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Tuesday, 24 September 1974
Page: 1354

Senator BISHOP (South AustraliaPostmasterGeneral) - There is a greater need for agreement between unions and employers today in this inflationary period than has existed ever before. There is also a greater need for the sort of provisions which Senator Greenwood criticises, that is, the need, more than ever before for every member of a union to become involved in cementing these agreements. If agreements are pursued in the light of the present inflationary situation, the members of the union and the public generally will be aware of what is involved in the economy and they will be aware of the situation which may arise by reaching an agreement in the circumstances Senator Greenwood has mentioned in which the normal increase is greater than can be justified before the Prices Justification Tribunal.

Senator Greenwoodhas reminded me about the question he posed during the previous debate on this Bill. I do not think that I had an opportunity at that stage to reply to him and it was not satisfactory to write to the honourable senator. But I can read to him the reply which has been prepared in answer to his question. It is:

The Bill facilitates negotiation and agreement between employers and unions. In its policy on wage indexation, currently under discussion under the auspices of Mr Justice Moore, the Government has put forward a package proposal which is designed to curb 'double-counting' with regard to prices in determination of wage claims. In addition, as part of its general policy in this area, the Government is examining the powers and functions of the Prices Justification Tribunal, lt is proposed to invite the Tribunal to scrutinise with care price claims that are based on wage costs in excess of awards.

However, this Bill is not the appropriate vehicle for establishing how the Prices Justification Tribunal should act, and the Government's policy on prices and guidelines laid down by the Prices Justification Tribunal in no way affects the Bill or its purposes. On the other hand, there is nothing in the Bill which conflicts with the policy I have just expressed. It is obvious that an employer, or an employer organisation, when entering into agreement with unions, would bear in mind a number of considerations related both to his specific enterprise, as well as to his specific industry. One of these considerations would obviously be the guidelines of the Prices Justification Tribunal in relation to agreed wage increases. The employer is free, and will remain free to bargain for any wage rate he desires, whether they be higher than the general level in an industry or not and to reach agreement accordingly.

The Prices Justification Tribunal has ruled that where such agreed wage rate increases are to such an extent that they cannot be classed as an 'unavoidable cost' in the eyes of the Tribunal, then the Tribunal will not consider them, to the extent that the increases are not unavoidable as a basis to increase the price of goods. An example of such a ruling is set out in the report by the Prices Justification Tribunal on 2 August 1974 on an application by Mayne Nickless to increase interstate freight rates by 1 8 per cent. This in no way infringes upon the machinery of the Bill, which is one concerned to encourage and facilitate the certification of agreements, and to ensure that these agreements are satisfactory to the majority of the union members concerned, and therefore more likely to be observed and honoured by them.

I remind Senator Greenwood and other honourable senators that the provisions contained in this Bill before us tonight were first introduced in the comprehensive Conciliation and Arbitration Bill in April last year. Of course, at that time the economic climate was certainly different. It was more apparent that agreements could run easier and there were not the tests which the Government stated later should be made in respect to wage agreements. The Government is saying now to the union movement, employers and Government departments that there must be wage restraint. A stop must be put to wage claims which cannot be justified. It seems to me that normally Senator Greenwood would say that that is one way of curtailing the inflationary spiral. But he is saying now, as I understand him: 'Why do you do that? Why do you not make an agreement with the unions, even though the norm or the usual level of increase cannot be justified?' He knows that in this situation, simply because the Government has an overall economic and political policy, this does not mean that the Government is against the cementing of arrangements between the workers and the bosses. As I said earlier, there is more need for this. If there is an established procedure to make more agreements and have less arbitration, that procedure must be more satisfactory.

The circumstances provided for in this Bill are not like those which existed in the old days when agreements were made. We all know perfectly well that agreements were made between management committees of the unions and the employers and that half the time the union members did not know what the agreements were edi about. But they made the agreements and in most cases they worked. In many cases, those agreements contained provisions like the disputes procedures provisions contained in this legislation. They were good provisions then and they would be good provisions now. It is expected that unions will continue to make agreements whether or not this legislation is passed. The honourable senator knows that the representatives of large organisations and the unions will meet across the table. They will be making agreements as they did before. They will be putting arrangements into their agreements to short circuit disputes. They will be arrangements such as the arrangements contained in the first oil companies disputes procedures clause. That is good, even though the economic climate is different now and even though the escalation or advance in the conditions or wages of employees may not have been as great as it would have been in the old days. There is certainly the same sort of need for such agreements. In fact, there is a greater need.

What is the Government doing about it? Firstly, of course, last year the Government put forward the need to streamline the purposes of arbitration. The Opposition, as opposed to its argument in relation to the Conciliation and Arbitration Bill which provided for the amalgamation of unions, says that there is no need to place the testing of the agreement in the hands of the union membership. I say in relation to Senator Greenwood's complaint about the bans clauses that there is no intention to act in the way that he has envisaged. Bans clauses cannot be inserted in agreements on matters which are not related and confined to the area of the agreements -

Senator Greenwood - But they agree it must be for-

Senator BISHOP - There cannot be bans clauses in the agreements in this way. There can be a bans clause in respect of what is contained in the agreement. The employer and the union can say: 'Yes, we will ban this practice or ban that practice on one side or the other'. But you cannot do that in respect of matters which are not within the agreement.

Senator Greenwood - But that may be the reason why the employers agreed, that is, to get that promise from the unions.

Senator BISHOP -It does not matter. The honourable senator is arguing both ways. On the one hand he is saying that there is this irresponsible action by the unions and that the unions have taken over the countryside. He has said that the Government is going cap in hand to the Australian Council of Trade Unions. What we have done in relation to the Australian Council of Trade Unions has been done only on the basis of our need to reach agreement with the major industrial organisation in the country. If we make that agreement with the workers- the Austraiian Council of Trade Unions- then on the other hand we have to go to the employers and say: What about a system of wage indexation?'. We are trying to contain this great inflationary contest as a result of which the unions and the union members have had this great escalation of activity trying to get wage increases to keep up with prices. We know that there is no solution to that. As I said earlier, I think that the union movement and the union officials are starting to understand the position and are getting tired of the constant activity to try to get wage increases in a situation of inflation. This is also the position because in some months past the labour market was good.

We are trying to act not only in respect to wage indexation. As honourable senators know, we put before the Premiers Conference- the meeting between the Australian Government and the State governments- various procedures which we think ought to be related to a proper conception of wage restraint. These are new initiatives to us. They are the sort of things which Senator Rae talked about. When Senator Rae was concluding his remarks in the previous debate he asked: 'Can the Government find new methods to control the position and can it take new initiatives?'. The Government is doing this. It seems to me that Senator Greenwood is again applying his old conservative line of argument. He seems to be saying on the one hand that the Government is arguing for agreements between the unions and the bosses which might have provided very good agreements, wage increases and conditions for employees which were above the norm. But now he is saying that such agreements should not obtain. We are saying exactly that. We are saying that there are still benefits in such agreements. We are saying that there are benefits for the workers and benefits for the employers. If such an agreement is made, it will be made in the context of the parties being aware of Government policy. I think that such agreements will be made on the basis of what is decided this week between the Australian Council of Trade Unions and the unions after their conference. What could be better than that?

We hear Opposition members talk about Mr Hawke competing with Mr Whitlam. What could be better than to have at the source of industrial power, the union power, the President of the Australian Council of Trade Unions? He may have differed occasionally in his public statements from the views of our leaders but in fact -

Senator Greenwood - It is a mighty concession.

Senator BISHOP - The honourable senator has seen Bob Hawke 's statements. Bob Hawke today is saying, and said yesterday to his Federal union conference, that unions must take account of the responsibilities they have in this inflationary situation, the need to preserve the Labor Government and to make new arrangements in terms of wage indexation under which workers will surely get an amount of money which will compensate them for price escalations.

Senator Greenwood - It is different from what he was saying a month ago.

Senator BISHOP -That does not matter. I come back to the point I made earlier. In our society any move which involves more people in democratic action is a good thing. Mistakes will be made, as in the dispute involving the Ford Motor Company. I was involved in that dispute for a short time when Mr Clyde Cameron was away overseas and I must confess that on my entry into the dispute I could not solve it. Mistakes will be made, but if we can involve in any plant or union more members of that plant or union in the making of agreements, those agreements will be better understood. It has been stated, and some honourable senators have had the opportunity to examine the systems, that in countries like Sweden and Germany wide national agreements are made on wage matters, union membership, escalation and so on. In the United States of America it is common practice to have an escalation clause in respect of prices and wages. All we are saying is that despite the economic problems within this community today- and not only within Australia but also elsewhere- there is still just as much need for provisions which will allow wider agreements. There are new problems about which Senator Greenwood has spoken. I do not disagree that we have problems. I am saying that in my experience and in the experience of most people who have been in the union movement there is still a great need for wider agreements. They are better than arbitration, are more lasting and for those reasons the Opposition should support the Bill.

Question put:

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