the ABCC will stay until 31 January 2010, with all of its powers and all of its budget. I can confirm we’ll deliver on our election commitment that on 1 February 2010 it will be replaced by a specialist inspectorate within Fair Work Australia.

The implications are clear: in six months time it is all over, replaced with a toothless tiger. I am of the view that, until such time as it is clear that the culture of lawlessness that dominated the industry for decades is firmly behind us, the ABCC must remain in place and intact.

The worth of the ABCC has been well demonstrated in the performance figures of the construction sector since its inception. Emerging as we are from the effects of the global financial crisis, why do we need to compromise opportunities for recovery which, the government has signalled, will take several years? The government has not demonstrated a clear case that would justify this bill, other than a promise made to the unions. As I said earlier, the dilution of the commission is premature and unwarranted on the evidence.

That is why 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 fear of payback and retribution. Existing powers are capable of being used against everyone in the sector, both employees and employers. Existing investigation powers are not unique; they are akin to other powers widely available to other Commonwealth agencies and under other Commonwealth laws.

The proposed restrictions on investigation powers are cumbersome and will prevent them from being used effectively due to the vast amounts of red tape that must be cut through before they can be used. Even Justice Wilcox, who was asked by Julia 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. Special investigation powers unique to the building and construction sector would not be necessary if the sector had the same culture and history of normal, everyday workplaces.

On a local level, the advent of the Fair Work legislation has seen a move back to the bad old days. Right of entry powers are being used, and not with good intent, and those businesses affected are fearful, again, of retribution by those representing the unions. Until this culture changes, and it may take a generation, the need for such legislation remains, and that is why I am opposing this bill.