LAWS:
Prime Minister, good morning.
PRIME MINISTER:
Good morning John.
LAWS:
Nice to talk to you and thank you for being available for us. I wanted to talk to you about the industrial relations moves that you're intending to make. Are you driving this package to provide a better deal for Australian workers or a better deal for Australian business?
PRIME MINISTER:
A better deal for Australian workers and Australian businesses because their prosperity is dependent on the strength of the economy. No industrial relations system can save a worker's job if the economy is in recession and no flexibility can enable an employer to make a profit if the economy is not functioning well.
LAWS:
Okay, but you're not suggesting that the economy will go into recession?
PRIME MINISTER:
No I'm not but I am suggesting this; that unless we make further reforms to industrial relations, to workplace relations, the current level of productivity which is underpinning our economic prosperity will not continue. The reason I want to change our workplace relations system is to maintain the productivity gains of recent years, to give us a new burst of productivity so that in five years time, ten years time, the economic strength we now have will be maintained. That's the reason, above everything else, that I want to make these changes. What we have at the moment is really the product of the changes that have been made over the last decade or so, but we need to make further changes because it's a never ending race - the battle to maintain economic strength and economic prosperity. And if you look around the world, the countries that have the freer, more flexible labour markets are the countries with the lowest levels of unemployment and the highest levels of productivity. And just by way of comparison, when all of these changes have been completed, Australia's industrial relations laws will still be more regulated than in either New Zealand or Britain - both of which are governed by Labor governments.
LAWS:
Are you actually on target to get this legislation ready by October?
PRIME MINISTER:
That's the advice, that the legislation will come in in October. We've given a general outline of it but obviously until the detailed piece of legislation is presented, people are going to run fear campaigns. I accept that. They're wrong. But in a sense, until the legislation is in, they're going to continue to do that. But I want to make it plain that the purpose of this legislation is not to advantage either the employer or the employee. The purpose of this legislation is to add to the future economic strength of Australia because we are living in a competitive world and we have to have more flexibility, we have to encourage workers and their bosses to make agreements at the workplace level. We had a debate a couple of days ago about parental leave. Now at the end...
LAWS:
But that couldn't be a possibility, could it?
PRIME MINISTER:
Well look John at the end of the day that has got to be dependent upon circumstances in each workplace.
LAWS:
Exactly.
PRIME MINISTER:
You can't hand down a tablet from the mountain on something like that. And I know from my own experience of talking to people, and also years ago when I was an employer myself in private business, and of course equally now with a large office staff, if you've got a good employee...
LAWS:
Yeah you're going to take care of them.
PRIME MINISTER:
You will give them all the time they can reasonably need for anything in order to keep them.
LAWS:
Well the ACTU already has Australian workers persuaded that the reforms are going to be bad for them and they say it's not a scare campaign. They say it's a truth campaign.
PRIME MINISTER:
Well look I understand that, but they do have a political agenda. The Labor... the ACTU said the same thing about the changes we introduced of a more limited form, because we didn't have the numbers in the Senate, nine and a half years ago. They said that was going to lead to a reduction in living standards. They said that was going to drive unemployment up. The reality is that we have the lowest unemployment in 30 years and in the time I have been Prime Minister real wages have risen by 14%.
LAWS:
Yeah but what's real wages?
PRIME MINISTER:
Real wages is wages over and above inflation. In other words, a genuine gain. I mean if inflation goes up by 3% and your wage goes up by 3%, you haven't had any real wage rise. But if your wages go up by 7%...
LAWS:
Yeah you have.
PRIME MINISTER:
...inflation goes up by 3%, you've had a 4% gain. And what I'm saying is that over the nine and a half years, wages have risen 14% more than inflation. That's what I'm saying. Now that is compared with about 2% in the 13 years of Mr Hawke and Mr Keating.
LAWS:
Can you give a guarantee that the minimum wage won't be eroded?
PRIME MINISTER:
Well I can certainly give a guarantee as I outlined in the Parliament a few weeks ago, that the benchmark for future adjustments of the minimum wage will be the minimum wage determined by the most recent decision of the AIRC. It can't go beyond that. Now obviously the quantum of adjustments above that will be a matter for the Fair Pay Commission to determine over time.
LAWS:
So you can give a guarantee that the minimum wage will not be eroded.
PRIME MINISTER:
I can give a guarantee that it will always be above what was determined in the most recent case. As to how much it will be above it, will be a matter for the Fair Pay Commission.
LAWS:
Okay. What about long service leave? There's concern that that may not be preserved. Will it be?
PRIME MINISTER:
Well the long service leave is guaranteed in state legislation and we have no intention of overturning that legislation, none whatsoever.
LAWS:
I suppose a lot of this is going to depend on the ability... so just back to that, long service leave is not going to be affected in any way?
PRIME MINISTER:
No.
LAWS:
People are concerned, and maybe rightly so. Won't it come down a lot to the individual worker's ability to negotiate? I mean if you're a good talker, you'll have a bit of hope. A lot of workers will have bosses walking all over them.
PRIME MINISTER:
Well I think the starting point is to recognise that for the first time perhaps in my lifetime we are living in an employee's market. This country is now short of workers. It's very short of skilled workers. And all of the talk up until quite recently has been about how we encourage people back into the workforce or kept them in the workforce. Now doesn't that tell all of us that for the first time in a long time we are living in an employee's market? Now it has always been the case, it is now, that some people are better at talking for themselves than others, and it will be the case in the future. What is important is that you have guaranteed minimum standards, and we'll have those, below which nobody can go. And isn't it also important that you're not forced to talk for yourself if you don't want to?
LAWS:
No, you can go...
PRIME MINISTER:
You can have a union official, you can have your brother, you can have your solicitor, your priest, anybody you like, do the negotiation for you. So any suggestion that a person is on their own is wrong. And then the other point I would make is that if you are already on an award, you're an existing employee on an award, your boss cannot say to you - sign this agreement or I'll sack you. He can't do that. That's unlawful now and it will be unlawful in the future. And to that extent, those ads the ACTU has been running on television where the bloke is presented with a bit of paper and the boss says sign here, and the bloke says I've been here 15 years...
LAWS:
Yeah well that's...
PRIME MINISTER:
That is wrong. That is completely dishonest, and the ACTU knows that.
LAWS:
But it's not wrong in the case of a new employee...
PRIME MINISTER:
No, but that's not... that's the case now. Under the existing situation - which everybody says is, now says is marvellous, because it's a bit different from what we propose in the future - under the existing situation an employer has the right to say well we would like you to be on a workplace agreement rather than on an award. Now whether they end up on a workplace agreement or an award and what the terms and conditions of that workplace agreement are going to be, will vary according to circumstances and will be a matter of negotiation. But that is the situation now. It's interesting in relation to this that the big change that the unions and the Labor Party want is a situation where if you have a firm that's got 100 people in it and a majority of those people want to be on... want the firm's arrangements to be covered by a collective agreement and not by individual agreements, they would seek to deny the minority the right to have individual agreements, which we think is quite unfair. And that's an issue that's been debated in relation to universities and it was a flash point of debate last year when we were debating the university changes. But under the present law, a new employee has to... he changes job or you come to the labour market for the first time, you go to your employer and sure that employer can say well I'd like you to be on a workplace agreement, but that's the present situation. We're not changing anything in that regard. But it is the situation now that if you're employed under an award, it is illegal for somebody to threaten to sack you because you won't sign a workplace agreement. That is prohibited now and it will remain prohibited in the future. But one of the things that I would like to see happen in this debate is for us to look at the positive side of better relations between workers and their employers, and I think we both know that you cannot regulate from on high to make people nice to each other.
LAWS:
No.
PRIME MINISTER:
That in the end, good workplace relations is the joint responsibility of both, but a lot of the leadership and the initiative has got to come from the employer. And it is a universal reality that if you have good staff...
LAWS:
You'll look after them.
PRIME MINISTER:
You treasure them, you protect them, you remunerate them well, you look after them. I mean that has been my experience both working as a lawyer years ago and employing a few people, and having worked under what I might loosely call public sector working conditions. I have had staff that I will move heaven and earth to keep because of their value to me. I don't care what they get paid.
LAWS:
Yeah well you don't because we're paying.
PRIME MINISTER:
Well okay you make a point. But I mean that would be true of a private sector employer.
LAWS:
To a degree. You've stated that no existing employee will be forced onto an individual contract. But employers will be able to force new employees...
PRIME MINISTER:
They can now.
LAWS:
They can now?
PRIME MINISTER:
They can now. When you say force, I mean an employer has a right to say to somebody now, who is joining them for the first time, well look I'd like you to sign an agreement, a workplace agreement. Now they might... you know, some employers don't do that, some do. It depends.
LAWS:
Yeah. So it's still take it or leave it.
PRIME MINISTER:
But I mean to a large extent that's been the case for years. You say take it or leave it. But I mean the fact is that in the present labour market most employers are desperate to get good staff. That's the point I go back to, the point I made right at the beginning in my remarks, that in the end what really matters is the strength of the economy. That's a greater guarantor of job security than anything else. I noticed the other day that the new Premier of New South Wales said that he was influenced by the sadness he felt when his father lost his job in the recession of the early 80s, and I respect that and I would have felt exactly the same as he did in similar circumstances. But I just would... and he used that as a justification for opposing my changes.
LAWS:
Yeah well they're talking about going to the High Court.
PRIME MINISTER:
Yeah but I mean can I just make the gentle point that his father lost his job under the industrial relations system that Mr Iemma wants to go back to. I mean the industrial relations system that obtained in the early 1980s was a highly regulated, union dominated industrial relations system. Now we have changed it a bit. We want to change it a bit more. But the point I simply make is that all of that regulation and protection didn't prevent a million people being thrown out of work and the reason for that is that the economy was weakened, and the economy in part was weakened in my view at that time because we didn't have a good industrial relations system.
LAWS:
I'm told that if you want a job in Kevin Andrews' own department, you either agree to a workplace agreement or there is no job for you.
PRIME MINISTER:
Well I am told that there is a mixture of people, some employed under workplace agreements and some employed by collective agreements.
LAWS:
And can it be that way now?
PRIME MINISTER:
You often have places now where you have collective agreements and some workplace agreements, yes. And I want to keep it that way. It's the unions who want to change that. The unions want to say that if you get 51% who want a collective agreement, then the other 49% have got to be covered by that collective agreement too. I don't agree with that.
LAWS:
How can you say that public holidays and meal breaks are going to be protected, when you'll be able to bargain all but five minimum conditions on pay, ordinary working hours and leave entitlements?
PRIME MINISTER:
Well at the present time you can bargain in relation to meal breaks and public holidays, and you'll find when the legislation comes in that we're going to preserve the existing arrangement in relation to that, because that is the situation that obtains at the present time.
LAWS:
But if you sign a workplace agreement, an individual workplace agreement, and you're desperate for a job and you want that job, and the employer says okay but we don't have any lunch hours or we don't have any morning tea breaks, I mean you're in an invidious position.
PRIME MINISTER:
Yeah well I think you'll find when the legislation comes out that you won't be able to do that. I mean at the present time there's a capacity to bargain and if you... the way you describe it, you might equally say that obtains at the present time. But the reality is that in the swings and roundabouts, that doesn't happen. I mean everybody is entitled to reasonable treatment in relation to meal breaks and we don't intend to change that.
LAWS:
The new laws, from what I've heard, I think... I've got to tell you that I think that Kevin Andrews shot his bolt a bit early on this. Don't you think?
PRIME MINISTER:
No I don't. In what sense John?
LAWS:
By starting to talk about it too early when it's still quite a mystery in many ways.
PRIME MINISTER:
Well that's not... that wasn't just Kevin Andrews' decision. I mean I accept responsibility for that decision, the whole Government does. But you can't bring about a major change like this other than the way we have done it. If we had decided to prepare the legislation before we made any public announcement, that would have been a public relations disaster because...
LAWS:
Isn't it now?
PRIME MINISTER:
No, certainly not. And the reason why it would have been a public relations disaster would have been that inevitably something would have leaked out. We've got about 100 people working on the changes to this legislation, and the idea that you could have kept that secret for two or three months... something would have leaked out and then the papers would have been screaming - Howard's secret plan to do this, that or the other. The only way you can handle a major announcement and change like this is to announce the outline of the change, and we provided in my statement to Parliament a lot of detail, and then follow it up with the detailed legislation. And in the course of the public debate that then goes on, you explain the broad outline, you get a lot of questions that you can't finally answer in detail until the legislation is produced. Now I know that produces opportunities for our opponents, but there is no alternative. The idea that we could have prepared legislation in secret, without having announced to the public that we were going to alter the industrial relations system, we would have been legitimately accused of bad faith and of deceit and of hiding something from the public, and that would have heightened the suspicion that we were trying to do something of which we were vaguely ashamed. Now we're not ashamed of these changes. I am very proud of what we have achieved to date and I believe that these changes will guarantee that in five years time, the productivity levels of our economy will be as strong as they are now or stronger, and as a result there will be lower unemployment and there will be higher real wages. I mean that is my very strong belief.
LAWS:
I'm aware of that and it's a belief that you've had for years and years and years, and I'm aware of that too. And I know that you're committed to it.
PRIME MINISTER:
But I'm not doing this because I've had a 30 year commitment to it. I'm doing this because I think it is good for Australia's future.
LAWS:
Okay. Can you guarantee that no worker will be worse off?
PRIME MINISTER:
John, I have been asked that before.
LAWS:
I asked you years ago...
PRIME MINISTER:
And I cannot do that. There are 10 million workers in Australia and I do not know what their 10 million individual circumstances are going to be in the future. I can't do that and I'm not going to try and play that game. But what I can say is this, that this will not result in real wages falling or in unemployment going up. That's what I can say. But as to the individual circumstances of 10 million workers, I can't give a guarantee in relation to each individual worker. I mean I don't know what circumstances might affect their workplaces or their (inaudible). A firm can be badly managed and everybody loses their job and then somebody comes along and says oh that's the fault of Howard's industrial relations system. It's got nothing to do with Howard's industrial relations system. You can only ever credibly give guarantees about the general impact of changes of this character.
LAWS:
Bill Heffernan, who I think is a terrific bloke but he can be a bit of a larrikin when he wants to, did he give Barnaby Joyce a tough time yesterday?
PRIME MINISTER:
Well John, Bill is a good bloke and Barnaby is a good bloke. They're both good blokes and they're both my blokes as far as I'm concerned. And I have to say that those newspaper reports were a bit over the top, they were a bit embellished. You'd have thought it was, you know, seconds out of the ring. It was nothing of the kind. But look I am delighted that the Government has a majority of one in the Senate. Everything's relative, as you know, and this is a darned sight better than what we had before where we were in a minority. And it hasn't gone to my head. We'll have a lot of vigorous internal debates. There's nothing wrong with that. I've got a party of individual men and women. They have their strong views. There are differences in the party room. I make no bones about that. There always have been, always will be, and I hope there always will be. We don't impose the ironclad discipline. We don't run a political party where our leader is determined by the head office of our organisation, as appears to obtain in some parts of Australia with the Australian Labor Party. We run a party where people are entitled to express their views and I have no doubt that the Government will continue to preserve the unity and cohesion it's had over the last nine and a half years.
LAWS:
Do you think that Barnaby Joyce would cross the floor?
PRIME MINISTER:
Look what he ultimately does is a matter for him. All I do know is that he's very pleased to be part of the team and I'm delighted to have him because he's a member of the National Party, and the Liberal Party and the National Party work together very closely. And he represents a point of view within the National Party; it's legitimate and it should be listened to. We listen to everybody's point of view and then we make decisions. And we've got a few issues. We'll work through them and we'll just see what comes out of them. But I am so pleased that we won four out of six Senate seats in Queensland and I obviously welcome all of my new colleagues - Russell Trood who is the Liberal from Queensland, as well as Barnaby, they're new members and I welcome both of them.
LAWS:
Okay. So long as they behave themselves.
PRIME MINISTER:
Well John, I've been in this game long enough not to sort of be governed in these things by a few statements and a few headlines. You work through the issue, and I have found over the years that if somebody has got a strong point of view on something and you spend time listening to them, you can normally work out an accommodation which meets their concerns, but equally is consistent with the overall principle. Now I'm not saying that you can apply that in every situation, but generally I've found that to be the case.
LAWS:
Do you have any plan... and I know you're in a hurry so this will be the last one.
PRIME MINISTER:
No that's alright.
LAWS:
Do you have any plan to dip into the $9 million surplus to lower the Government's tax rate on fuel to temporarily at least alleviate the problems that the people in the bush must be having? Because the cruelty there is that they pay the same price for fuel... they pay the same amount in tax, income tax, as people in the city pay, but they don't pay the same price for fuel or other commodities. Shouldn't they be given a break? And they are in drought.
PRIME MINISTER:
Well they've been given a lot of help in relation to the drought.
LAWS:
Well...
PRIME MINISTER:
No well hang on, okay you're going to talk about those headlines in the Sydney Morning Herald. All that indicated was that not as many people met the criteria for entitlement to the drought aid as we originally thought. It might also reflect the fact that the original provision allowed for a lot more people than in the end needed it. But the answer to your question is we don't currently have any plan to do that. I mean I'm always cautious about saying we're never going to consider this or that. But we don't have any current plan to do that and we did make of course a number of changes to the excise arrangements several years ago. We cut the excise and we removed the automatic indexation of excise. Now if that had not been done, everybody would be paying now a lot more for petrol than they are. And I'm very aware of how high the cost of petrol is.
LAWS:
But in the country areas it's worse. And the thing that...
PRIME MINISTER:
Well it is higher, but of course in relation to diesel, which is used more widely in the country, there are some concessional arrangements which in proportionate terms would benefit farmers and people in country areas more than they do in the city.
LAWS:
Yeah but the thing that really bothers me about the people in the bush - and they're important to us, we wouldn't have much on our table if we didn't have them - is that they pay the same rates of tax but they don't get the same services.
PRIME MINISTER:
Well many of them aren't paying much tax at the moment.
LAWS:
No, because they're not making any money.
PRIME MINISTER:
Exactly. And we are doing something about that in the sense that if you're entitled to Exceptional Circumstances relief you get not only the social security support, but you also get, if you've been in drought for a while, you also get the very significant interest rate subsidy of up to 80%, which is a very generous interest rate subsidy which people in similar circumstances in other parts of Australia do not get.
LAWS:
I talked to Peter McGauran the other day about this and he said that many people didn't apply... didn't conform or reach the criteria because the bar was set too high, it was too difficult.
PRIME MINISTER:
Well I didn't hear what he said. But it is true that we made the criteria more generous when I made the announcement a few months ago. But part of the reason that we made it more generous was that the drought had gone on longer than we had anticipated.
LAWS:
Now he's saying that there will be another summit to discuss the drought and the benefits that can be given to farmers.
PRIME MINISTER:
Well it's always necessary and desirable in these circumstances to keep talking to the people who are affected. But I do think the drought package that was announced several months ago was a very generous one and it was widely supported in rural areas, and fortunately since then we've had some rain, although it's not completely drought breaking and there are still many areas of the country that are badly affected.
LAWS:
Okay. Just back to the question that I asked. I got a negative this time. Last time I asked you that very same question - could you guarantee that nobody will be worse off? It was prior to an election, whether it was the last or the one before. You said yes you would guarantee...
PRIME MINISTER:
Well I don't know quite the context of the answer...
LAWS:
Same as today.
PRIME MINISTER:
Precisely the same?
LAWS:
Exactly the same.
PRIME MINISTER:
Yeah well John all I can do is to repeat the answer that I gave to the question you've just asked me. No disrespect to you but I would like to have a look at what I exactly said a few years ago. I answer a lot of questions.
LAWS:
I understand that.
PRIME MINISTER:
And I'm asked every day will you rule this in or out. And for reasons I'm sure you'll understand, I have to check that. But you've asked me a question. My answer is that I believe that as a result of these changes, real wages will continue to rise and unemployment will continue to fall. That's the impact I believe; a beneficial impact that these changes will have on people. As to each individual of 10 million Australian workers, for the reasons I have outlined I can't give guarantees because I do not know what particular circumstances beyond my control or beyond the reach or impact of my policies, are going to have on each individual.
LAWS:
The ads that are being run by the unions. Are any of them correct or are they all...
PRIME MINISTER:
Well the two major ones I've seen are wrong. There's the one about the woman who says oh but I've got a sick child. That's wrong. You can't sack somebody because of their family responsibilities.
LAWS:
And you won't be able to.
PRIME MINISTER:
And that will continue. It will be unlawful. And the other point is in relation to the bloke who, as I understand the ad, the fellow has been there for 15 years. I think he says that. Now if you're a new employee, I acknowledge it's the law now that a new employee, the employer has an option. But if you're an existing employee, it is unlawful termination to sack somebody for reason that they refuse to sign a workplace agreement. And the whole thrust of that ad is that that bloke has been on the award. He's been there for 15 years and the employer said well come on in, I'm going to make you sign this workplace agreement. Well that's unlawful. I mean it's an unreasonable depiction of the majority of the employers because as we agree, if you've had somebody for 15 years he must be a good employee and the last thing you're going to do is treat him badly.
LAWS:
Okay. I appreciate your time very much and I've stolen more of it than I should. I apologise for that.
PRIME MINISTER:
Well could I just conclude by saying I hope you had a great night the other night to celebrate your 70th birthday.
LAWS:
It was a terrific night. It was really a terrific night.
PRIME MINISTER:
I'm sorry for reasons I explained I couldn't be there, but good luck to you.
LAWS:
No, no, you were terrific and your thoughts were greatly appreciated by everybody.
PRIME MINISTER:
Thank you.
LAWS:
Nice to talk to you Prime Minister. Thank you very much.
PRIME MINISTER:
Thanks John.
[ends]