11/07/2012 - 10:51

Ministers’ advice falls on deaf ears

11/07/2012 - 10:51

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The parallels with the emerging industrial climate and that which prevailed in the 1970s and 1980s are clear.

The parallels with the emerging industrial climate and that which prevailed in the 1970s and 1980s are clear.

It may have been just a verbal stoush. But the tone of the responses suggest there is a growing disconnect between sections of the union movement and the federal Labor government with, potentially, damaging consequences for Western Australia’s resources sector. 

And for those with long memories, there are fears that unless the current attitudes are reined in, exorbitant wage demands and industrial unrest could return, along lines similar to the experience in the Pilbara in the 1970s to mid-1980s.

That all came to a head in the Robe River confrontation, which had severe repercussions all round. 

Any repetition in the current climate would not only be unpleasant, it would also see companies, which require massive investment to get their projects off the ground, having second thoughts and, possibly, deferring or cancelling their development plans.

The result? Lost jobs, lost production, including exports, and lost opportunities. It’s that serious.

The stoush involved two senior federal ministers – not just any two ministers by the way – and federal and state union leaders.

Martin Ferguson (Resources) and Simon Crean (Regional Development) both flagged that unrealistic pay claims were in no one’s interests, regardless of the state of the labour market, which, in the resources sector at least, is moving very much in favour of the sellers – the workforce. Increases, they said, should essentially be based on productivity.

These are no two ordinary Labor ministers. Both are former presidents of the peak union body, the Australian Council of Trade Unions. Their fathers were also prominent Labor politicians.    

Frank Crean was a long-term federal MP and served as deputy prime minister and treasurer during the Whitlam government. 

Jack Ferguson was a bricklayer by trade who went on to play a key role in the NSW government, elected in 1976, as works minister and deputy premier.

Martin Ferguson and Simon Crean have been in and around the labour movement for a long time and have experienced the good times and the bad.

So what was the union reaction to their call? 

The best that could be said was that it was unenlightened. You might as well have been back in the 1970s when, coincidentally, I reported on industrial relations issues for The West Australian, and later The Sydney Morning Herald.

The new secretary of the ACTU, Dave Oliver, told the ministers to “stop lecturing” the current wave of union officials, adding that the industrial climate was now a far more challenging one in which to operate.  

Mr Oliver accused the ministers of asking for a special deal in which companies could negotiate “one-sided” agreements and drive down wages and conditions. Thanks Dave.

The WA secretary of the Maritime Union of Australia, Chris Cain, advised Mr Ferguson to stand up for Labor values or get another job.

 “If he just wanted to abide by his own ALP policy, then maybe he should go and get out of the Labor Party and go and work for Chevron,” Mr Cain said. 

“The problem we have is that we have companies like Chevron, Woodside, BHP and Gina Rinehart that need to bargain in good faith, as do their contractors.” 

In one sense, we should not be too surprised at this reaction. It is in the nature of blue-collar union leaders especially to be verbose and hairy chested on such issues. They believe that is what their members want. The cardinal sin for these officials is to be seen as “wimps” and react too reasonably to the bosses, let alone Labor ministers. 

That row coincided with a well-attended union rally in Perth protesting against the federal government’s enterprise migration agreements, with Ms Rinehart’s Roy Hill project in the Pilbara being earmarked as the first beneficiary.

 Mr Cain was again prominent, offering this advice for both Chevron and Mrs Rinehart: “If you want to work in our country you are going to pick up our labour.”

The parallels with the emerging industrial climate and that which prevailed in the 1970s and 1980s are clear.

In both cases there was a shortage of people prepared to work in the isolated north-west. Until union power waned after businessman Charles Copeman triggered the Robe River confrontation in the mid-1980s, companies had been prepared to “buy” industrial peace – virtually at any price – to keep production going.

Stoppages were an everyday occurrence at the mine sites of the four companies, which were the initial operators. 

The vast majority of strikes were not engineered by the state union officials. At the centre of most disputes were the local shop stewards, most of whom had various broad British accents. The “pommy shop steward” became famous. And, for some mysterious reason, similar voices are re-emerging, 25 years later.

In fact, as an industrial reporter in the Perth Trades Hall in Beaufort Street in the 1970s, I witnessed the looks of horror on the faces of senior officials as the phone calls came in from the Pilbara advising that their members at another mine site were again “out on the grass”. 

The premier of the day, Sir Charles Court, had a field day calling on the union leaders to “lead”, and for “good sense to prevail”. That was code for going back to work.

The issue became so serious for the union movement, that before the 1977 state election, Labor’s candidate for the Pilbara seat, a young Norm Marlborough, joined then ACTU president Bob Hawke and then Trades and Labor Council secretary Peter Cook on a visit to Japan. The goal: to assure investors and customers that Labor and the unions agreed that Australia had to be a “reliable supplier”.

As far as the industry is concerned, they were the “bad old days”. The past 20 years have been great for business, investors and the workforce, as productive capacity has accelerated to satisfy the burgeoning demand, especially from China, and increased prices. Profits and wages have jumped too.

A strong attraction for working in the Pilbara and on the North West Shelf are the high wages, in return for the long shifts in isolated locations. That also compensates, in the case of fly-in, fly-out workers, for extended breaks from family and friends. 

If you push the theory of the capital versus labour class warfare to its logical limit, when the opportunity presents itself to squeeze the other side – perhaps coinciding with a labour shortage – you grab it.

But there’s always a risk. And, in the current climate, unions could score significant pay rises – such as have already been won for the crews of vessels serving the offshore rigs. 

Should the rises spread and push up labour costs to such an extent as to encourage companies to look at other lower-cost countries for future expansion, it would be a pyrrhic victory indeed. 

That is the message Martin Ferguson and Simon Crean are trying to get across.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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