Tuesday, 26 June 2012

Abbott's chance to redefine the oversight of unions

Last week there was a lot of talk about 'dirt' files, and then former Labor attorney-general Robert McClelland got one from his bottom drawer and started talking about Julia Gillard in the Parliament under privilege.

Throwing dirt at political opponents is standard practice and is fair enough, provided that there is a public interest in the material being used. It is all a matter of definition and context.

Needless to say, the public find the practice abhorrent, but knowing your opponent is part of the contest, and not just in political warfare.

Most of the media have turned a blind eye to the McClelland story, so I expect that the story will die down again as it did last year. Whether it will resurface will probably depend on the existence or otherwise of any new information.

Elections are normally about hip-pocket issues, general economic management, and specifics like health and education, not some vague allegation.

The better way to think of the issue is to look at the broader policy issues. In this case, the broader issues are the role and management of unions. These are real issues for both sides; for Labor, because the unions run that party; and for the Coalition, because a better system would improve productivity and boost living standards.

For Labor, corruption in the union movement is a risk. This is why Bill Shorten recently introduced legislation to deal with the HSU scandal, in which rank and file union members have been ripped off by the union hierarchy.

For the Coalition, the HSU saga is an opportunity to canvass the wider issues. So far, Tony Abbott has proposed higher penalties for failure to meet compliance standards and a shift of supervision of the legal requirements from Fair Work Australia to the Fair Work Ombudsman.

This shift is just moving the chairs on the Titanic. Former registrar Doug Williams has proposed that the function be switched to ASIC so that there is a real change in the culture of this function and so that unions are treated the same as small businesses.

Abbott's position so far is OK but he needs to go further. He needs a narrative to better describe what is happening across the labour market. For example, widespread corruption and exploitation in the building and construction sector needs to be cleaned up.

Abbott has a policy to bring back the ABCC but he needs to link this good idea with other reforms. The unions now represent 13 per cent of the private sector workforce, but they have been given huge leverage over parts of the economy by policies like superannuation which puts union leaders in the box seat of major investments.

The union hierarchy get superannuation board positions for which they have no expertise, and they have a system of default contributions which deny rank and file members' real choice.

Abbott has said he will support increases in the superannuation levy. Personally, I think this is a poor decision on his part, but he could show he means business by saying that his support for the increases in the levy will depend on the passage of legislation to impose real choice for union members on superannuation and genuine transparency on how union superannuation is managed. He could force union super funds to have expert directors who know about superannuation.

He should also announce that the Coalition will repeal the "conveniently belong" provisions of the Fair Work Act. The Coalition wanted to remove this clause back in 1996. It should be Coalition policy now because the existing provision denies workers the choice of the union that represents them.

The lack of competition is not in itself corrupt but it is contrary to the principles of competition that apply elsewhere in the economy and should apply to unions. Competition might make some union bosses realise that they can't afford to take their members for granted as happened in the HSU.

Governments can be slow to react to changing circumstances but because they have a lot of resources, when an issue needs to be addressed, they can take control.

People used to say about John Hewson that he wasn't political enough, but actually he had two particular strengths. The first was that he was an expert on how to run a modern economy and he was strong intellectually. His other quality was his ability to set the political agenda.

The best example of this was his campaign 'Fightback!' which set the political agenda for at least 10 years (when the GST was finally adopted). He had the political instinct to know when to go on the front foot. He knew that by being quick off the mark he could set the political agenda.

One of Hewson's favourite means of doing so (which should be remembered by Abbott who then worked for Hewson) was that he would often put out long treatises, dressed up as press releases, on Sundays. I think his record for one Sunday was seven press releases.

The relevance of this point is that today Minister Shorten is trying to control the union corruption agenda by introducing his legislation to make it look as if he is cleaning up the HSU mess. In response, Kathy Jackson said he is more like Dracula in charge of the blood bank.

For the Coalition, unless they can paint a much broader picture of what needs to be done to really clean up corruption, then they will be largely leaving the issue to Shorten.

The Coalition should not let him get away with it; it would be a big mistake and a lost opportunity not to challenge his approach.

The promise to increase penalties is fine but it is only one element of what is needed. The Coalition needs to demonstrate a strategic approach. It needs to get around and talk to all the interested parties, and work up a comprehensive policy and a timeline for implementation.

It should be putting that policy out soon, not three weeks before the next election. It needs its strategic response to be part of its answer to the Thomson affair and any other union scandal, old or new, that might come along in the meantime.

The HSU issue has highlighted a huge vulnerability for Labor; it is time the Coalition got on the front foot and made the most of the policy opportunities now presented.

Tuesday, 19 June 2012

Economic posturing favoured over real reform

Julia Gillard is off on another overseas trip to try to boost her political standing at home. As a political ploy, her efforts have so far yielded no dividends at home, and abroad, our PM seems oblivious to the likely reaction of many Europeans to her simplistic commentary on economic issues.

Only a year or so ago she said she wasn't even interested in foreign affairs, and now on this occasion she started lecturing the Europeans even before her arrival at the meeting of the G20 in Mexico.

It is fair enough to tell the Europeans to get their act together, but she is the wrong person to deliver the message. Europe's problems include debt and poor economic management and notoriously rigid labour markets. Gillard has yet to deliver a surplus and she has reregulated the Australian labour market, so she is hardly in a position to be lecturing others.

But worse, she is championing major changes to Europe's political system. Her statement jointly authored by the South Korean president (widely reported in last Sunday's papers e.g. The Sunday Age, page 1) stated:

A crucial element of restoring confidence in Europe is agreement on a road map for the eurozone to underpin its monetary union by a fiscal union and a banking union.

This might be true, but Australia should not be telling citizens in Europe that they should cede more of their sovereignty to bureaucrats in Brussels. New Zealand is not about to go broke but hypothetically, if they were, then it would not be smart politics for outsiders to tell the Kiwis that they had to cede economic control of their country to Australia.

In the same way, many Europeans cherish their freedom, and the thought that they should now be forced to give up control of their own budgets, mainly to the Germans, must give many people cause for thought. Nothing Gillard says will make any difference to what happens in Europe, so why go round giving gratuitous advice?

The same simplistic approach was on show at last week's economic forum. The Gillard talkfest was a classic example of everything that is wrong with Labor's handling of the economy. The whole affair was just a stunt. A lot of top business people refused to go while a bevy of union leaders were all given top billing.

Why would anyone serious about economic reform invite Paddy Crumlin from the MUA or the populist protectionist Paul Howes from the AWU to a meeting to discuss economic reform?

The MUA is one of the main reasons that the competitiveness of the offshore gas industry is so poor that future billion-dollar developments are under threat. Howes wants more subsidies for industry, more protection, and he is opposed to government policy to facilitate the needs of big resource projects for skilled labour.

And then there was Joe de Bruyn from the shoppies union. Joe is supposed to be the moderate face of unionism in Australia, but he opposes reform in the retail sector even though the Productivity Commission's report on the industry made it crystal clear that without reform, the industry will suffer from growing online competition and thus fewer jobs. He was also responsible for stopping young people from working after school hours.

The only reason for indulging the union bosses is because they put Gillard in power and she wants them to keep on supporting her. The fact that they are a slowly fading minority group is irrelevant to Gillard. Her problem now is that the business people who run the economy will certainly not want to turn up next time Gillard calls an economic forum.

The model forum from last weekend was the HR Nicholls Society conference in Melbourne. Unlike the Gillard forum, the conference doors were open at all times, there were no constraints on what could be said, and it tackled issues that Gillard steadfastly pretends do not exist.

Doug Williams, the last industrial registrar before the establishment of Fair Work Australia, called for registered unions and employer associations to be supervised by ASIC. As registrar, Williams was well regarded for his impartiality; there is no question about his independence, and he obviously knows more about the issues than anyone.

His call for reform was a challenge for both the Opposition and the Government. The Government is intent on having as little reform as it can get away with. The Coalition wants to pass the supervisory function to the Fair Work ombudsman and thereby merely change the venue rather than tackle the underlying cultural problems of Fair Work Australia.

Under the Coalition, the same people running the show now will remain in place, whereas a shift to ASIC would force real change. In my view, the Coalition needs to take some advice from Williams and they need to push this issue a lot harder.

Another presentation at the HR Nicholls conference provided a case study which showed how Gillard's Fair Work legislation has encouraged higher levels of militancy and days lost to strikes and thus reduced productivity in the resources sector.

Respected pollster Mark Textor outlined how political parties need to better explain the need for reform. He emphasised the importance of demonstrating that reform must be aimed at work flexibility that allows people to earn more or better meet their needs such as balancing the pressures of work and family. He noted that the quality of relationships at work and the opportunities that can be provided through work also need to be important aspects of the reform agenda.

The HR Nicholls conference showed what a few volunteers can do to promote real debate; perhaps Ms Gillard might be wise to scrap phoney summits in the future and instead start with a realistic assessment of Australia's circumstances, rather than hosting a political gimmick to ask business leaders to give her a pat on the back.

Tuesday, 12 June 2012

Australian laws fail the most willing parents

Nine days ago the Melbourne Age carried a story of a young couple and their quest to have children.

This couple's long, heart-wrenching and expensive saga was partly a story of the failure of main stream politics.

In my case, as an eight-times grandfather, I look at the story mainly out of personal pride as well as understanding the obvious desire of most young people to have children. It is part of their DNA and they harbour powerful and wonderful instincts for the growth of mankind. For those who are blocked, through no fault of their own - either temporarily or permanently - from having children, only the prospective parents could describe the heartache and deepest disappointment occasioned by the years of hope stuck in IVF and similar programs.

As a washed up ex-politician, I also see the issue through economic policy and politics which may seem mundane but which are still important. Australia is still a relatively new society, it has already built solid organisational structures in commerce, public life and cultural aspects but it still has a long way to go. A singular task for Australia is to grow in every way possible; culturally, socially, economically and in anyway free people want to grow. And to achieve this goal of continuing growth Australia needs more people or, in the jargon, a policy of increasing its population.

One aspect of this growth is to continue the policy of welcoming migrants to join our expanding enterprise. Unfortunately that policy is under attack, mainly from Labor and the unions but also the Greens and parts of the Liberal Party. Given that a majority of Australians have a migrant background it is surprising that migration policy is politically controversial. The union movement is generally opposed because they mistakenly think that less migration protects jobs when in fact migration has for decades helped to grow the economy as evidenced by the Snowy Rivers scheme and today in the mining industry. The Greens are anti-development so they are lukewarm on migration except for queue jumpers, and have common cause with the unions. Labor's 2008 policy to open the door to people smugglers has also had the effect of discouraging public support for migration because community support is eroded by genuine concerns that the Government is unable to manage our borders. This is the wider impact of the story dramatically demonstrated when people smugglers were recently found living in public housing in Canberra under the nose of the witless Gillard Government.

But migration policy is not the only means to increase population. Governments have spent millions on baby bonus schemes, subsidies for new homes and child care funding arrangements to encourage young couples to have babies and to go back to work.

The one group that attracts less support are the young couples who want to have a baby but are struggling to do so for medical reasons. They do receive financial support from government through Medicare and publicly-funded medical research, although in recent times the Gillard Government broke a promise and made cuts to this funding.

But this is only one aspect of the issue. The real deterrent and the obvious barriers for many couples are the huge financial burdens imposed on young people simply because our political class don't support their right to have children.

In Australia the system is designed to stop couples who need assistance to have a baby.

You can't advertise for a surrogate or a donor egg. If you could find what you needed, the bureaucracy of all the do-gooders would make red tape in the business community cause for a national summit.

If you are one of the handfuls that go through this nightmare, then there is still a risk, because birth mother can claim the child. In Canada and India, the law protects the agreement between the parties so that the parents know they will be able to keep the child but in Australia this unjust law is clearly another means to discourage these couples from having a baby.

You certainly can't pay an Australian resident to have the baby for you and it is illegal in NSW, Queensland and the ACT for you to pay for an overseas surrogate. So in these states you could be jailed for having a child overseas, or alternatively they expect you to leave NSW, Queensland or the ACT and live somewhere else.

The Age noted that despite the illegality of paying a surrogate in India, our High Commission provides advice on its website on how to have a newborn registered as an Australian citizen in the system. I think that is sensible but it highlights inconsistency in Australian law when one government opposes the practise and another facilitates its reality.

Aly and her husband Damien O'Brien reported in The Age (June 3, 2012) that they had to sell their home to pay over $120,000 to have their twin daughters born in Canada. A picture is worth a thousand words; you only have to see the happy couple and their healthy and happy twins to know that, they succeeded in their dreams to have a family.

But as the couple persevered, Australian laws did worse than just fail them; those laws were against them for most of their journey.

While Captain Emad has his family living in public funded housing, Aly and Damien have paid a huge penalty just for wanting a child.

Young couples who want to have a baby should be supported not discriminated against. Inconsistent approaches to law are confusing and unjust.

I can only assume the reason this state of affairs continues is because there are difficult issues around surrogacy and mainstream politicians have found it easier to let moral and religious crusaders have too much say.

The Canadians obviously have a system that is much better than Australia's and it's about time that main stream politicians, state and federal, within Labor and the Coalition get together and sort out a much fairer system.

Tuesday, 5 June 2012

Labor guilty of basest politics hypocrisy

The current Parliament is not that much worse than previous parliaments. Australia's problem is its government.

The fact that we have a minority government is no excuse for poor policy nor is it an excuse for protecting people who shouldn't be protected. Of course the media like to say how things are worse than ever because it sells newspapers and certainly many people are very frustrated at Australia's recent and poor economic management.

The situation is exacerbated by the fact that the global financial crisis that started at least five years ago is still a problem. Understandably, even though Australia is in better condition than other countries, recent huge losses on share markets and falling house prices have all added a level of uncertainty that we are not accustomed to.

When the Australian public look at the political system today they see a government that has made one bad decision after another and while they clearly support a change in government that is not going to happen for a little while yet. No wonder that people are not impressed with politics today. That is understandable; but we should not lose sight of the fact that Australia has a relatively vibrant and successful democratic system.

Compared to most countries, Australia is free of corruption. Some decisions made in the Australian Federal Cabinet and party rooms may at times smell of incompetence, they may further vested interests of minority groups, they may be made in ignorance and they may be made with the basest of motives but fortunately corruption is not part and parcel of the way we do political business in Australia. The truth is that there are enough good people in the Federal Parliament, a free press and a judicial system to keep Australia free of corruption.

So our system is not as bad as some people make out but most would agree that we have our fair share of hypocrisy. Hypocrisy can sometimes reveal the weakness in a proposition. There have been two examples recently.

The first was the appointment of Peter Slipper as Speaker of the House of Representatives. The hypocrisy of the Slipper appointment was overwhelming because Labor prides itself on opposing people who rat on their own side as exemplified by their reaction to Mal Colston's defection. But there was also a certain amount of hypocrisy from the independent MPs who promised a new paradigm for the new Parliament and then voted for a person whose standing in the Parliament was not of the same standard as the previous speaker Mr Harry Jenkins. Literally within weeks of the appointment, the Labor Government had reason to regret their decision.

The Colston incident will probably go down as the classic act of hypocrisy in Australian politics. The 1996/97 Labour Party senate opposition attacked Colston for travel rorts but it was later revealed that Labor had protected Colston from the very same allegations.

Mal Colston, an ALP senator, harboured ambitions to be the deputy president of the senate and he was promised the job. The trouble was that his colleagues changed their mind so Colston abandoned his own party, nominated for the deputy president's position and won the vote with the support of the Coalition. That set off a chain of events. Unlike their pitch for Craig Thomson today, Labor did not wait for due process; their attack was revenge, pure and simple. Colston retaliated by moving a motion that the travel allowances of all members and senators be investigated.

This led to the revelation that under the Hawke government, Colston had been protected for years for his 'misdemeanours'. The proof of the cover-up was a file note in August 1983 that stated 'The Attorney felt that any action that might be taken should stop short of investigation". Alan Ramsay wrote "it remains the most exquisite irony that, with Beazley and Evans now Labor's national leaders, the very investigation Labor stymied 14 years ago should now involve not only Colston's inventive behaviour over the years but their own roles in shielding him from exposure in 1983". (Alan Ramsey Sydney Morning Herald 19 April 1997 and 19 November 1997). The hypocrisy rebounded on Labor.

Quite frankly, the controversies around Peter Slipper or Craig Thomson will all be sorted out one way or another in due course. The public will make up their own mind and if someone's been a hypocrite then they will be judged at the ballot box or in the party room and life will go on.

But one recent example of hypocrisy has however been worse than usual. Mary Jo Fisher is a South Australian Senator. She once worked with me as an adviser and she is a person of the highest integrity. She was recently in the Adelaide Magistrates Court arising from a panic attack in a supermarket and a claim that she had stolen groceries.

The incident occurred at a time when Senator Fisher was trialling new medication for depression. Whilst the Labor party have been saying that allegations against Craig Thomson should be dealt with in the courts and he should not be judged beforehand, the Labor Party, including Prime Minister Gillard, seized on Senator Fisher's problems by giving them as much airing as possible as a counter to the activities of Craig Thomson.

This in itself was despicable behaviour. Her situation was completely different to Craig Thomson and it was the basest politics for Labor to drag her name alongside Craig Thomson. When the matter was first listed in the courts Senator Fisher's barrister, Adelaide QC, Michael Abbott told the court that police prosecutors offered to resolve the matter without it going to court. Abbott's view was that, like many other similar cases, this matter should never have gone to court and the police agreed with him. It was agreed that there would be no conviction recorded.

But instead a decision was made higher up and a lengthy and expensive trial was held. The senator was acquitted of theft and the magistrate found the assault charge 'trifling'. The opposition justice spokesman in South Australia said recently (in the Australian, May 26, 2012) 'I am very concerned that there may have been interference on political grounds'.

Labor has had much to say about due process for Craig Thomson. It's a pity they have never afforded the same courtesy to Mary Jo Fisher.