Michael Keenan (Stirling, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Hansard source

Already we get heckling from the back bench, who say it is ‘rubbish’. But it is true, and I will run through the reasons why the abolition of the ABCC and its replacement with a toothless tiger will result in exactly that.

We hear a lot of spin and rhetoric from this government and very little of substance, but the spin that they are putting out on this particular bill deserves a gold medal. We have heard the minister claim that the abolition of the ABCC and its replacement with a toothless tiger was actually the government standing up to the militant building and construction unions. But of course the exact opposite is true. The new body that has been established within Fair Work Australia to replace the incredibly successful Office of the Australian Building and Construction Commissioner is not an independent body. It is controlled by the minister. It is not a strong cop on the beat. It will become so bogged down in paperwork and bureaucracy that it will not have the time and resources to do its job properly. It is not a simpler model; it is a more complicated model that makes it far more difficult for it to go out and do the job that it is supposed to be doing, which is enforcing law and order in the building and construction industry.

It is important that this House acknowledge that the building and construction industry is not like any other sector of the Australian economy. It has for decades been plagued by serial thuggery, lawlessness and unlawful activity. It has been plagued by strikes, assaults, bribes, intimidation, trespass, vandalism, sabotage, threats, coercion, boycotts, blackmail, stalking, collusion, wilful damage—you name it and this industry has had it. These practices have meant high infrastructure costs, delayed projects—stalled for months by strike action—and the development of a culture which can, in many respects, be compared with that of organised crime. Ordinary Australians will not and should not be required to cop this sort of behaviour. People are smart enough to know that the rule of law is more important than the agenda of minority interest groups and militant unions. I wish that the powers of the ABCC—and they are quite extraordinary powers—were not needed. But we know from serial misbehaviour within the sector that the tough cop on the beat needs to have the powers that are required to do its job. Sadly, this bill will abolish those powers and it will abolish the body that has been so successful in enforcing law and order.

I want to remind the House why the Office of the Australian Building and Construction Commissioner was established. Of course, it took a coalition government to take the tough decisions to return the building and construction industry to law and order. In August of 2001, the Howard government established the Cole royal commission to investigate the culture of lawlessness that had plagued that industry for decades. Commissioner Cole reported in March 2003, and the report catalogued more than 100 different types of unlawful conduct in that sector. This resulted in the creation of the Building Industry Taskforce, a body that secured law and order in the industry until the BCII Act was established, and the ABCC was created in 2005. The ABCC was created as a genuine and strong cop on the beat, and it was given the powers that it needed to actually enforce law and order and to do its job properly.

The ABCC is independent, it has been very effective, and it has done the hard yards to try to wrest control of the industry away from a culture of lawlessness and return it to something resembling other sectors in the Australian economy—sectors where people can go to work and expect that they will not be stood over or subjected to thuggery or intimidation, where they can just go to work and behave like they are in a normal workplace, as every other Australian would expect. It has been incredibly successful in returning law and order to the industry and, in doing so, it has also been incredibly important for the overall health of the Australian economy. Independent research says that industry productivity is up by some 10 per cent, there has been an annual economic welfare gain to the whole Australian economy of $5½ billion per year and inflation is lower. It is estimated that there has been a downward impact on CPI, to the tune of 1.2 per cent, and higher GDP for the whole Australian economy—up by 1½ per cent—because of the significant success of the ABCC.

It has also, very importantly, resulted in a significant reduction in the number of days lost to industrial action. For the workers in that industry it has resulted in real wage increases of more than 15 per cent. So it has gone some way, within its short life, towards controlling the culture of lawlessness in the industry and changing the culture of the industry. But I do not think anybody who has been privy to some of the work done at the Westgate Bridge construction site in Victoria could say that the ABCC’s work is done or that the culture of the industry has been changed. This industry still requires an incredibly tough cop on the beat to do the job it is being asked to do in what is a very tough industry.

I want to go through some examples of lawlessness that were uncovered by the Cole royal commission. These are the sorts of things that have been happening in this industry in the last decade—it is not ancient history—and they are great examples of how the militant unions in the sector have conducted themselves. Cole came up with more than 100 examples of the lawlessness that occurs, and I would like to remind the House of some of the case studies he presented. He talked about a Japanese company called Saizeriya. They wanted to establish new facilities in Victoria. It is generally acknowledged that it is in Victoria and Western Australia that the militant construction unions are at their worst. After some discussion with the state Labor government in Victoria, Saizeriya decided to make a massive investment in food-processing infrastructure. They were going to invest, in the first instance, $40 million. This project would have created 100 jobs locally and about 500 full-time jobs on an ongoing basis, with experts predicting that the indirect flow-on effects from the establishment of the new facilities would create up to 3,000 additional jobs.

Saizeriya’s long-term plan was to open a new facility every five years. They wanted to invest more than $200 million over a 20-year period. But the second they started work on their first site, the Victorian Trades Hall Council and the militant unions started their normal campaign of work bans, boycotts, contractor restrictions, strikes—the sorts of behaviour I outlined earlier. They did this in support of union demands that three workers who were not needed on the project but who were members of the union be employed, that arrangements be made for employees from an asphalting company to be dual ticketed, that a barbecue lunch be provided on site at Easter 2001 and that the company agree to provide a DVD to be raffled at the barbecue with the proceeds to be paid to the CFMEU fighting fund to support its opposition to the work of the Cole royal commission.

As you can see, the union’s demands were ludicrous. But, because those demands were not met, this union went about disrupting the project and ensuring that it could not go ahead in a timely manner. As a result, the first plant, which was due to open in February 2002, was not completed until June 2003. After completion of the first stage, and because this company had found it so difficult, the company decided to pull the plug on any further investment. So the $200 million and the 3,000 jobs that would have come into the Australian economy were pulled because the company found it far too hard to do business in Australia because of the unions and the poor industrial relations climate that existed. They looked at taking their business to New Zealand instead. The royal commission found that:

By any standards, the Victorian investment proposed by Saizeriya Australia Pty Ltd was significant. It had great potential benefits for the Victorian economy. Largely as a result of industrial misconduct on the part of the AMWU and CFMEU members and officials associated with the project, the first stage will, it is expected, be completed almost 12 months behind schedule. Not surprisingly, Saizeriya Australia has chosen to review the issue of whether it will proceed to build some or any of the four remaining plants which formed part of the original proposal. Saizeriya Australia’s experience starkly calls into question the effect upon foreign investment requiring building and construction work of any magnitude in Victoria when such work may be subject to unlawful and inappropriate conduct and actions by unions.

Anecdotally, if you ask well-placed people in Victoria about Saizeriya, they will tell you that the founder of Saizeriya, a very successful Japanese businessman, had been subjected to a campaign of fear and intimidation by the Japanese yakuza when he was establishing his business in Japan. I understand that one of his stores in Japan was actually burnt down as a result of that. He saw off that challenge and built his business there. But he said he has never found anything as difficult as the culture of the construction industry in Victoria and that what he was subjected to in Victoria was worse than what he was subjected to by the Japanese mafia in Japan.

As I said, it is in Victoria and Western Australia that you see these militant construction unions at their worst. The Cole royal commission outlined the case of Dependable Roofing. The situation was that a contractor had engaged Dependable Roofing, which was not on the union’s list of approved companies, to perform work. The CFMEU, led by Joe McDonald, raided the site. They hunted down the employees of Dependable Roofing, who were at the time working on a scissor lift some 6½ metres off the ground. The CFMEU raided the site and hunted down employees of this contractor, which was not a union approved contractor. This happened in the last decade; it is not ancient history. This union official is still causing trouble and he is still the lead union official for the CFMEU in Western Australia at the moment. He hunted down the employees. The raiders surrounded the scissor lift and prevented it from being moved. They then turned off the central control unit of the elevated platform and removed the keys, so those workers were stuck 6½ metres in the air and could not get down.

After stranding the workers up in the air, the union then claimed it was a safety issue. When Dependable’s workers finally were able to get down from the lift, they were so intimidated by the raiders that they were forced to retreat into their site office. During that time one worker was assaulted by Joe McDonald, and others were surrounded, abused, threatened and told to get off the site. When in the site office, which was a demountable site office, a temporary arrangement, the raiders bashed and kicked the side of the office and eventually lifted that site office from its mounts and pushed it over, with the people trapped inside. This was Joe McDonald, a serving union official in Western Australia. This is a report from the Cole royal commission.

This is an example of the way that these unions behaved, and it is an example of the sort of behaviour and lawlessness that the ABCC was established to deal with. It would be good if we could report to the House that this sort of behaviour was a thing of the past within the building and construction industry, but clearly it is not. We can see that from examples at the Westgate Bridge building site in Victoria from just the last couple of months. There have been some appalling examples of behaviour from that site. It has been blockaded and delayed. It has seen intoxicated unionists from both the AMWU and the CFMEU engage in behaviour that could only be called absolutely appalling.

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