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4 Treasury Place [Melbourne], 21 May 1997: transcript of doorstop interview [Workplace agreements; Media ownership; Senate reform; Tax reform]

EOE

JOURNALIST: (Inaudible)

REITH: The numbers that have been released by the Department today show a fairly high level in respect of agreements, certainly a level which is at the top end of the Bank's advice in terms of what we need to do to maintain inflation at reasonable levels.

The Government has in place a series of changes to the agreement making system and we encourage employers to use the new system, employers in particular to develop strategies to make sure that they get the best out of the new system in terms of trading productivity increases or wage increases where those demands are made. We are pleased that there is evidence of use of the non-union agreement stream which is available under the Workplace Relations Act. As I was able to demonstrate recently, that new system provides a lot of flexibility which hasn't been available in the past and that certainly should be used by companies.

JOURNALIST: ... pattern bargaining?

REITH: We have got a new system in place. There is a lot of pressure on employers to ensure that they have got a strategy for better employee relations and they need to be dealing with these demands. In some areas we are seeing the union structure across the board, providing a uniform approach by the unions. We have in place a means by which we can see, over-time, the creation of unions which better reflect the circumstances of a particular enterprises. So we have allowed for the first time for enterprise unions.

We have also got in place much stronger compliance measures to deal with unauthorised industrial action and employers should be using those where they are faced with unreasonable demands by union leaders. But I think there is heavy onus on union leaders to have in mind the best interests of their rank and file membership and a return to high inflation will mean much bigger costs on employees than on anybody else. People should bear that in mind.

JOURNALIST: ... leaving employers exposed to industrial action?

REITH: It is a fact that some employer organisations will take the view that it is the Government's responsibility to fix up their employee relations within individual enterprises.

The Section 127 process has been pretty widely used since the I st of January. There have been seventy or more applications. Not in every case have the employees got their way. But it is also a fact that when we look at employer relations, the nature of the relations at a particular enterprise are an important factor in the settlement and the handling of any disputes.

The Government can't run people's employee relations for them. We can set in place a system. Not every result under the Section 127 process has in my view been the right result. But the Commission is the independent umpire, and you wouldn't expect it to be any other way.

JOURNALIST: You were saying that a return to high inflation would be a bigger cost to employees than anyone else. Do you see these figures as heralding a return to high inflation?

REITH: These numbers are a continuation of the last two quarters. We have now had three quarters of around 4.8-4.9%, just under 5%, and that is certainly at the top end. This number looks a bit higher than the last quarter because the last quarter was down a bit because of a few particular agreements.

So I think the numbers need to be seen for what they are and we have got some more numbers out tomorrow, average weekly ordinary time earnings, so that will give us a better idea where the aggregate numbers are going. But this is just another signal to both employers and employees that we have really got to have a sensible attitude to wage outcomes, otherwise wage increases will be eaten up by inflation and jobs will be put at risk.

JOURNALIST: Do you agree with Ken Cowley's comments this morning that if the Government's going to change the cross-media ownership laws it should be fair about it?

REITH: That is a question for Senator Alston. I don't agree with the claims, however, that the Government is just sitting back relaxed and comfortable in terms of structural reforms.

He referred to for example, to the transport industry. We have made a lot of changes to transport. There are some very big changes to be made there. We have inherited a massive financial cost from the previous maladministration of the Labor Government and we have got a program in place which John Sharp is implementing. The reality is that there is a hell of lot to be done, you can't fix the world overnight or in the first fourteen months when you have got thirteen years to clean up. It is just wrong to say that we are sitting back in that area. We have made some very significant decisions and we have started to redress a long standing chronic problem.

JOURNALIST: What about the assertion that the Howard Government has done a deal with the Packer organisation over media ownership?

REITH: I haven't read all his assertions, obviously, but media proprietors all have their particular worries.

JOURNALIST: There were suggestions this morning that they might be using your legislation to push through changes to the Senate...

REITH: The Industrial Relations Legislation is focussed on the circumstances of small business and exemptions from unfair dismissal. I wouldn't expect it to have attached to it anything in relation to the Senate electoral system.

JOURNALIST: But just on the issue of reform to the Senate; how serious are you and when would you like to see them put in place?

REITH: If it is a matter of unions, ask me questions. As to Senate electoral reform, that is a matter for the Prime Minister and others.

JOURNALIST: Mr Reith, with tax reform back on the agenda now, is the GST a necessary part of that?

REITH:Put it this way, I think there will be a lot of talk about a GST in the few months ahead.

JOURNALIST: It would be a good chance to make changes to the Senate voting system...

REITH: We have had a lot of talk in the country about the GST without any reference to the Senate voting system.

JOURNALIST: Cheryl Kernot is obviously worried that changes to the Senate might see the Democrats wiped out, which would see a GST pushed through without opposition.

REITH: Whatever the nature of any tax reform proposal you can be absolutely certain there is going to be a hell of a lot of debate about it. And I am sure Senator Kernot will be in the thick of it.

Thanks very much.

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