Thank you very much.
After what must have been a tumultuous and incredibly hard working few weeks for the people at the Australian Financial Review it’s a good time to pause and consider the other big economic challenges confronting the country.
With all those special supplements and additional analyses on the world financial crisis to write and prepare for publication, the editorial staff of the Fin must now know what it’s like to work as hard as the Commonwealth public servants in my Department.
Productivity output at the paper has soared. So well done, you’ve qualified for the Order of Rudd.
Times have indeed gotten tougher for everyone.
The world is holding its breath and economists are labouring over their forecasts.
But even in these most difficult times, there is reason to be confident Australia will come through better than most due to the underlying strengths of our economy and financial institutions.
But the crisis has reminded us of the truism that we must always be looking to strengthen the foundations of our prosperity.
Difficult times call for decisive measures, such as those the Government has implemented.
But difficult as they are, difficult times are no time to abandon economic reform.
When Australia experienced difficulties in the early 1990s the Hawke and Keating Governments did not relent on reform.
They formed the Council of Australian Governments to progress inter-governmental reform. They created the Australian National Training Authority to boost technical education. They introduced competition policy. They pushed ahead with enterprise bargaining for our industrial relations system. And they continued to expand university and TAFE enrolments.
The outcome was more than a decade and a half of economic growth.
The lesson from this is ‘keep reforming’.
That’s what the Rudd Government is going to do, in a way that increases prosperity whilst creating a fairer society.
We’ve set ourselves huge tasks:
- To improve the quality of our human capital by creating an Education Revolution, improving the health outcomes for our citizens and promoting social inclusion.
- To reform our tax system to raise workforce participation levels.
- To address climate change, including water shortages.
- And of course, to give Australia a better workplace relations system to help lift national productivity.
THE STATE OF THE REFORM PROCESS
Key parts of the workplace relations reforms Labor took to the last election under the banner Forward with Fairness have already been bedded down.
The transition to the new workplace relations system commenced on 28 March 2008, with the implementation of the Workplace Relations Amendment – Transition to Forward with Fairness Act.
This Act was developed in consultation with major stakeholders to ensure that the transitional arrangements for the new system would be right.
It promised to lay the groundwork for the new system by ensuring stability and sufficient time for adjustment, most notably by preventing any new Australian Workplace Agreements from being made, putting in place a genuine no disadvantage test for agreement making and ensuring sensible and measured transitional arrangements to the final system.
And I’m happy to say that by-and-large, the Australian people and stakeholders have given the Government full points for delivering on those commitments.
The Transition Act also enabled the Australian Industrial Relations Commission to get started on the process of modernising industrial awards. The process has been challenging and there are still some important details to be ironed out but thanks to the hard work of the AIRC, unions and employer groups, this important process is on track. The suite of modern awards, with a fair and comprehensive safety net of employment conditions, will take effect on 1 January 2010.
Right now we are in the process of making the final decisions about the legislative detail on the Fair Work Bill, to be presented to the Parliament in the coming weeks.
This too will be influenced by our extensive consultation with stakeholders.
The Government took office with a commitment to take an open, measured and consultative approach in developing our new workplace relations system.
We established consultation mechanisms that included workplace relations players from the largest corporations, to small businesses and unions covering employees in all sectors of the economy.
I have held regular meetings with peak union and employer bodies through the National Workplace Relations Consultative Council. I established the Business Advisory Group, the Workers Advisory Group, the Small Business Working Group and its counterpart Small Business Employees Advisory Group to provide Government with a wide range of perspectives and ideas.
I have also convened several meetings of the Workplace Relations Ministers’ Council, while my Department has consulted extensively with their State and Territory colleagues.
The Committee on Industrial Legislation – or COIL – met for ten days in Canberra this month to work through the detail of the legislation.
Over 50 people were involved, representing unions, a wide range of business interests as diverse as farmers, manufacturing, builders, mining and hotels, as well as state and territory officials. COIL was given an unprecedented level of access to the draft legislation and to Departmental officials to discuss the legislation.
It is worth noting that this compares to the few short hours given by the Howard Government to COIL to review the complex and lengthy Work Choices Bill, and this was only after the legislation was presented to the Parliament, meaning there was no real opportunity for genuine feedback.
I am pleased to say the COIL process has been a great success. I have been very impressed by the quality of advice and feedback I have had from this expert group and by their willingness to work on the issues with each other and with the Government in such a constructive and positive manner. I have no doubt the legislation will be better for the process.
I am also grateful for the respect generally shown by the COIL participants for the process. A frank and robust exchange of ideas can only be had when confidentiality is respected. A couple of breaches of the COIL fortress occurred – I suspect Steven Scott snuck some tin cans with a very long string into COIL, as clearly some of the information became terribly distorted as it travelled down that long string.
Of course, a group like COIL with its diverse interests was never going to agree about everything; but let’s face it, employers, unionists, lawyers and academics seldom do.
No one side will get everything they want. I can assure the COIL group and the Australian people that the final legislation will be balanced. It will be fair. It will be workable. It will allow the nation to achieve much-needed long-term stability in the workplace relations system.
THE AIRC’S PERSONNEL WILL BE RETAINED
I am sure that many members of this audience are very interested indeed in the fine detail of legislation. However, as I am continuing to work through the feedback from the COIL process, I’m not in a position today to make further announcements about the new legislation.
But there’s one important decision I can announce – and that’s about the role of the existing Australian Industrial Relations Commission personnel in the future system.
In particular, I can announce that all existing full-time AIRC members will be offered roles in Fair Work Australia with full preservation of their conditions, including for Presidential members, their status as judges. They will also retain their current appointments as members of the AIRC for a transitional period.
The current President of the AIRC, the Hon Justice Geoffrey Giudice, has also been invited to be the first President of FWA. He will also retain his current appointment as President of the AIRC for a transitional period.
Presidential members of the AIRC will have their existing judicial rank, status and entitlements preserved by the transitional legislation. All AIRC Commissioners will become FWA Commissioners, also with existing entitlements maintained.
Fair Work Australia will be a new ‘one-stop shop’ that will merge together the functions currently performed across seven government agencies. This presents a great opportunity to integrate efficiently all services to the public relating to workplace relations.
The organisational structure and related staffing issues are currently being examined by the Fair Work Australia Establishment Taskforce, lead by Director Marion van Rooden, working in close consultation with the existing Agencies.
I would also like to take this opportunity to confirm that employees of the agencies to be abolished (the Australian Industrial Registry, the Australian Fair Pay Commission Secretariat, the Workplace Authority and the Workplace Ombudsman and the Australian Building and Construction Commission from 1 February 2010) will be transferred to positions in the new Fair Work Australia institutions or other appropriate positions consistent with the Public Service Act 1999 as in any machinery of government change.
IT’S ABOUT GUARANTEEING FAIR WORK AUSTRALIA’S INDEPENDENCE
I have made these decisions because we’re determined to ensure the absolute independence of the new industrial umpire.
And I want to agree with the comments of Justice Giudice in his recent 2008 Julian Small Address to the Law Society of New South Wales where he said (and I quote):
The independence of our tribunals from the executive is in the best traditions of the theory of the separation of powers and generally our tribunals enjoy a reputation for independence equal to that enjoyed by the courts.(1)
This Government is committed to maintaining that independence, which is why we have committed to all future Tribunal appointments going through a fair and bipartisan process.
When Fair Work Australia is established, the Minister responsible for Employment and Workplace Relations will only make new appointments after completing the following processes.
- The shortlist of candidates will be scrutinised by a panel comprising:
a senior official from the Department of Education, Employment and Workplace Relations (who will chair the panel);
- a senior official from the Australian Public Service Commission;
- a senior official from each State (and Territory) Department of Workplace Relations that wishes to participate.
The Minister will be required to consult with the opposition spokesperson for workplace relations and the head of Fair Work Australia prior to making any decision about appointments to recommend to Cabinet.
The process will be rigorous and provide for bipartisan involvement. It will ensure that all appointments made to Fair Work Australia are fair, balanced and made on the basis of merit alone.
This appointment process will ensure the integrity of Fair Work Australia endures changes of government.
The Attorney-General will follow a similarly merit-based system for appointments to the Fair Work Divisions of the Federal Court.
FAIR WORK AUSTRALIA IN CONTEXT
Of course the conciliation and arbitration power conferred on the Commonwealth by the Australian Constitution has always been politically charged.
It was a strongly contested element of the conventions and public debates that brought the Australian Federation into being.
In fact, so contested were the potential powers conferred by section 51 (xxxv) that the passage of the original Commonwealth Conciliation and Arbitration Act in 1904 contributed to the downfall of three Australian Governments in the first four years of our Federation.
There have been numerous attempts over the last century to radically transform the system’s powers and methodologies.
No fewer than seven referenda have been tried and failed, the last being in 1973.
And legislative attempts to rid the Commonwealth of powers to intervene in industrial disputes have contributed substantially to the electoral defeat of two governments, both times costing the Prime Minister his own seat.
It’s true the role and powers of the Commonwealth’s workplace relations bodies have changed considerably over time, becoming progressively less legalistic, less formal and more administrative in approach.
For instance, conciliation increased in importance in the 1950s after the loss of the system’s judicial functions as a result of the Boilermaker’s Case. And in the 1990s under Labor, the system’s emphasis changed again, to the facilitation of enterprise bargaining.
But while the independence and balance of the industrial umpire will remain, some things must change.
Australia now operates as a single modern economy; perhaps not as seamless yet as we’d ideally like but far more unitary than in the past. State-based economic divisions are decreasing in relevance.
It wasn’t that long ago that drinking Castlemaine XXXX in Melbourne labelled you as a potential member of the avant-garde. Today even suburban bottleshops are stocked with beer from Belgium and Thailand. Our world has changed.
In such a changing context our workplace relations system needs to be simple, accessible, provide a fair safety net and must promote workplace productivity. So it needs to change again too.
This means historical reliance on the conciliation and arbitration of inter-state disputes power in the Constitution, with the arcane and complex processes of ambit demands in logs of claims, dispute findings and all the rest, seems to be about as relevant to the modern economy as a workshop making wrought iron harvesting equipment or ladies’ corsets.
The implementation of a truly national workplace relations system is essential.
Together with my Ministerial counterparts in the States and Territories we have been making solid progress towards nationally consistent workplace relations laws for the private sector.
This will be achieved either by State Governments referring powers for private sector workplace relations or other forms of cooperation and harmonisation.
Further discussions on the National System will be front and centre once again when I meet with my fellow Workplace Relations Ministers in Melbourne next week.
Fair Work Australia will be based around a user-friendly culture that moves away from the adversarial and often legalistic processes of the past in favour of less formal processes. The focus will be on providing fairness and efficiency and excellent levels of service to users of the system.
But one thing will be constant – the respected role of Fair Work Australia.
Fair Work Australia will succeed the Australian Industrial Relations Commission, which in turn succeeded the Conciliation and Arbitration Commission. While the name of the industrial umpire is going to change, as will as its constitutional footing, some operational features and the legislation being applied. This is a natural evolution to meet the changing needs of our society and modern economy.
CONCLUSION
What all this history demonstrates is that the creation of Fair Work Australia is another chapter in our long industrial relations history. It is a joining of the best the past has to offer with new ways of doing things to meet the present and future needs of Australian society.
However the respect in which the independent industrial umpire is held by the Australian people will remain constant.
And the reforms Labor promised in opposition are now close to implementation. The reform process has not slackened an inch.
The Government will implement in full the commitments given in Forward with Fairness – the policy approved by the Australian people at the last election – and will do so within the timeline it set for implementation of its workplace reform agenda.
While the final details of the legislation are being worked on, in truth, there is only one big question on workplace relations in this country today.
And that question is this – will the Liberal party deny what the Australian people voted for, and stop the nation moving forward with fairness?
The Australian people await the answer.
Thank you.
(1)Justice Giudice (2008), ‘What should we expect from our industrial tribunals?’, the Julian Small Address 2008, Law Society of New South Wales, 14 October.