Subject:
Workplace reform, Australian Cricket Team
E&OE...
PRIME MINISTER:
Well ladies and gentlemen, Mr Hockey and I have called this news conference to announce a change to the Workplace Relations legislation which will introduce a stronger safety net for Australian workers. As you might imagine, the Government has very carefully monitored the operation of WorkChoices, the changes made to our industrial relations system more than a year ago and our conclusion is that these changes have been of enormous benefit to the Australian economy. They have strengthened the Australian economy; we've seen more than 270,000 new jobs created since WorkChoices came into operation. We have seen a continued rise in real wages, they have now risen by 19.8 per cent since this government came to office in 1996, compared with a miserable decline in real terms in the 13 years of the Hawke and Keating governments. And remarkably industrial disputes have fallen to their lowest level since 1913, the year before the commencement of the Great War, and speaking here in Melbourne, let me emphasise that there has been a spectacular decline in the number of industrial disputes in the building and construction industry, which was plagued in Melbourne and in Perth with industrial disputation. That is due to a combination of WorkChoices and the introduction and establishment of the building and construction industry authority flowing out of the first Cole Royal Commission, an authority which the Labor Party has promised, incidentally, to abolish.
Australian Workplace Agreements which were first introduced in 1996 under Mr Reith's reforms have now become an integral part of sectors of the Australian economy especially the mining industry and most particularly but not only in Western Australia. By the end of this year there will be a million Australians employed under Australian Workplace Agreements and the idea that workplace agreements should no longer be available as an industrial instrument will lead to chaos in sectors of Australian industry and it surprises me not at all, that the mining industry is aghast at such a prospect. The unfair dismissal changes have been a stunning success. They have led to the creation of thousands more jobs, they've been widely welcomed by small business and the changes we enacted in WorkChoices will remain intact and we will make no alteration of any kind because we believe them to be fundamentally very desirable and very successful. The introduction of a national system has been a great success. It has been validated by the decision of the High Court of Australia, legally that is, and constitutionally in the face of a challenge from the states.
Now the Government's aim is to lock in these reforms so that the benefits flowing from them can continue to strengthen the Australian economy. I emphasise that because the changes I am about to announce will in no way alter the fundamentals of the reforms and indeed because they will meet community concern in a particular area, they will in fact act to consolidate and lock in the reforms that we have introduced.
One area of concern has emerged and that is the possible impact on take home pay of the loss, through trading off without adequate compensation, of such things as penalty rates and overtime payments. It was never the intention of the Government that it might become the norm for these to be traded off without adequate compensation. They weren't included, in other words we did not mandate penalty rates and overtime loading and the like, in the standard under WorkChoices because that would have reduced flexibility because it has long been the case under union agreements and non-union agreements that penalty rates are traded off in return, for example, a higher base rate of pay, or some other change to working conditions. And none other than a prospective Labor Party candidate in the Hunter Valley, Mr Greg Combet, has boasted about the capacity of unions to bargain away penalty rates in return for other things. So there is nothing revolutionary about that particular concept. But perhaps I could encapsulate the essence of the message I've got and what I've heard as I've listened to the Australian community. What people have said to me is, Prime Minister these reforms seem pretty good for the economy, there's a lot of new jobs and small business like them, I haven't been affected by them, I don't know anybody who has been affected by them, but I hear that they might affect people and I hear people are worried that they might one way or another have their penalty rates taken away or their overtime payments affected without getting something in return and, you know, if I'm getting $1100 a week and some of that's penalty rates and overtime and I've taken out a mortgage on the strength of that I don't want those penalty rates or that overtime interfered with. Now that's a message that's come through to me from the community. People are not themselves directly affected but they hear that some are and there's an apprehension so we're going to act in response to that and we're going to give a reassurance in relation to that and we're going to make sure, we're going to guarantee through the changes we're making, that if things like penalty rates are traded off there is fair compensation given in return and I think that's only fair in itself. So we're going to introduce into the law a new fairness test and that's going to guarantee that where there is a trading off of things like penalty rates and overtime payments there's proper compensation, fair compensation given in return. Now this test will only apply to incomes below $75,000 and it will only apply to areas of employment that are covered by awards.
As you will know the awards themselves provide for the penalty rates and the overtime and how it will work is that in relation to any agreement - AWA or collective - lodged after midnight on the 7th of May, that's midnight on Sunday, there will be an examination made of that agreement as happens now and where the agreement is silent on the protected conditions, things like penalty rates and overtime, well nothing will be done, it will just go through because under the existing law the award provisions in relation to the penalty rates etcetera apply. But where the penalty rates etcetera are taken out or are modified in any way there'll be a fairness test and the fairness test will inquire whether adequate compensation has been provided in return. Now in the great bulk of cases that compensation will take the form probably of an increase in the hourly rate to take account of the non payment of penalty rates but the compensation can take a non-monetary form and in examining whether adequate compensation's been paid the authority will have a look at all aspects of the agreement. In some cases extremely flexible working arrangements can be given in return for the non payment of penalty rates, in other cases additional entitlements can be given.
It can be the case that a particularly beneficial arrangement is made by a parent in relation to leave to do things concerning their children in return for an understanding that if that parent is required to work at irregular hours then penalty rates are not to be paid. Now these are all assessments that will be made. The economic circumstances of the firm can be taken into account, the employment opportunities and experience of the individual employee can be taken into account but it would be my belief and the belief of the government that in the great bulk of cases the judgement would be made in relation to monetary matters but I would not want to exclude non monetary ones. We're going to make a couple of changes in nomenclature. We're going to rename the Office of the Employment Advocate the Workplace Authority. It expresses in plainer, less complicated language, precisely what that body will do and we're going to rename the Office of Workplace Services the Workplace Ombudsman. And the bigger document that I'm going to give all of you at the end of this news conference will set out the changes in detail and will allude to a couple of other amendments which are very much in the character of fine tuning that reinforce existing provisions and are a consequence of the major change that I'm announcing today.
I should also indicate that there will be a public information campaign to explain the details of the changes and to reinforce in the minds of the public the protections that are available under the present law. I think this is a very good change. It's a change that will give added protection and reassurance to people. It's a change that does not in any way undermine the fundamentals of the legislation and undermine the quality of the reform that the legislation represents. We have come a long way in industrial relations in this country and the notion of turning back to a union dominated industrial relations system clearly has alarmed many people in the business community, but that alarm goes wider than the business community. People are worried that Labor's policies will replace a system that has elevated the importance of individual agreement making at the workplace above the influence of union bosses and the primacy of union power.
I think the attitude of the ACTU towards Australian Workplace Agreements and the transparent power bid that is involved in Labor's policy was best revealed the other night when Mr Combet admitted on television that people were better off under AWAs in the mining industry but notwithstanding that, he wanted them abolished. There was only one explanation for that and that is he's more interested in union power than in the remuneration of Australian workers. Now that is the essence of the union position, it's the essence of the Labor Party position. Our position is very different. We are interested in the remuneration and the conditions and entitlements of Australian workers and the profitability of the businesses that employ them because the two are linked. Unprofitable businesses cannot deliver high wages for their employees and we will always put those two things above the power of organised groups in the Australian community, be they organised business groups or organised trade unions.
Can I conclude my press conference by thanking Mr Hockey for the great contribution he has made over the past couple of weeks and much earlier than that as well, of course, in discussions with me and the putting together of these reforms. I think they're good. I think they will reassure some people. They are fair, but they don't disturb the quality of the economic reform represented by WorkChoices. Any questions?
JOURNALIST:
Prime Minister is the fairness test applied to new employees?
PRIME MINISTER:
Yes. I couldn't understand what Julia Gillard was getting on about. I mean we won't disturb any existing arrangements, you can't do that, but anybody newly employed will of course be covered and anybody going to a new job will of course be covered because it catches any agreement lodged and you have to lodge agreements; that's part of the existing law. But it doesn't apply to existing agreements. But I couldn't understand what Ms Gillard was getting at this morning when she said it doesn't appear to include new workers. I mean...
JOURNALIST:
Mr Howard when WorkChoices was announced you said that no Australian worker would be worse off under them. But isn't this a concession that....?
PRIME MINISTER:
No, no, could I tell you I didn't say that. I was invited to give a guarantee and I didn't. And I think it's unrealistic to guarantee that nobody's going to be worse off. Nobody can give that guarantee; you don't know the circumstances. The guarantee, one can give more limited guarantees but I believe that it's reasonable to assert that as a result of these changes we can guarantee fair compensation for people who might trade off their penalty rates and their leave loadings. But as for an aggregate guarantee, look people who give those guarantees are being very adventurous.
JOURNALIST:
Prime Minister, people who sign new AWAs will have guarantees, or will be compensated for trading away conditions. What do you say to people who have already signed AWAs and have lost conditions and now can't...
PRIME MINISTER:
Well I don't accept that in all the cases where the penalty rates and the like have been traded off people are necessarily worse off because in many cases people have been given other things in return, but it is just not realistic to reopen existing agreements. When the former Government changed industrial relations laws they didn't reopen existing agreements and it would be chaotic to try and reopen existing agreements.
JOURNALIST:
So they will have no recourse to get those conditions?
PRIME MINISTER:
Well the assumption in your question is not one I automatically accept.
JOURNALIST:
Prime Minister, can you just outline some more about the public information campaign? How much it's been, what form it will take and how long it will run?
PRIME MINISTER:
Oh I can't tell you how long it's going to run. I mean it will be whatever is necessary to properly explain these and also to communicate the protections that are available under the legislation. I mean it won't be political in the sense that we won't be attacking the Labor Party, we won't be attacking the trade union movement; it wouldn't be ethical to do that. But according to the guidelines under which government advertising operates in this particular respect; and incidentally they're 1995 guidelines that were laid down by the former Labor Government, it's perfectly legitimate to run a public information campaign to explain the impact of Government legislation, particularly a new provision, and also to factually correct inaccurate allegations that have been made about existing Government policy.
JOURNALIST:
Mr Howard, doesn't this change prove Labor's point that WorkChoices did leave some workers worse off?
PRIME MINISTER:
What this proves is that I am a Prime Minister who listens to people's concerns. I mean people have said to me that they are not themselves worse off, and they don't know people who are but they are concerned in this area surrounding penalty rates and overtime payments. And I have heard that and I am doing something about it. I mean the Labor Party can say what it likes. No matter what I do, the Labor Party will attack it. But I am just telling you why I have made these changes and what my motivation has been.
JOURNALIST:
So obviously some people are being adversely affected?
PRIME MINISTER:
Not necessarily. You see the paradox in this is my mail from the community is, and this has been the experience of individual members and as you can imagine I talk to my colleagues on a daily basis, and they say well we haven't had people coming up and saying I've been affected but they have this general idea that others might have been and they particularly refer to the issue of penalty rates and overtime payments. Now I mean they are crucial to the take-home pay of the average Australian, particularly in the booming economy. People are being asked to work a lot of overtime and weekend work and people take the opportunity of doing so, it helps to pay the mortgage. And if you have built into your mortgage commitments $150 a week for penalty rates and overtime you don't want that at risk and I understand that and I hear people and this will give them a lot of reassurance.
JOURNALIST:
Prime Minister, just on another issue, last night the Bracks Government passed its controversial stem cell research bill which means that (inaudible). What are your comments?
PRIME MINISTER:
Well that's a free vote. When this matter was debated in the National Parliament I voted in a very conservative fashion, as is my want on these matters, but it's a free vote and some of my colleagues voted with me and some of my colleagues didn't. That's alright; it's a free vote and the law will take its course. I don't have any special comment to make on what the Victorian Parliament has done. There was a free vote in the Victorian Parliament and these matters should be decided on a free vote. They're not things that mandate a Liberal position or a Labor position. People should vote according to how they feel and I respect that and they're normally quite good debates and they produce some interesting positions.
JOURNALIST:
Prime Minister, you mentioned you'd been working with Mr Hockey for the past fortnight on this package. How long have you been actually looking with some concern at the issue?
PRIME MINISTER:
Oh I can't sort of think of a particular date John, just over past weeks. I listen to people, I talk to my colleagues, I get letters, I run into people in the street and at RSL clubs and so forth and people talk to me and communicate their views.
JOURNALIST:
Prime Minister, how will fairness be judged by the new authority?
PRIME MINISTER:
Using good Australian commonsense.
JOURNALIST:
So there won't be an objective...?
PRIME MINISTER:
There will be a lot of similarities, and I don't want to push the analogy too far, but there will be a lot of similarities between the way this fairness test is applied and the way in which the no disadvantage test was applied and that involved the application of a commonsense judgement as to whether the aggregate benefit of the award was matched in the Australian Workplace Agreement. So I don't think they come to this as rookies, I think they come to this with that background and that was only a little more than a year ago. So I don't think they'll have any difficulty. But you apply a bit of Australian commonsense and people experienced in this area can make a judgement as to whether fair compensation has been given. And I repeat, this has been happening for years. The unions have been negotiating away penalty rates and overtime payments and certain agreements for a higher weekly rate or this, that or the other and they've been boasting. I mean I am not criticising them, I am not the least bit critical because it makes sense that it occur because it's all part of additional flexibility.
JOURNALIST:
Prime Minister, are you happy to keep tinkering with WorkChoices?
PRIME MINISTER:
Well look, I'm not ever ruling out, with something like this, further fine tuning. I mean this is a...if you ask me, is this fine tuning? I think it's a bit more than that but not the matter, it's a question of whether it's good for the working people of Australia or not and I think it is good and that's why I'm doing it. As to the future, well I think I made it very clear from my introductory remarks that I'm pretty attached to the fundamental reforms of the legislation. But further fine tuning, no I don't rule it out, it's never wise to do that because I don't know what is ahead as far as developments in this area of the law.
JOURNALIST:
Prime Minister the changes driven by direct evidence of abuse or is this a perception issue?
PRIME MINISTER:
Overwhelmingly by the perception. I mean they are very much what I call, you know, it's anticipatory reassurance rather than a direct response to clear evidence of abuse. I mean the great bulk of employers I talk to are doing the right thing, they...I ask them what they're employment arrangements are, so they say oh look, you know, we pay the award and a lot more, some will say we've got an AWA which is way above the award or we've got a collective agreement with our workforce, in some cases we've got a collective agreement with the union, it's a variety and that's the experience I have. But there is this perception in the community, even though the personal experience is as I have relayed it, there is this perception in the community that there might be situations where people are vulnerable to having their penalty rates and overtime loadings traded away or taken away without adequate compensation. Now I don't want that to happen and it was not the intention of the legislation that that might become the norm, we didn't want that.
JOURNALIST:
Prime Minister will we see any more changes before the election?
PRIME MINISTER:
Well I was asked earlier would I rule out further fine tuning, and no I won't, I mean you never do that with a major piece of legislation. Workplace relations law covers a whole lot of things and the idea of saying, well look I'm categorically saying there'll never be further changes between now and some date in the future, I'm not going to do that because you don't know what is going to emerge in the context of something like this, that directly affects the way we live our daily lives.
JOURNALIST:
You mentioned a couple of other minor changes, what are they?
PRIME MINISTER:
Well there's one to strengthen the duress test and there's one to put beyond argument that where there's a change in relation to the ownership of a business that....just let me check it, it was always the intention that an employer who takes over a business cannot require an employee to sign an AWA as a condition of continued employment, that was always the intention and to ensure certainty in this area, the act will be further amended to make this abundantly or more abundantly clear. That's the sort of thing I was mentioning.
JOURNALIST:
Can I just ask what the message is to the business community, given they've been strong advocates of WorkChoices?
PRIME MINISTER:
Well my message....
JOURNALIST:
Are they being assured of certainty in this area, given the change?
PRIME MINISTER:
Well they can speak for themselves. I did and Mr Hockey did consult people in the business community about these changes, but they'll speak for themselves. But what is my message, my message is that the fundamentals of WorkChoices remain completely intact. Small business can breathe easy that under the Howard Government there'll be no reinstatement of the ludicrous, draconian, unfair dismissal laws of the Keating-Brereton period, and larger corporations, particularly in the mining industry can rest assured that under the Howard Government there will always be AWAs, that we believe they're integral to the mining industry and collectively the entire business community can rest assured that under the Howard Government there will not be a reintroduction and reinsertion of unwanted union power into every conceivable workplace negotiation because if you read the fine print of Labor's policy, that is what will happen under a Labor government. I mean Julia Gillard wasn't joking when she said in announcing the Labor Party's policy, or explaining it rather, that this new body they have in mind, Fair Work Australia, might need to have an office in every suburb. I can't think of anything more Orwellian for small business in this country, the idea of having an office of Fair Work Australia in every suburb and the difference between our policy and Labor's is chalk and cheese. Ours in a policy based on individual choice and continued economic prosperity. Labor's policy has been dictated by the unions, who in the words of Mr Combet think it's about time they started running the country again.
JOURNALIST:
Mr Howard just on cricket quickly. The Australian team are to go to Zimbabwe to play their one day matches. What's the situation? Is that...
PRIME MINISTER:
Well this is an issue of a lot of concern to me and I believe a lot of people who love and follow cricket. I did discuss the matter yesterday morning at the breakfast welcoming home the Australian team with Mr Creagh O'Connor the Chairman of Cricket Australia and also briefly with Ricky Ponting. I told them that the Government would continue to discuss the issue with Cricket Australia. We were concerned about the deteriorating position in Zimbabwe. I indicated that if Cricket Australia were to cancel the tour in response to a strong request from the Government, the Government would indemnify Cricket Australia against any financial consequences reasonably incurred as a consequence of that cancellation; that we hadn't made a final decision but he had some idea of the drift of our thinking. I said that I wanted to know the views of players. I indicated this to Ricky because I have got the strongest possible view that the players shouldn't carry the burden of making a decision in relation to this. On the other hand, the Government should be informed by the players' wishes and I imagine that like any other group of Australians the players have a diversity of views. Some of them would want the tour to go ahead and others mightn't but nonetheless I would pay the players a compliment of wanting to know their views. We'll have further discussion with Mr O'Connor and James Sutherland, the Chief Executive of Cricket Australia, before doing or saying anything else. But the situation in Zimbabwe has become quite catastrophic. The failure of neighbouring African countries that have the power to do so to bring about a change, and the only change that can help Zimbabwe is the immediate departure of Mugabe as President. His continued presence is disastrous for the country. Its appalling living standards, its hyper-inflationary rate which has reached the proportions of what I read about in the Weimer Republic when I studied German history at school and it really is quite a sad situation from the country that was once a bright and shining hope in Africa.
JOURNALIST:
Is it fair to say that...?
PRIME MINISTER:
It's fair to say that you report what I have just said. Thank you.