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Thursday, 7 November 1985
Page: 1748


Senator MICHAEL BAUME(3.48) —I am glad that Senator Siddons stopped wasting the Senate's time by sitting down early, and I congratulate him. That was the only part of his speech with which I agreed. The reality is that the prices and incomes accord is now no more than the mechanism through which a government, headed by a former leader of the Australian Council of Trade Unions, is controlled by the present leaders of the ACTU. There is only one answer to the question `Who is running this country?' and that is the union movement, through the accord. The Government's economic policy, its retirement policy, its wages policy, even its foreign policy, are now controlled-we have seen all the evidence-by the ACTU. It is not only through the direct operations of the accord but also through the continual blackmailing of the Government-that if it does not toe the ACTU line the accord will fall apart-that this pressure is exercised. Obviously, the Government is very nervous and very determined to maintain the accord because it has no other basic economic policies.

Let us look at what has really happened to establish this case. Apart from the fact that Mr Kelty has admitted that the accord has delivered higher wages than the market can justify-I draw Senator Siddons's attention to that-it is clear that the accord is the instrument through which the ACTU influences and controls this Government. Let us start right at the beginning. Let us recognise, for example, that it was the ACTU that brought pressure on the Government to repeal the Fraser wages freeze. It required the reintroduction of the assets test. Honourable senators might have forgotten the role played by the ACTU in requiring that. It tells the Government whom we are allowed to trade with.


Senator Richardson —That's ridiculous.


Senator MICHAEL BAUME —Did somebody say that that is not true?


Senator Richardson —I said that.


Senator MICHAEL BAUME —I am overjoyed. We will examine the reality of that because it was an alternative put up by the ACTU when there was great pressure in 1983.


Senator Richardson —Hardly a requirement-`requirement' was your word.


Senator MICHAEL BAUME —Indeed, the Government danced to the tune sung by the ACTU, and it goes on and on through a whole range. For example, we saw the extraordinary wage taxing system trade-off that took place this year. Senator Cook talked about discounting as if it were fair dinkum. We all know that is arrant nonsense. The discounting will be paid for in a very determined way. It will be paid for by a tax cut financed by the rest of Australia through tax nasties, and of course also through inflation, as we discussed this morning. The discounting that Senator Cook talked about is so patently nonsensical that he failed to note that the take home pay of people would not be affected in real terms at all, and this is the importance of this matter. The take home pay of employees in Australia will not be discounted because there will be an offsetting tax cut. That tax cut is part of the trade-off deal that the ACTU required the Government to do. There can be no argument about the requirement of the Government to do that because the Treasurer (Mr Keating) at the time had strongly asserted the absolute need for real discounting for the devaluation of the dollar. As I mentioned this morning, that real discounting did not take place. It was totally offset by a tax cut to be paid for by the rest of Australia through the $800m of nasties that are the remnants of the Keating tax package.


Senator Aulich —How many times are you going to speak today?


Senator MICHAEL BAUME —Well, one has to say these things again and again because Senator Richardson obviously still does not understand them, and neither does the Sydney Morning Herald whose editorial was so enthusiastically quoted by Senator Cook a little earlier. He thought it was very interesting and reasonable. Let me read this bit to demonstrate the intellectual competence of whoever wrote this editorial. He said:

Certainly suggestions that the Government should seek a further cut in real wages for the additional depreciation are nonsense.

What is this further cut? There has been no cut in real wages, as we have just demonstrated, and as the ACTU itself has demonstrated. Where is this real cut to have a further one? The fact is that it has been offset by that extraordinary reneging by the Treasurer of his solemn undertaking at Budget time that there will be full discounting. There has not been, and the Labor Party knows it. That is only one of the many things. Look at the way the ACTU instructed the Government to remove section 45D of the Trade Practices Act-instructed the Government. I do not hear Senator Richardson responding on that score. Yet we have in section 45D as proved in the Mudginberri situation the clear evidence of how one needs that kind of legislation to prevent blackmailing by the union movement of not only individual unionists who are getting a better deal out of management, but also management itself which is doing well and benefiting Australian exporting. I instance the Public Service where one has had the industrial democracy legislation, repeal of the no-work, no-pay provisions, for example, and all those matters. Under direct instructions from the ACTU, the Government has done what it is told. One has had the Superannuation Fund Investment Trust matter when the ACTU sought to insist-and it was blocked only by this chamber-on union control of the funds involved in that trust. One could go through a great list of these items.

What happened to the Economic Planning Advisory Council when it wanted to keep reporting to the public and to this place what its economic projections were based on various possibilities? These caused some fuss when they were released-when they were leaked. As a result of the fuss-and it is natural that there was a fuss because it revealed the consequences of major increases in wages on the economy, and they were significantly damaging consequences-when those projections carried out by the EPAC were released, the ACTU went off its head. It instructed the Government-instructed, I use the word again-that it was not going to have that sort of thing. As a result the Government instructed EPAC not to involve itself in such projections. So the EPAC which was supposed to be the public extension of the accord-one of the greatest bits of phoney nonsense I have ever heard-was blocked from doing what it was supposed to be doing because it did not happen to suit the ACTU.

In the whole Budget process, the ACTU has an extraordinary and incredible relationship with the Government. The Opposition parties sought to be advised of the sort of information the ACTU was given before the last Budget. We were told: `No, you cannot have access to that information; it is private'. It seems quite reasonable that if a large section of the community-that is, the ACTU-is to be given access to what was obviously confidential information about the economy, it is totally improper that other sections receive that privilege, that extraordinary benefit, of pre-Budget advice from the Government. We then, through the Freedom of Information Act, sought access to that. That application was rejected because the Government signed a conclusive certificate saying that it was not in the public interest that this information be revealed. If it is not in the public interest to reveal that information, why is it in the public interest to reveal it to a select, specific group like the ACTU which got a specific benefit from that knowledge?

Let us look at the whole question of taxation reform, superannuation lump sum payments, and so on. In the taxation reform area we had the most extraordinary situation where the ACTU simply said that it was not prepared to put up with Mr Keating's proposals on indirect tax. As a result, those proposals sank before they even got to the National Taxation Summit. The list goes on and on. In prices policy, one can see the way the ACTU at its recent conference instructed the Government-I use the word `instructed' again-to tell the Prices Surveillance Authority to become more active in its surveillance of prices. In other words, a Labor government's natural tendency towards increasing control over the private sector was pushed much further by the ACTU because it said that the Government had not been effective enough through the Prices Surveillance Authority. As a result, that Authority is now having to upgrade and increase its intervention into the market place. Surely in this competitive environment the realities of the market place themselves should be the greatest controller of costs, not the artificial role of a government-dominated organisation. So across a whole range of activities one finds the ACTU expressing its view using its special relationship with the Government and its special capacity to blackmail the Government as a result of the Government's obsessive need to have the accord in existence.

Senator Richardson denied that the assets test was in any way the result of any instruction from the ACTU. Let me remind him that in the mini-Budget of 19 May 1983 the Treasurer announced that lump sum superannuation payments which accrued after that date would be subject to taxation, in most cases at the rate of 30 per cent. The ACTU objected to this and so did many other people. The important point is that the ACTU argued for the re-introduction of the assets test to stop `double dipping' and that measure was subsequently adopted by the Government. On that issue let us recognise that the assets test is not the only way of making certain there is needs-based welfare and it is, of course, a totally inappropriate way. The fact is that the Government adopted what the ACTU instructed it to adopt on that occasion because it was one of the determining elements in the Government's decision.


Senator Richardson —That is a very weak case.


Senator MICHAEL BAUME —It is not a weak case because the ACTU continually tells the Government to do things and it continually does them. I have listed several of them, and I think the point--


Senator Aulich —You ought to write an opera.


Senator MICHAEL BAUME —I thank the honourable senator. There is no doubt that the question of an opera is appropriate because there is no doubt that the Government is dancing continually to the tune of the ACTU. I commend the honourable senator for his perception.

Let us examine the point that was made by Labor senators, that the accord has done something marvellous for Australia. The reality is that despite the accord Australia has recovered to a large extent economically from the results of the drought and the world recession--


Senator Aulich —And from the Fraser Government.


Senator MICHAEL BAUME —The Fraser Government's wages pause gave the economy such a benefit by reducing the rate of inflation. It is incredible that whenever this Government talks about what the accord has done for Australia, it always omits to mention the key elements of that recovery. It is now evident that the one reason that our economy is now at risk, our balance of payments is at risk and our interest rates are going through the roof is that the accord itself is causing natural concern. It is involving wage rises that are higher than the market would justify, as Mr Kelty has already said.


The ACTING DEPUTY PRESIDENT —Order! The honourable senator's time has expired.