Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Wednesday, 27 November 1985
Page: 2366


Senator SIDDONS(3.41) —The matter of public importance that we are debating is the trade union domination of the Government and particularly the superannuation issue. I guess that that raises the question of the accord but it particularly raises the question of superannuation. I want to spend most of the time that I have talking about superannuation, but first let me deal with the accord. I believe that those who criticise the accord have a responsibility to say what they are going to put in its place. If we break down the accord how will we control wages in this country? I have not heard in this chamber any reasonable alternative up to this point. The sooner that members of the Liberal Party of Australia delineate precisely what their alternative is to the accord the sooner we will have a worthwhile debate on the accord. From where I stand I can only say that the accord at this point is working, and it is working well.

Senator Robert Ray quoted some figures. He did not mention, of course, the fact that business is booming. If we look at the figures for the September quarter of 1983-84 we see that business profits rose by 17.8 per cent and if we look at the figures for the September quarter 1985 we see that business profits rose a further 21 per cent. So things are going well. The accord has given this economy the opportunity to expand without industrial disruption. We have only to look at history to see what has happened. During the Fraser years there was an attempt to break down centralised wage fixing. The powerful unions, particularly the metal workers, got into the act. They negotiated enormous wage increases. That immediately flowed on to all other sectors of the economy and we had a wage explosion the like of which this country had not seen before. If we are to debate responsibly the issues about union domination we have to say responsibly what is the alternative. Until members of the Liberal Party can give us a carefully reasoned alternative I believe that debating the accord is very unproductive.

On the face of it, the accord has been successful to this point. I for one, speaking for the Australian Democrats in general, am very pleased that the Government was able to negotiate another two years of the accord. But, in doing so, it brought in some new issues. Let us just look at the history of what we are debating. the negotiations that the Treasurer (Mr Keating) undertook with the Australian Council of Trade Unions were to the effect that the unions would get the normal consumer price index wage rise, except for the first quarter next year when there would be a 2 per cent reduction, and then after 1 July next year the Government offered them superannuation in lieu of the productivity increase. At this point the Government has not brought down any guidelines on what it intends to do with superannuation. It has said that it will move to offer superannuation to all employees. The Democrats applaud the Government in that initiative. At present only 50 per cent of workers enjoy superannuation and the facts of the matter are that they tend to be the higher paid workers. So there is a crying need in the community for general superannuation benefits and we are pleased that the Government has taken that initiative. Unfortunately, the Liberals did not do it when they had the opportunity when they were in government.

The Government has said that it will offer superannuation to all in three ways: First, through existing employer schemes; secondly, through union-based schemes; and, thirdly, through a safety net which will be a national superannuation scheme.


Senator Parer —That's not the way it is working.


Senator SIDDONS —That is what the Government has said it will do. Our principal concern is that if the Government is going to use these three types of schemes, is to give everybody the opportunity to contribute to a superannuation scheme, it is absolutely paramount that the contributor has a free choice as to which scheme he or she wishes to join. If there is a free choice I think at least 50 per cent of our problems will be over because that will force the competing schemes to be effective. I do not believe that we can do it in any other way.

Having looked at the history of union superannuation schemes to date, we are in some fear as to what the Government guidelines will be. Let us look at what happened with the builders unions superannuation scheme. First of all, everybody was forced to join the BUS scheme. There was no free choice; they had to join that scheme. Secondly, the contributors were given the opportunity to cash in their superannuation when they went from one job to another. They were not contributing to a superannuation scheme; it was a disguised wage increase. If people can cash in their superannuation as soon as they go from one job to another that is not superannuation. That is not a nest egg to be built up for people for when they retire; that is a disguised wage increase. So we are very critical of the BUS scheme. We hope that the Government guidelines will put that sort of scheme to rest.

We have just had a big debate on the Federated Storemen and Packers Union. As Senator Ray pointed out, members of that union tried to beat the gun to get union superannuation before 1 July next year as was agreed to under the accord and they involved themselves in a bit of industrial confrontation. Happily, I think the matter was resolved before it became too serious. Perhaps the Minister for Employment and Industrial Relations, Mr Willis, should be congratulated on his efforts to negotiate that dispute. It could have been very serious. As I understand it from the Press reports I got as I ran from one spot to another in this place today, it seems that this dispute has been negotiated on the basis that the contributors will be given a choice to contribute either to the union scheme or to the employers scheme.


Senator Messner —No.


Senator SIDDONS —If that is not the case I will be concerned. That was my understanding of it. The Democrats would like to outline what we believe are the essential principles that have to be addressed by the Government when it brings down its guidelines for universal superannuation. I believe that our first concern is that there should be portability. That simply means that contributors should have the opportunity not to be disadvantaged when they go from one job to another; their superannuation entitlements should be completely portable and there should be no problem or penalty when they change from one job to another. The second important principle is the one I have already alluded to, namely, that there must be a choice between competing schemes. There must be a choice so that the contributor can join an existing scheme, a union-based scheme or the national scheme, whichever he or she chooses to join. It seems to us that the third important principle is that it is essential that employees also contribute to a superannuation scheme. I believe that there was no employee contribution in the BUS scheme. If there is no employee contribution there is a tendency for people not to take an interest in what is going on and to look on it as a handout. In those circumstances, I think, the real benefit of superannuation tends to be lost.

I come now to my fourth point. We have had a lot of talk today about union schemes, how beneficial they will be, et cetera. I do not believe that we would have any objection to a union scheme provided it competed on a fair basis with existing schemes.


Senator Parer —It's not the real world.


Senator SIDDONS —There are existing schemes. If the union schemes can match the benefits of existing schemes and the contributors have an opportunity to join one scheme or the other I think many of the problems will be overcome. I come to our fifth, and all important, principle: Who is to appoint the trustees to any superannuation scheme? That is a vitally important issue which I believe has not yet been addressed by the Government. Senator Walsh, who is reclining at the moment-I hate to wake him up-made the point when we were debating the Public Service superannuation scheme that we can trust the ACTU to appoint a majority of the trustees. Maybe we can trust the existing ACTU but I paint the scenario where an unscrupulous ACTU in the future decides to appoint the majority of trustees as its mouthpiece, as its front or as its stooge, to do what they are told. If the ACTU then said to the trustees `Take funds out of this industry and put them into that one.', or `We have an industrial dispute going on in the industry; take the funds out, or threaten to do so and we will really put some pressure on them.', the unions would be in an enormously powerful, even unassailable, position. That danger exists unless we have a satisfactory way of ensuring that the trustees will always operate in the best interests of the contributors and in the interests of nobody else.

One can debate all the options for appointing trustees. The Democrats say again that there is no way that we will stand by and see trustees appointed on the recommendation of any one body, whether it is the merchant bankers or the ACTU. It makes no difference. We have to find a fair and equitable way so that the rights of the contributors are paramount and are protected. Enormous amounts of money are involved. In the Public Service superannuation scheme alone, $1m a day is invested. The trustees have control over where that money is to be invested and so have enormous leverage, if they want to exercise it, over the economy of this country. Who controls the superannuation funds controls Australia. It is as simple as that. So the issue is vitally important. I do not believe that it is good enough for the Government just to sit back and say that we can trust the unions. Maybe we can; maybe we cannot, but there has to be a better way of appointing the trustees to control these enormous amounts of money.

We have given this a lot of thought and we say that the only fair way is to respect the rights of the contributors. They should have the final say over their money because it is their money, nobody else's, that is being invested on their behalf. Surely in the final analysis it is the contributors who should have authority over who is appointed to invest their funds. The only fair way to do that is to have an election at large to allow the contributors to vote directly on who are to be the trustees. I had a debate on an Australian Broadcasting Corporation program an hour or so ago with Senator Cook and he maintained that if we let an election at large occur, the unions would dominate that election anyway and we would not get anywhere. I do not believe that that is true but the fact of the matter is that we can do no more than give the contributors the right, the authority and the power to elect the trustees. They are the people concerned; they are the ones who should have the final power. If they choose to be browbeaten by the ACTU or by the unions that is their business, but at least if the law says that there is to be an election at large the contributors can vote on who are to be the trustees, on who are to invest their funds and at least justice will be done. We can do no more.

I would be happy to debate any scheme that is put up during this discussion or at any other time on the principles to be applied to the appointment of trustees for superannuation funds. It is the most important issue. There is no doubt that superannuation will be a major issue because of the Government's initiative and because of the accord. It will be the subject of major debate in this country for the next 12 months and the sooner we give it some very serious and careful thought and address the fundamental problems, the better. I have laid down five principles that concern the Democrats. We are happy to debate those five principles with the Government or with the Opposition in this chamber or anywhere else at any time.