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

The coalition strongly opposes the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009, because we believe that every Australian, whether they be an employer or an employee, deserves to be able to go to their workplace and operate in an environment where basic law and order is enforced. Every Australian has that right, and this bill abolishes the body that ensures that law and order is enforced in the building and construction industry.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Rubbish!

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to 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.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

That’s not true.

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

So you are saying that reports of bad behaviour at the Westgate Bridge are not true?

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Were they in the Australian?

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

It is interesting, because your minister has commented on those reports. Maybe you should refer back to her speech. It is interesting that members opposite would interject that this is not true. So apparently there has not been any bad behaviour at the Westgate Bridge. This is probably a great example of the sort of denial the Labor Party members are in. If they were not in that denial, how could they support the abolition of this body that has brought law and order back to this industry?

Let me just go through the examples of behaviour that apparently have not occurred at the Westgate Bridge site. What has happened is that union officials there have surrounded the manager of the construction company, called him a dog, abused him, banged on windows, kicked the front door off its tracks, impeded people from going to work and abused staff. Even a cursory search on the internet, if members opposite would like to undertake that, will show documentary photo evidence of this happening. This needs to be considered in the context that the company is paying workers on that site, on average, $135,000 a year, which I think by any measure is a reasonable wage.

We have also seen balaclava clad, militant raiders involved in high-speed car chases. There have been allegations of bikies being paid money to attend protests. There have been attacks on the private homes of supervisors. There has been damage to vehicles. There have been bricks thrown through windows, with death threats. Ultimately, police have been called in to protect workers who just wanted to go onto that site and do their job. All of this has happened within the last 12 months. Now we find this government is going to abolish the one body that has the powers to  control this sort of behaviour.

I am happy to go on with examples of bad behaviour. Again I will turn to Western Australia, which is subject to the CFMEU in particular, who have an incredibly blackened record of behaviour within the building and construction industry. The infamous Joe McDonald, whom I referred to earlier, had his right-of-entry permit withdrawn at state and federal levels some time ago. Despite this, in 2008 the Industrial Relations Commission had to force an undertaking from the secretary of the CFMEU’s WA branch that Mr McDonald would not continue to enter sites unlawfully. This was a result of a complaint from Multiplex. Mr McDonald had entered their sites on over 30 occasions without a valid permit. In a media interview afterwards, Mr McDonald said that he would continue to illegally enter building sites, despite the undertakings that had been given to the Industrial Relations Commission. So clearly this is not a union or a union official with much respect for the law.

The Cole royal commission  found that payments had been made to the CFMEU in Western Australia of over $1½ million for so-called casual tickets, which is basically money paid in return for industrial peace on sites where all workers are not members of the union. The Cole commission found that, of the $1½ million that had been paid, they could only trace less than $500,000 of that money. So $1 million of this money paid to the CFMEU has just disappeared.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

It’s an allegation.

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

It is interesting that Labor Party members here seem to think that this is all made up. They might want to go back and refer to the Cole royal commission. Apparently they will not believe that members of the CFMEU would behave in this way. It is only that sort of denial that could lead you to support this ludicrous bill that abolishes the body that  controls this sort of behaviour.

There are significant problems with this legislation that we are opposing here today as the opposition. Despite the rhetoric of the Minister for Employment and Workplace Relations that it maintains a tough cop on the beat—and this is another great example of the minister’s cliches; she says ‘tough cop on the beat’ but sadly it does not mean anything—this bill removes the independence of the building inspector and it ties up the watchdog in red tape. It actually has a sunset clause, for the abolition of the powers that the new body has, to do its job properly. Most ludicrously, it contains provisions that switch off the powers that the new inspectorate within Fair Work Australia has to enforce the law. That seems to me to be an extraordinary thing to contain within Commonwealth legislation. There are laws that are established so an independent body can do its job, and you can apply to have those laws switched off. Why you would need those laws switched off is unclear to me. Of course, what will happen is that this will become part of negotiations and the unions will demand that these powers be switched off for any particular site and therefore they can return to their bad old ways without fear of  having a policeman on the beat that has the powers to draw them into line.

This bill also reduces penalties for unlawful behaviour within the industry by two-thirds. It narrows the definition of industrial action and it removes provisions that stand against coercion and undue pressure being put within that industry.

It is not just the opposition that is appalled at what is happening here. With the exception of the militant unions, which are going to be given carte blanche to return to their bad old ways through this bill, all of the stakeholders within the industry are publicly on the record opposing what is happening here. AMMA have supported some aspects of the bill but their overall impression is:

… the effect of the BCII Amendment Bill is to disarm the tough cop and tie up the building industry watch dog in red tape.

That is exactly what the opposition says and exactly what is going to happen if this bill passes through parliament. The Master Builders Association said that the government must reconsider the bill and not proceed with its passage and that the bill is potentially disastrous for the building and construction industry. The AI Group, perhaps one of the government’s more favoured business groups, have said that cultural change has not been achieved within the industry. They have raised concerns about the proposed switch-off provisions, about the five-year sunset clause and about watering down the penalties by two-thirds, and they are also concerned about the lack of independence of the proposed inspectorate. The Civil Contractors Federation have echoed the concerns of the AI Group, as have the Business Council of Australia. They have said that they want the bill delayed and that they are opposed to having switch-off provisions within the bill, provisions which are, quite frankly, ludicrous. The Air Conditioning and Mechanical Contractors Association oppose the bill. They say that this bill will result in:

… a significant diminution of the powers of the “..cop on the beat..”

and:

… there is likely to be a return to a level of unlawful behaviour on construction sites that prompted the actions that were taken by the government in 2002 to curtail such behaviour.

These are the bodies that actually represent people who are engaged in this industry on a day-to-day basis, and they are saying that passage of this bill will result in a return to the bad old days within the building and construction industry.

I will go on. Australian Business Industrial say that the government should reconsider its approach to the controversial aspects of the bill. The Electrical and Communications Association believe that the specific legislation for the building and construction industry should remain. The Housing Industry Association said:

To enable a long term cultural change, HIA submits the bulk of the current institutional framework embodied in the ABCC needs to continue without some of the significant “watering down” of powers contemplated in the Bill.

The Australian Chamber of Commerce and Industry supports the existing system. They say that the ABCC should:

… be retained as a stand-alone agency, with its existing capacities and responsibilities, and with its supporting legislation and associated instruments essentially unchanged.

Finally, the Chamber of Commerce and Industry Western Australia, a body that knows all too well the behaviour of the CFMEU in WA, say:

Removal or weakening of such power is expected to encourage union lawlessness.

So there we have it. All of the organisations representing people who actually operate within the industry say that the passage of this bill is going to result in a return to lawlessness within the building and construction industry, a return to the practices that I have reminded the House about that were exposed by the Cole royal commission and that led to the establishment of the ABCC. It was established with the powers that it needs to maintain law and order within the industry—and all the resulting good that that has done for the Australian economy as a whole, not just for the building and construction industry.

Nobody should be fooled by the minister’s spin on this particular issue. This bill fulfils the long and oft-stated goal of the militant construction unions to abolish the ABCC; it is replaced by a toothless tiger that does not have the powers to do the job properly. In a tough industry, the new body is going to be weak and it is not going to have the ability to do what it is supposed to do. The opposition will oppose this legislation at every step of the way, because every Australian employer and every Australian employee deserves to be able to work in a culture that is free of lawlessness, free of thuggery and free of intimidation. They should expect that they will be able to go to work in the building and construction industry and have the same law and order that every Australian worker expects when they get up in the morning and go about their lawful business.

We will oppose this bill. It abolishes a very successful body and it fulfils the oft-stated wish of the militant construction unions. Nobody should be fooled by the minister’s spin on this. It is a bad bill. The opposition will oppose it.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Clearly, I rise in support of the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009and can I say that I am less than overwhelmed by the contribution of the opposition spokesman, the member for Stirling. In fact, the member for Stirling should perhaps look at what was going on in this country about a century ago, when a chap by the name of Henry Lawson was writing a poem called Second Class Wait Here. The member for Stirling clearly supports a system where workers in the building and construction industry are second class, treated differently to all other workers in Australia. That is what the member for Stirling is on about. He recites a couple of examples from the Cole commission and he raises the spectre of Joe McDonald, a Western Australian union official, whom his party vilified in the course of the election campaign. The man swore on a construction site—gee whiz! If he is the only person in this country who has sworn on a construction site I would be very surprised.

Let’s talk about Joe McDonald, because the member for Stirling, who has now left the chamber, raised the issue of the chap. Let us talk about him and that particular construction site and the reason that he was on that site on that day. It was the Q-Con construction site in Perth. What was he there trying to do? He was there trying to ensure that the workers in his union were given the opportunity to work in safe conditions. He was videotaped verbally abusing an official from the company, a fellow who was obviously a much more worthy person than Joe McDonald, because he was dressed in a suit and tie. What happened on the building site? Let us just read from the West from 5 July 2007:

Falling concrete has prompted workers to walk off the job at a Perth building site where union hard man Joe McDonald was caught on video abusing a construction manager over safety.

Abusing a construction manager over safety on a building site that was unsafe—my goodness, what a dreadful man this Mr McDonald must be. Big chunks of:

Concrete fell 16 floors at the Q-Con construction site on St Georges Terrace … sparking safety concerns.

I beg your pardon? Joe McDonald was on the site sparking safety concerns and Joe McDonald was right. It is a fortunate thing that workers were not killed on that site. As has been noted on a number of occasions, not least by the former member for Corangamite, Mr Stewart McArthur, in a speech in this chamber about two years ago on 16 August 2007. I will read the full sentence because he was coming at it from a slightly different angle to me:

There is no room for bullying or unsafe practices on a construction site and the high-fatality statistics in the industry are chilling proof of this.

That speech was made in support of a system that we are told is the one that is going to improve construction safety. The Australian Safety and Compensation Council produces notified fatalities statistical reports. I have two here with me today: July 2007 to June 2008 and July 2008 to December 2008. It is interesting to look at construction industry fatalities statistics in those two reports. In the year from July 2007 to June 2008, 36 construction workers lost their lives on building sites. Nobody should have to go to work knowing that there is that level of fatality in the industry. I note that far too many people do die.

In the second half of last year there were 18 fatalities on construction sites, and 16 of them were workers on construction sites. But it is also illustrative to see how construction site fatalities have trended since the introduction of the ABCC, which members opposite tell us is going to solve all the problems. In 2004-05 there were 18 fatalities on construction sites; in 2005-06 there were 25. The ABCC came into effect in October 2005 and certainly did not reduce fatalities that year. In 2006-07 there were 28, in 2007-08, as I have said, there were 36. Fatalities have risen under the regime of the ABCC, which those opposite would have us believe was there to prevent just that happening.

Members opposite are more than willing to vilify and call criminals those members of unions and their executive who seek to protect lives. A submission to a Senate select committee quite recently from the building industry superannuation fund has an interesting little couple of paragraphs within it:

In September 2002 the Fund supplied the ATO—

Australian tax office—

with approximately 70 employers who had failed to pay contributions—

That is, superannuation contributions—

for the 2001/2002 year.

In a follow up conversation with the ATO—

The writer was advised—

that half had gone bankrupt … 10 had no record of existence at the ATO and the remainder would be followed up with desk audits over the next few months.

No doubt by the time that desk audit was over some of those too would have gone out of business. If you are going to go chasing the criminals in the building industry, you had better have a look at some of the building industry companies, not just the unions. The ABCC has concentrated its entire effort on building industry unionists or innocent bystanders. Look at the university academic that they were trying to haul in in Melbourne. This is not the way our country needs to be run.

I should make mention of a certain case just so that people understand the situation in which construction industry unions find themselves in their work. Several years ago I met a guy by the name of Gary McCarthy. Gary McCarthy was a member of and, I think, a site organiser with the CFMEU. A very close friend of his, a young man by the name of Mark Allen, died in September 1996. He was killed on a demolition site in Perth—this centre, the member for Stirling would have us believe, of unlawful activity by the building industries. He was killed on a site while trying to get workers down from an unsafe area on a demolition site. He was killed, he was opposed and Premier Court at the time thought the situation was wonderful.

I will now return to the provisions of the bill that is before us. This bill is informed by a number of things. One of the things it is informed by is the Wilcox review commissioned by our government, not the Cole inquiry commissioned by the former government.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Is Cole good or bad?

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

I am more than interested to listen to what the architect of Work Choices has to say. If you want to take us on over industrial relations in the community, feel free.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Tell us how much you got from the CFMEU.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

I am going to answer that question because the member deserves an answer. The CFMEU did not contribute to my campaign. The CFMEU is a union from the other side of the party that I belong to. It did not contribute to my campaign. But I tell you what: I have more respect for any unionist in any union in this country than I have for any of the people who sit over there, who will oppose the legislation before the House.

Murray Wilcox reported on the activities in the industry and made eight key recommendations, and this government is proceeding down that path. The big point of contention is the retention of the coercive powers. Talking about spin, the spin that these powers need to be retained comes from the newspapers, members opposite and companies in the building industry, who, we note, because of their financial behaviour, are not blameless. I am not so sure that this widespread unlawfulness exists, but I am prepared for the level of coercive powers to be retained under the conditions that have been set out, because they are reasonable conditions—for example, the five-year grandfather clause. I would be very surprised if we cannot wipe out any actual or alleged unlawfulness within the building industry in five years.

These powers are obnoxious. If they were not obnoxious they would exist in every enforcement regime in the country, and they do not. They are obnoxious powers and they are targeting a particular group of Australian citizens—and quite unfairly, I believe. I think that over the course of the next five years the limited number of occasions on which these powers will be used will prove me right. Each use of these powers will require approval by a presidential member of the Administrative Appeals Tribunal. That means that, for the Fair Work Building Industry Inspectorate to actually use these powers, it will have to show cause to someone who has some understanding of what all of this means.

Unlike the current situation, a person summonsed to appear under these powers will be able to have the assistance of the representation of a lawyer. Good grief! The former government set up a situation where people were denied representation in quite legalistic processes. You would not do it anywhere else. Why would you deny a person appearing before any court of this country the opportunity to be legally represented? People will be provided or reimbursed reasonable expenses, which I think is fine. All examinations will be undertaken by the director of the inspectorate or somebody who has been deputised by him or her to do that. Finally, all examinations will be videotaped and reviewed by the Commonwealth Ombudsman to make sure that the powers are not being abused.

It is also important to note that a person who is interviewed under these provisions will not be prevented from telling his wife or anybody else about what is going on. The idea that you can be interviewed and not discuss it is quite ludicrous. I think it is also appropriate to make the point clearly that within this legislation the penalties and offences are exactly the same as the penalties and offences within every other industry in the country. There will be no more special penalties or special offences for the building and construction industry. The Fair Work Building Industry Inspectorate has not been included in the office of the Fair Work Ombudsman as had been planned, and I actually support that exclusion. It is a departure from what Wilcox suggested, but I would be very disappointed if coercive powers were part of our mainstream industrial legislation. Whilst they exist I am happy for them to exist to the side.

The switch-off power of the coercive powers is interesting in the context that construction projects that do commence post 1 February 2010 are able to operate in an environment where these powers are not hanging over the heads of workers like the sword of Damocles. I wonder why people would think that that is not appropriate. The member for Stirling indicated that he believes that the hotbeds of unlawfulness in the construction unions are in Victoria and Western Australia. That may or may not be the case. I certainly do not see enough evidence to suggest that there are hotbeds of unlawfulness. But that leaves a number of other states—Tasmania, New South Wales, Queensland, Northern Territory, the ACT and South Australia—as not hotbeds of unlawful behaviour. Quite frankly, the existence of these powers is always going to create a tension between employer and employee. If those powers can be switched off in the context of a project, I suspect that will be something to assist in creating a good working relationship between employer and employee and I would not be surprised to see applications coming from the companies undertaking projects as often as they come from the unions or third parties.

The interesting thing of course is that the unions would prefer there to actually be a switch-on power rather than a switch-off power. I think they are actually both. The need to have approval of the presidential member of the AAT before the powers can be used is, in effect, a switch-on power. It is a safeguard against ideologues such as those who operate in the ABCC currently, people who are true believers of a nature other than the true believers on my side of the chamber, who are out to do a job. Quite frankly, I think everybody in the country recognises that the job they were set to do and the job that they have relished is a union-busting job. They have been unsuccessful and the government has been elected making quite clear statements in relation to the building industry through the Forward with Fairness documents in April and August of 2007. The people knew what they were getting from this government. The election was about industrial relations. If you people opposite wish to take on this government over industrial relations, then there will be fewer of you after the next election.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

This is my first attempt at addressing the chamber from my new position. I rise to oppose the government’s attempts to water down or destroy the very successful ABCC today. This is, as we have just seen from the speech from the member for Longman, a campaign being run by union members for union bosses, not for the interests of actual workers on the ground. Let me just address a couple of points the member for Longman made in particular on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009, the first being that those of us on this side do not care and nor does the ABCC about worker safety. It is an absolutely outrageous slur on anyone in this place to suggest that anyone would not care about the death of a worker, or the death of anyone for that matter. It is a suggestion that is beyond repute but not beyond those on the other side because that is the way they operate. It is a disgusting slur, it is not unusual, it is a CFMEU tactic, it is a Labor Party tactic; and it is not right.

Let us deal with OHS in the building and construction industry. The member for Longman comes from Queensland. As I understand, there has been a Labor government in Queensland all of this century. Who looks after OHS on work sites? Labor state governments. If you want to make a criticism of governments not caring about deaths in the construction industry, start looking closer to home, Member for Longman; start looking to those in your state government who seem to be more interested in getting kickbacks for services delivered on projects than they are in actually looking after your workers’ safety. If you want to start to make accusations about who cares or who does not care about workers and their safety, look closer to home. That is the first issue: state governments have the fundamental responsibility for OHS in this country.

An aspect of the Cole Royal Commission into the Building and Construction Industry was the establishment of the Federal Safety Commissioner, which this bill, as I understand, seeks to continue. So the link between safety on work sites, deaths in the construction industry and the ABCC is a deliberate slur in place of an argument. If you want to be critical of the OHS performance in your state, look at Premier Bligh, look at Premier Beattie and have a look at your state Labor governments who have run this country for the best part of the last 10 years. If you are serious about looking at safety, have a look at the record of your state Labor governments. Let us deal with that in the first instance. Let us deal with that slur that they continue over there because they have got no argument on this point. All they have got is a slur. If you want to look at safety, look at the performance of your state Labor governments. Any death on a work site is tragic. To suggest that anyone does not care about that is a complete and utter slur and should be withdrawn.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

I am not sure that is what I said.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

It is absolutely what you said and you allege the ABCC does not care about it. In fact, Commissioner Lloyd has said:

The ABCC is committed to do all it can to improve the industry’s poor occupational health and safety record and to support those specifically charged with this task …

Those charged with this task are the Federal Safety Commissioner established by the former Howard government and the state OHS officials. So much for union officials doing so much for safety if the record is so poor. Let us deal with the history of this industry.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Mr Sullivan interjecting

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

So where have the OHS officials from the state government been, Member for Longman?

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

They were there.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Oh, they were there. It really mattered, didn’t it? Their record has been outstanding on this, hasn’t it? It is a poor link in place of an argument, which you do not have.

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

I have got a great argument.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

The argument run by the other side is that being run by the CFMEU, and they are just placating in this place. But we will deal with that.

Let us look at the history of this industry and where the ABCC comes from. It comes out of a royal commission that those on the other side now seek to slander, as they have since it was established. They did not mind when Commissioner Cole investigated a campaign by the then member for Griffith, but the royal commission held when he investigated the building industry did not have as much value, apparently.

Let us look at what that royal commission found. It found an industry which was basically snubbing its nose at the rule of law. It was conducted from August 2001 and was established to inquire and report into the nature, extent and effect of any unlawful or otherwise inappropriate conduct in the building and construction industry. The commission sat for 171 public sitting days, accumulated 16,000 pages of transcripts and heard from 765 witnesses. In addition, 1,900 exhibits, including confidential exhibits, were tendered to commissioners, and some 29 general submissions were presented from interested parties throughout the building and construction industry.

The final report from Commissioner Cole was tabled in parliament on 26 and 27 May 2003 by the then Minister for Workplace Relations, the member for Warringah. It outlined the royal commission findings that the industry was characterised by widespread disregard for the law, and catalogued over 100 types of unlawful and inappropriate conduct. The commission also found that existing regulatory bodies had insufficient powers and resources to enforce the law.

Let us deal with some of the issues that the royal commission found. The findings provide a very compelling insight into this industry, prior to the beginning of the ABCC. The royal commission found:

(a)

widespread disregard of, or breach of, the enterprise bargaining provisions of the Workplace Relations Act 1996 (C’wth);

…            …            …

(d)

widespread requirement by head contractors for subcontractors to have union-endorsed enterprise bargaining agreements (EBAs) before being permitted to commence work on major projects in State capital central business districts and major regional centres;

(e)

widespread requirement for employees of subcontractors to become members of unions in association with their employer obtaining a union-endorsed enterprise bargaining agreement;

(f)

widespread requirement to employ union-nominated persons in critical positions on building projects;

(g)

widespread disregard of the terms of enterprise bargaining agreements once entered into;

(h)

widespread application of, and surrender to, inappropriate industrial pressure;

(i)

widespread use of occupational health and safety as an industrial tool;—

This is just what we saw the member for Longman do in defending this case.

(j)

widespread making of, and receipt of, inappropriate payments;—

This is very similar to what happens in Queensland at the moment, as I understand—

(k)

unlawful strikes and threats of unlawful strikes;

(l)

threatening and intimidatory conduct;

              …              …              …

(n)           disregard of contractual obligations;

(o)

disregard of National and State codes of practice in the building and construction industry;

(p)

disregard of, or breach of, the strike pay provisions of the Workplace Relations Act 1996 (C’wth);—

They were completely thumbing their noses at the law—

(q)

disregard of, or breach of, the right of entry provisions of the Workplace Relations Act 1996 (C’wth);—

This is a bit similar to what is happening at Woodside in WA at the moment, with 170-odd right of entry applications in four weeks—four weeks!

(r)

disregard of Australian Industrial Relations Commission (AIRC) and court orders;

(s)

disregard by senior union officials of unlawful or inappropriate acts by inferior union officials;

(t)

reluctance of employers to use legal remedies available to them;

No wonder!

              …              …              …

(w)

inflexibility in workplace arrangements;

(x)

endeavours by unions, particularly the Construction, Forestry, Mining and Energy Union (CFMEU), to regulate the industry; and—

last of all—

(y)

disregard of the rule of law—

which applies in our country.

What was the effect that we found this had on our economy and on general mum and dad punters? We saw an industry whose productivity had been lifted by 10 per cent as the ABCC was introduced, we saw a lower CPI, we saw a higher GDP and we saw an annual economic welfare gain of $5.5 billion per year. But all these results are disregarded by those on the other side purely for their political purposes. Those on the other side stand hand in hand and side by side with the CFMEU officials who are identified in this royal commission report as being the perpetrators of the economic destruction of this industry.

The ABCC has actually brought law back to this industry. It has brought back a legal framework which employees, employers and subcontractors can operate under. It has removed the bullying and the intimidation which—for too long—made this industry a laughing stock not only in our country but other countries as well.

So let us not have this ‘ABCC are all a bunch of neophyte Liberal-lovers who run around trying to destroy the union movement in Australia’. The ABCC has reintroduced the concept of the rule of law into Australian workplaces in the building industry. This is not a matter of dealing with workers’ rights or safety; it is actually a matter of dealing with inappropriate, illegal conduct on building sites.

Those on the other side will stand up and talk about how we do not support workers’ rights and how we are all out to get unions and so forth. That is completely untrue. Those on the other side seek to denigrate this royal commission and argue it was done for political purposes; but this royal commission found an industry held up by illegal conduct and which was damaging our economy through this behaviour. They seek to defend that behaviour and to reinstate the power and privileged position of certain officials in the CFMEU and other unions like the ETU in Victoria—I notice the member for Deakin is not speaking on this bill, which surprises me a great deal. They seek to take us back to the bad old days.

In its short time, the ABCC has achieved quite significant benefits to the Australian economy. It was established due to a recommendation of the royal commission. In 2003 the first steps to implement the recommendation were begun by the member for Warringah, followed by the member for Menzies, successive workplace relations ministers. Following the 2004 election, in October 2005, the commission was established, led by Commissioner John Lloyd, who has done an outstanding job. It is a credit to his work ethic. Members can shake their heads and denigrate a public servant if they wish—they are good at it—but he has done an outstanding job of reintroducing the law into this industry.

What we have seen from the KPMG-Econtech research—which those on the other side will disagree with—is industry productivity up by 10 per cent, an annual economic welfare gain of $5.5 billion, a lower CPI, a GDP higher by 1.5 per cent and a significant reduction in the days lost through industrial disputes and illegal behaviour on worksites. That is what we are talking about here: illegal behaviour on worksites. No-one has anything to fear if they actually follow the law; that is the point. If they follow the law and respect the rule of law in our country, which I thought those on the other side stood for, they have nothing to fear.

What those on the other side want to return to is the privileged position that a certain union had. What does it mean? Increased membership means increased financing. Increased financing means increased donations. It is a revolving slush fund, and that is what they want to go back to. This is not about safety or workers’ rights—not at all. This is about union power; make no mistake. The arguments mounted by those on the other side will quote workers’ rights and OH&S concerns. They will ignore the facts that the OH&S is looked after by their state Labor mates, that there is still a Federal Safety Commissioner and that safety is the concern of all of us. Deaths on work sites should not be used as political pawns, but all too often we will hear speeches from those on the other side peppered through with fatality statistics, suggesting that what we did in government and what we seek to do today is to continue unsafe practices, which is completely untrue and a slur.

So we had a royal commission and we had the recommendations implemented. We have seen the results of the recommendations: an improvement in this industry, for the workers as well as the employers. The member for Longman made the point that in this industry building employers from time to time do not follow the law either. If that is the case, they will be prosecuted. Anybody in this industry, or any industry for that matter, who does not follow the law should be prosecuted by the relevant authorities. That is common sense. But what we saw in this industry—the reason we had a specific piece of legislation and a royal commission into this industry—was that there was a specific circumstance in this industry and a specific behaviour with a disregard for the law. So there was specific legislation built. The legislation has worked, the ABCC has worked and we have seen the improvements, so why change?

Let us look at what has happened in recent times. The Labor government was elected in November 2007 on promises including the abolition of the ABCC and the establishment of a specific inspectorate division within Fair Work Australia from 1 February 2010, until that time maintaining the full powers and operations of the ABCC and a strong cop on the beat at all times—because that sounded like they were being tough—ensuring new arrangements are simple and retaining the principle of the current framework. What we see in this bill is those promises largely implemented following the review by Justice Wilcox. The other thing this bill does is to introduce this concept of switch-on and switch-off with the coercive powers, which basically is switching off—the removal of the coercive powers. The powers in the current law are there to compel witnesses to give evidence that is needed and to provide protection to those who want to give evidence to the ABCC without fear of payback or retribution. What we found with the ABCC—let us remember what we went through earlier on—is that this industry was full of intimidatory practices where people were snubbing their noses at the rule of law. So we needed specific provisions, and that is one of the reasons this has worked.

The existing powers are capable of being used against everyone in the sector: employees, employers and subcontractors—you name it. The proposed restrictions on investigation powers are cumbersome, but they are there because this is the out, you see—this is the deal. I referred today in an article on a website to Ross Fitzgerald, not a well-known supporter of our side of politics. There was a Ross Fitzgerald article earlier this week in the Australian, where he talked about the performance of the Deputy Prime Minister, the woman most likely to succeed when the current Prime Minister runs out of time. He refers to her performance on the Q&A program against the Leader of the Opposition last week, and he is not kind in his analysis of her performance. He says:

She is all style and very little substance. Long on rhetoric, but short on delivery. All foam, no beer.

It is quite a cutting analysis of her performance, and you see that in this bill. What you see is the talk that there has been this great brawl with the CFMEU and the bullyboy unionists—‘I’m standing up to them and we’re keeping this tough cop on the beat’—but then you actually see the detail, which shows that that is simply not true. There are the little opt-out powers which remove all the beneficial aspects of the ABCC.

You will see the removal of Mr Lloyd at some point—you can guarantee that. We saw the reaction from those opposite when I mentioned his name, and there are head nods now; that pretty much confirms that that is what will occur, because this is what happens. If you have someone who those on the other side do not like, who might actually be doing his job properly, you will see a personal campaign of vilification against him. You saw that with the Cole royal commission; you will now see it with Mr Lloyd.

This is the behaviour of those on the other side, who seek to implement their real agenda. They cloak it under a language which pretends that they are tough on illegal or inappropriate behaviour, but in truth they are not. In truth what they are doing is reducing the role of the ABCC, because that is what the unions want. And who benefits from that in the end? The Labor Party. The Labor Party benefits from it in the end. It is all froth and no beer. This is what this bill is: all froth and no beer. It is implementing the true desires of those on the other side: the removal of the institution which has reintroduced the rule of law into this industry, an industry which needed a specific royal commission into it, which found over 100 instances of illegal or inappropriate behaviour. It is an industry which has been for many years subject to inappropriate and illegal behaviour and which will go back to the worst of the excesses of those who seek to implement their own agenda for their own benefit into the future.

We have seen the benefits of the ABCC from the Econtech research and we will see the outcome of the removal of these powers. This is being done for politics. This is not being done for the benefit of the Australian consumers. This is not being done for good policy reasons. This is being done for political reasons. It is a political deal—they have to reward their mates when they are in government. But, instead of being honest about that, what this bill seeks to do is to claim they are standing up when indeed they are not. This is the undercutting of the powers of the ABCC. The removal of these powers is the very essence of the reason that the ABCC has been successful, because remember that the major finding of the royal commission was that this is an industry guided by illegal behaviour and inappropriate conduct. This is a very Labor bill from a Deputy Prime Minister who is all froth and no beer.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I am happy to speak in support of the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. The Rudd Labor government has no tolerance for unlawful and illegal behaviour, whether it is in the building industry or in any other industry in any sector of this country. Unlawful industrial action will not be tolerated by the Rudd Labor government. We will honour our commitment, and this legislation honours that commitment, which we made prior to the last federal election to ensure not only that we have a tough cop on the beat in the building and construction industry but also that we bring a degree of fairness and justice and equity into that industry.

The truth of the matter is that the Howard government, in its time in office, engaged in the persecution of workers not just in the building industry but elsewhere. Work Choices is clearly the best example of the Howard government’s lack of commitment to the terms and conditions, pay and salary and the lifestyles of Australian workers. It is a bit rich for one of the architects of Work Choices, the member for Mayo, to actually give us lectures about the rights of workers. The truth is that the Cole Royal Commission into the Building and Construction Industry was itself a political act set up by the Howard government to ensure that the salary and conditions of those hardworking men and women in the building and construction industry would find themselves subject to a different rule of law than any other worker in any other industry.

I have a fundamental belief that, whether you live in Palm Beach, Perth, the Torres Strait or Tasmania, there should be one law for all. The member for Mayo should have a really good look at the Building and Construction Industry Improvement Act. I note he did not quote in his speech from any sections of that act. I am going to say this for the purpose of those who might be listening in the gallery and for the Australian public. Let us have a look at the draconian provisions in that act. Section 52 says that the ABC Commissioner has the power by written notice given to people to obtain information in a manner and form specified in the notice to produce documents. That power means that a person who has received that notice has to reveal all their telephone and email records, whether of a business or a personal nature; report not only on their own activities but on those of their fellow workers; reveal their membership of any organisation such as a union; and report on any discussions in a private union meeting or other meetings of workers. The provisions can apply not only to a person suspected of breaching a law but to workers in the building industry not in any way suspected of wrongdoing. Also, it applies to innocent bystanders and to the families of workers in the building and construction industry, including children of any age of workers in that industry, journalists and academics. The truth is that that sort of legislation is draconian and unfair on people.

Section 53, which I note the member for Mayo did not even refer to, says certain excuses are not available in relation to section 52 requirements. Section 53(1) says:

(1)

A person is not excused from giving information, producing a document, or answering a question, under section 52 on the ground that to do so:

(a)

would contravene any other law; or

(b)

might intend to incriminate the person or otherwise expose the person to a penalty or other liability …

That is remarkable. Section 52(7) overrides the secrecy provisions in other laws. In other words, it has the potential to override national security laws relating to, for example, ASIO. The sections ensure that the ABCC has coercive powers which override the protection of journalists’ sources, privacy law and even cabinet confidentiality, according to Professor George Williams.

There are no safeguards. Warrants are not there. The review under the Administrative Decisions (Judicial Review) Act is not there. Democratic rights like the right to freedom of speech and the right to silence are stripped away. In fact, it makes a mockery of its aspirations to respect the rule of law in section 3 of the Building and Construction Industry Improvement Act. So let us not get sanctimonious about this. This is an Orwellian piece of legislation produced by the Howard government after their commissioner of choice put down a report and Howard followed it. He opportunistically used legislation and the fact that they had a majority in the Senate to do certain things. The ABCC was given extraordinary powers in an industrial context which were not even given to the police to investigate major crimes. They go far beyond the powers of the police. The ABCC regime is very different from any other regime. It acts in a discriminatory manner. For example, you can say that ASIC, the ATO or even the Child Support Agency has investigative powers, but they do not investigate those powers and take on, say, butchers or those living in Toowoomba or those who may be Catholics. The ABCC has very discriminatory powers and the law itself is a criminal investigatory model put forward in a non-criminal industrial context. That is the situation.

Those opposite should not get too pious about what their position is and how wonderful and virtuous the ABCC legislation is. I can think of nothing more Orwellian in terms of its nomenclature, apart from Work Choices, than the Building and Construction Industry Improvement Act. John Lloyd, the ABC Commissioner, has shown his true colours with what he has done. We have seen many prosecutions initiated and there is a degree of unbalance in the nature of the activities going on. I have had friends who have been attacked and subject to prosecution. Just yesterday I had lunch with a good friend of mine, the secretary of the plumbers union in Queensland, Bradley O’Carroll, who himself was pursued. There is a lack of even-handedness about the ABCC’s activities. Fortunately, Justice Spender, throughout the case against Brad O’Carroll, said it should never have been brought in the first place. That is just typical of what I would consider to be the unfounded coercion that the ABCC practises in relation to workers, many of whom are law-abiding Australians who go about their business providing for their families from the salary entitlements that they earn working in the building and construction industry. If there are acts of illegality and criminal behaviour in the building and construction industry then they should be subject to the full force of the law by the police and the courts. That is why we have the Australian Federal Police and the police forces of the states and territories of this country.

The member for Mayo talked a lot about following the Cole Royal Commission report, but the Deputy Prime Minister herself decided to look into this and appointed the Hon. Justice Murray Wilcox to provide a report to consult the stakeholders in the report on matters relating to the creation of what we believe to be a fairer system that is putting the whole issue of the building and construction industry into the Fair Work Building Industry Inspectorate. Murray Wilcox came back to the government with recommendations after extensive consultation with stakeholders in the industry. Many people—employers and employees, ACCI, and the Business Council of Australia—were involved in responding to the Wilcox inquiry. We have acted on our election commitment, a commitment upon which we were elected by the Australian public. We have listened to what the Hon. Justice Murray Wilcox has had to say and we have followed his recommendations. I agree with what the Deputy Prime Minister has had to say about the vast majority of participants working in the building and construction industry: they are law-abiding men and women and wonderful citizens of this country.

The Wilcox recommendations go a long way towards bringing forward important safeguards to avoid the arbitrary, if not capricious, misuse of the powers given to the ABCC by the Howard government in this piece of legislation. The provisions in this legislation before the House today prescribe, very carefully, prudently and appropriately, clear safeguards and oversight in all the circumstances. I applaud the campaign of so many workers and their unions who have focused on this particular issue and aspect of our industrial life in this country. I have many friends in Queensland—in the BLF and the CFMEU, the Electrical and Plumbing Union and other unions—and many of them are good, hardworking, decent Australians who have been subject to the threat of these terrible laws hanging over them for far too long. We hope and expect that the coalition would respect the mandate given to us by the Australian people when we pass this legislation—not just through the House but, we hope, through the Senate—in the circumstances.

The legislation before the House goes a long way to alleviating the problems with the current legislation—legislation which so persecutes Australian workers in the building and construction industry. I have learnt in many years in politics that you cannot get everything you want and I have argued my position for a long time in the various forums of our party in relation to this. I am happy to speak on this bill and to support what I believe will be a very significant improvement in the lives, in the workplace and elsewhere, of men and women in the building and construction industry, not just in my home state of Queensland but in the whole of Australia.

The elements of this particular piece of legislation are very, very important. We are abolishing the ABCC and creating a new and separate regulatory independent ombudsman called the Fair Work Ombudsman to administer the regulatory framework for the building and construction industry. The Fair Work Building Industry Inspectorate will go a long way to bringing fairness, justice and equity into the workplaces and the building and construction industry in this country. Abolishing the ABC Commissioner and the deputy commissioners is important. I would have preferred that they had not been appointed in the first place, but I am happy that we will appoint other people in all the circumstances. The changing of the definition of ‘building work’ to remove its coverage for off site work is important to limit the scope of the legislation. The establishment of an advisory board to make recommendations to the director of a new inspectorate is important because the advisory board will make recommendations about policies to guide the performance of the director’s functions and the exercise of the director’s powers. The advisory board will consist not just of the director but a Fair Work Ombudsman and a representative from the building industry employees’ unions, as well as a building industry employer representative and other representatives.

Another important reform is the creation of an office, the independent assessor, who on application from stakeholders—and that can be employers or employees, and unions as well—can make a determination that an examination notice power will not apply to a particular project. The switch-off powers are important because these coercive powers should not apply to every single project in the circumstances and the independent assessor, if satisfied, can make a determination to switch off the powers. It would be my hope that that would happen on many, many occasions. While we retain the coercive powers there are significant amendments to implement the Wilcox recommendations, including regarding external oversight. The use of each of these powers is dependent on a presidential member of the Administrative Appeals Tribunal being satisfied that a case has been made out for their use.

Importantly, if a person is summoned they could be represented by a lawyer of their choosing and their rights not to disclose information on the grounds of legal professional privilege and public interest immunity will be recognised. That is an important safeguard in terms of civil liberties. Also their reasonable expenses could be reimbursed. All examinations are to be undertaken by senior officials, and all examinations will be videotaped and the Commonwealth Ombudsman will monitor those and review all examinations and report back to parliament on the exercise of this power. Before this examination notice can be issued, an AAT presidential member must be satisfied on reasonable grounds of a number of things. One is that you cannot get this information by any other way. We think it is important that there should be a sunset clause for the coercive powers to end at the end of five years from 1 February 2010. There will be a review prior to that sunset clause date being reached, but in all the circumstances I believe firmly that we will see an end to coercive powers in this country. The criteria which the independent assessor has regard to in terms of the public interest will be specified in regulations, which I think is important, and they will be objectively ascertainable and geographically neutral.

A very important reform which we are initiating is the ministerial direction which is being given to the ABCC. Before exercising that power, the ABCC must provide a nominated person who is a presidential member of the AAT with a report describing the person against whom the power is to be exercised and the purpose of the exercise of that power, the urgency, the likely effect on the person and whether the purpose can be achieved in any other way. In other words, you have got to show that this is absolutely necessary in all the circumstances. An objection can be taken to an appropriate court or tribunal. It is very clear oversight administratively and judicially.

What did the ABCC say about all this and the Wilcox report? The true colours of John Lloyd and co were revealed in its response to the Wilcox recommendations. If we needed some degree of objectivity and evidence based decision making coming out, we did not see that from the ABCC in its response to the Deputy Prime Minister following publication of the Wilcox report. Guess what: the ABCC says that many of the Wilcox recommendations are unnecessary or too expensive in the circumstances—for example, the video recording of every examination. The judicial and administrative reviewable oversights are unjustified, according to the ABCC. The ABCC opposes limiting the definition of ‘building work’ in the guidelines. It thinks that the exercise that it has undertaken in relation to the interrogation powers of a compulsory nature is justified in the circumstances, despite the many cases it has had thrown out. The true colours of John Lloyd and his cohorts have been clearly shown.

The legislation before the House is extremely important. It is about improving the living standards and the working conditions of men and women in the building industry. It is about bringing back a degree of fairness and justice. I can say as a Queenslander that we have not had anything like the unlawful behaviour we have seen from time to time in places like Victoria and Western Australia. My knowledge as a practising lawyer who worked in industrial law from time to time and my knowledge of the men and women who represent workers in their industries in Queensland demonstrate to me that this legislation goes a long way—not quite as far as I would hope but a long way—towards bringing back justice for building and construction industry employees in this country.

I would hope that those opposite would take the opportunity to listen to the voice of the Australian people, to help us eradicate draconian powers given to the ABCC so that the compulsory interrogation powers can be prescribed and so that we can see a modern society in Australia where building workers and their families and children are treated decently, with humanity and with a degree of justice that we as Australians believe is important across all the workplaces of this country. I warmly commend the bill to the House.

Stuart Robert (Fadden, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. Like all Labor titles for bills, it seeks to create something which it is not. Perhaps the bill should have been called the building construction revolution, the BCR, or perhaps the construction revolution and productivity, though that acronym would not quite work. Either way, this bill will not seek to improve anything. At its worst, it will take industrial relations on construction and building sites back to the 1960s and 1970s, and at its best this bill will emasculate an organisation, the ABCC, whose work has been so vital in bringing harmony and order back to Australian construction sites. If power corrupts and absolute power corrupts absolutely, we have seen the ABCC’s function rein in the worst excesses of the Australian union movement. Its removal will see corruption return to sites.

The other question that must be asked is: if you have done nothing wrong, if you obey the law, what do you have to fear? If you drive within the speed limit on the correct side of the road, you have nothing to fear from the law enforcement agencies. If people on construction sites—workers, unions, delegates and employers—obey the law, they have nothing to fear from commissions like the ABCC. Yet the furore I hear from the other side would seem to indicate there is something to fear. That in itself shows that something is wrong.

The coalition supports the work and the operation of the Australian Building and Construction Commission and will vote against any move in this place to water down the operation of that body. Keep in mind that the ABCC, its powers and functions came out of the Cole royal commission that was established because there was a culture of lawlessness, intimidation and unsavoury practices within the building and construction sector. It is almost as though I am speaking about an outlaw motorcycle gang with respect to lawlessness, intimidation and unsavoury practices, but I am not. I am speaking about Australian work sites and about a commission that seeks to give law back to them, which this Labor government wants to undo. The ABCC was established to improve practices within the construction and building sector and has achieved remarkable results. If something is so successful then surely you would want to roll it back—that is the common sense thing to do, isn’t it—and go back to the practices of the past that caused so much pain!

Interestingly, the Labor government always said that they would not touch the ABCC until 2010. Yet, on 25 June this year, the Deputy Prime Minister tried to sneakily issue a ministerial directive to neuter the ABCC from August this year. She sneakily tried to slide it in under the radar to take away its powers. It is good to see the Deputy Prime Minister keeping her word on what the Labor government intend to do. But then, again, I look across the table at the minister for the environment, who said, ‘When we get in, we’ll just change it all, won’t we?’ My goodness, haven’t those prophetic words come true?

We should spend some time and look at what has occurred within Australian building and construction sites since the introduction of the ABCC. Let us deal with facts. Let us not look at the hyperbole of what Labor puts out; let’s look at the cold, hard, brutal facts in the broad spectrum of daylight and at what this Labor government is looking at rolling back. Let me read from the KPMG report, commissioned by the Master Builders of Australia, dated 6 May this year. I am reading from the executive summary:

Both the 2007 and 2008 reports showed that, following the establishment of the Taskforce in 2002 and its successor the ABCC in 2005, and in conjunction with industrial relations reforms extending to 2006, the construction industry has achieved higher productivity than would otherwise have been expected.

And further, ‘This 2009 update brings the economic analysis conducted in the previous reports up to date.’ The report continues:

• ABS data shows that, by 2008, construction industry labour productivity outperformed predictions based on its relative historical performance to 2002 by 10.2 per cent.

Of course we have to roll this back—this is dreadful! It goes on:

• The Productivity Commission found that multifactor productivity in the construction industry was no higher in 2000/01 than 20 years earlier …

Well done, Hawke and Keating governments! That is a great result—productivity no higher, it did nothing—

but rose by 13.6 per cent in the four years to 2005/06.

Clearly, the ABCC has failed! The report goes on:

• The Allen Consulting Group, in a report to the Australian Constructors Association, found a gain in non-residential construction industry multifactor productivity of 12.2 per cent in the five years to 2007.

The Cole royal commission found that, from 1980 to 2000, there was no change in productivity—there was nothing but lawlessness. Yet, in the five years to 2007, productivity rose by 12 per cent. In any language that is an outstanding success of the role of the ABCC and associated legislation. It is unable to dispute the facts, which is why the Labor speakers have not dealt with the facts. They have just rolled over about working families and children and how it is so unfair. The KPMG report continues:

• Using Rawlinson’s data to 2008, the cost penalty for completing the same tasks in the same regions for non-residential construction compared with residential construction has shrunk. This implies a relative productivity gain for non-residential construction conservatively estimated at 6.2 per cent.

And further:

• Other studies conducted in this area support the findings of KPMG Econtech’s analysis. These studies submit that industry reform has lifted construction productivity by approximately 10 per cent.

Whatever study you look at, wherever you go, there is a 10, 12, 13 or 14 per cent productivity improvement because of legislation the Howard government put in and, importantly, because of the role of the ABCC in countering and fighting lawlessness on building sites driven by lawless unions. The report continues:

… the Consumer Price Index is an estimated 1.2 per cent lower than what it would otherwise be under the Baseline Scenario … due to industry reforms, consumers are better off by $5.5 billion on an annual basis, in 2007/08 terms.

Surely such commendable results—industry productivity up by 10 per cent; an annual economic welfare gain of at least $5½ billion per annum; CPI lower by 1.2 per cent; GDP increased by 1.5 per cent; a significant reduction in days lost through industrial activity to the lowest since records have been kept—say one thing: let’s keep doing what we are doing; it is working and, if it’s not broken, don’t fix it. But here we are today trying to fix that which is not broken.

With the overwhelming evidence pointing towards the success and the economic gains to the whole nation, when the CPI reduces, when the GDP increases, every Australian benefits. So why are we here looking at these reforms? The answer is quite simple: on 24 November 2007, Labor came to power. And on Monday, 26 November 2007, on the Gold Coast, where my seat of Fadden is located, the big burly union boys were out on the construction sites saying: ‘Union ticket, or no entry; Labor has won.’ That is why we are here. Since the November 2007 election, strike activity has increased by about 700 per cent—the unions believe they are back in town. In the last four weeks, one Rio Tinto mine site has had over 170 union right of entry demands—it is a non-union site and the unions want to be back in town. If that is not harassment, what is it?

I note with interest that the Attorney-General has produced a discussion paper on the new terrorism laws and their extension to psychological terrorism. How dangerously close is the CFMEU getting to psychological terrorism by making 170 demands in four weeks for union right of entry? This is all about unions exacting their toll for the tens of millions of dollars they put into Labor’s coffers for Labor to win government. There can be no other reason why we are going there—no reason at all. Productivity is up by 10 per cent, the economic gain is $5.5 billion, the CPI is down 1.2 per cent and the GDP is up by 1½ per cent. This is all because of what the ABCC and associated legislation has achieved—and they want to roll it back! It defies imagination. It beggars belief. If you did this as a university assignment you would fail because it makes no sense. You could not mount a substantive argument as to why you would seek to roll back the ABCC after such phenomenal success. But here we are today debating a Labor bill that wants to do exactly that. So it is worth while looking at where we have come from.

In August 2001 the Cole Royal Commission into the Building and Construction Industry was established to inquire into and report on the nature, extent and effect of any unlawful or otherwise inappropriate conduct in the building and construction industry. That royal commission sat for 171 days—16,000 pages of transcript, 765 witnesses, 1,900 exhibits and 29 general submissions from interested parties. Its final report, tabled on 26 and 27 March 2003, is staggering. Here is what the Cole royal commission found about construction and building sites and the unions that run them. It said in its summary of findings that, amongst other things, there was:

(e)

widespread requirement for employees of subcontractors to become members of unions—

demanding it—

(f)

widespread requirement to employ union-nominated persons in critical positions on building projects;

(i)

widespread use of occupational health and safety as an industrial tool;

(j)

widespread making of, and receipt of, inappropriate payments;

That is called corruption. It is exactly what is going on with Queensland Labor at present—the inappropriate receipt of payments. The royal commission also found that there were:

(k)

unlawful strikes and threats of unlawful strikes;

(l)

threatening and intimidatory conduct;

(n)

disregard of contractual obligations;

(o)

disregard of National and State codes of practice in the building and construction industry;

(r)

disregard of Australian Industrial Relations Commission (AIRC) and court orders;

(s)

disregard by senior union officials of unlawful or inappropriate acts by inferior union officials;

(w)

inflexibility in workplace arrangements;

(x)

endeavours by unions, particularly the Construction, Forestry, Mining and Energy Union (CFMEU), to regulate the industry; and

(y)

disregard of the rule of law.

These are the findings of the Cole royal commission. Because of that the ABCC was put in place. And because of that and other legislation, massive productivity improvements and great economic gains have been realised throughout the economy—and this is what Labor wants to roll back. It makes perfect sense, does it not—it all adds up? It is absolute and utter nonsense.

Labor is proposing in this bill to wind back the powers of the ABCC; to narrow the scope of the application of the act; to introduce a whole range of bureaucracy—as if we do not have enough; and to turn a tough cop on the beat into a neutered, toothless tiger. The ABCC will be abolished under this bill and replaced by an inspectorate within Fair Work Australia. This inspectorate will be required to enforce the provisions of the new law if it is passed. An advisory board will be established to make recommendations to the inspectorate about policies and a range of priorities. The scope of circumstances to which the bill applies has been narrowed by removing application to off-site work, and penalties have been reduced. The ability to compel witnesses to provide information to the building inspectorate remains; however, there are a whole range of requirements for such compulsion.

The reason why witnesses were compelled to provide testimony to the ABCC was the lawlessness and intimidation on work sites—if you gave testimony to the ABCC, that would be it; it would be all over. You would not get work anymore. You would be harassed and intimidated. Hence, the coercive powers of the ABCC were put in place. You were compelled to give testimony—so you had no choice. Watering that down and removing it will simply take us back to the bad old days. These requirements are nothing more than bureaucracy. They are designed to entrench and bog down the inspectorate and stop it from acting quickly to investigate any breaches.

There is a switch-on and switch-off interrogation power, I guess like a light bulb. The bill creates the ability for said powers to be switched on or switched off. The position of independent assessor, special building industry powers, may, on application from stakeholders, make a determination that coercive interrogation powers will not apply. There have been 170 requests for right of entry in the last four weeks on one Rio Tinto site. Do you reckon the CFMEU is going to request that the powers be switched off? Do you think they will be good corporate citizens and say: ‘No, you keep them on. We have nothing to fear from the law. We obey the law, so we have nothing to fear. You keep them on’? Do you reckon that is going to happen, after 170 demands for work access in four weeks? It is absolutely and utterly outrageous.

It is a neutered provision that will replace the ABCC. It is completely watered down. It is a payback to a union movement that helped the Labor government win. No other explanation can possibly make any sense. The economic good for the entire nation that has been achieved because of the ABCC and associated industrial legislation is beyond dispute. This is beyond reason. There is no other way to explain it. To water down the ABCC will simply take us back to a union controlled workplace. It will reduce productivity. It will increase inflationary pressure. It will reduce GDP. It will reduce output. It will affect the economy. Those are the outcomes from the legislation that Labor is putting in place. This legislation simply and utterly cannot be supported.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

People who think there is no difference between the political parties ought to pay more attention to parliamentary debates. In particular they ought to pay more attention to this one on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009, because it makes absolutely clear what a stark difference there is between the parties. The member for Fadden just described the CFMEU as akin to terrorists. He gives the game away. He and the other Liberal Party members simply cannot help themselves. The Liberal Party is still the party of Work Choices.

The purpose of this bill is to implement the key recommendations of the Wilcox report on the transition to Fair Work Australia for the building and construction industry through amendments to the Building and Construction Industry Improvement Act 2005. Some of the key amendments of the bill include the abolition of the Australian Building and Construction Commission and the establishment of a new and separate regulator independent of the Fair Work Ombudsman to administer the amended regulatory framework for the building and construction industry.

The bill abolishes the offices of the ABC Commissioner and the deputy commissioners. These will be replaced with a director. The definition of ‘building work’ is amended to remove its coverage of off-site work, thereby focusing the scope of the inspectorate’s operations on work on building sites. The bill also removes the existing building industry specific laws that provide higher penalties for building industry participants for breaches of industrial law and broader circumstances under which industrial action attracts penalties in relation to the building industry.

An area of ongoing controversy has been the question of what are referred to as the coercive powers. The bill creates an office, the independent assessor, which, on application from stakeholders, may make a determination that the examination notice powers will not apply to a particular project—that is, that the coercive powers will be switched off for a particular project. In the event that a project where coercive powers have been switched off experiences industrial unlawfulness, the independent assessor may rescind or revoke the original decision, switching the powers back on based on the same criteria that were used when switching them off. The director may request that the independent assessor review the decision at any time based on changes in circumstances on a particular project.

While the coercive powers have been retained, there are significant amendments to implement the Wilcox recommendations regarding external oversight, including that each use of the powers is dependent upon a presidential member of the Administrative Appeals Tribunal being satisfied a case has been made for their use, that persons summonsed to interview may be represented by a lawyer of their choice and that their rights to refuse to disclose information on the grounds of legal professional privilege and public interest immunity will be recognised. I welcome these safeguards and the intention to sunset the coercive powers in five years time.

I think it is important that House revisit the original, spurious premise for the Building and Construction Industry Improvement Act 2005 and its regulator, the Office of the Australian Building and Construction Commissioner—that is, that we revisit the Cole royal commission, which was established in 2001. From the outset, the Howard government ensured, in setting the commission’s terms of reference, that specific matters, like alleged union misconduct in the industry, received greater scrutiny than other matters. At the time, the establishment of the royal commission was not prompted by any particular issue or dispute in the building and construction industry. In fact, in research papers provided to the commission, the Australian construction industry ranked second or better in 16 of the 23 comparative international studies of the industry consulted by the researchers. On productivity specifically, Australia ranked second in five of the seven reports. On completion times, Australia ranked second in all studies. Finally, on cost per square metre, Australia was consistently rated as second lowest in all studies. This clearly demonstrated that the industry was internationally competitive, rather than one that required radical reform.

A report by the Employment Advocate in May 2001 made allegations of union corruption, fraud and other illegality in the building and construction industry. According to lawyers who closely observed the commission, none of the allegations contained in the Employment Advocate’s report were borne out by evidence, and few of them were even aired in commission hearings. The bias of the commission was also apparent. Ninety per cent of hearing time was devoted to anti-union topics. Six hundred and sixty-three employers or their representatives gave evidence, but only 36 workers. Around three per cent of hearing time was spent dealing with allegations about the wrongdoing of employers. While the royal commission made numerous findings against employee organisations and individuals, very few were made against employers.

The restrictive industrial action provisions that would later form an integral part of the Building and Construction Industry Improvement Act were based on contentious findings of the commission and on a small number of incidents of unprotected action within the context of the industry as a whole. It is difficult not to conclude that the establishment of the royal commission was essentially a political act that was more about Liberal Party ideology than sound economic policy. It was little more than a political exercise, using dubious findings to drive a strategy to undermine union influence in the construction and building industry and provide a smokescreen to justify the introduction of harsh anti-union measures.

In recommending the establishment of an industry specific regime, the royal commission characterised the building and construction industry as singular due to its lawlessness, yet it did not make this judgment based on any comparison with other industries. As George Williams and Nicola McGarrity indicated in their article entitled ‘The investigatory powers of the Australian building and construction commission’ for the Australian Journal of Labour Law:

It is therefore unclear on what basis the Royal Commission could describe the building and construction industry as ‘singular’.

Any differences between industries are likely to be a matter of degree. For example, there is nothing about the lawlessness identified by the royal commission, including breaches of the proper standards of occupational health and safety, application of inappropriate industrial pressure and threatening and intimidatory conduct, that is unique to the building and construction industry. The royal commission found that the existing non-industry specific bodies had inadequate powers to enforce Commonwealth industrial law. If this was true, then there was a problem that needed to be rectified for all industries and not simply in the field of building and construction. As Stewart argued in 2003:

If these amendments are worth introducing, why aren’t they worth introducing more generally?

In the selectivity of its jurisdiction, the ABCC differed from other bodies possessing investigatory powers. The ACCC, for example, has jurisdiction over all persons and organisations, regardless of the industry in which they work or operate, that contravene the Trade Practices Act. By contrast, we had created a body like the ABCC, whose jurisdiction was limited to a single industry, thereby establishing different sets of rules and rights for different workers and employers. It is worth while for the House to note that the CFMEU early this year received formal confirmation that the $66 million Cole royal commission resulted in only two prosecutions—one company prosecuted over strike pay and one union official prosecuted for giving false evidence. No union official or construction worker was prosecuted, let alone convicted, for corruption or criminality arising from the terms of reference for the royal commission.

In recommending these construction industry laws, the commission also had a complete disregard for Australia’s international obligations under ILO conventions to which Australia is a party. In fact, in November 2005 the ILO Committee on Freedom of Association found the Building and Construction Industry Improvement Act breached ILO conventions 87 and 98 on freedom of association and collective bargaining. It is important for the Australian government to fulfil its international obligations regarding our domestic industrial relations arrangements and to act as a leader by demonstrating a genuine substantive commitment to the principles of the ILO.

As I have mentioned in the parliament before, the economic case for the Howard government’s legislation was refuted by a paper co-authored by Griffith University Professor David Peetz called ‘Constructing figures: the mythology of productivity in the Australian building and construction industry’, which pointed out fundamental flaws with the Econtech reports that were used to support the role of the Australian Building and Construction Commissioner. In fact, in that report in reference to the fact that the construction industry is one of the most dangerous industries in the economy, the authors suggest:

It may be that there may be greater economic benefits in focusing on effective occupational health and safety regimes in the industry. It is almost certainly the case that there would be greater social and ethical benefits in doing so.

This is an important point because, since the introduction of the Building and Construction Industry Improvement Act, safety in the industry has deteriorated, with deaths having increased from 19 in 2004-05 to 40 in 2007-08. The lack of action to reduce workplace deaths and improve health and safety on construction sites was a damning indictment of the Building and Construction Industry Improvement Act and of the ABCC. There can be no case for allowing a deterioration in safety standards in the industry. The focus should be on lifting the standard of employer duty of care to ensure that workers’ health and safety is protected. The ABCC failed to adequately deal with employers who broke the law or cut corners on safety. As has been noted in Creighton and Stewart’s Labour Law in reference to the 1969 O’Shea case:

… excessive and insensitive use of enforcement procedures—especially procedures that do not accord adequate respect to the right of workers and unions to take industrial action to protect and promote their legitimate social and economic interests—may well be counter-productive both in terms of those who seek to use them and in terms of protecting the integrity of the system of which they are a part.

The House should contrast the attitude of the Howard government on this issue to that of the Hawke and Keating governments. In pursuing industrial relations reform, the Hawke and Keating governments were successful in significantly increasing productivity levels in the building industry. This was achieved by promoting a cooperative, non-discriminatory approach in workplace relations.

The BCII Act and the ABCC are relics of an adversarial system. I do not think they have any place in a modern economy. Labour law should be balanced, promoting the interests of both employers and employees. We are at a time in our global economy where uniformity and flexibility are both necessary for our labour relations system. I refer to comments by Professor Andrew Stewart. In a submission to the Productivity Commission, he said: ‘The adoption of a national approach includes having laws which avoid unnecessary burdens or restrictions; are not unduly prescriptive; are accessible, transparent and accountable; are integrated and consistent with other laws including international standards.’ What we should be striving for is a seamless national workplace relations system that is flexible and productive and that will respond effectively to the challenges as we emerge from the global financial crisis.

These debates about industrial relations demonstrate the absolute bedrock of difference between the Liberal Party and the Labor Party. The Liberal Party’s belief in free markets, in market fundamentalism, is such that they believe in individual bargaining between employers and employees. The Labor Party, by contrast, believe that this is inherently unfair. We believe that the inherent bargaining strength of employers needs to be leavened and some balance achieved, essentially in three ways. Firstly, we believe that there needs to be a right for employees to organise themselves and bargain collectively through trade unions. Secondly, we believe in the existence of an independent umpire who can resolve disputes. Thirdly, we believe that there needs to be certain minimum standards to protect those workers who have the least bargaining power.

This difference between the two parties was true 100 years ago and it remains true now. We saw it previously in the debate on the Fair Work Bill and we are seeing it here. The opposition have forever been on the lookout for opportunities to do away with the rights of trade unions, with the independent umpire and with the legislated minimum standards. These are precisely the matters which drove Work Choices, which was a key factor in costing the coalition the election in 2007. Many of those opposite know perfectly well that this is what cost them the election in 2007, so they are now torn and conflicted.

The fact is that there are many of those opposite whose mood remains defiant. Deep down in their hearts they still believe in Work Choices, and one of the odd things about their view of the world is that it has led to more regulation rather than less. In the case of Work Choices we saw a massive bill of over 1,000 pages designed to restrict employees, trade unions and indeed employers with yards of red tape. You would think that their view of the world would lead to less regulation but, in fact, it led to more.

The final point I want to make about the history in relation to this issue is that, since the time of the Keating government, Labor’s modern view of the needs of the workforce and needs in workplaces has been that of enterprise bargaining. I believe that the introduction of enterprise bargaining has been a great success. It led to productivity improvements far in excess of those which occurred during the period of Work Choices, and I believe that that is the right way to go for industrial relations in this country—that we look to a cooperative model of industrial relations and we look to a model focused around bargaining at the enterprise level. I commend the bill to the House.

Tony Abbott (Warringah, Liberal Party, Shadow Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

Let me begin my contribution to this debate by reminding members that workplace reform was one of the greatest achievements of the Howard government. Workplace relations reform in part contributed to the golden age of posterity which this country enjoyed from the middle 1990s until quite recently. In particular, workplace relations reform helped to achieve the marvellous outcomes of more than two million new jobs, a 20 per cent increase in real wages and—this is very important—a reduction in industrial disputation to the lowest level since records were first kept back in 1913.

Let me be very clear about this. Industrial disputation helps no-one. Industrial disputation has to be at the very least a last resort. Strikes cost jobs, strikes hurt workers, strikes mean that a whole lot of people are out of pocket and inconvenienced, and no-one ought to argue that strikes are anything other than a blight on our economy and on the prospects of the decent working people of this country.

Members opposite in the course of this debate have alluded to the former government’s Work Choices industrial legislation. Work Choices did not cost the former government the election; it was the temporary abolition of the no disadvantage test which, more than anything else, cost the former government the election—and Work Choices was far more than just that.

We are here today to talk about the government’s building and construction legislation in the form of the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. When I became the workplace relations minister back in 2001, it was hard not to notice that the majority of strikes took place in the commercial construction sector, particularly in two states, Victoria and Western Australia. In those two states the rule of law had become the law of the jungle.

In 2001 I established the Cole royal commission to inquire into the commercial construction industry, particularly in those two states. The finding of the Cole royal commission that this industry was marked by coercion, collusion and intimidation was substantially confirmed by the subsequent inquiry conducted by Justice Wilcox, commissioned by the current government. The result of the royal commission was the establishment of an interim task force to police and enforce the rule of law in the commercial construction sector and that eventually became the Office of the Australian Building and Construction Commissioner.

As Justice Wilcox found in his recent inquiry, there are still problems in the commercial construction sector but, thanks to the work of the royal commission, the interim task force and the ABCC, there has been an improvement bordering on a transformation. Labour productivity in the commercial construction sector is up by 20 per cent. The cost differential between commercial and housing construction has dropped from 15 per cent to an almost negligible two per cent. Industrial disputation in the commercial construction sector has dropped from the highest in the country to almost negligible levels. The difference between the industrial environments in which the EastLink project was constructed in Melbourne and in which the CityLink project was constructed just a little while earlier demonstrates the impact that the whole Cole royal commission process has had.

As a result of all this there has been a boost to national economic output estimated, given the size of the sector, at more than $5 billion a year. It is appropriate in the course of this debate to put on record my, and I hope the parliament’s, gratitude to some of the key figures in this whole process: not only Justice Terry Cole, who was subjected to large and violent demonstrations when he was conducting his hearings, but also Nigel Hadgkiss, the former senior policeman who was the head of interim task force, and later John Lloyd, a former distinguished public servant and then Australian Industrial Relations Commission deputy president who took on the job of heading up the ABCC. These are fine Australians and their work has done great things for a very important industry and for the decent, honest people trying to earn a living within it.

The essence of the success of the Office of the Australian Building and Construction Commissioner has been a significant staff of investigators, many of whom have experience of real policing, and, most importantly, the power to compel witnesses. This is particularly important for employers. Given the climate of intimidation which long existed in this sector, it was almost impossible under the previous arrangements to get hard evidence of breaches of the law. The people who knew about the breaches of the law simply would not appear. The workers were frightened of physical intimidation and the businesses were frightened of commercial retribution. This is why these coercive powers, the powers to compel witnesses, are so important. Once these powers were in place the companies—that had previously been terrified of commercial payback should they tell the law enforcement authorities of what they knew—could not ignore the laws that said that they had to give evidence.

The real problem with the government’s legislation is that it essentially makes these coercive powers impossible to exercise. This is the great payback to the union movement. The coercive powers that meant that the dark secrets in this sector had to come out are being essentially taken away, or at least made almost impossible to exercise, as a result of the legislation before the House. The Rudd government pre election promised a tough cop on the beat. It said that there would always be the rule of law in this sector but, as has so often happened, that pre-election promise has turned out to be just more spin from a Prime Minister who has proven himself to be an absolute master in the arts of political deception. What this bill shows is that the tough cop is on the high road to becoming a toothless tiger.

I know that there are many decent members sitting opposite us in this House. Minister Martin Ferguson, who is at the table, is of course a person of integrity, principle and long experience in the union movement. Decent members of the union movement know what was going on in this sector. They have no truck with the kind of people who enforce right of entry at the point of a crowbar, as we saw happen just a few years ago in Melbourne. Yet they have been dragged into this legislation by their leader’s need to appease a union movement which has been so important to his campaigning success. The problem with this bill is that it puts decent workers, decent unionists and decent businesses at more risk than they have been. It removes the protections that have been there for them at least since the establishment of the ABCC back in 2006.

My problem with this legislation is not that the government have capitulated to the shop assistants union or that they have capitulated to the Australian Workers Union. They have not even capitulated to the forestry division of the CFMEU. But they have capitulated to the construction division of the CFMEU, the most militant, the most lawless and the most violent union in this country. In essence, this is Kevin Reynolds’s bill. That is what this bill is. It is payback for Kevin Reynolds. It is payback for the support that the militant unions have given to the government. This is thoroughly bad legislation. It will be opposed by the coalition both here and in another place because it makes the decent workers and the honest businesses of the construction sector of this country much less safe than they deserve to be.

Mark Dreyfus (Isaacs, Australian Labor Party) Share this | Link to this | Hansard source

The Liberal Party are still the party of Work Choices. This is the only conclusion that the Australian people can draw from the Liberal Party’s opposition to the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. The Liberal Party have demonstrated their continuing commitment to Work Choices by their speeches in this House and indeed by their disallowance in the Senate of the government’s direction to the Office of the Australian Building and Construction Commissioner.

The Independent senators and the Greens recognised the mandate that this government received at the last election to abolish Work Choices. That is why they supported the Fair Work Bill when it passed through this parliament on 20 March this year. The government has an equally strong mandate for this bill because the Labor Party took a firm and clear commitment to the Australian people, which was to abolish the Office of the Australian Building and Construction Commissioner and to transfer its responsibilities to a specialist fair work inspectorate from 1 February 2010, and that is what this bill does.

The bill of course contains a set of provisions which will put in place a procedurally fair and appropriate form of regulation for the Australian building and construction industry, one which fits within the framework of the Fair Work Act. It has been extraordinary to listen to the speeches that have been made in this House for—I think it is fair to say—the hysterical tone which has been adopted by those opposite in respect of this industry.

The aspect of the bill that I want to speak to particularly is the preservation, for the time being, of coercive powers. As the minister explained in her second reading speech, the reason why coercive powers have been retained in the framework of legislation that is here being put forward is that former Justice Wilcox in his report, which was a very considered report following a process of a discussion paper, wide consultation throughout the Australian community and written submissions from all interested parties, concluded that there was still a need for coercive powers in a limited form to be retained in the framework of regulation that is going to go forward for the building and construction industry.

Justice Wilcox commented that there is not, in a continuation of coercive powers, something that has been suggested by number of people commenting is entirely outside the framework of the Australian legal system—far from it. Coercive powers are to be found in a range of different acts of this parliament. One could point to coercive powers that are given, for example, to the Australian Consumer and Competition Commission or indeed the coercive power that is exercised every day by courts in this country, which is the sending of a subpoena to witnesses. The particular coercive powers that are in question here are ones which, Mr Wilcox expressed the opinion, were needed for some further time.

What this bill recognises, by two provisions, is that the government and the Labor Party envisage that a time will come when coercive powers will be no longer needed in the Australian building and construction industry. The way in which this bill recognises that end result, if you like, is by first of all imposing a sunset provision which sunsets the coercive powers at the end of five years from 1 February 2010. The second way in which this bill recognises that coercive powers may fade away and be no longer part of the industrial relations scene and no longer applicable to the building and construction industry is that the powers will be able to be switched off for particular projects.

It is recognised in this bill that starting on 1 February 2010, which is when the new regime will apply and when this legislation is passed through this parliament, while projects that have been commenced before 1 February 2010 will continue to be covered by coercive powers, it will be possible for particular projects to have the powers switched off. That is something that an independent assessor will look at. I would expect that over time it will become commonplace for these coercive powers to be recognised as not necessary for particular projects. I would expect that, in entire regions of Australia, quite quickly we will get to a position where it is simply a matter of course that the coercive powers will be able to be switched off and that there will be no special regime applying for those projects or in those areas because it will be accepted that they are not needed.

In both of those respects, this bill recognises that coercive powers are not going to be with us forever. It recognises the unusual nature of these coercive powers and reflects appropriately the reluctance that this parliament should always have to impose this kind of regime on any part of the Australian economy, any particular industry or any group of Australians. They are extraordinary powers. They need to be recognised as extraordinary powers and it should be recognised that they should only be introduced in circumstances where they are absolutely required. This is something that Justice Wilcox has given very long and earnest consideration to. The government, in legislating in the way that it has in this bill, is accepting that long and earnest consideration given to the subject by Mr Wilcox.

It should also be pointed out that there is an extensive set of safeguards that are to accompany the coercive powers which are to continue to be employed in the Australian building and construction industry. They include:

• use of the powers is dependent on a presidential member of the Administrative Appeals Tribunal being satisfied a case has been made for their use,—

The next point is perhaps the most important of all of these safeguards in the exercise of these coercive powers:

• persons required to attend an interview may be represented by a lawyer of their choice and their right to claim legal privilege and public interest immunity will be recognised,
• persons required to attend an interview will be reimbursed for their reasonable expenses,
• all interviews are to be videotaped and undertaken by the director or their deputy,
• the Commonwealth Ombudsman will monitor and review all interviews and provide reports to the parliament on the exercise of this power, and—

as I have mentioned,

• the powers will be subject to a five-year sunset clause.

In all of those respects there is a recognition of the extraordinary nature of these coercive powers, there is a recognition that the time in which these powers are going to continue to be employed is going to be a limited one, and there is a recognition that because of the extraordinary nature of these powers it is entirely appropriate that they be accompanied by safeguards which will deliver procedural fairness and, in a very real sense, the rule of law in this area.

Having dealt with one of the more contentious areas of the bill, I again want to deal with another step that has been taken by those opposite which reflects just how clearly they are the party of Work Choices. It is something which was dealt with by the minister in her second reading speech: what is to occur in the interim before this legislation takes effect. In her speech introducing this legislation, the Deputy Prime Minister said that she was going to make a direction under the existing legislation to the Office of the Australian Building and Construction Commissioner. The Deputy Prime Minister did just that and made such a direction, which went to the manner in which the existing powers of the Building and Construction Commissioner were to be exercised.

The response of those opposite and the step taken by the Liberal Party in the Senate on 25 June to an entirely appropriate direction given by the minister as foreshadowed in her second reading speech was to move, regrettably successfully, for disallowance of that direction. That disallowance confirms that the Liberal Party is still the party of Work Choices.

As I said, that direction was made under the existing act. It relates to the manner of the exercise of powers until the ABCC is abolished with effect from 1 February next year. The direction is entirely consistent with the Wilcox recommendations on the coercive powers. The direction does not affect the investigative, compliance or prosecution powers of the ABCC and it does not take away any of the coercive powers that are presently vested in the ABCC. The direction does introduce a measure of procedural fairness and decency in the exercise of those coercive powers, and it is that measure of procedural fairness and decency which those opposite reject. They do not want fairness and decency in the industrial relations system of this country. They wish for a return to Work Choices; they make that clear every time they speak on this subject, they made that clear in the Senate by disallowing this ministerial direction and they continue to make it clear by their opposition to this bill.

It is worth pausing for a moment to look at what was rejected in this direction by those opposite. Again, to give it context, this is a direction to the Australian Building and Construction Commissioner about how in the interim before the commission is abolished on 1 February next year he is to go about exercising the coercive powers. The first of those was a very simple direction to permit a legal representative—no more than that—to sit and speak with someone who is being made the subject of these coercive powers, to permit a legal representative to speak on behalf of that person and—shock, horror!—to be given the time and privacy to consult and advise that person. Those opposite do not believe in legal representation, they believe that workers should be deprived of legal representation, and that is the effect of what they have done in disallowing this direction.

Because it is absolutely representative of the attitudes of those opposite I want to mention the other four elements of this very simple direction, which in no way cut across the continued use of these coercive powers but which do set appropriate conditions for the use of those powers. The next alarming direction that the Deputy Prime Minister gave to the Australian Building and Construction Commissioner was to comply with the Commonwealth’s obligation to act as a model litigant, and apparently that, too, is seen as some vast lessening of power and as interference with the regime of industrial relations that applies to the building industry.

The third requirement was to give those who are affected by the coercive powers a reasonable opportunity to raise an objection in an appropriate court or tribunal. Again, reflective of the fact that those opposite do not believe in the rule of law or any opportunity to test the lawfulness of the conduct of a Commonwealth official, that, too, has been rejected by them.

The final direction which has been rejected by those opposite was to introduce, as a means of ensuring that there is procedural fairness in the use of these coercive powers hereafter, the procedure where it would be necessary for the Australian Building and Construction Commissioner to provide to a presidential member of the AAT a report describing how he proposed to use the coercive powers against particular persons, describing what was sought to be achieved by the use of the coercive powers, the likely effect on the person of the use of the coercive powers and the time within which this was all going to be done, and the requirement specified—this was far too much fairness and appropriate procedure for those opposite—that the Australian Building and Construction Commissioner was to ‘consider any advice received’ from the nominated presidential member of the AAT before proceeding further to exercise those coercive powers.

Again we have it clearly stated, by the speeches in this House on this bill and the rejection and disallowance of the minister’s direction in the Senate, that the Liberal Party is the party of Work Choices and wishes to reinstate Work Choices in every sense and continue with the harsh regime of industrial relations that was introduced in 2005. It is a party which does not believe in checks and balances or procedural fairness. It is a party which does not believe that workers should have rights. I would call on those opposite to respect the decision made by the Australian people in November 2007 to replace the Howard government with a government committed to the repeal of Work Choices and the replacement of the Australian Building and Construction Commission with a new body, because—be in no doubt—the same clarity of commitment to repeal Work Choices was shown in the clarity of the commitment that the Australian Labor Party took to the people at the last election, which was to abolish the Australian Building and Construction Commission. We have honoured that first commitment to repeal Work Choices and replace it with a fairer industrial relations system, which is what we see in the Fair Work Act that has now come into force. Refusal to pass this bill will prevent the government from honouring the second major commitment made in the industrial relations area, which was to abolish the Australian Building and Construction Commission. Refusal to pass this bill condemns the opposition as what they are: the party of Work Choices.

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Energy and Resources) Share this | Link to this | Hansard source

I am here today to speak on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. Sadly, this is a bill that completely waters down the strong regulatory regime put in place by the previous government over the thuggish building and construction unions. The building and construction industry is led by one of the most militant unions in this country. We have all seen them on TV, and the Cole royal commission, which I will go into shortly, provided some home truths about the blatant disregard for the law held by the unions, particularly the CFMEU. Here the government wants to amend the law to water down the powers and independence of the Australian Building and Construction Commission, or ABCC, the construction industry watchdog or ‘tough cop’.

Before I go any further and while the member is still in the chamber, I would just like to point out that he does need to actually get it right. The commitment from the Labor Party in opposition was that they would not get rid of the ABCC. In fact, the minister quite categorically said that she would not do this and would allow there to be the ‘cop on the beat’. You need to tell the truth in this place and not mislead, because that is just not true.

The ABCC was established by the former coalition government following the recommendations made by the independent royal commission, which found that lawlessness, intimidation and corruption were rife in the building and construction sector. The coalition government wanted to ensure that there was a strong cop on the beat to stop this unlawful behaviour, improve working conditions, protect the rule of law and dramatically increase productivity. That is the key to this: the dramatic increase in productivity.

While Labor promised—I again reiterate: they promised—to retain the ‘tough cop’ attitude, maintain the full powers of the ABCC, as I remind the member, until February next year and carry through existing principles to the specialist inspectorate division of Fair Work Australia, it is once again all spin and no substance. The minister sneakily issued a directive on 17 June limiting the powers of the ABCC from August. This was not the deal that was subsequently disallowed in the Senate.

From next year, the watchdog will be moved to the specialist inspectorate at Fair Work Australia. This legislation provides the minister with greater powers, restricts the independence of the inspectorate compared to the ABCC as it is now, reduces the penalties for unlawful behaviour and really makes coercive powers optional. The watered-down version pays only lip service to the strong principles the ABCC was founded on—not surprising from a minister who, as a lawyer at Slater and Gordon, was once employed to represent the interests of the militant unions that the ABCC has now clamped down on. Under this legislation, penalties for not obeying the law are drastically reduced and previously unlawful action is now acceptable. The bill allows for construction laws to be switched on or off for particular building sites. If people were already following the law, there would be no need to vary the laws at a whim, would there? Is this really Minister Gillard taking a tough stance against militant construction unions? It is not. In fact, it is just laughable. This is really Labor thanking its mates the unions for helping it win the last election and funding it with in excess of $30 million in that campaign, so this is payback time: ‘We’ll help you because you got us $30 million to run the last election and now, because you’ve given us the dough, we’re going to help you.’

The coalition cannot support the watering down of this watchdog. We cannot afford a return to the dark old days of workplace unrest, strikes, bullyboy tactics, coercion and organisations looking after their mates. Labor’s plans could set Australian workplace relations back decades and certainly will hurt our economy. We must make sure that unlawful activity, intimidation and threats do not return to the building and construction industry—or, if they do, that there is a strong enough body to take them on.

The Master Builders Association chief, Wilhelm Harnisch, said:

The specific building and construction industry reforms—

he was referring to the ABCC—

have assisted the building and construction industry to increase productivity, bring industrial harmony and to provide benefits to employers and employees.

Labor is hell-bent on reversing this position and taking Australia back in time, as I have said. Before the 2007 election, Minister Gillard indicated that the existing laws had ‘balanced the rights of employers and unions’ and that Labor did not want to jeopardise this productivity or cause industrial unrest. That is what she said before the election, and what is she doing now? The abolition of the ABCC and the watering down of its powers will not only encourage industrial unrest but also destroy productivity.

The coalition supports the retention of the ABCC, as you can see from all the speakers on our side today. The outcomes it has produced for the industry and the economy—and this, I might add, is supported by Econtech research—speak for themselves. These are some of the figures produced by Econtech: a10 per cent increase in industrial productivity; massive reductions in industrial disputes by 91.9 per cent to record lows; and increases in average weekly earnings for workers in the construction sector between 2004 and 2007 of 25½ per cent, compared to 15.7 per cent for all other industries. It has improved the levels of health and safety, and I want you to remember this about the safety aspect when I come to it shortly. There was a 7.3 per cent productivity gain in commercial building relative to residential building since 2004. Not only has the ABCC been effective in maintaining a degree of harmony but it is overwhelmingly cost effective. In fact, it costs the taxpayers a relatively meagre $32 million per year but returns $5.5 billion in terms of economic gain—in other words, $167 generated for each dollar spent by this administration.

But the bottom line is that we have a more workable and effective body to watch and manage the industry, and that is why the unions hate the ABCC. Unions lost their control, their tight grip on power, and they were suddenly accountable and held responsible for all the things that these people had gotten away with for years—the unconscionable conduct. Under the previous Labor government, the average number of working days lost to strikes per year was 22.6 per thousand employees—I repeat, 22.6 working days per thousand employees. In September 2007, by way of comparison, this was down from 22.6 working days to a negligible 1.2 working days per thousand employees. What a vast improvement! But, as we know, with 70 per cent of the Labor Party’s front bench being ex-union officials and with union spending in excess of $30 million in Labor’s campaign, it is clear why the unions are getting an absolute armchair ride on this bill.

By neutering the ABCC, Labor is simply reinforcing the longstanding belief that they are more interested in looking after their mates than in maintaining law and order and protecting local jobs. There is nothing more important than creating and sustaining jobs. In fact, 2.2 million jobs were created under the coalition’s watch, with around 60 per cent of them being full-time positions, unlike the casualisation that is going on now. Labor inherited an unemployment rate of 4.3 per cent. In 1996, Labor had left us with a rate of 8.1 per cent. So that is the difference. We inherited 8.1 per cent in 1996. They hit Lotto: they had 4.3 per cent when they assumed government.

Real wages increased under the coalition by 21.5 per cent, compared to them actually decreasing by 1.8 per cent under the 13 years of the previous Labor government. In fact, you will recall former Prime Minister Bob Hawke bragging about the accord and driving down wages. Unemployment in my electorate got down to 4.1 per cent, compared to 8.4 per cent in December 2004, when I became the member for Canning. Canning, particularly the younger population of Canning, is susceptible to higher levels of unemployment, and that is where government energy should be focused, not on handing back power to the union thugs.

Paul Kelly wrote in the Australian a while ago:

… standing immovable is Labor’s support for greater trade union power, more costly restriction on employers, a greater role for the revamped commission, an effective end to individual statutory contacts, a revival of arbitration, and a sharp weakening of direct employer and non-union employee bargaining.

And this is what businesses are up against. As an aside, I would like to mention that I recently spoke at a local Gosnells Small Business and Tourism Association breakfast. A number of those business owners raised their grave concerns to me about the government’s Fair Work changes. It is a bit Orwellian, isn’t it—fair work changes? Small business is the lifeblood of the Australian economy, and, while I am pleased that Canning has a raft of small businesses, unfortunately many of these businesses’ trading conditions have never been tougher. Yet in these tough economic times the government is trying to make it even harder for them with these archaic workplace reforms.

As we said previously, the ABCC was established under the independent royal commission by Mr Justice Cole, and he found extensive evidence of disgraceful lawlessness, intimidation and thuggery in the construction sector. Before I go on, the member for Wills, as they do on that side, called the Cole royal commission biased. What a disgrace. Not only do they besmirch Mr Cole himself but here is a 22-volume report, well researched and the benchmark of industrial harmony going forward in this country, which those on the other side—and the member for Wills said it the other day—said it was a biased report. It is a disgrace that they would try and drag his reputation through the mud.

Commissioner Cole’s report was tabled in 2003. The report found that the industry was rife with lawlessness. In fact, there were more than 100 types of unlawful behaviour, which included the following: favouritism for union members, widespread industrial pressure and taking and making inappropriate and questionable payments. I remind the House that I recently raised concerns about the issue of the Australian Workers Union but was swiftly interrupted by the member for Bruce. The issue I raised in the House here, can I inform the House, has now been taken up by the Australian Electoral Commission, and they are investigating an unusual slush fund in and around the Alcoa worksites in my electorate. I will be looking forward to the AEC’s report on their investigations of these so-called site allowance moneys and where they went.

I continue: the commission found unlawful strikes, the rorting of employers, threatening and intimidating conduct, disregard for laws and regulations at all levels, actions by unions—particularly the CFMEU—to regulate the industry, and unions pressuring government departments. Does the government really want to return to this sort of behaviour? I am sure there are a lot of responsible members of integrity on the other side who really do not want to return to those days of lawlessness. Labor seems intent on taking the construction sector back to the past, where thuggery and militant construction unions prevailed over the rule of law.

Being a Western Australian, I am all too familiar with the antics of the CFMEU’s self-proclaimed heavyweights in the likes of Joe McDonald and Kevin Reynolds. The type of behaviour uncovered by the Cole Royal Commission was seen in eight minutes of footage from an ABCC worksite, which he had entered illegally, where he was hurling obscenities and threatening bosses and workers who would not join the union. In the earlier Forward with Fairness legislation, I spoke about union bosses claiming bogus safety issues to get themselves on a worksite and then wreaking havoc on that site. After his re-election in Western Australia, Kevin Reynolds, in his Che Guevara T-shirt and wearing bib and brace overalls, claimed that he had a mandate for militancy and it seems the Deputy Prime Minister could be giving him the green light by dismantling the ABCC.

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

Mr Martin Ferguson interjecting

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Energy and Resources) Share this | Link to this | Hansard source

He’s a cute little bloke, isn’t he! Both Joe and Kevin worked on the Canning Vale polling booth at one of my elections. And by the way, Joe McDonald wouldn’t pay a bet he had with me; he still owes me $20.

In May 2007, Joe McDonald made his position about the ABCC pretty clear:

I live for the day when (the ABCC staff) are all working at Hungry Jack's or Fast Eddy's or Kentucky Fried Chicken. That is what's waiting for them. They're all ex-policemen and they can go and do whatever ex-coppers do. I'd suggest that John Lloyd and his mates will be unemployed before I will be.

I wonder if he got a wink and a nod from the minister to be able to say that. Kevin Reynolds likened the ABCC to the Gestapo, and Dean Mighell said the creation of the ABCC was a stunt by the coalition government. They will all be jumping with joy now when this legislation goes through the House—if it does. In April of this year, the ABCC reported intimidation and cost blowouts increasing. Shouldn’t this be all the more reason for its retention? In Western Australia, the Director of the Master Builders Association made the point that if $2 billion in state government infrastructure projects were blown out by just 5 per cent because of union antics, this would waste $100 million of taxpayers’ money. I do not think our state can afford to waste this sort of money when we are all screaming for more infrastructure and essential services like policemen, teachers and nurses.

An April editorial in theAustralian hit the nail on the head, when it said:

Julia Gillard says the ABCC will be replaced in January with a new unit to watch the industry. Good, but not good enough. The ABCC and the powers it possesses should stay.

I know those on the other side like watching. With regard to the coercive powers in the legislation, basically the government wants to be able to compel at convenience. Coercive interrogation powers are able to be switched off on the order of the independent assessor. So we know that one site could have powers initiated on them and then, at a whim, they could be switched off again. It is one site on and one site off. It will be very interesting to see how this ever stacks up in law. While the government gives the appearance that they are not completely caving in to the unions by retaining the so-called coercive interrogation powers, it is really nothing more than a thinly veiled attempt to hide the fact that the powers are so bogged down in red tape that they will rarely be used. It is important to remember that these powers exist for a reason. Powers available under the current laws to compel witnesses to give evidence are needed to provide protection to those people who want to give evidence to the ABCC without the fear of payback or retribution by the union for having done so—and it was very clearly pointed out by the member for Warringah in his speech why coercive powers are needed. In fact, the ABCC Commissioner, Mr Lloyd, recently said that he had no reservations about his power to use coercive powers because people preferred that in order to give testimony rather than feel the wrath of the union should they be seen to be cooperating. So of course they would love to give evidence. When it was voluntary before and there was a show of hands and they could be identified, we knew that they were penalised for doing so.

Existing powers are capable of being used against everyone in the sector—employees and employers. Even Justice Wilcox, who was asked by Minister Gillard to report on the powers of the ABCC, recognised that the investigative powers are integral to ensuring that law and order is maintained in the construction sector. These powers would not be necessary if the sector had the same culture and history as normal, everyday workplaces. The truth is that construction is a special case. Labor has no real intentions of creating a tough cop overseer or being tough on the construction unions. The Deputy Prime Minister said:

A future Rudd Labor Government will not tolerate intimidation or violence by any party in the building and construction industry. The practices of the past are not part of Labor’s future for industrial relations.

Labor promised it would maintain the existing ABCC arrangements until February 2010, but we should not be surprised that this government says one thing and does another. It is racking up quite a long list of backflips on commitments. While the minister talks tough, the reality is that the unions have already won this debate as the proposed act reduces the penalties for unlawful action and gives a green light for a return to the bad old days.

Claims that the ABCC has affected occupational health and safety levels are also misguided. ABCC Commissioner John Lloyd has stated:

The ABCC is committed to do all it can to improve the industry’s poor occupational health and safety record and to support those specifically charged with this task …

As the member for Mayo said in his contribution to this House, it is the state governments who actually administer this, and where were the state Labor governments when occupational health and safety was an issue? The truth is that the independent building industry police are in real danger of losing their powers, losing their independence and being nothing more than a token body with no ability to stop a return to lawlessness and intimidation on the building sites of Australia.

Joanna Gash (Gilmore, Liberal Party) Share this | Link to this | Hansard source

The Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009 is all about neutering an agency that was making a difference in addressing a dysfunctional industrial culture that has been synonymous with the construction industry in Australia. It is a bill representing the payoff to the building unions for their generous support in getting the Prime Minister, Kevin Rudd, across the line. The Australian Building and Construction Commission represents an effective response to the decades of banditry that the building industry was forced to endure. The Master Builders Association says this:

The building industry has enjoyed unprecedented industrial harmony and improvements in productivity following the five years that the ABCC has been in existence. These benefits are measured at $5.5 billion per annum and are particularly important in the current economic circumstances to help the government’s strategy to lift the Australian economy out of recession.

The dilution of the powers that were vested in the ABCC will place a greater reliance on the assumption that these maverick unions will continue to play fairly. That is a big call, and you need only look at the history of the building unions in Australia to gather a sense of foreboding that that is not going to happen. The Master Builders Association has reported significant improvements in efficiencies since the advent of the ABCC:

The Econtech Construction Industry Productivity 2009 report card shows that there have been significant improvements across a range of productivity measures including a 6.2 per cent productivity gain in commercial building relative to residential building since 2004. There has also been a 9.4 per cent addition to labour productivity in the construction industry due to the ABCC and other associated reforms, and a 10.2 per cent outperformance in the construction industry labour productivity compared to predictions based on historical performance to 2002.

Those statistics cannot be denied, yet this government is prepared to sacrifice the gains made on the back of political expediency. And of course there have been attempts to discredit the Econtech research. For instance, the Mitchell report and another report said that gaps in costs between domestic and commercial building costs were due to factors other than restrictive work practices; the second says there was no gap in the first place. These attempts to attack the ABCC and the hard facts that it has improved sector productivity are nothing more than union propaganda hiding behind a veil of easily discredited academic research. Econtech compares costs of the same tasks in the same states over time, and does not attempt to cherry-pick the figures to suit union or minority interest group needs.

Richard Bunting, a partner at Blake Dawson, suggested that the ABCC legislation was not a result of any new or recent industrial misbehaviour. He said successive federal and state governments, both coalition and ALP, have found it necessary to deal with the very poor industrial relations in the building and construction industry, including an industrial culture which from time to time has involved considerable lawlessness. He went on:

It is well known that there was considerable industrial misbehaviour involving officials and some of the members of the Builders Labourers Federation in the 1970s and early 1980s.

The BLF was deregistered as a consequence in 1974 and only registered again in 1976 after giving specific undertakings to abide by decisions of the Australian Conciliation and Arbitration Commission and to participate fully in the prevention and settlement of disputes through conciliation and arbitration. In 1981, the Victorian and Commonwealth governments announced a royal commission into the Builders Labourers Federation. The royal commissioner was Mr John Winneke QC. His subsequent 1982 report into activities of the Australian Building Employees and Builders Labourers Federation recommended prosecution of various persons.

In March 1983, following the election of the federal Labor government, further BLF deregistration proceedings were adjourned. The federal government subsequently withdrew as an applicant in the deregistration proceedings after the BLF gave certain undertakings about its industrial behaviour. However, in 1986 the Labor government deregistered the BLF for five years and similar action was taken by the New South Wales and Victorian governments around the same time. The further development of industry unions in the late 1980s and early 1990s ultimately resulted in the principal industrial coverage for building industry employees being assumed by the CFMEU and to a lesser extent by the AWU.

In the early 1990s a New South Wales government royal commission into the state’s building and construction industry, the Gyles royal commission, recommended the establishment of a task force in New South Wales to examine and investigate illegal activities in the industry. The task force commenced operation in 1991 and continued until mid-1996. The Gyles royal commission’s 1992 final report summarised the commissioner’s views as follows:

The public and confidential submissions received, with very few exceptions, identify and complain about various aspects of union militancy. The complaints were from so many disparate sources and are so consistent that they amount to a powerful body of evidence in themselves to establish the proposition that the conduct of the members and officials of the former BWIU (NSW Branch) severely affect productivity and efficiency of the industry in this State, both because of the persistent disruption of projects and businesses and because of the restrictive work practices instituted and defended whilst work is actually proceeding. The evidence reveals nothing less than industrial anarchy in which any pretence of the rule of law or the application of principle has been abandoned.

Mr Gyles recommended the deregistration of the BWIU. Ultimately, the application to pursue deregistration of the union was withdrawn and the union gave various undertakings, including to operate within the law and to comply with the NSW code of practice.

There were some similar developments and attempts at imposing more orderly industrial relations for the building and construction industry in other states. For example, in Western Australia a building industry task force operated between 1993 and 2001. At Commonwealth level, Mr Terrence Cole QC was appointed by the federal government in August 2001 as a royal commissioner to inquire into certain matters relating to the building and construction industry throughout Australia. The Cole royal commission cost the Australian taxpayer over $60 million. Yet here we have a move to start the reversal process taking us back to the bad old days. I did see newspaper reports recently reporting that the Rudd government was talking tough, but really, is that just show? I think it is. Their intent was clearly expressed in the course of the 2007 campaign where they vowed to ‘roll back’ tough new laws that were prickling the unions. The public cannot be misled by the show of fabricated dissent between the unions and the Rudd government. After all, Mr Rudd promised the unions. It beggars belief that he would dishonour such a significant promise made to his paymasters. What I anticipate is the continued dilution of this agency, whatever form it takes, to the point of eventual redundancy. I am just not buying the line that this government is going to seriously oppose the will of the unions, and neither should any freethinking individual.

The Australian on 6 July quoted the Prime Minister as saying:

This government will not tolerate violence, threats of violence, or intimidation in any part of the industry.

Yet this is just what is beginning to happen in my electorate of Gilmore. When you take into account previous tough talk on grocery prices, petrol prices and reining in the banks, you have got to take this latest resolution with a very large grain of salt. I am betting a secret deal has already been stitched up and all we are witnessing is a very well-rehearsed public show of false indignation. After 2010, all bets will be off and the watchdog will be as effective as Labor’s much-vaunted petrol commissioner.

Despite the wide acknowledgement that there is still a lot to be done, this bill is, candidly, premature if the health of the industry is the prime objective. Justice Murray Wilcox, in his report Transition to Fair Work Australia for the building and construction industry, said that the ABCC should remain in place for at least another five years. He was quoted as saying that there was still work to be done to restore industrial sanity in the sector. Yet the government dismisses the recommendation of its own appointee and starts the process of dilution.

It is inevitable that under the hand of this government the ABCC copy will certainly remain, if only as a symbol of toughness. What appears to be happening is a concoction of semantics in the bill that creates the impression of toughness but in fact will be hampered by red tape sufficient to frustrate the process, again adding to the costs of anyone with a genuine concern. It is a clayton’s bill that sets out to appease the public without actually doing anything.

Mr Deputy Speaker, just listen to this: penalties for not obeying the law are diluted; previous unlawful action is now acceptable; and provisions are made for switching off the laws, when it suits, for specific building sites. On 18 September last year, in an interview at the National Press Club, the minister, Julia Gillard, was asked a question by Nick Butterly from the West Australian. He asked:

You’ve said that the ABCC will remain in place until 2010. But can you just guarantee that the powers of the ABCC will not be watered down before then, either by a carbon budget, cuts in staffing or by other methods? And also, what do you make of this push within Caucus to defame the ABCC before 2010?

What did the minister—and I notice the minister sitting opposite me at the table—say in reply?

I can guarantee we’ll deliver on our election commitment, which is that the ABCC will stay until 31 January 2010, with all of its powers and all of its budget. I can confirm we’ll deliver on our election commitment that on 1 February 2010 it will be replaced by a specialist inspectorate within Fair Work Australia.

The implications are clear: in six months time it is all over, replaced with a toothless tiger. I am of the view that, until such time as it is clear that the culture of lawlessness that dominated the industry for decades is firmly behind us, the ABCC must remain in place and intact.

The worth of the ABCC has been well demonstrated in the performance figures of the construction sector since its inception. Emerging as we are from the effects of the global financial crisis, why do we need to compromise opportunities for recovery which, the government has signalled, will take several years? The government has not demonstrated a clear case that would justify this bill, other than a promise made to the unions. As I said earlier, the dilution of the commission is premature and unwarranted on the evidence.

That is why powers available under the current laws to compel witnesses to give evidence are needed to provide protection to those people who want to give evidence to the ABCC without fear of payback and retribution. Existing powers are capable of being used against everyone in the sector, both employees and employers. Existing investigation powers are not unique; they are akin to other powers widely available to other Commonwealth agencies and under other Commonwealth laws.

The proposed restrictions on investigation powers are cumbersome and will prevent them from being used effectively due to the vast amounts of red tape that must be cut through before they can be used. Even Justice Wilcox, who was asked by Julia Gillard to report on the powers of the ABCC, recognised that the investigative powers are integral to ensuring that law and order is maintained in the construction sector. Special investigation powers unique to the building and construction sector would not be necessary if the sector had the same culture and history of normal, everyday workplaces.

On a local level, the advent of the Fair Work legislation has seen a move back to the bad old days. Right of entry powers are being used, and not with good intent, and those businesses affected are fearful, again, of retribution by those representing the unions. Until this culture changes, and it may take a generation, the need for such legislation remains, and that is why I am opposing this bill.

Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

in reply—I rise to sum up this debate on the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. This bill is about three things: it is about delivering on the Rudd Labor government’s election commitments—our promise to the Australian people; it is about ensuring that there is always a strong cop on the beat in the building and construction industry; and, of course, it is about delivering workplace relations laws in the national interest that get the balance right. I am well aware that there is opposition to these laws. They are opposed by trade unions, and they are opposed by many employers. The government has approached this task to get the balance right in the national interest.

During the course of this debate, we have heard a number of offensive and erroneous remarks from the opposition about the impact of this bill, and I will go through those misrepresentations one at a time. But I say more generally to the Liberal Party: at some point, they need to ask themselves why the Australian people do not trust them on workplace relations—because the Australian people do not. The Australian people repudiated them on workplace relations at the 2007 election. The Australian people do not believe that the Liberal Party can be trusted with workplace relations. And they do not believe that because the Liberal Party did not tell them the truth about Work Choices in the run-up to the 2004 election. The Liberal Party did not tell them the truth about Work Choices when it was hurting working Australians, and the Liberal Party is not telling them the truth now about their intentions to reintroduce Work Choices. So there needs to be a fundamental rethink by the Liberal Party; they are not trusted and they are not respected on workplace relations. And when you listen to the contributions to this debate, it reinforces the fact that the Liberal Party should not be trusted or respected on workplace relations because their arguments in this debate have been all about misrepresentation, all about offensive remarks about members of the government; there has been, as usual, no substance to their debate. So I would say to Liberal Party: at some point they should come clean with the Australian people and say, ‘We are the party of Work Choices and if ever re-elected we will reintroduce it,’ and then, at that point, we can have a decent and honest debate.

In the meantime the Rudd Labor government will do what we were elected to do, what we promised the Australian people. I know members of the Liberal Party think promises to the Australian people are not worth much. That is why, when in government, each and every time it came to breaching a promise, they did so. The party of non-core promises is the Liberal Party. But we in the Rudd Labor government believe that promises to the Australian people are important. At the 2007 election we gave the Australian people the following promises. We said that we would always keep a strong cop on the beat for the building and construction industry—and this bill delivers on that promise. We said that we would replace the Office of the Australian Building and Construction Commissioner with a Fair Work Australia inspectorate from February 2010—and this bill delivers on that promise. We said that we would consult widely with stakeholders about the required changes for the regulation of the industry—and we have delivered on that promise. We promised that we would enact strong, fair and balanced laws for the industry—and these are those laws.

Apart from the fact that people do not trust the Liberal Party on workplace relations, it needs to be recognised that the laws before this parliament are the product of an extensive consultation process convened by a respected former judge who was asked by the government to provide advice on this area of law. This bill delivers changes consistent with the advice of the Hon. Murray Wilcox. I thank him for those efforts and I thank him for that advice.

In introducing these laws I made it clear in my second reading speech and I make it clear today that the Rudd government has no tolerance for the pockets of the industry where people think they are above the law, where employers flout their obligations to staff, where people think that threats and violence somehow have a place in our society. They do not. Anybody who breaches the law should feel the full force of the law. That is the position of the Rudd Labor government and this bill delivers on that commitment.

This bill contains tough provisions. It will create a building inspectorate that will be charged with enforcing the building industry’s compliance with the law. Many silly words have been used by Liberal Party members to describe this body, but its charge will be to ensure lawful conduct in the building industry. It will have powers at its disposal to do so, including safeguards recommended by the Hon. Murray Wilcox—coercive powers where necessary. This bill delivers these powers and delivers that kind of compliance. This bill enacts, as recommended by the Hon. Murray Wilcox, the equalisation of penalties for building industry workers and workers generally under the Fair Work Act.

Members opposite, during their contributions, have criticised that. Interestingly, at the same time as they are saying the ABCC is doing a good job, they have criticised that recommendation of the Hon. Murray Wilcox and that provision in this legislation. What members opposite clearly do not know—or they are unconcerned about the degree of inconsistency—is that on many occasions when the ABCC litigates for penalties, it litigates for the penalties that are in the Fair Work Act and that were in its predecessor the Workplace Relations Act 1996. Indeed, in more than half of the court cases in which the ABCC has successfully obtained penalties, they were penalties prescribed by this act. So if you say the ABCC is doing a good job then you must say it has done a good job when it has successfully litigated those cases under the kinds of penalty provisions in this act. Members opposite cannot have it both ways and say that that is somehow inappropriate—given that it was recommended by an independent judge and is part of the way the ABCC has gone about its work in successful prosecutions.

Beyond that criticism, there have also been criticisms of the new safeguards that are being put in place on these coercive powers—the compulsory examination powers—under this bill. We have heard claims from the opposition that they are too onerous, that they are red tape, that they will stop a quick response. All of these claims fall away when you hold them up to the light of day and actually have a think about the facts, as opposed to the spin and rhetoric that comes from the Liberal Party. I would draw the House’s attention to the fact that, according to the ABCC’s last annual report, less than nine per cent of its investigations included the use of compulsory examination powers—these powers tend to be used when investigations are well underway. So any nonsense and spin from the Liberal Party that somehow these safeguards prevent ABCC inspectors from doing their work and will create hurdles in all investigations clearly falls away. These coercive powers have been used in nine per cent of investigations when the investigations are in a deep state—and often the ABCC has said publicly that these powers are used as a last resort, not as a first-instance response.

Let us hear about the safeguards. It is just not clear to me what the Liberal Party thinks is unreasonable about these safeguards. Does the Liberal Party—and I stress the use of the word ‘liberal’, given its meaning in political philosophy—really say it is inappropriate for someone to be represented by a lawyer of their choice? Is that the Liberal Party’s philosophy today? The Liberal Party would say that it is the party of individual rights. If you look at its political pedigree over the ages, one of the things the Liberal Party would say about itself and its history is that it has been the party of individual rights. What is exceptional, what is objectionable, about the right to be represented by a lawyer of your choice and the associated right to client legal privilege? What could be objectionable about that?

The next safeguard is the payment of reasonable costs incurred. If you are asked on a compulsory basis to go and do something, is it so unreasonable, so absurd, so ridiculous, so objectionable, that the reasonable costs that you incur in getting there are met—when you have been compelled to do so?

The oversight of the Commonwealth Ombudsman—is that objectionable? Is it objectionable that, when we have action under a coercive power, there is an independent statutory person who can look at that? Is scrutiny a bad thing in the Liberal Party today? Do they not like things being scrutinised? Is that objectionable?

Then there is the fact that one needs to go to a presidential member of the AAT—once again a coercive power. This is a statutory body. The AAT does a lot of things. I would have thought that oversight by independent office holders of government decisions and the decisions of statutory bodies would be viewed as reasonable in the modern age. What is objectionable about that from the Liberal Party point of view? It is very hard to see.

Then the Liberal Party talk about the five-year sunset provision. But of course they fail to say that the sunset provision was recommended by His Honour Murray Wilcox, as were all of the things that I have just listed and talked about, and that I have specifically said—and this was recommended by His Honour Murray Wilcox—that a review will occur prior to the sunset on all matters relating to compliance in the building and construction industry, and such a review will be inclusive of the views of all stakeholders. It is hard to see what is wrong with that, with enacting what His Honour said should be enacted and with having a review which will listen to all views, as I laid out in my second reading speech and as I have said on a number of occasions publicly since.

Then the opposition have criticised the government’s decision to have an independent assessor with the power to switch off the compulsory examination powers on peaceful projects. In this regard, I think perhaps members of the Liberal Party ought to get out more and they ought to talk to employers and people within the industry.

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

You should get out and talk to some people in the industry and see what they say to you.

Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

I have done it myself on many, many occasions. When I have those discussions with people in the industry, they point to projects where workplace relations have been peaceful, have been a model, where projects have been delivered on time, on budget and, on some occasions, before time. In my own state of Victoria, for example, the EastLink project, an enormous piece of civil construction, was delivered ahead of time with exemplary workplace relations—hardworking decent Australians going to work every day, working hard to make a living, not causing any industrial disruption or trouble and then going home.

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

Mr Keenan interjecting

Alby Schultz (Hume, Liberal Party) Share this | Link to this | Hansard source

Order! You may disagree with what the minister is saying, but the minister has the call.

Julia Gillard (Lalor, Australian Labor Party, Deputy Prime Minister) Share this | Link to this | Hansard source

Another great Liberal value, the right to free speech, is not honoured in the modern age as much as it used to be, just like the right to a lawyer! The Liberal Party is staggering around in opposition, having lost its way.

For projects like that, an application could be made to switch off the coercive powers. That would be assessed by an independent assessor. Should there be a subsequent problem with industrial unrest, then it can be switched back on. But this is a recognition that there are parts of this industry that are peaceful, that are characterised by good employers and hardworking people, and we believe that in the legislative framework we should recognise that. Of course, this is also an industry where there are parts of it with significant industrial troubles and disruption. I have publicly talked about those. For those parts, there should be absolutely vigorous, hard-edged compliance and no tolerance at all for unlawfulness. This bill delivers that as well.

I conclude by saying that the Wilcox review found, and I absolutely believe, that there are problems in parts of the building and construction sector that cannot be ignored. As a government, we have no tolerance for conduct which breaks the law, whether it is unlawful industrial action or underpayment of employees. Each and every breach of the law is wrong and each and every breach of the law should be acted upon. This bill ensures that we have got the balance right for all participants in the Australian building and construction industry. It ensures, and it is the government’s intention, that the use of coercive powers is focused where they are needed the most. This is a bill that gets the balance right and honours each and every one of the government’s pre-election commitments. I commend it to the House.

Question put:

That this bill be now read a second time.