Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

A simple analysis of the contribution by the member for Werriwa can be put in a very short sentence: ‘The 750,000 persons identified by the Productivity Commission—possibly extending to 1.9 million Australians—who have, irrespective of this legislation, chosen personally to be independent contractors are too dopey to make decisions on their own behalf and must have their hands firmly held by Greg Combet or, for instance, the head of the CFMEU in Western Australia, Mr Reynolds.’ And Mr Reynolds seems to have done fairly well from the job. He has just occupied an apartment in the most expensive apartment block in Western Australia. Maybe, to assist in the financing of that, he sold his share of a $3 million tavern in which he has been the major investor for some years. The tavern, I might add, is in the electorate of the member for Brand.

Who is being defended in this place? Is it the trade union movement, and the fees it attracts from, for instance, a certain group of owner-drivers? And would they ever explain to those owner-drivers the massive conflict of interest that exists when you have the same representative in a market situation defending the rights of your principal opponent?

There is no anger and distrust between a waged driver at, say, Fox, and an owner-driver, but they are competing for the same work. The member for Werriwa quotes a comment frequently made that you have to look after owner-drivers because they have such big loans to pay off. Now how did that happen? Did Lindsay Fox go out in the street and do as they used to do in the old days to collect people for the Navy? Did he put his very large arm around their necks, drag them through the gate and say, ‘You are going to buy a truck, sign up for a very expensive hire-purchase or lease agreement and then work for me for ridiculously low rates’? No.

I have been in the business. I have been an owner and I have been a subcontractor. I had a licence to drive a road train—until a conspiracy between the unions and our government and the state governments wiped my licence out, along with those of 30,000 others, because we were not driving regularly. Too bad if you drove three months a year seasonally—you were not considered a regular driver, and you would have to pay $2,000 to get your licence back. And we think we have a skills problem! And now they are talking about bringing in overseas drivers. It was the union movement that wanted to kill off all those licences.

But let me come back to the main issue. It has always been a problem for owner-drivers that, by their own choice, they line up and—because they have got no money—take on a lease contract on an asset, which is worth possibly a quarter of a million plus these days, and pay the highest possible interest rate. The prime contractor, on the other hand, has two choices. He does not pay that sort of interest rate. He has the option to buy brand-new equipment—well, he might use shareholders’ money to pay for it—and then he pays wages. There is nothing wrong with that. That is the judgement he makes back in the front office: a judgement between the cost to his business at his cost of capital and the cost of wages. He is competing with an owner-driver who generally pays very high interest rates and, as a consequence—and, for the member for Throsby’s information—usually continues to operate an old smoky truck, because he cannot afford a new one. That owner-driver has got to compete, with his choice of capital, with the prime contractor. That is the judgement. It is not avaricious; that is the judgement. And who is the representative who says, ‘I’ll look after you; trust me’? The trade union movement.

If this bill were about recognising the role of the owner-driver contractors association as a body representing its members in the Magistrates Court to argue some of these instances, I could see the sense in it. But when people come to this place and tell me they need the protection of the Industrial Relations Commission of New South Wales, when it has a conflict of interest with their entitlement to work, I find it absolutely ridiculous. I am deeply concerned, consequently, that this legislation chooses to exclude from its provisions the laws of New South Wales that create that conflict of interest. And there are a hell of a lot of drivers in New South Wales who would like to shed that restriction.

Those opposite talk about minimum rates. But once you arbitrate a rate, it also becomes the maximum rate. And independent contracting is all about initiative and hard work, in whatever category, and about delivering better returns, both to the person who takes that independent contracting choice and to the community. Because if you want to double the freight rates to a remote area in Australia—and there are plenty of them—what happens at that locality? The prices go up. If those rates have been decided in a commission that does not take that into account, then it is a bad deal.

The prime contractor is in competition. If a freight contract opens up for a major mining company or something like that, it will be Linfox versus TNT versus the other big players—Toll, in particular. And of course their business decisions are made accordingly. They have cheap capital. Owner-drivers do not. And the fundamental issue is: owner-drivers need to be able to make their own judgements as to the price they will charge. Say you are a really smart operator, and you have saved your money, or you have got an inheritance—maybe mum and dad died and you got their house, which is worth more than a truck these days—and you use cash to buy a truck and you are lucky enough to be able to put a couple of trailers behind that. In New South Wales and Victoria, the two perpetrators of this particular type of legislation, the governments have done everything to make trucking uneconomic for subcontractors by not giving them a decent configuration. But Western Australia has led in that respect, I know. We allow double-bottom semis to run around the Perth metropolitan area—surprise, surprise, they have not run over anyone yet—and that configuration adds significantly to the efficiency of the vehicle.

So someone in New South Wales—and we are going to perpetuate this—spends their own capital and thinks the rate of return they want to get will be a little bit better than bank interest. They buy a brand-new, non-polluting prime mover and they want a job, given the investment of their capital. They go to Lindsay Fox or they go to Mr Little of Toll and say, ‘I want to work at this rate.’ Under the laws of that state they have got to be shown the door. So another bloke, with smoke coming out of his truck’s exhaust pipe, gets the job, because the system provides for it. It provides for the minimum amount of investment and the lowest quality equipment—and the owner-driver is stuck with it. He cannot be competitive. He cannot go and buy the more efficient truck, the more environmentally friendly truck, and get a job, because the prime contractor would break the law if he gave him the job, notwithstanding that he has come in and said, ‘I will deliver to that remote Aboriginal community for less money than anybody else.’ But you are not allowed to do that under Victorian law. (Quorum formed) Wouldn’t it have been good for Kim if he could have called a quorum at the doorstop the other day? Next thing they will be trying it! ‘Don’t confuse me with the facts,’ those opposite say. Here they have the opportunity to hear me speak on behalf of the very people they say they are defending by opposing this legislation. But they are turning around and denying me the opportunity to explain why there is a conflict of interest in owner-drivers being represented by the trade union movement.

Let me say that I understand the circumstances in New South Wales. They have a long history. It is amazing that people can come to this parliament and tell us, quite correctly, how tough it is to be an owner-driver and then tell us they paid goodwill for the job in excess of the value of the truck they bought. Given that the rule when you buy a business is that goodwill is the luxury value of owning that business, it is silly that they do so—but I do recognise it. My concern with the provisions of this bill that exclude owner-drivers is that they will be across Australia. I think the minister is deluded in thinking he can limit national legislation to one or two states. But putting that aside, I cannot see how this proposal will benefit owner-drivers. As for my suggestion, it is still under consideration. I have had my discussions with the Prime Minister, and I want those people out there who are concerned about these exclusions to know that the government is now going to wait until it receives the report from the Senate committee. I think certain members thought that inquiry was going to be a great opportunity for the trade union movement to put its case. There have been a lot of industry people putting representations to that committee too. Quite properly, the government is going to consider those before this bill is debated in the Senate.

I have only requested an amendment that puts a two-year sunset clause into this legislation, so that something is done about it. That does not mean the removal of the rights of owner-drivers in New South Wales, where they are to their benefit. But, as I just said, if we are going to acknowledge some people as being a representative group of owner-drivers, why isn’t it the owner-drivers association? Why is it a group in the trade union movement that has got its eye on its own waged member who is in competition for the job down at Toll or Linfox? The system does not work. The reality is this: if we want to give some rights of representation to owner-drivers in this case, why not let them form an association?

I might add that the government recently put legislation into this House—which passed it and sent it up to the Senate—which allowed owner-drivers and other small business people to negotiate collectively under a set of conditions. The reason that stopped is that the Labor Party voted against it. Senator Barnaby Joyce gets a mention but the reality is that his vote counted for nothing. It is like border protection here the other day: two or three people sat over there. They could not change anything in this place without a 100 per cent vote against border protection by the Labor Party. The same thing applies.

If Labor had supported that legislation rather than making a tricky little political point, there would be a provision in as we speak where sections of the contracting community, independent people, could have negotiated collectively by the simple act of notifying the ACCC—and getting their approval, admittedly, but there was a process. That is hung out to dry. To hang it out to dry on the principle that Coles and Woolworths might amalgamate one day—what a joke. Before that happens, Wal-Mart will buy one of them!

It is a silly concept and a good opportunity to create some fairness in industry. I oppose these measures because I think they are wrong—but not in the context that there is not a situation in New South Wales that has to be addressed. You just cannot tell a lot of people overnight they no longer have goodwill when they have provided for it.

If I can come back to my example of the fellow who got an inheritance and paid cash for a truck, he does not need his superannuation to be protected. He will make provision for that out of the profits of his truck. But that sort of person is denied work under the New South Wales legislation because he cannot be competitive. He cannot come in and say, ‘Look at my beautiful new half-a-million dollar rig, highly efficient and highly environmentally sensitive. It’s got a speed limiter on it so I can’t drive too fast,’ because the boss will say, ‘Can’t take you at your price; I’m obliged to pay more and I’ve got a coupla blokes with smoky old rigs that are on the list already. I daren’t put them off, because the union’ll go crook.’ That is the situation. That is what this piece of the legislation forgets, and it is time this parliament woke up to where the benefits to the environment and the benefits to efficiency arise: out of a competitive environment. But I can bet you the bloke who has inherited that money would not go and do that and put that money at risk. I guarantee you he is not as stupid as the member for Werriwa suggests—how you have to have people who have a $3 million apartment looking after their affairs under the guise of being trade union leaders. Excuse me!

This legislation has got to go further, and I hope that the Senate committee will have sensible recommendations for the government that look after people that are in an invidious position of their own making. It has got to be resolved, but not by this process of giving them a conflict of interest.

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