2GB Mornings - Productivity Commission report on workplace relations framework

Subjects: Productivity Commission report on workplace relations framework; penalty rates.

LUKE GRANT: Now a landmark report into the Australian labour market by the Productivity Commission has recommended Sunday penalty rates for café, restaurant, entertainment, and retail workers be lowered to the same level as Saturday penalty rates. Under the proposal, higher Sunday surcharges will be replaced by a single weekend rate. Business groups, as you might imagine, have welcomed the move saying it’ll boost employment, and lift the cash flow of small business owners. Federal Employment Minister Michaelia Cash is of course able to comment on the review given her role, and I’m delighted to say that she joins me on the line. Minister good morning.

MINISTER CASH:  Good morning Luke.

LUKE GRANT: Merry Christmas to you.

MINISTER CASH: And Merry Christmas to you too.

LUKE GRANT: I just wonder out aloud, I think many people in business think the notion of at least having a detailed look at penalty rates is a good, meaningful thing to do that might be better in terms of being able to employ other people and the like, but the political reality is that the union movement, the Opposition, and I guess some in the media are going to hammer you the moment a conservative government goes anywhere near pay rates. Isn’t that the reality?

MINISTER CASH:  It’s very unfortunate, but what I say to the people of Australia is Labor and the unions are effectively dealing themselves out of a conversation in relation to reasonable economic and workplace relations policy by only focusing on one issue. In terms of the PC report, this is a broad report, it has 31 chapters, approximately 69 recommendations, and yet what we see is because Labor have nothing else to offer they revert immediately to an argument on penalty rates. And quite frankly it’s predictable, and it’s a tired old campaign.

LUKE GRANT: And it is, and you’re right, and I agree with you, but I just sense that there will be cut-through because it’s easy to go down the scare road isn’t it? I mean probably every opposition does that to be fair.

MINISTER CASH:  And look a scare campaign is a really easy campaign to run. So what I would say to your listeners is think about workplaces today, think about how different they are to twenty years ago. What we need as Australians is a workplace relations system that reflects that. In terms of penalty rates, I mean as you would know the Government’s position is that the determination of penalty rates is for the Fair Work Commission, not government, but when you look at what the Productivity Commission itself has found, it’s found that if there was that small change to Sunday penalty rates it would deliver a significant number of jobs, in particular in small and medium business. This then has flow-on benefits to consumers and the unemployed. Luke I’m all about as a Government, and I know Prime Minister Turnbull is all about creating as many jobs as possible, but also acknowledging that we have to have a strong safety net, and that’s what we’re focused on.

LUKE GRANT: Yeah, and the job numbers have been pretty good you have to say, particularly of late, but how do you ensure that a small business operator doesn’t just say I’ve now got an extra couple of hundred bucks, I just whack that in the back pocket, and happy days?

MINISTER CASH:  Oh look and I think when you talk to small business owners they will say to you that they are all about growing their businesses. They’re all about, if they’re not already open on a Sunday, given the right economic environment opening on a Sunday, and in particular in those niche industries of hospitality, entertainment, restaurants, retail, and catering. It’s all about job creation. They want to open, they want to employ more Australians, they in particular- and I’m focused on this as well - how do we get more youth who are unemployed into work? And one of those things is ensuring that our businesses are able to open. And look just from my own perspective as a Senator for Western Australia, I mean I travel around my state, in particular to rural, regional areas, and I talk to business owners there; they simply just can’t open on weekends because of the cost of doing business. And if we’re going to continue to be a government and a society that buries our head in the sand, we are literally going to be bypassed. We can’t afford to do that.

LUKE GRANT: Yeah, well look I agree with you, I just think the other side of this debate, they’ll just go nuts like they did about WorkChoices and other things. Just answer me this if you can – in relation to the process, because this I think’s key to the scare campaign, working or not. Is there anything that the Federal Government – and you said before that there was nothing – can do to ensure that penalty rates are changed, and if not, what process does the Fair Work Commission have to go through to get some change?

MINISTER CASH: Okay, so responsibility for setting award wages and conditions, and that includes penalty rates, is a matter for the Fair Work Commission to determine, not the government. In relation to the Productivity Commission’s final report, there is nothing in this report that suggests the Government should change its position. And in fact, the recommendation on penalty rates is a recommendation to the Fair Work Commission, not to government. As you’d be aware, the Fair Work Commission is currently looking at the issue of penalty rates. I know that there have been copious submissions provided to it by business and the unions, and they will bring down their decision I understand in sort of mid next year.

So in the first instance, the Fair Work Commission are looking at penalty rates. As a government, we say it is their responsibility, and they will bring down a decision next year.

LUKE GRANT: Okay, and if they bring down a decision next year that says you know what, we need to do something here because we are a seven day a week society, and we all expect to be able to do whatever we can do on a Monday on a Sunday or a Saturday or whatever. If they come down and say we’ve got to change these penalty rates, is it then not the duty of government to support or otherwise this? And I wonder if you’d therefore then support the Fair Work Commission, how that might play out among the people, because the Labor Party and the unions will have a field day there.

MINISTER CASH:  Look, it is a very interesting point you make, because the Fair Work Commission is independent of government. And so if the Fair Work Commission does bring down a decision so that there is a weekend penalty rate, so basically they’d align Sundays with Saturdays, that’s what being asked for, that would be a decision of the Fair Work Commission, and as a government we would respect that. If the Labor Party or Bill Shorten are saying that government should interfere in an independent process once a decision has been made, I think you are starting to tread on very, very dangerous ground. I will just remind your listeners though that the Fair Work Commission, again being independent of government, has already shown it is prepared to move on penalty rates, because they have already lowered Sunday penalty rates in those particular industries – so hospitality, entertainment, retail, restaurant and catering.

But again, they are currently considering the issue of penalty rates, and they will make a decision next year. But it is a decision that is independent of government.

LUKE GRANT: And what about the recommendation in relation to the Workplace Standards Commission replacing the Fair Work Commission in determining minimum wages and award regulation – is that something that you support?

MINISTER CASH:  Oh look no I’ve said I won’t play rule in, rule out. What I’m going to do is obviously …

LUKE GRANT: Oh go on, it’s nearly Christmas Michaelia.

MINISTER CASH:  Oh, I know it’s nearly Christmas and I could give you a Christmas present but then it wouldn’t be one for me.

LUKE GRANT: [Laughs].

MINISTER CASH:  That would be giving Brendan O'Connor a Christmas present and I couldn’t do that [laughs].

LUKE GRANT: [Laughs] Oh you’re a star, you are.

MINISTER CASH:  What I’m going to do is, and I have said, this is all about collaboration. This is about bringing Australians, with the Turnbull Government, on the journey towards that workplace relations system that is going to create as many jobs as possible with a strong safety net. We’re going to, as I said, bring Australians on the journey, and so in early 2016 I am going to have a series of roundtables. They will be across the board roundtables, and very much look at how the system should promote jobs and productivity. How the system should provide incentives to prevent long-term unemployment, in particular for youth. We have a problem with youth unemployment in Australia, and so that’s my focus. And we will release our policy next year, and we’ve always said we will seek a mandate from the Australian people in the lead-up to the election and that is what we’ll do.

LUKE GRANT: Well that’s all very fair. Now you’re a minister, I’m assuming someone will do the turkey or the ham or the Christmas fare, I mean you’re a minister now, you’re meant to pull rank, aren’t you?

MINISTER CASH:  [Laughs] That’s my poor husband, who is a fantastic cook and I rely heavily on him [laughs].

LUKE GRANT: [Laughs].

MINISTER CASH:  I hope he’s not listening to this [laughs].

LUKE GRANT: No, he’s – well he’s in Perth, so he’s …

MINISTER CASH:  He’s in Perth, and he’s still in bed, actually.

LUKE GRANT:  Alright, fantastic to talk, I love the straight talking. Don’t ever lose that, because that’s one of your great qualities.

MINISTER CASH:  Oh, thank you very much, and to you and to all your listeners, do have a fantastic Christmas but an even better 2016.

LUKE GRANT: Thank you.

MINISTER CASH: Good on you.