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Thursday, 8 September 1983
Page: 591

Mr RUDDOCK(4.25) —The principal purpose of the Public Service Amendment Bill is to ensure that the Government's community employment program and two other programs can operate effectively in the Public Service. The community employment program, modelled on the wage pause program of the previous Government, was enacted with the support of the Opposition in the May sittings of the Parliament. I will later address some comments to the effectiveness of this program; that is, the community employment program. Nationally, $300m will be available to the community employment program in 1983-84, of which $50m will be made available to Federal departments and authorities. The Community Employment Act provides that Commonwealth departments may incur expenditure for carrying out approved projects, and that Commonwealth authorities may enter into agreements with the Commonwealth for the purposes of carrying out approved projects.

Division 10 of the Public Service Act of 1922 provides for temporary employment in the Service. However, the difficulty confronting the Government in engaging young unemployed people under these provisions was the requirement of section 82 that applicants for temporary positions had to be chosen on the basis that they were the best qualified persons for work. The community employment program has different criteria for the selection of people to participate in the program and it includes a provision that preference be given to those who have been registered with the Commonwealth Employment Service for some nine months or more .

The proposed amendments do not change the merit criteria for appointment to temporary positions generally in the Public Service, but they make a number of special qualifications. The provisions to be enacted qualify section 82 so that where employment is offered firstly under the Community Employment Act; secondly under the national employment strategy for Aboriginals; or, thirdly, under the Commonwealth work experience program, persons chosen for the purposes of the program or project by the CES shall be appointed. Honourable members may wonder, as I did, why similar qualifications were not proposed to the temporary employment provisions contained in the enactments of various Commonwealth authorities. My research into that matter revealed that in relation to Telecom Australia, Australia Post, Trans Australia Airlines, the Commonwealth Banking Corporation, the Canberra College of Advanced Education, the Pipeline Authority, the Australian Film and Television School and the Australian Broadcasting Corporation temporary employees are not required to be the best qualified for the available work or appointed on merit. It may surprise honourable members-it came as a surprise to me-that such qualifications are not insisted upon by other authorities, but that appears to be the case in relation to those I have mentioned. I have not checked all the enactments of all the authorities of the Commonwealth but I assume the draftsmen and the advisers of the Minister for Finance and Minister assisting the Prime Minister for Public Service Matters (Mr Dawkins) have checked all such enactments and that no further amendments will be necessary to facilitate the introduction of this scheme in the Public Service.

A further technical amendment proposed by the Bill relates to the definition of 'department' to ensure that full effect is given to that definition as amended in 1982. This amendment is to facilitate the earlier amendments in the form proposed.

The Opposition supports the amendments, as it supported the introduction of the community employment program. There are very good reasons for the extension of the operation of the community employment program to the Commonwealth Public Service. The Commonwealth has invited the participation of State governments, their authorities, local government and voluntary organisations. Their participation is essential for the success of this program. The sum of $250m has been allocated for that purpose.

In 1974, as a member of the House of Representatives Standing Committee on Aboriginal Affairs, I participated in an inquiry into special employment programs for Aboriginals. The special program which we looked at in northern New South Wales was called the special works projects scheme. Our Committee inquiry showed us high levels of participation by local government, local authorities, State departments and local employers in those very special schemes. But very few, if any, Commonwealth authorities were involved. Few departments of the Commonwealth were found to have engaged young unemployed Aboriginal people, and yet clearly opportunities were available in communities to do so. This lack of example by the Commonwealth and its agencies was a severe embarrassment to me and to other members of the Committee.

It is the Opposition's earnest desire that on this occasion the Commonwealth will fully participate in this program and that, particularly in the national employment strategy for Aboriginals, opportunities will be found for engagement. It is not enough to amend legislation. A commitment in all departments, all authorities and all agencies to find suitable tasks and job opportunities is required. On behalf of the Opposition, I make it clear that I will be seeking regular reports to the Parliament detailing which departments and authorities are participating in these programs.

In the Committee stage of the Community Employment Bill my colleague the honourable member for Balaclava (Mr Macphee) commended for consideration a particular program for Commonwealth participation. I reiterate his suggestion for noting by the Minister and his officials. The honourable member suggested that repair and maintenance programs in various Commonwealth factories be commenced. He noted that a dozen or so factories now in the Department of Defence Support are in urgent need of attention and urged that repairs be pursued, in the national interest, as a matter of priority.

In commending this Bill, and offering it a speedy passage with Opposition support, we should not, however, ignore the reality of unemployment and that this program for the Public Service and generally will not create, in real terms , extra employment for Australians. The Budget, so recently presented by the Treasurer (Mr Keating), recognises that this year unemployment is estimated to rise by some 90,000 people. It is asserted that the community employment program will create up to 70,000 jobs for an average duration of only six months. The reality of these figures cannot be ignored. It is only through a real economic recovery that lasting employment opportunities will be created. A wages policy is crucial to this economic recovery, as Treasury noted in Budget Statement No. 2. The Opposition recognised this in May when it proposed the following second reading amendment to the Community Employment Bill.

Whilst not declining to give the Bill a second reading, the House-

(1) is of the opinion that the Government should acknowledge that permanent jobs will only be created when economic recovery occurs and should do its utmost to implement policies consistent with the following extracts from the National Economic Summit Communique:

(a) There is a recognition that to achieve recovery will require restraint in expectations and claims from all sections of the community except the impoverished (paragraph 2);

(b) It is a legitimate expectation that income of the employed shall be increased in real terms through time in line with productivity (paragraph 8), and

(c) The preservation of the private sector as a profitable operating sector is essential to Australia's well being and to encourage job creating investment from both within Australia and abroad (paragraph 9), and

(2) Resolves that the Government should seek to extend the wages pause and subsequent wage restraint until economic recovery, increased investment and consequent job creation have commenced strongly.

The honourable member for Balaclava made other pertinent observations about the Community Employment Bill which should not be forgotten. He stated:

First of all, the Bill seeks to provide temporary employment for less than 10 per cent of the unemployed. Secondly, it does so in a manner and by criteria very similar to those adopted by the previous Government when distributing the $ 300 million saved from the wages pause in respect of Commonwealth employees. Thirdly, I have no doubt that the Fraser Government, had it still been in office in August, would have introduced a similar program to this.

He further stated:

The program in this Bill had its genesis in the wages pause program of the Fraser Government which the then Opposition roundly and wrongly condemned.

My colleague said that the wage pause and the government's incomes and prices policy should have one overriding economic objective and that is limiting the increased growth in wages. He noted the problem of wages growth outside the centralised wage fixing system at that time in the building industry with its consequential flow-on effect. That problem is more real today with the $15 to $ 20 wage increase outside the centralised system paid by H. J. Heinz Co. Australia Ltd. These increases, with consequential flow-on effects, argued by the President of the Australian council of Trade Unions, Mr Dolan, as inevitable will occur on top of a general wage increase of 4 per cent accepted by the Government as a permissible outcome from the Australian Conciliation and Arbitration Commission inquiries proceedings at this time. These increases, with any further indexation awards, make the Government's Budget wage growth forecasts of 7 per cent in the year ahead unlikely and an almost impossible outcome. The tragic effect will be increased inflation, loss in real value of funds for the Commonwealth Employment Program and a reduction in the estimated number of jobs to be created. The reality of this can be seen in the figures that were released today by the Australian Bureau of Statistics.

I think every honourable member would be alarmed to learn that, whereas this community employment project will create something of the order of 70,000 jobs for some six months duration, in August a loss of 52,000 jobs occurred. There is in this for the Government a clear warning of the consequences of its reckless policy of full wage indexation. Many Australian businesses simply cannot survive under indexed wage rises, which will force many employers to offset higher wage costs by reducing their number of workers. The August fall in the number of Australians at work has not been matched by an equal rise in unemployment only because the level of discouraged workers who have not bothered to register is now at the highest level ever recorded. The labour force participation rate is now only 59.8 per cent, the lowest level since official figures were first collected more than 20 years ago, and compares with a 61.3 per cent participation rate when the former Government lost office in March.

These latest job losses put at risk the Government's Budget objective of increasing employment by about 1 1/2 per cent over 1983-84, which I have already said is going to be disastrous. Unemployment appears to be set to rise even higher than the Government's wage forecast because of the Government's full wage indexation policy. That needs to be understood. Whilst the community employment program-and its extension to the Public Service-is an initiative, it will only be a panacea in part.

My colleague the honourable member for Balaclava also noted that the $300m for the community employment program was achieved at the expense of programs of the former Government axed by the present Labor Government in May which would have also created additional jobs. Again I will quote the honourable member:

During this financial year we were looking at a wages pause program which had job creating benefits as great as any proposed in the Bill. The former Government proposed welfare housing, airport upgrading, the Australian Bicentenial Road Development Program and water projects-

and the Northern Territory railway-

all of which were important for job creation. The present Government, in saying that its razor gang has removed these projects, is using mirrors to pretend that it has provided $300m for the creation of extra work. In fact, people who are concerned with the Brisbane Airport work and other such projects-

such as the Northern Territory railway-

will have cause to wonder. I believe that in the end most of what is proposed will be nugatory and that all of it will represent a cruel deception and illusion to the unemployed.

But it is not just the Opposition which has its doubts about the success of the community employment program in the light of our economic situation. Deborah Hope, in an article in the Sydney Morning Herald of Friday, 2 September, commenting on the Government's job creation scheme, stated:

But some social analysts and economists are arguing that the money could be put to better use and that the scheme could actually worsen the lot of Australia's long-term unemployed.

While some are likely to benefit from greater work skills and boosted morale, many more could end up back on the dole queue and even more disillusioned than before.

The Government admits the scheme will do nothing to reduce the level of unemployment.

By the end of June this year, nearly 720,000 people were looking for work, a rate of 10.3 per cent.

According to the Budget papers, the Treasury expects unemployment to grow, rather than fall, in 1983-1984, from an average of 540,000 a month last year to an average of 680,000.

This is in part because the labour force is expected to grow at a faster rate than unemployment.

The figures I gave, which were announced by the Bureau of Statistics today, very much confirm that proposition. Deborah Hope added:

It may have been a more courageous and constructive advance for the unemployed if CEP funds had been allocated to make small capital loans to the unemployed to set up small business that would at least contain the potential for a continuing independent income.

This proposal is strongly supported by the welfare organisation the Brotherhood of St Laurence.

The Brotherhood's social and economic policy director, Peter Allen, claims the European example of governments promoting community industry could be followed.

According to Mr Allen, European governments are expressing increasing dissatisfaction with work experience and training programs as responses to the present job crisis.

A report being prepared by the EEC and expected later this year is expected to lead to a substantial increase in government support for permanent rather than temporary job creation programs.

This is taking place against a background of predictions for Europe that total employment within the EEC will fall by about one per cent over the next three years, and a growing realisation there that a lift in economic growth, when it occurs, is unlikely to lead to a significant increase in jobs.

There is one aspect of administration which has caused me considerable concern. Honourable members may not have seen the article entitled: 'Wage pause fund in limbo', in the Canberra Times last week. It makes certain startling allegations requiring urgent clarification. The report alleges that the $200m allocated by the former Government's wage pause program appears to have dried up and that the Government is unaware of how it is being spent.

Mr Dawkins —Has it?

Mr RUDDOCK —I am interested to hear that interjection because the people who were speaking on behalf of the Government were suggesting that the money had been spent or was committed. It was noted that in July the funding of State programs was suspended when only 10 per cent of the available funds had been spent and States were denied funds until their backlog was reduced to only one month's allocation. The reporter's inquiry of the Department of Employment and Industrial Relations to ascertain the current position brought the response that the scheme was effectively wound up on the basis that money was committed, or there were enough applications to take up the rest. However, no information was available as to how the States had spent the funds allocated before the freeze. The most alarming statement was in the final paragraph. It states:

But since August, the energies of the Department appear to have been directed away from monitoring the older job-creation scheme in favour of establishing administrative machinery for publicising the Community Employment Program initiative announced by the Treasurer Mr Keating, in May which is to run for three years.

This matter requires urgent clarification. I trust that the Minister will be briefed to clarify these questions. There are reports emanating from South Australia that participation in the community employment program is being made conditional upon applicants for employment joining appropriate trade unions, in some cases the Public Service associations. As far as I could see, there was nothing in the Commonwealth guidelines about such a condition of participation by the unemployed. I would like the Minister's clarification on this matter and his advice that it is contrary to the spirit of the scheme. There can be no basis for compulsory unionism by stealth.

The Minister will be aware that International Labour Organisation conventions protect freedom of association, but they eschew compulsion. Article 20 of the Universal Declaration of Human Rights provides that everyone has the right to freedom of peaceful assembly and association, but it further provides that no one may be compelled to belong to an association. This is the test to which members of the Government and members of the Australian trade union movement must direct their minds. If they believe in and support the Universal Declaration of Human Rights, they cannot in conscience condone the philosophy of compulsory unionism. The Opposition's position is clear: It supports a strong and virile trade union movement, but it must be based on voluntary membership. If the Government's objective is otherwise, it should be pursued directly and not by subterfuge, and particularly not at the expense of the unemployed who may be engaged only on a short term basis.

There were some figures emanating from South Australia suggesting that something of the order of $250,000 of the community employment program could find its way into the hands of unions through membership fees collected at $75 per head on the basis of the number of participants for South Australia. I think that is very significant. If $250,000 of community employment funds are to find their way into union coffers, I think that is a very real matter of concern and one that must be remedied.

Finally, I would like to raise another matter in relation to the Public Service Act generally. That is the Act that we are amending on this occasion. Yesterday during Question Time the Prime Minister (Mr Hawke) made it clear that the services of the present Chairman of the Public Service Board, Sir William Cole, would no longer be required. His term as a distinguished, non-partisan and independent chairman of the Public Service Board is to be brought to an end by the Government. There are widespread rumours which the Prime Minister has refused to deny, that Sir William Cole is to be replaced by that long term servant of the Australian Labor Party, Dr Peter Wilenski. The Government knows that the position of Chairman of the Public Service Board is a very sensitive one and it knows that the position has a great bearing on the performance and morale of the Public Service as a whole. That is why it is proposing to put one of its own followers into the position as Chairman. By doing so, the traditional independence of the Public Service, which is so essential if it is to provide the Government with objective, independent advice, will be seriously jeopardised .

I think the Public Service will be harnessed more to meet the subjective demands of the Labor Party than the Australian community if such an appointment goes ahead. I believe it would be disastrous and the manner in which it is being pursued casts very grave doubts upon the Government's credibility. This position needs to be explained. As the Minister has responsibility for the Public Service Board and the Act, as Minister Assisting the Prime Minister, I certainly hope he will take the opportunity in this debate to explain that matter to us all today.