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Thursday, 9 June 1994
Page: 1681

Senator TIERNEY (South Australia) (7.25 p.m.)—I rise tonight to speak on the rating by the OECD of Australia's performance, particularly its criticism of Australia in terms of the inflexibility of its labour market programs. I have actually been trying to do this for some days in question time and have been somewhat frustrated by not getting the call.

  That is the current issue this week, so I really want to put on the Hansard record the disgraceful attempt by the federal government to influence the decision of an international body by trying to get it to recommit a matter and come out with a different decision that was more favourable to the government. This matter was first raised in the House of Representatives by Dr Kemp who tabled a minute from a first assistant secretary of DEET, Mr Peter Grant, to the Minister for Employment, Education and Training, Simon Crean.

  It turns out that the ACTU, in particular, was unhappy with the report of the OECD on the accord. The OECD was critical of the rigidities in our labour market. For some time the government has gone on about labour market reform, enterprise bargaining and agreements. Mr Brereton has created an absolute shemozzle, as a result of which he has had to do massive back-flips on his arrangements. Apart from that, the arrangements in place after 11 years of Labor government are something about which the OECD has been especially critical.

  An example of how much the government is a puppet of the ACTU, is the fact that the ACTU actually approached DEET and the minister in an attempt to get the OECD to do a more favourable review through another division. The ACTU wanted the Labour Market Directorate to have a look at it and come up with a better review. The DEET official whom I mentioned earlier spoke to Mr Tom Alexander of the OECD's Labour Market Directorate and asked whether a review would be possible and what the likely outcome would be. It gives us a lot of confidence in the independence of the OECD and its reports, especially those on Australia, to note that, to his great credit, Mr Alexander replied that there would be no change in the stance of the OECD.

  Interestingly, he suggested that a comparative analysis should be done between labour market rigidities and their effects on economies between New Zealand, the UK, the US and Australia. We all know that would show the absolute failure of this country's labour market policies and the way in which other countries have leapt well ahead of us. Certainly the ethos in industrial relations in the United States is way ahead of us and the flexibility and outcomes are far better than they are in Australia.

  Countries that have started later than the US, in particular, the United Kingdom and our brothers and sisters across in New Zealand who, we thought, were going down at first a similar track in economic policy in the early 1980s, have outcomes that are now showing that they are leaving us behind. One of the most critical reasons why these countries are leaving Australia behind is that they have bitten the bullet, reformed the labour market and not been the toadies of bodies like the ACTU and implemented the policies of such bodies.

  If we want to get our economy back on track we need to firstly bring in industrial relations policies that will lead to greater flexibility to give businesses a chance to perform and compete in the international labour market. That certainly has not been happening. It was best summed up in what we found when we uncovered these documents and the DEET official said that Australia could be greatly criticised because of our speed—if that is the right word for it—towards true enterprise bargaining and:

There is a real danger that other labour market policies will be criticised.

And that the OECD would find that:

. . . labour market regulation has been increased through tighter occupational, health, and safety standards; equal opportunity legislation; and non-wage labour costs, including the Training Guarantee, Superannuation and Payroll tax.

Fortunately, the government has started to see the light on some things, such as the training guarantee levy, but it still has a long way to go. The main thing this report has highlighted is that this government in this area is on the wrong track. It has not really bitten the bullet on proper labour market reform. It has had a number of initiatives in the budget and in the white paper which have had the effect of just churning the dole queue; they really have not solved the fundamental, underlying problems to which I have alluded previously.

  The Senate should be outraged that the government, given its poor record in this area, has tried to influence an international body and, by changing the departments of the OECD to report on Australia, has hoped to get a more favourable report. That is a disgrace and it should be condemned by the Senate.