Light on the Hill: Industrial Relations Reform in Australia
The Hon. Sir Joh Bjelke-Petersen, KCMG, MLA
Mr John Stone, President of the H R Nicholls Society,
the Honourable Lindsay Thompson, former Premier of
Victoria, the Honourable Paul Clauson, Attorney-General
of Queensland, Distinguished Guests and Members of
the H R Nicholls Society, Ladies and Gentlemen, Friends
I say 'friends', because all those of us here today,
who I know include people who are not members of the
National Party, share a great concern, a concern which
is expressed in every part of Australian society. That
is, that our industrial relations institutions, inherited
from the early days of Federation, are dragging Australia
In dragging Australia down, they are also holding
Queensland down, and so I regard the Statement of Purposes
of the H R Nicholls Society as of the greatest importance.
Let me read them to you.
- to support the reform of Australian industrial relations
with the aim of promoting the rule of law in respect
of employer and employee organisations alike;
- the right of individuals to contract freely for the
supply and engagement of their labour by mutual agreement,
- the necessity for labour relations to be conducted
in such a way as to promote the economic development
The theme of your conference is 'The Light on the
Hill: Industrial Relations Reform in Australia' It
is appropriate that you should come to Queensland to
discuss this subject. Here in Queensland we have ensured
that the lights will stay on, and our efforts at industrial
relations reform are to be the subject of four papers
to be delivered at your Conference. One, on the Industrial
(Commercial Practices) Act, is to be delivered by my
Attorney-General; another, on voluntary employment
agreements, will be given by the chairman of my Party's
Employment and Industrial Relations Affairs Committee;
another will be given by the legal representative of
Australia's first enterprise union, the Queensland
Power Workers' Association; and a fourth is to be given
by a distinguished Queensland public servant, Wayne
Gilbert, on matters relating to the electricity industry.
The last great leader of the Federal Labor Party,
the late Ben Chifley, gave your Conference its theme
in two ways. First, with his observation that the practitioners
of politics must not lose sight of the light on the
Less directly, but perhaps more importantly, he understood
that it is not sufficient in politics to relax with
a warm inner glow which comes from believing one has
found the light on the hill.
He understood that one must move towards that light
with courage and resolution, ignoring the selfish pleas
of those who have a vested interest in resisting change.
Although his vision of the light on the hill was imperfect,
he did not flinch from his duty to Australia as he
saw it, even when that involved resisting the might
of the trade union movement.
The state of our nation today owes much to the lack
of the quality which he so amply displayed. When Chifley
was Prime Minister, even though Australia had slipped
from its pre-Federation position of having the highest
standard of living in the world, it was still within
the first five nations of the world.
The economic imperative of fundamental reform in our
industrial relations structures was not as apparent
then as it is now. But to Chifley the national interest
took priority over the hang-ups of the Industrial Relations
Club. What a pity his Labor successors have not held
the same view.
Coming as so many of you do from other States, I am
sure you still hear that far-reaching reform of the
industrial relations system cannot be achieved; that
it is 'industrially unrealistic'; that it will founder
on the rock of trade union power.
If that is accepted, such defeatism would make the
triumph of our opponents certain indeed. I turn, therefore,
to history to show what has been done here as an answer
to those who proclaim that there is no point in trying
to wind back union power.
When I became Premier in 1968, it was as leader of
a Coalition Government. At that time:
- trade unions in this State---indeed, only in this
State---were by law exempt from civil liability arising
from conduct in contemplation or furtherance of a trade
- membership of a trade union by State public servants
- the State Government collected the fees from its
public servants on behalf of the unions;
- the accounts required to be prepared by trade unions
for the information of their members---and the public---were totally inadequate; and
- there was no adequate provision for conscientious
objection to union membership.
This state of affairs reflected not only 39 years
of Labor government, broken by 3 years of non-Labor
government during the depression, but also the subsequent
constraints of coalition.
Since that time there has been an ongoing program
of industrial relations reform. Measures taken include
In 1974: the Governor-in-Council was empowered
to remove the exemption from civil liability in relation
to particular strikes.
In 1976: the exemption from civil liability
was totally removed, thus moving Queensland at last
back into line with the rest of Australia.
In 1984: compulsory union membership in the
State Public Service was terminated, although preference
in employment at point of engagement was substituted;
the Industrial (Commercial Practices) Act, mirroring
sections 45D and 45E of the Commonwealth Trade Practices
Act, but applying also to intrastate trade engaged
in by individuals and secondary boycotts directed to
individuals, was enacted; and legislation to curtail
the more abusive forms of union-controlled superannuation
In 1985: the Industrial (Commercial Practices)
Act was amended to make unlawful primary boycotts in
aid of demarcation disputes and preference to unionists,
and strikes called without 7 days' notice; industrial
action in the electricity industry was prohibited and
contract employment in that industry authorised; and
the right of individuals not to join a union, or to
resign from one, was enhanced.
In 1986: the accounting requirements for trade
unions were brought substantially into line with those
applicable to companies.
In 1987: the Industrial (Commercial Practices)
Act was further amended to make unlawful primary boycotts
in relation to export industries or research development
activity; a Bill for legislation to permit voluntary
employment agreements between employees and employers
in an enterprise was introduced and will be dealt with
by the Parliament in August; the subject of preference
in employment in the State Public Service was referred
to the Public Service Board for a report to the Government;
and a general review of the Industrial Conciliation
and Arbitration Act (including consideration of preference
provisions in the private sector) was announced.
Taken as a whole, these and related measures represent
the most substantial program of legislative change
in the industrial relations area implemented in Australia
since the turn of the century.
In our endeavours, we have not been wholly alone.
The Thatcher Government in 1979 inherited a like situation
of union privilege, including immunity from civil action,
which it is slowly redressing in favour of the principle
that all should be equal before the law.
Unlike my Government, the Thatcher Administration
has not yet wholly eliminated union immunity from civil
action in the context of industrial disputes. It has
moved, rather, on a step-by-step basis in removing
it from particular activities, at the same time taking
other initiatives directed to trade union reform.
Whether a more fundamental reform program implemented
at the commencement of her Government's term of office
would have been more successful, is a matter which
cannot now be conclusively decided one way or the other.
What is beyond doubt is that her industrial relations
reforms have been a major factor in the recovery of
the former 'sick man of Europe'.
Whilst we have gone far, we have not been able to
go either as far, or as fast, as we would like. We
have constantly been threatened that the Commonwealth
Conciliation and Arbitration Commission will seek to
intervene in State industrial relations.
The Hawke Government, with the help of the Senate
Democrats, has even legislated to deny the Queensland
Electricity Authorities the right to argue defences
available to other respondents before the Commonwealth
Commission---a move later held to be unconstitutional
by a 5-1 majority of the High Court.
These threats must be assessed against the background
that whilst the State industrial system has some unsatisfactory
features it has a very much better record of resolving
disputes than the Commonwealth system.
That is demonstrated by the fact that whilst 64 per
cent of Queensland employees are subject to State awards,
as opposed to 24 per cent subject to Federal awards,
over 60 per cent of man days lost through strikes in
1986 occurred in employment subject to Federal awards.
In industrial relations issues, as in economic ones,
the problems we see in Queensland cannot be solved
by State action alone. It is critical for Queensland
that the next Federal government creates an environment
in which real industrial relations reform can occur.
This applies even more to the other States, where
our reforms have not been implemented and some of whose
governments are actively conniving at the enhancement
of union power.
The need for such reform has been documented already
in many papers and articles, and not least in the publications
of the H R Nicholls Society. Our own research, not
surprisingly, confirms these needs.
To whom does one look for the creation of that necessary
environment for reform?
Clearly, not to the Hawke Government. It obviously
takes pride in the role ascribed to it in its various
accords with the ACTU, the executive arm of the trade
Those accords required it to deliver more power and
less accountability to the trade unions. The Hawke
Government attempted to formalise, by introducing the
Industrial Relations Bill, the abdication of power
by the elected government to the ACTU. As well, it
was to set the seal upon the emergence of a corporate
state in Australia.
In almost every respect, that Bill, if enacted, would
have been a change for the worse. The monopoly position
of trade unions was to be preserved and entrenched.
The few rights now left to business proprietors to
manage their businesses would have been taken away.
And most damaging of all, rights enjoyed by all Australians
for hundreds of years would have been summarily destroyed.
A system of sanctions on unlawful conduct which has
worked would have been replaced by one which has already
totally failed. The unions obviously told the Hawke
Government to jump. Its response was to ask 'How high?'
The Hawke Government's decision not to proceed with
the Bill at this time is a cynical move to disguise
its special relationship with the unions until after
Nor can we confidently regard the Liberal Party as
the solution to the problem. Its past record, present
personnel and so far stated policies disclose neither
an adequate appreciation of the essential nature of
the problem nor the resolution to implement the necessary
At the heart of the problem of Australian industrial
relations lies the extraordinary power of the controllers
of trade unions. This is underpinned by the extraordinary
legal privileges of trade unions, as organisations,
and the inability of members of unions to resign from
them unless they are willing to give up their jobs.
Since time immemorial, the common law has refused
to grant legal effect to agreements which prevent competition
in the market place. Since 1623, the prerogative power
of the Crown to grant monopolies has been non-existent.
More recently, the power of trading corporations to
achieve by market activity the monopoly they cannot
obtain by law has been restricted by legislation such
as the Trade Practices Act. Yet trade unions are guaranteed
a monopoly position by Section 142 of the Commonwealth
Conciliation and Arbitration Act and comparable State
These provisions are the foundation of trade union
power. Preference in employment of unionists, odious
as it is in principle, operates merely as a convenient
means of mopping up dissenting individuals.
The cornerstone of any industrial relations policy
which will be effective to wind back the power of the
trade union leadership is full freedom of association.
That certainly involves individual employees not being
compelled, either directly or indirectly through preference
clauses, to join a union. But it also involves individual
employees being permitted to join the union of their
own choice, or, if they see fit, to form their own
union. This concept is a major element of the legislation
currently before the Queensland Parliament.
The second essential element of industrial relations
policy is that it is both the right and responsibility
of employers and employees to determine for themselves
the employment conditions to apply. If any industrial
tribunal is to interfere, it should be one locally
based rather than a centralised system imposing its
will upon unwilling parties.
Any policy for industrial relations which does not
address these fundamental issues is simply fiddling
at the edges.
Recently I released two documents. The first is the
detailed policy on employment upon which National Party
candidates throughout Australia will campaign. The
second is a background paper on Flexibility in the
labour market prepared by the Employment and Industrial
Affairs Committee of my Party which demonstrates the
need for real reform of labour market structures.
The essential elements of this policy are:
- the creation of genuine freedom of association by
permitting employees to form their own unions or to
remain outside unions;
- guaranteeing to union members effective control of
union decisions affecting their lives;
- the termination of the compulsory arbitral power
of the Commonwealth Conciliation and Arbitration Commission,
leading to voluntary employment agreements as the principal
basis of employment;
- the enactment at Commonwealth level of the principles
of Queensland's Industrial (Commercial Practices) Act;
- the removal of the right of the Commonwealth Conciliation
and Arbitration Commission to interfere in civil actions
against unions in the real Courts of the land; and
- the removal of those privileges which elevate trade
unions and their bosses above the law applicable to
My Government and Party regard the proper role of
trade unions as essential to a productive and growing
society. We reject totally the vision of Australia
as a low wage community in which employees have no
Our country's future lies not in reducing the standard
of living of its workers, but in increasing that standard
through increases in productivity. Our present levels
of productivity, as revealed in the background paper,
are deplorably low.
The time has come for all Australians to realise that
improvements in our living standards cannot come from
socialist policies of soaking the rich, or from running
down the capital base of our industries. We have to
realise that no one gets it if there isn't any.
We don't need a sweatshop mentality---but we
do need a Mudginberri mentality.
We will never increase our productivity whilst our
industrial relations machinery is built upon foundations
of an earlier age whose structures are now irrelevant.
Monopoly craft-based unionism with its attendant issues
of demarcation, rigid work practices, and entrenched
opposition to change is a relic of the past which will
continue to drag us down unless we outgrow it.
Mr President, I was delighted and honoured to receive
your Society's invitation to open this Conference.
Since its foundation less than 18 months ago. your
Society has played a major role in promoting public
understanding of the issues to which I have referred.
In doing so, it has already performed a great public
service to Australia.
I know that, in the future, we will stand shoulder
to shoulder in this great endeavour to restore our
I declare this Conference open and wish you well in