Comment

Paul Bongiorno
The view from the jobs summit

On Tuesday morning, ahead of attending the prime minister’s 100 days in the sunlight address at the National Press Club, Jim Chalmers held another one of his Zoom conferences with key stakeholders who were to attend this week’s jobs and skills summit.

That morning it was with the Business Council of Australia, which has shown strong leadership among the captains of industry in wanting to come to terms with Australia’s contemporary challenges. Its chief executive, Jennifer Westacott, took her council out on a limb before the election, producing a much more ambitious climate change action program than Scott Morrison’s government was prepared to accept – much to his electoral detriment, as things turned out.

As the new treasurer, Chalmers has lost count of the number of times he has had these personal, if virtual, engagements with Australia’s business and other leaders. He was heartened by the response to the government’s initiative and the feedback he was getting. And that’s despite the opposition warning its putative allies they were being conned.

Particularly exercising Liberal hardliners was the apparent warmth in negotiations between employer groups and the unions. In a speech last week, deputy Liberal leader Sussan Ley said business groups risked “being used as props” for Labor’s jobs summit and, worse, like Labor, capitulating to the unions’ agenda.

Many in her audience didn’t see it that way. In their pre-summit consultations, some told government ministers they could not believe the Liberals decided to sideline themselves from the action. Shadow Treasurer Angus Taylor demanded an invitation to the summit, only to be overruled by his leader, Peter Dutton, who dismissed the whole exercise as “a stunt”. This criticism was not shared by his Coalition partner – the Nationals leader, David Littleproud, attended and, like the other non-government politicians who did, made sure he had his say.

The Business Council was not alone in seeing the summit as a real chance to influence the new administration. Indeed, as the summit wrapped up last night, there was enthusiasm for the opportunities it had opened.

There was real movement on industrial relations: gender pay equity, outlawing wage theft, labour hire, fee-free TAFE and additional university places. Skills shortages and increased immigration were addressed, with acknowledgement that more needs to be done to ensure upping the intake is not a substitute for training Australians. That is a challenge as much for business as for all levels of government.

The treasurer foreshadowed that his October budget will be heavily focused on cost-of-living relief, which would also go to meeting job market shortfalls. He singled out childcare as a game changer that would enable “people to work more and earn more”. That raised hopes its start date could be brought forward from next July to January. However, Social Services Minister Amanda Rishworth has worries about a dearth of trained early educators to meet an earlier dramatic increase in demand.

The three major employer and business groups – the Australian Chamber of Commerce and Industry, the Australian Industry Group and the Business Council – are now calling for a continuation of “strong consultation across the community”. They accepted there were clear limits to “the breadth of the consultation possible at the summit”. In a joint statement, they said they were looking forward to the promised employment white paper because it “offers many more opportunities for much broader engagement”.

There’s no argument from the government, something Chalmers and the prime minister stressed in their summit wrap-up. Chalmers accepted there were hundreds of people who had “a legitimate reason to be there” and he grappled hard to restrict the guest list to 143. He says he struggled to get the balance right between unions, business, gender, community groups and state and local government representation.

Peter Dutton says union coverage in the private sector is less than 10 per cent, but “out of 142 participants, you’ve got 33 who are from the unions”. A dispassionate analysis, however, shows there was 37 per cent business and 23 per cent union representation. And while it can’t be denied unions look after their own “vested interests”, they have also made and continue to make major contributions to improvements in all workers’ wages and conditions.

Anthony Albanese is looking to foster “a new culture of co-operation” for the future, as he said in his National Press Club speech, rather than pitting unions against business. What’s good for the worker should always be good for the employer. It’s a guiding light he has followed during his senior political career. It has allowed him to establish good relations with a range of business leaders. Indeed, his colleagues have no doubt the success of the summit process so far owes a lot to this fact.

Still, nobody can pretend it’s now all harmony and light after a love-in at the summit. Real differences and conflicting interests remain and are deep-seated, as are the challenges Australia is facing. But the prime minister says for the first time in a long time he believes “we will be moving to agreement on how to solve these problems – rather than arguing who is to blame for them”.

Chalmers was expecting and got unresolved disagreements. This influenced the decision not to attempt a final communiqué after the two-day conference. Instead of a “flowery document” that at best would be a motherhood statement of lowest common denominator sentiments, he produced two lists.

One was a list of immediate actions where there is sufficient common ground “to move forward together” immediately or at least by the end of the year. Then there is a second list where “there is sufficient common ground to do more work on issues”. These might then inform what he puts in his budget or in the employment white paper.

The Greens have reminded everybody that whatever is put to the parliament will need the party’s support in the senate. Party leader Adam Bandt says the Greens “won’t be a rubber stamp for government side deals with big corporations”. He is particularly exercised by any changes to the better off overall test in a way to revive enterprise bargaining.

Employment and Workplace Relations Minister Tony Burke has opened the door to modifications of the test, which small business in particular finds too rigid and which has been the death of many agreements otherwise finalised between the parties.

Ironically, the Greens could deal the absent Liberals back into the game here, especially as shadow minister Michaelia Cash is making accommodating noises around supporting changes to the test.

Bandt goes further, saying that when any proposals hit the senate the Greens will push to change the law to guarantee wage rises. “The government should treat low wages, especially in the care economy, as urgently as they are treating skills shortages,” he says.

Labor sees the ultimatum as grandstanding. The care economy is dominated by female workers, and the government, besides committing to gender pay equity, has already signed up to higher wages for those in aged care. Albanese is well aware that if the Fair Work Commission grants rises, his government will be called on to foot the bill. It will be yet another impost on the already heavily indebted budget. Albanese and Chalmers have repeated the “trillion dollar” debt mantra all week.

The prime minister is prepared to do it, especially as the treasurer and expenditure review committee have been combing the budget line by line to get rid of Morrison government rorts and waste to help pay for new summit initiatives.

There is, however, $243 billion in budget repair on offer, which Albanese is resisting. That’s the cost of the stage three tax cuts over a decade after they are introduced in the 2023-24 financial year. Chalmers points out that they are no help in the meantime, but says the government has no intention of breaking its election promise not to scrap the tax cuts.

The pressure to do so is building exponentially, however. Parliamentary Budget Office analysis for the Greens found that the richest 1 per cent of Australians will get as much benefit from the stage three tax cuts as the poorest 65 per cent combined.

Veteran Liberal backbencher Russell Broadbent joined the Greens and most of the crossbench in calling for them to be scrapped. He says, unlike his leader, Peter Dutton, he would have welcomed an invitation to the summit to argue that the tax cuts should be diverted to pay for things such as social housing, defence and a “list that goes on and on”.

Broadbent says the world has changed since the tax cuts were legislated in 2019 with the reluctant support of Labor. He says, “When things change, we should change.” Labor is unimpressed by Broadbent’s conversion, pointing out that his views are not shared by his leader or the rest of the opposition.

Economist Richard Denniss says the tax cuts will fall just eight months before the next election is due – about 1000 days from now. Nobody earning less than $45,000 will get any relief, while those earning $200,000 or more will get a $9000-a-year sugar hit. So, 40 per cent of taxpayers will miss out; that’s millions of voters whose anger is sure to be stirred up by the welfare lobby, the Greens and high-profile independents.

As political booby traps go, Scott Morrison couldn’t have set a more lethal one. 

This article was first published in the print edition of The Saturday Paper on September 3, 2022 as "The view from the jobs summit".

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