PRIME MINISTER
TRANSCRIPT OF THE PRIME MINISTER, THE HON P J KEATING MP
JOINT PRESS CONFERENCE WITH LAURIE BRERETON, MINISTER FOR
INDUSTRIAL RELATIONS AND MINISTER FOR TRANSPORT,
MELBOURNE, 19 JANUARY 1996
E& OE PROOF COPY
PMV: Today, Laurie Brereton and I are publishing a statement on our policy
on Industrial Relations. It's called Flexibility and Fairness At Work, it's
a hIstory of the process of consensual iincomes policy, a history of the
Accor4 from 1983 about how the labour market has worked in the
years, what each Accord did, how it has produced a competitive
outward looking, low inflation, high growth economy, strong growth in
fact, and increased real wages. And we're doing it to make clear how
novel and unique this policy Is in the world, that no other developed
country has pursued such a policy and when one looks at the rates of
growth which we've had during these twelve years compared with the
previous seven years of the Coalition, we've doubled the rate of
economic growth in Australia and yet we've had a very large decline in
inflation. This Is an almighty achievement. Show me any country
where the rate of growth picks up to twice the speed and you'll see a
country with a lot of prosperity, and you can see that now in the stock
market, we can see it in the general sense of employment growth, we
can see it around the world.
In recent months I've quoted Robert Reich, the US Labour Secretary,
who talked about the conundrum of US policy, saying we've had a lot
of job growth in the United States but we've got an army of working
poor because there's no gatekeeper, there's no-one looking out for the
low paid, there are no standards and he made the point that in Europe
they've got rigidities and standards but the rigidities are such that they
can't get the aggregate employment growth, so there's very low
employment growth In Europe, quite high employment growth in
America but quite low wages growth, falling real wages. In Australia,
we've had the best of both worlds. Strong employment growth, rising
real wages and rising household disposable income so we must be
doing something right, we think we're doing something very right here.
And as the Coalition and their leader has this month made clear that
industrial relations and their view of it is a major issue for them so too
have we taken the opportunity to say exactly were the Government
stands in terms of the labour market, what our philosophy is, what the
record is and where we'll be going in the future.
I might invite Laurie at this point to add to and complement my own
words of introduction.
LIS: Thank you Paul. There is no doubt this statement reveals in detail the
Labor way, the way we've gone about pursuing industrial relations
through the life of the Government and it's really the reality of the
Labor way In contrast with the rhetoric of the last couple of weeks of
John Howard and Peter Reith.
The Labor way of course is known to everyone, it's embodied in the
Accord, every Accord from 1 through to Accord Mark 8 and it's
embodied In the Industrial Relations Reform Act which has now been
operating for law of this nation for almost two years. Everything you
need to know about the Labor way is in this document, everything that
the electorate needs to know about their security in employment is
raised in this document and the Industrial Relations Reform Act. It's
the forrula that has given us high growth, given us high productivity,
Its gil~ en us low inflation and its given us record low industrial
disputation. It's a system that the Opposition of course, as the Prime
Minister said this morning, now wish to radically after. They won't give
us more than the rhetoric but I think this document makes a very stark
contrast between the reality of Labor and the unknown and the
uncertainty of what you would have with a change to the system with
the removal of the role of the industrial umpire with this new world of
John Howard's of Australian workplace agreements which are now
revealed not as agreements at all, not collectively reached but simply
individual contracts under another name.
J* Prime Minister you suggested In your speech today that you gave the
example of where the IRC would not be able to operate under a
Coalition government, yet my understanding of their policy is that the
role of the IRC has been downgraded in wage fixation but it would still
be there In terms of industrial disputes. On what basis'do you suggest
this and are you saying that's what will happen under a Howard
government?
LB: If I could answer that. It's very clear that under a system of Australian
workplace agreements outlined by John Howard re individual
contracts, there is no role whatsoever for the Industrial Relations
Commission because their role of vetting agreements, as they do at
the moment. by applying a specific set of quite strict tests, to make
sure workers are not disadvantaged in that the no disadvantage test is
fully applied before the agreement comes into existence, would be out
the window. This is a power that is being removed from the
Commission, it's one thing to say..
PM: About conditions, wages and conditions, it's a different basis, what
he's making is a different basis on which they will be set in which the
Commission does not have a role.
LB: That's right and if the Commission cannot deal with the totality of the
problem and we have a Commission that fortunately today can, can
deal with the dispute, can use It's arbitral powers in this area of
contract employment, if it sees fit on a special case basis then what
have you got, you've got Industrial mayhem and you've got no solution
to what this nation faced in December of last year.
J: Mr Brereton will you be changing this policy or refining in any way in
the lead up to the election or would you
LB: I think our policy is absolutely clear, it's outlined in this document and
of course it's embodied in the Industrial Relations Reform Act. Where
it's been necessary, we've made a number of amendments to that Act,
one of which was to simplify the dealings With unfair dismissal so as to
make them as non-legalistic as possible and I might say that that was
a chanqe welcomed by employer groups in Australia, but it's a change
that of course does not satisfy John Howard who said even as altered,
he would remove those safeguards and destroy the protections
avallable to Australian working men and women.
So not only would we have on the one hand individual contracts, but
on the other, we'd have the right of the Commission to deal with unfair
dismissals using the powers, the external affairs power, greatly
reduced.
J: So that's...?
LB: This is our policy and the Industrial Relations Act is our way.
J: Mr Keating if the Opposition Will continually hammer the theme that
one of the costs of the Accord in relation to business the Government
Is continually kowtowing to the ACTU, how do you feel of that issue, on
ANL and things like that?
PM: How many Heads of Government around the world would like to, as Mr
Howard put it, kowtow to their unions for a two and a half per cent
Inflation rate? This is the sort of nonsense he goes on with about the
Government kowtowing to unions as if there is some sort of runaway
trade union movement. I mean it's a contradiction in terms to say
there is some sort of runaway power In the trade union movement with
the inflation rate between 2 and 3 per cent. It was 11I under him and
you see, they won't step back and recognise the fact, the ideology Is
so strong, they won't say well look maybe the Government's come up
with something In a decade. Twice the rate of economic growth is a
big achievement, I mean look at Germany, they're starting to slow
down now they think somewhere between I and 2 per cent for the
coming year. Look at a lot of these industrial economies, they're
growing in Australian terms quite slowly, yet we have doubled the rate
of growth that existed under the Coalition and we've cut inflation
markedly. Now these things can only be consistent with good wage
setting and wage fixing procedures. Ones which have an eye to
productivity and I gave the details in the speech, since 1991, since the
New Zealand individual wage contract legislation was introduced, New
Zealand productivity has gone up by I per cent, labour productivity in
Australia by 2 and a half. In New Zealand there has been I per cent
wages growth in Australia there has been 5 and I think you'd think the
Coalition would sit back and say well something good is happening
here, I mean something novel is being done, but they want to tip it out
and they want to go back to a system without collectivity, without the
right of people to bargain in a collective way. They want to push
people back to a labour market were the employers have the
bargaining strength and an individual person is left to the vagaries of
the courts.
J: Prime f1inister, following the last election that when you suggested
you Were going to move further on the labour market deregulation, are
you pledging and Mr Brereton that this is the policy, it will not be
changing after the election and you will not be moving to free up the
labour market any further than it is?
PM: I think that some of the people who Will write about that speech read
Into it things that they want to see, in fact what was there was the
policy we now have and what we've seen under this Government is a
movement away from a centralised system to firstly a big change to the
structure of awards, a radical restructuring of awards and then
amalgamation of unions and then to a system of enterprise bargains
which are productivity based with the safety net underpinning it, that's
where we've moved. If you go through this document you'll see in the
various Accords where we started to move away from the centralised
system In a sort of evolutionary way towards an enterprise bargaining
based system. This is the point that John Howard has never
understood, to get wage flexibil ' ity you must have it in a way which is
non-disruptive anid ' where all of the community feel they're
stakeholders in the process, that's what we have done. This idea that
you can cold turkey the system, that's what he tried to do and said he
was doing in the late 1970' s, and early 1980' s, letting it rip. Well it
ripped all right, what we had was a wage explosion and then a wages
collapse and double digit inflation and double digit unemployment.
What the Government has done has moved the system towards an
enterprise bargaining based system, wbat we're saying in here when
we talk about the future, on page 3 of the document, we're saying in
the future we Will see continuing workplace reform to improve
efficiency and flexibility through the extension of bargaining and further
reform of awards, sustained commitment to ensuring fairness and
effective protection through to the safety net etc. In other words we
are seeing tremendous sophistication in our enterprise bargains and I
just don't think the Coalition knows about this or understands it and
that's why such a high proportion of federal employees covered by
federal awards are now part of a bargain so the consistency, I think it's
worth just looking through at page 10 of this document where under
the Accords 1, 2, 3, 4, you can see where we're starting to shift away
from centralised system to an enterprise bargaining system and that's
going to continue but we're getting there without industrial disruption
and we're getting there with all the appropriate sensible protections.
J: In some areas, Prime Minister, wages in fact are starting to grow too
fast now under this system, are you sharing that view?
PM: Well, no, what we want is a high wage low inflation economy, what
John Howard wants is a low wage low inflation economy, that's the
difference and I mean I just spent a day or two in Singapore and there,
the average wage, that's national income per capita Is running at
$ 31,000. Now they haven't run a low inflation country by pushing
wages Pown, they haven't decided to deal with competitors in Asia by
having a low labour cost country, that's Mr Howard's view, it's always
been his view, what we've always said lers educate our people,
produce innovative products, get a premium for them and increase our
wages. Real wage Increasing but we're seeing still the control of
underlying inflation which means there is productivity in the middle.
J: Now that
PM: I think it's very hard to say, some of it has been the fact of the relative
growth of the services sector of the economy which has been more
difficult to organise I think, but certainly the growth is there. The most
telling statistic I used this morning was household disposable Income
per capita at 21 per cent over the period, I mean that's the most telling
statistic I think about the history of Labor in Government in terms of
Incomes in Australia.
J: Should the Government be paying attention to Union membership
declining so rapidly?
PM: No, I think that is for employees and their organisations to attend to
and to worry about and you know, in some of the areas, in hospitality
for instance which had enormous growth in employment in the 80' s it
was largely unorganised, I mean they were not, those people were not
joined up, and as a consequence In that part of the economy it
dropped.
J: But doesn't that mean, we have declining union membership, doesn't
that mean that many of these people are not covered by any
agreement registered before the Commission the only alternative
they have is the Court system anyway?
LB: No, on the contrary, under the Federal system almost 60 per cent are
in agreements and all are covered by an award so they've got the
comprehensiveness of the Australian Industrial Relations Commission
overseeing the whole of their working arrangements.
J. The Liberals that with the IRC and the award system..
LB: Not at all because they'll introduce an alternative which they call
Australian Workplace Agreements which are in reality individual
contracts which will be optional and will be used to undermine the
whole Integrity of the system because any new employee will be faced
with the choice ' take the contract or you don't get the job' and as the
Prime Minister said in his speech this morning, with 1.7 million
Australian workers facing a new employer every year with 40 per cent
of the whole Australian workforce facing a new employer in the course
of one 3 year term of Parliament, It won't be very long at all before not
only new employees but all employees would find themselves under
contracl arrangements rather than the* comprehensive safeguards of
the Australian Industrial Relations System.
J: Independent research indicates that up to a third of workplaces have
Informal agreements anyway as the situation works and you've only
got about a 100 EFA's so isn't that the situation in any case in reality
LB: No because we've got a comprehensive award system, one indeed
that's being updated at the moment, as you well know the Commission
have started their review, the insertion of flexibility clauses into the
award system of facilitative clauses into the award system, of majority
clauses into that award system as well as the vehicles of certified
agreement making and enterprise flexibility agreement making so
you've got a totally comprehensive system but one which would have
the guts ripped out of it by individual contracts being introduced on a
widespread basis as the norm for the first time. Now certainly, I don't
deny there are many workplaces who have chosen to provide
overaward payments and we welcome that and we've never said quite
frankly that there's no place at all for some sorts of contracts in the
workplace but the integrity of the system needs to have the
Commission overseeing all of the bargain making and it needs to
have the award system providing the essential underpinning and the
application of a strong no disadvantage test.
J: Prime Minister, we've listened to obviously a campaign speech, why
don't you put the election on what are you waiting for?
PM: You mean the election, you said, and others said Laurie, we were
going to have eighteen months ago.
J: I don't think I said that Prime Minister.
PMV: Well many did, the election budget, the election we were going to have
when we were clearing the decks with a republic, the Accord Mark 8
election, you mean that election.
J: I mean the one that's due now, when are you going to put it on?
PM: When it suits the country and the Government.
J: When will that be?
PM: W~ hen it suits the country and the Government.
J: Well you said in your speech this morning that that we're going to
face an election In between 2 and 3 months, the 2 and 3 months, does
that mean that you regard it as potentially legitimate for the
Govempinent to run to May?
PM: Absolutely, I mean I'm the one on the record all the time saying that we
should get the maximum value from these Parliaments, most of you are
on the record saying there's going to be any early election.
PMV: Well, not all of you, some of you, some noisy ones of you.
J: Is industrial relations going to be the major issue?
PMV: I think, it's very interesting that where the Coalition saw themselves
vulnerable In the runup to 1993, In the last week of Parliament, if my
recollection serves me correctly, or it might have been the last
business week of the year, John Howson Introduced Fightback Mark 11,
a more cuddly version of it because he thought he had major
problems with Flghtback. John Howard has done exactly the same
thing, instead of doing it In the last week of December he's done in the
first week of January. He's come off his leave, made a statement and
gone back on leave. He said Industrial relations is one of the key
issues of the election It not the key issue, he's made it such an issue
by doing that and we're entitled as a Government to respond.
J: Does it surprise you that he actually went so far in changing the policy
PM: You can't take it seriously, that's the point we're making, I mean he
either takes the position that he terms the high moral ground of saying
Labors taken Australia a long way in internationalising the economy,
in changing the whole culture of the country but it can't take the last
step of labour market reform, I will take it. That's the ground he saw
himself standing on, the high ground he's seen himself standing on.
He's now saying he doesn't stand on that high ground at all and his
supporters are entitled to ask, well in that case Mr Howard, on what
ground do you stand on. That is if you accept it but why did the ACCI
and the Business Council remain mute, because they know what they'll
get is what they got with Mr Kennett and Mr Court, they'll get the full
version, they'll get labour market flexibility downwards, they'll get the
cuts in the bottom 40 per cent of the workforce that they've always
been looking for and that's what will come. You can Imagine the
ebullience of a Coalition Government in office being held to account
for something they said in January of this year. John Howard has
always said people know what I stand for, people know the team and
they know what we stand for and what they stand for is radical labour
market change.
J: Prime Minister, the Court and Kennett strategies, does it worry you that
it might work again?
PM: No, because I think as the polls indicated quite eloquently during the
week, I think people can spot that kind of behaviour. I don't think
given Mr Howard's consistent, continued advocacy of this course of
action and for well over a decade, to find him now seeking to portray
himself as the manager of a policy similar to the Governments is
Incredible and unbelievable and that sort of twerpish behaviour Is I
think well spotted by the public.
J: Do you think it will take you three months to get that across or can you
do It in a three week
PM: The fact that we've got much of that across now brought him out in
January.
J: Inaudible
PM: Oh well, there are no easy political tasks are there, I mean none of
them are easy but again the results speak for themselves. We open
the new year with all the bald headlines in the financial press about
the stockmarket and In the end what is the stockmarket saying, they're
imputing higher profits into their calculations in terms of the all
ordinaries Index and that's coming from growth and restraint in wages
and Inflation and at the same time we had very strong employment
numbers. You know, you don't need a microscope to work out which
way the economy is going, that's strongly and forward.
J: The polling this week shows that more than 63 per cent of people
didn't support Howard but also thought you had been In office for
too long
PM-Yes but I mean the point about it is, as I always tell you about the
stubby pencils, you know they have their own particular aura about
them and when people get one in their hand they think about the future
and about their lives. I think it was very telling that after the
Government has been in office for 13 years, succession of Labor
government's for 13 years, such a high proportion of people thought
the Government had done well.
J: That's more important than the level of support?
PM: Absolutely, absolutely.
J1 Given that the polls have shown you consistently behind the Coalition
through the last 12 months, do you think the campaign will bridge that
gap
PM: I'm not ' about to say, you know what I say about polls, I'm always
offending the press gallery talking about only politicians can decipher
the polls and they can it's true. There are very few people in Australia
who can read polls, not just a pol but the public mood.
J: Can you start a campaign this far behind?
PM: Well, I'm sure John Major is going to start his campaign much further
behind than we are.
J: Everyone says he may not win...?
PM: No, but we are, he may not but we are.
J: Prime Minister has Jeff Kennett's industrial policies your campaign
PM: Well, I gave the figures today, the closure of the schools, the 8,000
teachers that have been dismissed and in the end what's happening. I
mean Jeff Kennett is putting chains on public toilets on railway
stations, he is turning the ambulance service out to private contractors,
he's lost sight of what his responsibilities are in running a civilised
society and I think Victorians understand this well.
Ends.