Election set to spark power shift

The looming federal election could mark a big shift in political power, not just in Canberra but also WA.

Major spending promises announced in Perth last month by Prime Minister Scott Morrison and opposition leader Bill Shorten are clear signals a federal election is getting close.

The election is tipped for mid-May and, judging by numerous opinion polls, Labor is favoured to win.

A Labor government under Bill Shorten would bring about a major shift from coalition policies, while a shift in power at the national level would also bring major changes in Western Australia.

(view a PDF version of the full special report)

WA has been well represented in Canberra since the coalition won power in 2013 under Tony Abbott’s leadership.

WA’s representation reached a high point in 2017 when five cabinet ministers were from the west; that number has not changed, although the seniority of the WA contingent has, especially with the pending retirement of former foreign minister Julie Bishop.

Experienced ministers Mathias Cormann, Christian Porter and Michaelia Cash have been joined in cabinet by Linda Reynolds (defence industry) and Melissa Price (environment).

With Michael Keenan and Ken Wyatt in the outer ministry, WA has a total of seven ministers.

Should Labor win power, there is a distinct possibility WA will not have any cabinet ministers.

There are currently no Western Australians in the shadow cabinet. 

The most senior WA representative in Bill Shorten’s team is shadow consumer affairs minister Madeleine King, in the outer ministry.

A former chief operating officer at the Perth USAsia Centre at the University of Western Australia, who also had a stint as an adviser to former resources minister Gary Gray, Ms King was elected to parliament less than three years ago.

She was a surprise pick for the shadow ministry after Perth MHR Tim Hammond’s unexpected retirement in June 2018.

When Business News asked Mr Shorten last month about the prospects of having a Western Australian in his cabinet, he replied: “Good, if you vote for them”.

However, as Peter Kennedy explains in his column this edition, it is Labor’s caucus – not the leader – that selects ministers.

Labor is trying to compensate for the lack of senior federal MPs in WA by pushing the premier to the fore.

Mark McGowan has accompanied Mr Shorten on many public appearances, and his face is plastered on Labor’s campaign bus alongside Mr Shorten and deputy leader Tanya Plibersek.

Retirements

The upcoming election will bring to an end the political careers of several prominent MPs.

Julie Bishop and Michael Kennan plan to retire, and several other MPs face an uncertain future.

These include Liberals Ken Wyatt (Hasluck) and Steve Irons (Swan) whose seats would fall to Labor with only a small swing.

Labor is also targeting Christian Porter in the seat of Pearce, in Perth’s northern suburbs.

Mr Porter’s example shows the precarious nature of a career in politics. 

Depending on how the votes fall, in his electorate and elsewhere, he could be looking for a new job, or he may continue as a senior minister in a re-elected Morrison government, or he may be a leadership contender in opposition.

His upper house colleagues, such as senators Cormann and Cash, have much better job security. 

Behind the scenes

The prospect of a Labor government in Canberra would have repercussions in WA, including for the complex factional power battles inside the Labor Party.

The dominant faction inside WA Labor has for many years been the broad left, which revolves around the union United Voice.

Its no coincidence that United Voice WA secretary, Carolyn Smith, is also Labor’s WA president.

Mr McGowan is not factionally aligned but has a good working relationship with the broad left, whose representatives in cabinet include Fisheries Minister Dave Kelly.

The broad left’s dominance has been challenged over the past couple of years by a grouping called progressive Labor, which brings together several disparate groups from Labor’s hard left and right wing factions.

Its leading lights include Senator Glenn Sterle, formerly of the Transport Workers Union, who is shadow assistant minister for road safety.

Progressive Labor is also led by two of the most militant union leaders in WA – Christy Cain and Mick Buchan.

Mr Cain is head of the Maritime Union of Australia in WA while Mr Buchan is state secretary of the CFMEU.

They have been thorns in the side of the state government, which has been striving to present itself as moderate and sensibly pro-business.

The premier reportedly banned Mr Cain from his office after the union leader attacked the government’s recent decision on gas fracking – a compromise that banned the practice in most of WA but allowed it to proceed in defined locations prospective for gas.  

Mr Cain responded by describing the premier as average.

“He’s no friend of mine. I don’t think I’m on his Christmas list,” Mr Cain told 6PR radio earlier this year.

In contrast, Mr Cain has been strong in praise of Mr Shorten, particularly after the opposition leader backed the union’s campaign against BHP for cutting Australian crews on iron ore vessels.

“He’s well balanced. He’s a good leader. He wasn’t scared to come out against BHP,” Mr Cain said.

Mr Shorten has returned the favour. Both he and his deputy, Tanya Plibersek, have attended CFMEU and MUA conferences in WA and the opposition leader has happily been photographed with Messrs Cain and Buchan.

It is notable that the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), which was formed nationally last year through a merger of the CFMEU, the MUA and the Textile, Clothing and Footwear Union, has been a strong supporter of Mr Shorten.

The CFMMEU’s national secretary is Mick O’Connor, the brother of Mr Shorten’s shadow minister for employment and workplace relations, Brendan O’Connor.

Labor winning power in Canberra would be a big fillip for the CFMMEU and its state-based divisions, including those led by Messrs Buchan and Cain.

That would complicate life for the premier and senior ministers such as Treasurer Ben Wyatt, who for the most part have deftly managed relations with the state’s unions.

One of their big achievements has been the state government’s wages policy, which has capped growth in wages and played a big part in getting state budgets back to surplus.

Most unions have acquiesced but they have had more success on other policies.

The right wing-aligned SDA (formerly the shop assistants union) has fought hard against retail trading deregulation.

SDA secretary Peter O’Keeffe has been quoted as saying his union would walk out of the Labor Party if the government moved to further deregulate trading hours.

The Electrical Trades Union has also had success in getting the government to back away from deregulation of the retail electricity market.

Another hot issue facing the state government is the CFMEU’s push for tough industrial manslaughter laws.

Both the premier and the Industrial Relations Minister Bill Johnston have indicated they are looking at industrial manslaughter legislation.  

Two recent reports – the Boland Review and a Senate committee report – have recommended the introduction of such laws.  

“The McGowan government is currently considering both of these reports and the wider question of how to introduce industrial manslaughter laws,” a spokesperson for the minister said.

Business groups are opposed to this move and would be even more concerned if the WA government followed the lead of Victorian Premier Daniel Andrews.

He has foreshadowed industrial manslaughter legislation that would include fines of up to $16 million for companies and jail terms of up to 20 years for individuals.

Chamber of Commerce and Industry of WA chief executive Chris Rodwell said the state government should wait for the outcome of Safe Work Australia’s review of the Boland report and enter into proper and effective consultation with industry before proposing any amendments.

A broader issue for the business community will be Labor’s wages policy.

When discussing this issue, Mr Shorten enjoys rhetorical flourishes that delight his union supporters.

A prime example was his response last month, when asked by Business News about the impact of a 5 per cent lift in the minimum wage.

“I reject the fairy tales spun by the vested interests of big business, which says that reasonable wage rises cause economic dislocation,” he said. 

“Let’s be straight about this,” he added.

“Corporate profits have gone up in Australia by 45 per cent in the last four years, average wages in the country have gone up by 8 per cent.

“That isn’t fair, it’s not how the system should work.”

When Labor released its policy on a ‘living’ wage one week later, it was more nuanced.

Mr Shorten said the first step would be for the Fair Work Commission to determine what a living wage should be. 

Labor wants it to move away from the concept of a bare safety net towards a living wage.

The second step will be for the Fair Work Commission to consider the time frame over which the increase should be phased in, taking into account the capacity of businesses to pay and the potential impact on employment, inflation and the broader economy.

Business Council of Australia chief executive Jennifer Westacott welcomed this announcement.

“The Business Council has long supported the Productivity Commission’s recommendation that the Fair Work Commission broaden its framework for determining minimum wage increases while also considering the impact that any increase may have on the labour market and the economy more broadly,” she said.