Rudd to replace building watchdog

The Rudd government will tomorrow introduce legislation to introduce a tough new cop on the beat for the building industry which will place it at odds with unions.

It could also find itself at odds with the ALP National Conference in Sydney next month should unions succeed in pushing through a resolution calling for the abolition of special measures which apply only to the construction industry.

In a statement, Deputy Prime Minister Julia Gillard today said the government will introduce legislation which responds to the Wilcox Review by amending the Building and Construction Industry Improvement Act.

"The legislation will honour our promise to abolish the Australian Building and Construction Commission and replace it with the Fair Work - Building Industry Inspectorate," Ms Gillard said.

"The existing coercive powers will be maintained, alongside new safeguards recommended by Federal Court Judge Murray Wilcox.

"The Government's position on the Australian Building and Construction Commission (ABCC) has been clear for a long period of time.

"There are problems in parts of the building and construction sector which cannot be ignored.

"The Rudd Government has no tolerance for conduct which breaks the law, whether it be unlawful industrial action or underpayment of employees.

"At the same time, this sector is full of hard working people helping to build Australia towards recovery.

"That's why the Government is determined to get the balance right."

She added that the government has developed a mechanism to switch off the coercive powers for peaceful part of the building and construction industry where extra compliance arrangements are not necessary.

"The Government has also accepted and implemented the Wilcox recommendations to equalise penalties for building workers with other workers and to sunset the coercive powers in five years' time," Ms Gillard said.

"Prior to the sunset there will be a review of compliance in the building and construction industry."

The ABCC was established by the previous government in response to the Cole Royal Commission findings of lawlessness in the building industry.

Although promising to abolish the ABCC, the government wants some of its power to remain.

ACTU secretary Jeff Lawrence said earlier this week Labor was elected to government to protect the rights of workers.

Mr Lawrence said government must abolish the ABCC which had pursued a discriminatory agenda in favour of large construction companies and against workers and unions.

He said the government must also end the use of coercive powers, including the power to conduct secret interrogations.

"Third, the government must get rid of the special penalties that apply only to construction workers," he said in a statement.

"Under the current laws, construction workers can be fined up to $22,000 for stopping work and face up to six months jail for refusing to attend or answer questions at secret interrogations.

"Australian unions are united in our support for these changes and we are determined to continue campaigning for one set of laws for all workers."

The Deputy Prime Minister's announcement is below:

The Rudd Government will honour its election commitment to ensure there is a tough cop on the beat in the building and construction industry.

Tomorrow the Government will introduce legislation which responds to the Wilcox Review by amending the Building and Construction Industry Improvement (BCII) Act.

The legislation will honour our promise to abolish the Australian Building and Construction Commission and replace it with the Fair Work - Building Industry Inspectorate.

The existing coercive powers will be maintained, alongside new safeguards recommended by Federal Court Judge Murray Wilcox.

The Government's position on the Australian Building and Construction Commission (ABCC) has been clear for a long period of time.

There are problems in parts of the building and construction sector which cannot be ignored.

The Rudd Government has no tolerance for conduct which breaks the law, whether it be unlawful industrial action or underpayment of employees.

At the same time, this sector is full of hard working people helping to build Australia towards recovery.

That's why the Government is determined to get the balance right.

Last year the Government asked former Federal Court Judge Murray Wilcox to produce a report following months of consultations with stakeholders.

The Wilcox report came to the following pivotal conclusion about the ongoing need for coercive powers:

"I am satisfied there is still such a level of industrial unlawfulness in the building and construction industry, especially in Victoria and Western Australia, that it would be inadvisable not to empower the [Specialist Division] to undertake compulsory interrogation. The reality is that, without such a power, some types of contravention would be almost impossible to prove.

I have reached the opinion that it would be unwise not to endow [Specialist Division] (at least for now) with a coercive interrogation power. Although conduct in the industry has improved in recent years, I believe the job is not yet done."

The Wilcox report also recommended important new safeguards on the exercise of the coercive powers.

The Government agrees with the principal conclusions of the Wilcox report and has determined to retain the coercive powers with the new safeguards Wilcox recommends.

Importantly, the Government is taking an extra step to respond to the Wilcox observation that parts of the building and construction industry raise increased compliance problems.

The Government has developed a mechanism to switch off the coercive powers for peaceful parts of the industry where such extra compliance arrangements are not necessary.

This will enable compliance to be focussed on those parts of the industry where it is needed most.

The Government has also accepted and implemented the Wilcox recommendations to equalise penalties for building workers with other workers and to sunset the coercive powers in five years' time.

Prior to the sunset there will be a review of compliance in the building and construction industry.