Flawed management of IR

13/11/2007 - 22:00


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I may be one week premature on this, but with just more than a week to go before the federal election, I thought it was worth discussing the poll.

Flawed management of IR

I may be one week premature on this, but with just more than a week to go before the federal election, I thought it was worth discussing the poll.

More importantly, I feel it is necessary to cover off on how John Howard went from being the unbeatable prime minister of 10 years to almost certainly losing next week – given it seems unlikely another Tampa will appear over the horizon.

Even if he did pull off an amazing win, it is clear he is a spent force in politics.

So how did this happen?

Call it hubris, over-confidence or simply too much power, but Mr Howard’s changes to industrial relations laws were bungled.

Easy to say in hindsight, I realise, but the prime minister had the track record on reading the electoral tea leaves, and many would have mistakenly believed he knew what he was doing.

IR in Australia has always been a sacred cow, due to our nation’s development as a rich, new-found democracy.

But Mr Howard had encountered such prickly policy issues previously and overcome opposition. Remember the Goods and Services Tax?

The GST had lost John Hewson the unlosable election in 1993. Campaigning on such a tax was considered a death wish after that, even though both sides of politics knew it was important for the nation to rely more on taxing consumption rather than income.

Yet Mr Howard took on this relatively new sacred cow and won.

He did so by carefully working through the objections and creating mechanisms that nullified the electoral downside.

On the issue of food, he negotiated with the Democrats. Sure, he had to do this to get it past the Senate, but perhaps he knew that the blessing of Australia’s third player in politics might help smooth the GST’s progress. And while leaving food out made it a bastardised tax and meant income tax cuts could not be so great, that was the compromise that made his GST palatable. Maybe he foresaw it might end the Democrats as any sort of political force, too.

On the fear of future increases in the GST, Mr Howard was clear to spell out that there was no rise planned. Because no-one trusts politicians, he made a rise dependent on agreement from the states, effectively creating a third gatekeeper outside the two federal houses of parliament.

On the fear of business pumping up the prices by simply adding 10 per cent (rather than calculating the sales tax savings first), he introduced heavy penalties and beefed up the tax office. Just how heavy handed this would be was not known but it was extraordinarily hefty treatment for a sector that was meant to be the Liberal’s friends.

In other words, Mr Howard successfully showed how to introduce an unwanted change – by neutralising the issues that would have given something for the opposition to latch onto.

As someone who is known to have a detailed understanding of how the electorate worked, it makes a lot of sense that he took this track.

What I don’t get is why he didn’t apply it again when it came to IR.

Perhaps he felt he owed business something after lumping the GST on them, adding greatly to the paperwork in making them de facto tax collectors.

And with WordChoices he did not have a tricky Senate to negotiate. Arguably, he held the balance of power, needing only to salve the mixed-up conservatism of Queensland National Barnaby Joyce.

Also, he faced no opposition of any note. He’d dispatched Mark Latham at the last election and Kim Beazley was ineffectual.

Perhaps, in addition, he saw the opportunity to wipe out his real opposition, the union movement, and could not hold back from going for the jugular, despite clear evidence that the unions were successfully killing themselves off, slowly but surely.

It would be easy for any prime minister to think that, given such a track record of understanding the electorate, and enjoying the trust of the community, any hard decision could be sold if it was in the best interests of the country.

For those who wish to make notes for the future, clearly that is not the case.

Mr Howard chose to take the hardest line. He made WorkChoices as basic as he could and left little for the employer to do.

He created an Office of the Employee Advocate, but unlike with the GST, he did little to publicise its power or resource it to make sure it effectively managed its responsibilities.

There was little to stop employers who wished to take advantage of these rules doing things many of us would consider wrong.

Instead of gently leading the workers of Australia to the new nirvana of Australian Workplace Agreements, Mr Howard believed adults could take care of themselves.

In the main, this was true. But, unlike the GST, the marginalised few gave his opponents something to grab hold of.

Egalitarian Australia worried about the lowly paid being paid less and their own kids becoming wage slaves without conditions like their grandparents had known.

It is clear, in politics, that once an opponent has a clear place to grab hold, they are harder to shake.

And the more you fight, the more credibility your enemy gains.

Whatever happens on Saturday week, politicians of the future ought not avoid doing the hard things, just manage the process more carefully.


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