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Tuesday, 29 August 1989
Page: 471


Senator LEWIS(3.50) —Let me go right to the heart of the problem by drawing atention to words that have been used by the Prime Minister (Mr Hawke). I would like to take the Senate back to the Qantas Airways Ltd pilots dispute in August 1974 when Mr Hawke was President of the Australian Council of Trade Unions (ACTU). A report in the Sun-News Pictorial of 30 August 1974 said:

In a unanimous decision that covered Right-wingers, Left-wingers, and Mr Hawke, the ACTU executive has warned off ministers who try to interfere in the legitimate industrial processes of negotiations, conciliation and arbitration.

This decision was aimed at both Mr Cameron and the Transport Minister, Mr Jones, who told Qantas to withdraw its offer of 27 per cent to the pilots.

The next day Mr Hawke announced in a press release that he would `try to get the executive to endorse the principle that the Government should not interfere in negotiated agreements and should not intervene in arbitration cases to oppose claims for improved pay and conditions'. That is what he was saying in 1974.


Senator Collins —The unions are saying it now.


Senator LEWIS —Yes, as Senator Collins says, that is what the unions are saying now. But this Prime Minister cannot resist getting his cotton-picking fingers into it. What he has done is exacerbate the dispute. He has poured petrol on the fire and created an enormous economic problem for this country. I will come to that point in due course.

In 1977, when the Liberal-National Party Government ordered Royal Australian Air Force (RAAF) Hercules aircraft to provide an emergency passenger and freight air service to Tasmania during a domestic pilots strike, the then President of the ACTU, Mr Hawke, warned that the use of servicemen would be regarded as strike-breaking and could provoke an all-out confrontation between the unions and the Government. So, again, in 1977 he was criticising the very actions that he has taken today. Let us look at the answers given in the Senate today in relation to this matter. Senator Button said that he agrees with something which Mr Hawke said in July 1986 in relation to the Mudginberri dispute. Mr Hawke then said:

I don't believe that better industrial relations are brought about by the method of harsh legal sanctions.

That is what Senator Button said he approved of today. What did the Prime Minister say nine days ago? He said:

I say without equivocation that when the airlines decide to initiate those legal processes with significant very drastic financial penalties against individual pilots and their organisation, the airlines will be pursuing those legal processes with the full support of my Government.

On many previous occasions the Prime Minister has made statements about politicians, and Prime Ministers in particular, not interfering. Yet he is now interfering. We discovered from what Senator Button said today-and I believe it to be a disgraceful state of affairs-that the Government is negotiating with only one party to this dispute. The Government is not having any discussions at all with the pilots. It has not had any discussions with Mr McCarthy. It has taken to its bosom Sir Peter Abeles and Ansett Airlines of Australia. The Government is not prepared to try to bring about some proper negotiation which might bring this matter to a conclusion.

We on this side of the chamber have no brief for the pilots. We do not approve of what the pilots have done. But we do say that if the Government is going to interfere in any way in this matter, it should be trying to bring both parties to the negotiating table. It should be trying to get the pilots to accept that some sort of productivity agreement should be negotiated and that any salary increase should be granted on the basis of a proper and adequate consideration of current productivity, which Senator Button bucketed today. He has said that the pilots of Australia are not achieving proper productivity. I do not know whether they are. However, from what Senator Button said, clearly there must be room for productivity negotiations which might bring this dispute to a conclusion.

This dispute demonstrates beyond any shadow of doubt that the Hawke Government's industrial relations policy and the accord have failed both ordinary Australians and the Australian economy. The pilots dispute is a direct result of Labor's mismanagement of the economy and industrial relations. As I said, it has been exacerbated by the Prime Minister's inflammatory language. The dispute is the direct result of the failure of two centralised regulatory systems, both of which have failed to take into account economic reality and human behaviour. Under the centralised wage system, decisions are handed down about how much people should be paid without their true worth being known. That is the first system that is wrong. The second is the regulated price fixation system of the current airlines monopoly which means that there is no competition in the industry and that the costs are simply passed on to the consumer. In that sort of circumstance the result that we are faced with here today is inevitable.

The accord has resulted in a massive exodus of skilled workers from the system. It has created shortages. For example, Qantas is no longer able to carry out the maintenance of its aircraft because the skilled workers have left the system. That is a direct result of the accord. Both graduates and skilled tradesmen have departed from traditional employment. They have got out of the system; they have run away from the accord. I see that Senator Collins is looking at me. I say to him that when I was inspecting a factory recently I came across a very skilled young man who was repairing computers. I praised him and made some comments about the skills that he must have. He said to me, `Senator, can you tell me why my mate who is a brickie's labourer is getting more money than I am?'.


Senator MacGibbon —He has got a stronger union.


Senator LEWIS —It is all because of the accord and the fact that that person is in a stronger union. People have been locked in by the accord. As a result, people with skills, such as the young fellow I mentioned, are becoming brickie's labourers. That is what is happening in this country. The accord is deskilling this country.


Senator Collins —They're not, actually.


Senator LEWIS —There is not the slightest doubt that people are seeking all sorts of ways to avoid the accord. They are setting up their own consultancies and providing the same sort of service outside the system. The pilots dispute is simply one example of a group of people breaking out from the centralised wage system, a system which grants across the board increases irrespective of the needs of the employers and employees at the workface. Today Senator Button was critical of our policy. I say that such break-outs as this wage break-out can occur only in the Government's rigid centralised system. They would not happen under a coalition policy. They would not happen under a coalition policy. They just simply would not happen.

If our policies had been in place, if we had been elected in 1987, the pilots of Australia would not be in this position: they would either have remained in the industrial relations system with the effective enforcement provisions as outlined in the Bill which Senator Chaney introduced last week, and of which I gave notice this morning; or they would have negotiated a private agreement either on an individual basis, through a union or on some workplace basis which is binding on both parties and which would be enforceable by both parties. There would have been no wage break-out because we would not be worried, as is the Government because of the accord, of the flow-on.

That is what is worrying the Prime Minister. He recognises that under this stupid system the Government has established, if the pilots get a wage break-out it will flow right through the system. It will cause enormous economic havoc if the pilots get their wage increase under the Government's centralised system. It would not apply under our system. The Prime Minister's intervention and over-reaction has been thoroughly inept and he has simply inflamed the dispute to such a stage that, I might say, I believe his intervention has now become a major stumbling block to the negotiations.

I might add that it is quite clear also that the Prime Minister and this Government are operating under a set of double standards because there was no action by this Government when the waterside workers closed down the port of Melbourne for nearly a week. There was no action at all; we did not hear the Prime Minister jumping up and down and being Rambo about the waterside workers down in Port Melbourne. Nor did we hear the Government doing anything about it when the meat workers union imposed rolling bans and stoppages in pursuit of pay claims outside the wage principles. Of course they are outside the wage principles. If they do not get it one way they will have to get it another way. The pilots are demonstrating just one way of getting what they want outside the wage principles. When the Government opposed Senator Chaney's Bill recently what did Senator Aulich say in here? He is trying to justify himself today-incorrectly. I happen to have his speech, and it is quite clear that Senator Aulich was not at that stage in the debate last week saying what he said today. I will quote what Senator Aulich said last week:

In some ways I am not even pushing aside the viewpoint that has been expressed by members of the New Right. They had their viewpoints on particular disputes and taught us that in the end-

and listen to these words-

the worst possible thing to do to improve industrial relations in this country is to get people into the courts and the common law system. That is the worst possible way for people to go if, first, we are going to solve industrial disputes on the whole or, second, we are going to create a climate of industrial relations harmony that helps us as a country to maintain a reasonable reputation.

That is what Senator Aulich said during the debate here the week before last and yet the Prime Minister says, `That is exactly the way I am going to go'. Of course this hypocritical Prime Minister is in fact adopting our policies but he is trying to impose them upon a centralised wage system and they will not work in a centralised wage system.

This Government should immediately move to free up the industrial relations system. Senator Button said it in the course of an answer today when he said, `Of course there should be a more flexible system. There should not be wage rigidities. There should be a flexible wage system. There should be flexibilities in the industrial relations system'. Of course he knows the position. That is why I interjected, `Yes and in due course your Government will adopt-if you're here long enough-our flexible wage system. You will find some way of endeavouring to free up this system because it is too rigid and it is in effect deskilling this nation'. As far as the Prime Minister is concerned, he should swallow his pride and withdraw from this dispute.

Let us look at what is happening as a result of this dispute. Let us look at the tourism and hotel industries and see what is happening in those industries. The tourist industry is estimating known losses of $20m per day and a total cost estimated so far at about $600m already. We can see from the attitude of the pilots that this dispute will go on for a very long period of time. The Gold Coast is now in the peak of its tourist season. One-third of the tourists to the Gold Coast are air travellers. There have been 7,000 cancellations of conventions or groups recorded so far. Last Friday 2,200 delegates were lost from the Gold Coast.

The average loss of business on the Gold Coast currently is $2.5m per day in the 5-star hotel occupancy where the rates are estimated to be as low as 13 per cent in the peak of their season. We know that in the capital cities-Brisbane, Sydney, Melbourne -the figures are down for the hotel bookings. We know that the restaurants are suffering losses in Cairns; we have had reports of immediate cancellations of groups and conventions costing $2m and more coming in daily and costs of this order are being repeated in every State, with flow-ons to restaurants and the food industry.


Senator Stone —Who is responsible?


Senator LEWIS —Who is responsible? Mr Hawke inflamed this dispute because let us remember the domestic pilots, while we do not approve of what they are doing, were actually providing a service of sorts, at least from 9 o'clock to 5 o'clock, when suddenly the Prime Minister opened his mouth and that is the finish of it.


Senator Walters —What about Tasmania?


Senator LEWIS —I agree with Senator Walters from Tasmania: tourism stopped in Tasmania. Hotel bookings have been cancelled and air freight has been stopped.


Senator Collins —It is catastrophic in the Northern Territory.


Senator LEWIS —And did the honourable senator say to come and look at the Northern Territory?


Senator Collins —It is catastrophic.


Senator LEWIS —Senator Collins is saying it is catastrophic in the Northern Territory. The damage to the economy is immeasurable because it will go on. The damage to the economy will go on for a long period. Of course there is a possibility that the bottom might fall out of the Australian dollar under this Government if it stays here much longer and then, of course, overseas tourism might come good again. If that is Senator Button's policy, believe me, Mr Acting Deputy President, we do not approve of that policy. But that looks to be the only chance for tourism under him because it will be years-three to five years; and I see Senator Collins agrees-before the tourism industry recovers from this disastrous strike. It is front page news in Japanese newspapers and I understand that some 25 Japanese tour operators have cancelled tours in Australia.

There is another matter of grave concern, and that is the political pressure which we believe was imposed on the Civil Aviation Authority (CAA) to grant immediate operational approval for a DC8-62 aircraft owned by Arrow Air Inc. to operate on a charter basis for freight flights in Australia. Australia's aviation safety record is at risk in relation to this matter. Normally it takes three months for CAA to grant operational approval for an aircraft. It has done this in a couple of days and we understand that is because it has been leaned on by someone in the Government. Arrow Air Inc., which is providing this aircraft, does not have an operational manual for Australia and it does not have an enviable safety record. I alert Senator Button and others in the chamber to that problem.

The Government has repeatedly said that the accord is the cornerstone of its economic policies. Well, the accord has failed; the Government's economic policies have failed. Look at the Moody's report today. We have net foreign debt of $108 billion. We have a current account deficit estimated to be over $20 billion this year. The Budget is predicting inflation at 7 1/2 per cent. The Treasurer (Mr Keating) is telling us that the high interest rates will go on for another two or three years. There is Moody's attack on not only the Government's credit rating, but also on all of these institutions in Australia today. Let there be not the slightest doubt that this Government's economic policies have failed. The accord has failed. The Government has failed and it is time it went.