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May 28, 2005

deregulating the labour market

The new national system for regulating wages and employment is being heralded as a historic moment in Australian history and the remaking of Australia. It certainly looks that way, as it is the first example of roll back. In this case centralized power is being used to deregulate the labour market.

The rules and regulations of the federal industrial system will be dramatically overhauled; minimum wages will be eased; the safety net underpinning enterprise bargaining will be stripped back; small and medium business will be given free rein to dismiss unwanted workers without challenge from unions and tribunals; the rights of union officals to enter workplaces will be curtailed; there will be tougher sanctions against illegal industrial action and unions will have to hold secret ballots of workers to approve strikes.

Howard now has the numbers in the Senate to make it law.

Rodney Clement

Many of the low paid and vulnerable are going to lose many of the rights and most of the protection of the workplace system built bit by bit over the last last century.

Job security increasingly depends on the booms and busts of the economy as the primary employment relationship is now the individual contracts made between employers and employee, with a far more limited role for trade unions, industrial tribunals and governments.

A downturn in the economy means that the "burden of adjustment" will fall on the workforce, particularly those with limited skills and bargaining power. That is what a deregulated market is for: to enable employers to adjust labour costs and conditions to changes in demand.

Australian business says that this helps them to have a competitive edge at a time when Australia's position in the competitive index is weakening despite a strong and resilent economy. Business then adds there is a long way to go in reforms and the Coaliton cannot afford to lose its nerve as the reform journey has only begin.

That means that the current workplace package does not go far enough. From this economic liberal/free enterprise perspective most of the restrictive employment regulation remains, as does the scope for troublesome judicial interpretation. If those unskilled unemployed Australians who are to be shifted off welfare are to be employed, and poor households an income from enmployment, then the minimum wage needs to be reduced, and preferably abandoned. And the unfair dismissal regime or an award system regime should be wound right back.

For market liberals, such as Des Moore, the primary reason for pushing this kind of labour market reform is a small government philosophy. Their classic liberalism limits the reach of central government so as to expand individual choice, freedom and opportunity. This presupposes that individuals should be able to take care of themselves; and, given this self-reliance, the proportion of the population needing federal welfare and health assistance should fall. If individuals and families assume more responsibility for their own welfare, health and employment, then the nanny state can be wound back,if not abolished.

Posted by Gary Sauer-Thompson at May 28, 2005 11:20 AM

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The Howard government has increased the burden of government on Australia, IIRC he has got it up to 33% of GDP now.

Des Moore is kidding himself if he thinks the nanny-state can be rolled back. Politicians gain/keep their power and influence by bribing electorates, they can only do that by disbursing taxpayer monies to their politically weakest points.

The only nanny-state areas that will be rolled back, will be against those that are politically weak, and will not threaten as politician's hold on the reigns of government.

Those that waver will continue to be taxed disproportionately and then have the money given back, with political strings attached at election time. Our middle-income earners are being taxed inequitably and are bearing the burden of the income tax system.

But at election time we will see new programs rolled out to buy those votes back, with facetious
rhetoric on "easing" the burden. Things like vouchers for schools, or daycare etc.

Yet if the government didnt over-tax these middle-income earners, they wouldnt need to be dependant on government for these things. The big government of John Howard has created a new class of people that are dependant on government hand-outs; they are the middle income earners.

The nanny-state will not be rolled back for them, nor their tax burden reduced. It is too important politically that their fortunes feel chained to the actions of government, and the hand-outs of government - otherwise they might for someone else.

Posted by: Cameron Riley at May 28, 2005 11:26 PM

I agree about the emphasis being on the vulnerable and the politically weak.

As Eva Cox points out the Howard Government's populist rhetoric around their work-to welfare reform was about lazy welfare dependent single parents, those exaggerating their disabilities, young unmarried mothers with multiply fathered children, and older unemployed males with faked injuries and Mediterranean backs.

There is a contradiction buried in this: single mums were pillored whilst the recipients of Parenting Payments Partnered---wives of low income families with dependent children--were ignored. Single mums were bad whilst the others are lauded as the good wives and mothers who stayed home to care for their families.

What constitutes good and bad? Marriage.

Despite this, both the dad single mums and the good wives will have to work once their children hit school age.That ends all the conservative rhetoric about conservative women choosing to be a full time mother, which John Howard has deployed as a core part of his social views. They've forced to work too.

The conservative women commentators who have railed on about feminism destroying families for the sake of their selfish career were notably silent. Where was their criticism of the hard values of a neo-liberalism out to wind back the welfare state.

Posted by: Gary Sauer-Thompson at May 29, 2005 01:14 PM

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