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Wednesday, 10 May 1972
Page: 2344


Mr STREET (Corangamite) (Assistant Minister assisting the Minister for Labour and National Service) - The Opposition was faced with an impossible task in this debate because it had to try to piece together the tattered remains of its industrial relations policy and try to make coherent and responsible what has become incoherent and irresponsible. The honourable member for Hindmarsh (Mr Clyde Cameron) tried hard but he failed, because the job just could not be done. To understand why, we have to examine the recent history of the Australian Labor Party's efforts in this field. First of all we had that extraordinary exercise of the so-called mini-campaign on television last year. I say extraordinary' because the policy lasted less than 48 hours. That is not very long for a policy which took months of work to prepare and a reputed $20,000 to publicise. To give the honourable member for Hindmarsh his due, he at least recognised that there had to be sanctions provisions of some sort, but his own Party room, at the instigation and under the influence of the left wing humiliated and repudiated him. I understand the honourable member for

Hindmarsh now claims that his original policy has been re-endorsed by the ALP Executive. Bearing in mind what happened in Caucus last time I would not care to take a bet on how long it will last, because clearly a powerful faction within the ALP is bitterly opposed to it.

What is the current position? We know that the last ALP Conference insisted on repeal of any penalties against arbitral decisions of the Commonwealth Conciliation and Arbitration Commission or indeed decisions of a conciliating committee. That is official ALP policy. It is no coincidence that it is also the policy of the Australian Council of Trade Unions. Mr Hawke has said: 'We will not tolerate the concept of penal provisions and will ignore them'. However at the Victorian State Council of the ALP in June last year Mr Hawke proposed that agreements, freely accepted by both sides, could contain some sort of sanction. Running true to form the Victorian State Council rejected even that. In September 1971 the ACTU Congress adopted a resolution instructing its Executive 'to work out ways and means of ensuring that industrial agreements are honoured by the trade union movement'. In November the ACTU Executive noted this decision by Congress. However, because of the decision of the Victorian State Council of the ALP, Mr Hawke as a Victorian delegate to the ALP Federal Conference was put in the ridiculous position of having to oppose his own policy as President of the ACTU. If Mr Hawke has to support diametrically opposed policies, according to what hat he happens to be wearing at the time, no wonder the ordinary man in the street is confused; no wonder the last vestige of credibility or even consistency has disappeared from ALP industrial relations policy. It is confusing enough when the parliamentary party repudiates its own shadow minister but it becomes quite impossible to follow when the parliamentary party's master, the ALP Executive, is in turn faced with obvious disagreement within the Labor movement.

However, there is , nothing confusing about one particular aspect of ALP policy, although there has been an understandable reluctance to say anything about it. I refer to a resolution put at the last ALP Federal Executive meeting in Townsville in

December 1971, I believe largely at the instigation of the Victorian Delegate, Mr W. H. Hartley - and incidentally what nonsense that makes of any claim to have reformed the Victorian Branch of the ALP. The resolution was in the following terms:

Unions should be immune for actions in common law against private or civil wrongs alleged to have been committed by or on behalf of a trade union in furtherance of a trade dispute.

In other words, the Federal Executive has considered a future Labor Government placing union officers above the law. They would be free from civil liability for such industrial actions as damage to property, assault, trespass and conspiracy, provided only that they could claim to be acting on behalf of a trade union. This would be the most arrogant, dangerous policy ever to be adopted by any Australian political parly. It is an invitation to anarchy, and is clearly designed to destroy the very basis of our society - equality under the law. Not only does the ALP believe unions unions should be immune from penalties under industrial law; it believes that unions should be immune from the law altogether. It is interesting to note what Mr J. Mundey, New South Wales Secretary of the Builders Labourers Federation and a member of the National Committee of the Communist Party of Australia has to say on this subject. He said:

Deliberate damage to property . . . had a devastating effect on employers, government and police alike. In this dispute it took the class enemy by surprise. Future action of this type would be most successful if hundreds and thousands of strikers are involved so making it difficult for full police of government defence of the employer's property.

We therefore have the almost unbelievable situation that the alternative government in this country considered not merely condoning this sort of action but deliberately selling out to make it lawful. This is what the ALP calls an industrial relations policy! It is a travesty of a policy and every responsible citizen in this country will recognise its dangers and implications.

I shall now turn to this legislation and what the Government proposes. At first sight the Bill might be seen as being concerned only with our system of conciliation and arbitration and those people and organisations registered and operating within it. However, further reflection will make it clear that it involves both the structure and management of the economy. But it does not seem to have been generally appreciated that it is fundamental to the Australian national character. If I had to name one principle on which an Australian places more importance than any other it is the concept of a 'fair go', and that is exactly why the conciliation and arbitration system was originally established. In the first place it was designed to provide a framework for the equitable settlement of industrial disputes or potential disputes through conciliation, or failing that through arbitration; in the second to ensure, so far as it is possible to do so, comparative wage justice - a phrase used so glibly these days that people often tend to forget its real meaning - although I maintain that a 'fair go' is not a bad colloquial translation because equal pay for work of equal value is a vital principle of our system. Finally and perhaps most important of all the conciliation and arbitration system aims to preserve the public interest both in the settlement of disputes and the setting of minimum wage levels.

All these functions have one factor in common, the object of ensuring a 'fair go'; whether h be in settling disputes between management and labour, or ensuring that wages are not dependent on the use or misuse of industrial power, or watching so that the community in general, the public interest, ls preserved in the above processes. This is why this Government firmly believes, as have ali Governments before it, that a formal structure of conciliation and arbitration is preferable to what is generally loosely termed collective bargaining.

I should now like to examine how this legislation is designed to fulfil these 3 objectives. Under the present legislation the situation frequently occurs where the same person who has failed to settle a dispute by conciliation is called upon to settle it by arbitration. Inevitably the arbitral discussions start at the point where conciliation left off. The proposed complete separation of powers is designed to correct this undesirable situation. Under this Bill, Conciliation and Arbitration Commissioners will have equal status, proving that the Government recognises the importance of the conciliation process and the desirability of settling disputes by this means if possible. The aim has been not only to emphasise the importance of conciliation but to facilitate it.

But on occasions it will probably turn out to be impossible to reach agreement. Some element of conflict between management, whether public or private, and labour appears to be inevitable. I say appears to be because in the great majority of cases, given goodwill and a sense of responsibility on both sides, it should be possible to avoid conflict. I deplore the attitude of 'them and us' which tends to appear during discussions and negotiations. It should be unnecessary in today's political and economic environment and is merely evidence that one or both sides is unwilling or unable to act in accordance with the principles of goodwill and a sense of responsibility. The 'them and us' attitude should be a relic of the past.

Surely it is now obvious that seriously disadvantaging one party to any negotiations on terms and conditions of employment must sooner or later result in harm to both. Leaving aside for the moment the industrial relations aspect, if management attempts to make unreasonable profits by keeping wages unreasonably low, the purchasing power of the wage earners in the community is reduced and this eventually will be reflected in lower overall demand and lower business activity. On the other hand, if labour makes unreasonable demands it will affect the ability of management to remain competitive and make a reasonable profit, leading to a reluctance to make investment decisions and therefore endangering future job opportunities. This last situation has an ominously familiar ring at the moment and I shall have more to say about it in a minute. So good industrial relations in the widest sense must largely depend on being willing and able to look beyond the immediate issues and to assess the longer-term implications of any proposal or agreement. Unfortunately there are still too many examples which show a lamentable lack of appreciation of this fundamental principle. And that comment applies to both sides of the industrial relations fence.

I now come to the question of comparative wage justice. By its very nature wage fixing by collective bargaining virtually destroys the concept of equal pay for work of equal value. This statement is valid whether the whole system depends on collective bargaining or whether the latter is superimposed on a minimum wage arrived at by conciliation and/or arbitration as advocated by the ALP. The inevitable result will be to disadvantage those sections of the community in the weakest industrial position - the pensioners, those on fixed incomes and very importantly, from a national point of view, the producers who cannot pass on their costs. Included in the latter group are of course farmers and other exporters who have to compete on world markets. Many of Australia's biggest industries are vitally dependent on export markets. If the local cost structure made it impossible for them to remain internationally competitive the result would be catastrophic to the country. We would be so busy compensating exporters for their high costs, the resulting decline in resources available to satisfy all the other urgent and legitimate claims of our society would greatly retard our social and economic development.

Lord Balogh, Economic Adviser to the last United Kingdom Labour Government exposed the fallacy of the arguments in favour of collective bargaining when he pointed out that while the practice might show benefits to some highly organised sections of the community, these had been gained at the expense of other sections. In Lord Balogh's view the total loss outweighed the benefits, so the country as a whole was worse off.


Mr Kelly - Was he not a member of the Fabian Society?


Mr STREET - I believe he was. In his book 'The Battle of Downing Street', Jenkins refers to the 'insoluble post-war equation in which full employment and free collective bargaining had somehow to produce a satisfactory rate of economic growth'. Shonefield in his Note of Reservation to the Donovan Report mentions the failure to reconcile the practice of free collective bargaining . . . with policies for full employment and economic growth'.

It cannot be too strongly emphasised that higher wages for a section of the workforce can only make the national cake bigger if they are accompanied by a corresponding rise in productivity. Otherwise the bigger slice represented by these wages can be gained only by taking a bite out of the rest of the cake leaving less for the other wage-earners or company profits. This brings up the theory of constant shares and merges into the third argument in favour of our conciliation and arbitration system, and that is preserving the public interest. The theory states that the proportion of national income represented by wages and salaries on the one hand and company profits on the other varies only within fairly narrow limits over a period of time. There is a mass of evidence to support the theory which completely refutes the parrot cry of the Opposition that company profits -re gained at the expense of wage-earners. In 1953-54 salaries and wages were 69.1 ner cent of national income. In 1963-64, 67.1 per cent and in 1970-71 they were 71 per cent. Company income figures were! 12.3 per cent, 11.6 per cent and 8.9 per cent respectively. Incidentally these figures exclude personal farm income which could distort the true picture.

While it is absolutely clear that profits have not increased in relation to wages ;.nd salaries, the really important thing is to establish just why the theory is valid. Hie reason seems to be that once profits reach a certain proportion of national income, higher wages can be justified and obtained. However, once profits fall to an unacceptable level, potential investors tend either to take their money elsewhere or wait until the economic climate enables them to get a more satisfactory return. This is the vital point. If wage claims are pushed beyond the limit at which reasonable profits are obtainable, investment halts or at least slows down. Surely it must be obvious that this is exactly what has happened in this country. A potential investor is not encouraged to establish or expand an enterprise when salaries and wages rise over 12 per cent in a year when productivity rises by less than 2 per cent. No wonder there has been some slow-down in business activity, even in this country with a sound economy and with perhaps more natural advantages than any other. I should like to emphasise the point by quoting from the last British budget speech. It states:

If particular groups insist on pricing themselves out of jobs and the nation out of business, no Government can secure full employment.. ,

This brings up the question of responsibility and accountability. When the conciliation and arbitration system was introduced the balance of industrial power was probably in favour of the employer and means were needed to ensure that this power was not used irresponsibly to the disadvantage of employees. Today the balance has shifted to favour the other side and there is a corresponding obligation on the trades unions to act responsibly. Shonfield again has something very relevant to say on this issue. He said:

The trade unions can by a denial of wage restraint oblige Governments (unless they are prepared to follow a politically dangerous course of periodic devaluations) to defend the exchange rate wilh policies of deflation which bite into the aspirations of the people.

That is what irresponsible action does; it bites into the aspirations of the people. It seems to me, therefore, that it is entirely justifiable to provide as a last resort some form of penalty in our system for action which has been euphemistically described as a deficient sense of public accountability'. If we lived in the best of all worlds I agree that all that would be needed would be some form of mutual agreement and this of course would apply throughout society, not just in the field of industrial relations. But we do not live in a perfect world and it is totally unrealistic to put forward propositions that pretend that we do. However obscure may be the rest of their industrial relations policies, the Opposition say there should be no provisions for penalties for breaches of awards under the Act. We say there must be.

Let me illustrate the point in this way: Let us imagine two neighbours who over a period of years have both shown a regrettable propensity for throwing stones through each others windows. Eventually they get together and decide that this is a pretty stupid form of behaviour and make a pact that they will not do it in future. But then one neighbour says: 'This pact holds good only if we register it formally with a third party. What is more, if I do not want any penalties included for breaking windows then there can be no penalty'. Bearing in mind the previous history of relations between the two neighbours, it is a certainty that sooner or later one of them will get an overwhelming urge to start throwing stones again and equally inevitable that a window will be broken. We would then have the ridiculous situation of the stone thrower being able to say: 'You cannot make me pay for the damage. I did not agree to that being put into our agreement'. If there is no penalty for breaking a law then there is no point in having the law itself. This is a self evident truth and I have no doubt that it is clearly appreciated by the Australian community. If we want our conciliation and arbitration system to continue - there is certainly widespread support for it - then in the last resort there must be penalties for deliberately flouting its awards and judgments.

The Opposition should remember that penalties apply both ways. How would they like it if there were no penalties for refusing admission to an arbitration inspector, for providing employment under sub-standard conditions and rates of pay, or for the dozens of other provisions which are all designed to protect the safety, health and working conditions of employees? I would have thought any political Party would have been concerned to protect the rights of employees against unscrupulous employers. This Government certainly does. The Opposition apparently does not. But in industrial law just as in all other branches of the law you cannot have a double standard. The application of the law must not discriminate. The alleged double standard we have heard so much about from the Opposition is a fallacy. Award wages are minimum, not maximum, wages and any employer who charges more than the community is prepared to pay for his goods or services will soon be out of business.

In this speech I have deliberately dealt in broad principles and concepts rather than with matters of detail, since this legislation will either directly or indirectly affect all citizens of this country. To quote Shonfield again, 'it is no longer possible to accept the traditional notion of the individual work place as a separate and largely autonomous estate, where employers and employees are able to conduct their quarrels with little or no regard to the effects of what they do on other work places'. Australia is a country with a great future but that future will be realised only if all sections of the community are prepared to take a responsible attitude to their own particular job, and to realise that obtaining a temporary sectional advantage will eventually prove to be an illusion since it will have to be paid for by somebody in the end.

This legislation is concerned primarily with people and the organisations to which they belong. It will work effectively only if the parties are prepared to make it work, since legislation can of itself never solve industrial relations problems. The legislation is the result of complex and detailed discussions extending over many months with all the parties concerned, leading to the Minister's statement on 7th December last year. For the past 5 months there has been an opportunity for all interested parties to make their views known to the Government - a situation almost unique in recent Australian political history. If anyone did not make their views known then it has been their fault. The opportunity was provided. Many people and organisations have availed themselves of this opportunity, and the fact that some of the original proposals have been amended is conclusive proof of the Government's goodwill and sincerity. This Bill represents the combined efforts of a great many people and deserves and will get the support of the community. I have much pleasure in supporting the Bill.

Mr CLYDECAMERON (Hindmarsh)I ask for leave to make a personal explanation.

Mr DEPUTY SPEAKER (Mr Drury)Doesthe honourable member claim to have been misrepresented?


Mr Clyde Cameron (HINDMARSH, SOUTH AUSTRALIA) - I claim to have been misrepresented. The Assistant Minister assisting the Minister for Labour and National Service (Mr Street) alleged that my statement concerning the Australian Labor Party's policy on industrial relations was repudiated at the Townsville meeting of the Federal Executive. To justify that claim he quoted a resolution which he said was moved by Mr Hartley and carried. Mr Hartley's resolution was soundly defeated at the Townsville conference.







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