Address to Australian Mines and Metals Association National Conference - Perth 20th May 2010

It's truly a delight to be here today to speak at a forum organised by an industry organisation which isn't afraid to stand up and argue for the interest of its members - even if it does make them unpopular from time to time with the powers that be in Canberra. 

Because ultimately that's what industry organisations are all about - standing up for the interests of their industry. 

You had the guts to express your legitimate and now vindicated concerns about the CPRS. 

And now you are rightly speaking out against Labor's great big new tax on the mining industry. 

A tax which it is publicly claimed on one hand is somehow going to grow the mining industry (go figure). 

Yet on the other hand, even Ken Henry seems to privately agree is actually designed to slow the industry down. 

It's a wonderful gift to argue two completely contradictory points of view with a straight face. 

But given Climate Change is "the greatest moral challenge of our time", but we can defer action for 3 years, I shouldn't be surprised. 

I'm told by Labor we have a two-speed economy, and we have to get them synchronised. 

So true to Labor form, confronted with those that are well-off and those that are not so well-off, the option they take is to pull down the well-off rather than lifting the not so well-off - that is, according to Labor, the easiest way to provide equity is to shoot all the rich ones.


Now, I'm not an economist, but given the choice between the two positions, between the public spin of Rudd Labor and the private concessions of Treasury officials, I'll plum for the second option, besides commonsense defies the assertion that a big new tax will actually stimulate the sector. 

That is, that the Great Big 40 percent (additional) tax will slow the mining industry, it will stifle investment, and it will cost jobs. 

What we are seeing now from the Rudd Labor Government is exactly what we predicted 18 months ago when they plunged us into deficit under the false premise it would save us from recession. 

(of course, we all know the real reason we avoided recession was the strength of our economy from the Howard era, the strength of the Chinese economy, and the vitality and resourcefulness of our mining industry in capitalising upon that strength). 

It is typical Labor - spend more money than you have, and then jack up taxes to help pay for it.

Look at the taxes Labor has already increased since they were elected:-

-      Increased the luxury car tax by 33 percent (and surprise, surprise it reduced demand in the luxury car segement);

-      Removed the excise exemption from condensate

-      Jacked up the tax on alcopops and cigarettes - supposedly to reduce consumption (won't then increasing taxes on mining reduce mining activity??)

-      And of course they tried to impose the CPRS. 

To name just a few. 

Rest assured, we will not flinch in our opposition to this tax Great Big New Tax on the mining industry. 

We won't be seeking to punish the sector which saved us from recession, or to (as the saying goes) "Kill the Goose which lays the Golden Egg." 

I encourage you to keep up your opposition, because with his unprincipled backdown on the CPRS, Mr Rudd has shown that he has no convictions, that he stands for nothing, and that if he thinks it is getting too hot in the frying pan, he will jump out. 

(It just seems in the case of the CPRS he leapt straight into the proverbial fire!). 

But enough of that. 

You didn't invite me here to talk about economics, but instead, about  industrial relations. So I will. 

But before I won't be announcing any new policy today. And in case you're wondering exactly when our full policy will be announced, can I helpfully advise it will be "in due course". 

Notwithstanding this - in his budget reply speech - the Leader of the Opposition, Tony Abbott, announced the broad approach which we will be taking to industrial relations policy. 

Specifically, that we'll seek to take the unfair dismissal monkey off the back of small businesses which are more like families than institutions, and; of more relevance to you here today, we'll seek to make Labor's individual flexibility agreements more flexible. 

And, of course, as I've said dozens of times over recent months, including in numerous speeches, we won't be reviving WorkChoices.

The simple fact is, WorkChoices is dead, in name and in spirit. 

Not that that will stop the union movement and the Labor Party falsely asserting otherwise, and trying to fight the 2010 election on a 2007 paradigm. 

Indeed, I have no doubt that even when we do release the details of our Industrial Relations policy, and everyone can see in black and white that it isnt a return to WorkChoices, Labor and the unions will continue to assert that it is. 

For them to acknowledge otherwise is to acknowledge the falsehoods and waste of union members' money on their current campaign. 

My counterpart, Ms Gillard, is salivating as she falsely asserts that we will reintroduce Workchocies - a policy which we acknowledge was a failed policy. 

I could just as easily claim that a re-elected Labor Government would revise the embarrassing Medicare Gold debacle - the brainchild of Ms Gillard herself - a policy which she has never repudiated. 

Ms Gillard is also the number one ticket holder, not only of the Melbourne Storm, ironically of the salary cap fame&, but also of the Mark Latham fan club. 

Need I say more? 

Or of course there's the Pink Batts debacle. 

Four people killed under the watch of the Rudd Labor Government, yet hardly a peep out of the unions. 

It reminds me of Ms Burrows' infamous comment made in the lead-up to the 2007 election campaign: "I need a mum or a dad of someone whos been seriously injured or killed. That would be fantastic". 

We have all learnt from the lessons of the past, and for Ms Gillard, and the unions, I have a simple message - life has moved on. 

What Australians are interested in is how the current system is working, and our plans for the future - not the past. 

Now, as Tony Abbott flagged earlier, one of the pillars of our tweaking of Labor's industrial relations framework will be to make Labor's Individual Flexibility Agreements (IFAs) more flexible, and a more practical option for employees and employers. 

As Labor themselves have noted, an IFA is not an AWA, nor is it an individual statutory agreement. 

Whereas an AWA worked to the exclusion of the award, an IFA is underpinned by the relevant award, with the addition of the application of the Better Off Overall Test - the so-called BOOT test. 

A bit of brief history - as I'm sure many of you here are aware, when prior to the 2007 election Labor spelt out their plan to abolish WorkChoices. 

The part which included the complete abolition of Australian Workplace Agreements caused great concern to the mining sector, due the fact that so many workers in the mining sector had signed up to individual agreements which gave them significant benefits, and which also suited the unique needs of mining companies. 

As a result, Labor agreed that:

-      they would retain common law contracts for workers earning over $100,000;

-      Existing AWAs could continue ;

-      For a brief period between the abolition of AWAs and the introduction of the new FairWork system (18 months as it turned out), workers could sign-up to ITEAs (Individual Transitional Employment Agreements);

-      And finally, that the new FairWork system would allow for individual worker flexibility with the introduction of the afore-mentioned IFAs. 

Therefore, particularly in the mining sector, there is currently a mish-mash of employment instruments in place - including of course Collective Agreements. 

Many of these agreements are now approaching or past their nominal expiry date, and workers on old AWAs, or ITEAs, or expiring Collective Agreements are going to be searching for new employment arrangements over the next few years. 

Which is something that I have no doubt the union movement are salivating about. 

Because they see an opportunity to sweep a large class of workers previously on individual agreements, or from expiring collective agreements, into new union-negotiated collective agreements. 

A process which I have no doubt will unleash a new round of industrial unrest across the entire mining sector, and which won't just be quarantined to the larger players as it has been for the past  couple of years. 

 Which is why Tony Abbott said that we want to make Labor's Individual Flexibility Agreements more flexible - we want to make them a genuine option for employees and employers. 

We want to give employees and employers the genuine ability to choose how they are employed, rather than being corralled into union negotiated collective agreements. 

There is no doubt that Labor's individual flexibility agreements are a step in the right direction. 

IFA's sound good in theory and Ms Gillard promised that they would provide an option for workers and managers who wanted to work in a manner distinct from the one-size-fits-all approach that Labor holds so dear. 

But like so many of Labor's promises, the practical reality is different. Stakeholders and workplaces I have spoken to indicate that they are rarely being used. They are so regulated and stifled that it is simply not worth the trouble. 

We even saw, in 2009, unions in Victoria taking employees on strike for four days to force an employer to agree to a restriction on the use of IFAs. This is not good enough. 

It seems, according to Labor and the unions, individual flexibility in the workplace simply cannot be allowed - even if it results in markedly better outcomes for individual workers, as has long been the case in the mining industry. 

Indeed, I even heard Mark Arbib on Lateline last Friday night make the outrageous comment  that "when people hear flexibility, they know that it means AWAs". 

Pity the ABC interviewer didn't ask why the right to request flexible arrangements was the second of the National Employment Standards; 


Why Labor had legislated for Individual Flexibility Agreements!? 

When Senator Arbib made this comment, in the capacity of his job, it was  at 10.30pm at night. Does this mean Senator  Arbib is employed on an AWA? 

And does this mean his media adviser, who would have been with him in the studio, is also employed on an AWA? 

No. But it does show that in some jobs - particularly the mining sector -  there is a need to work hours that are outside of the union dictated 9 to 5 one-size-fits-all. 

Which is what workplace flexibility - and Labor's IFAs should be all about - the needs and wishes of those workers and workplaces that our system must accommodate. 

A system must be capable of listening to what people need - not dictating to people what Ms Gillard, or the union bosses, thinks they need. 

So as I have said on many occasions, within our industrial relations system there must be a balance, and most importantly, common sense. 

This is what Tony Abbott alluded to during the Budget In Reply. And this is what a Coalition Government would strive to achieve. 

Now, I note at the beginning of the year the Prime Minister burst back into the spotlight with his so-called series of speeches designed to set the political agenda. Rather than being a series of 7 speeches in 7 days, it was the one speech delivered in 7 different locations. 

The old cut and paste option on the Prime Minister's version of Microsoft was hopefully paid for working overtime. 

In that speech "the greatest moral challenge of our time" was put on the backburner in favour of another great challenge of our time - the challenge of "productivity". The word must have tested well in Labor's focus group.  But all we heard was the word mentioned and the need to drive productivity. 

In the 24,565 words contained in the 7 versions of his speech emphasizing productivity, not once do the words 'workplace' or workplace relations' get a mention. 

It seems, according to Labor, we can drive productivity absent of any input from workplace relations policy. 

And that might I say is consistent with Senator Arbib's answer to my question in the Senate on the 3rd of February this year:

Senator Abetz: I refer the Minister to &the outcome between Total Marine Services and the MUA & What, if any, productivity offsets have been achieved as part of that agreement?

Senator Arbib: &The Government welcomes Total Marine and the MUA reaching a new enterprise agreement &which is tailor-made for the needs of the business &

Senator Abetz: On a point of order &the question was: what, if any, productivity offsets have been achieved as part of that agreement?

President: I draw the Minister's attention to the question &

Senator Arbib: I will make the point again that this was an agreement that was reached between the employees &

Senator Abetz: Mr President, clearly we are not going to get an answer because I dare say there were no productivity offsets. I ask a supplementary question: Can the Minister confirm that excessive wage increases of this kind, which are not offset by increased productivity, will simply lead to wage inflation, which will, as it inevitably does, increase the cost of living for all Australian families and destroy jobs?

Senator Arbib: I totally reject that claim by Senator Abetz & 

So there you have it. You can have huge wage increases without productivity offsets and it won't hurt anyone. Oh, to be a true economic conservative like that! 

Our nation's long term welfare is severely prejudiced if productivity in workplaces is ignored. 

And we improve productivity by allowing innovation to flourish. And innovation flourishes when flexibility is allowed to flourish to develop rewarding employment opportunities for Australian workers, that also satisfy the needs of their fellow Australians that employ them. 

Flexibility in a manner that is fair and sensible. 

Flexibility through making Labor's very own system work as we were promised it would work. 

Australians want a fair system for their work places which is conducive to collaboration rather than confrontation between Australian workers and those of their fellow Australians who employ them. 

We will re-introduce commonsense. 

 Commonsense needs to be given a seat or a platform within workplace relations determinations. And commonsense suggests to me that a prescriptive "one size fits all" approach doesn't work, will stifle innovation and frustrate the aspirations of many Australian workers. 

We have faith in Australian workers who are not as easily pushed around and exploited as the ACTUs dishonest ad campaign is already making out. 

But we won't "rip-up" the Fair Work Act. 

Nor will we reintroduce Workchoices. 

However we will take to the election an industrial relations policy which is fair and which is balanced and based on common sense. 

A policy which recognises that workplaces work best - for the benefit of all involved - when recognition is given to the fundamental point that workers and employers work together, not against each other if given the right environment. 

We will restore the focus of our industrial relations laws to the workers and those that employ them, not to the government and third party interest groups as it currently is. 

We will focus on job creation and sustainable wages growth, (under the last Coalition Government over 2 million jobs were created and real wages increased by over 20 percent). 

It will not be reform of the current laws, nor will it be a recycling of anything from the past. 

It will be sensible, balanced tweaking of the Fair Work Act, for the benefit of all Australians.

About Eric

Eric Abetz has been a Liberal Senator for Tasmania since 1994 and has served in a range of Leadership, Ministerial and Shadow Ministerial roles.

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