Keating's Australia: is that what we wanted?

September 30, 1992

By Peter Anderson

For those who may not fully have realised the import of Labor's record in government, or who still harbour illusions about its pretensions to progressive social reform, Paul Keating laid it all out quite clearly.

This was behind closed doors, so to speak, to a meeting of academics and experts at the World Congress of the International Industrial Relations Association in Sydney on August 31. The speech was not the sort of thing Keating would present on television, at least not in election mode.

The arbitration system established in 1901 "is finished", he said, and "we are rapidly phasing out its replacement" — by which he meant the Accord.

The assessment is interesting. In the first place it is not true that the industrial court system which polices labour issues has been done away with. Whatever form industrial relations practice takes, the courts are still there to ensure compliance by unions and workers, at the pain of stiff penalties should they not do so.

Secondly, if the Accord is really on the way out, what does that mean for all the rhetoric from Labor and its supporters about social wage provisions supposedly a part of the Accord deal? Will there be even the slightest Accord-type nod towards the maintenance of social amenities and social welfare conditions in the future?

Keating's point was that "we have now begun to do things in a new way", which was his way of introducing congress delegates to Labor's commitment to enterprise bargaining. If Keating is right, Australian labour relations are already suffering draconian changes.

But if there was an element of hyperbole for the benefit of the audience of industrial relations opinion formers, there was also a grain of truth and a warning for those who maintain a strong allegiance to basic union rights and traditional working conditions.

The arbitration system never worked very much in the interests of wage and salary earners, though it did deliver a reasonable uniform minimum standard of living during times of economic boom, now long gone. Policed by the arbitration system, the Accord slashed wages and conditions, and delivered precious little on the social wage side. Now, enterprise bargaining foreshadows a New Zealand-like disaster.

Enterprise bargaining is tailored to fit the needs of generally large, internationally competitive industries using the latest technology. Meanwhile, minimum wage standards for the vast sea of sweatshop workers will start to disappear, and below that the underclass of permanently unemployed will never find respite. What was the situation when Labor "arrived in office in 1983", when inflation was over 11%? "We were exhausted by industrial warfare. The profit share had been squeezed down", said Keating. These are the "problems" that Labor set out to fix.

Luckily, said Keating, "we ... had a very enlightened central leadership in the union movement, and [in the 1980s] a prime minister whose entire suite of talents developed during a long and eventful career were ideally fitted to the task of conducting a national summit to reconcile the warring industrial parties".

In one way or another, the Accord was essential to the "favourable outcomes we were able to make", he said. Unhappily, this is true. The political hallmark of the period is the abject compliance of most of the ACTU/trade union leadership at a time of dramatic attacks on union conditions.

The ACTU's support for enterprise bargaining is just another episode in this long and sorry saga.

"Last year we had the lowest number of disputes for 30 years", Keating reported, and this at a time when unemployment went through the 10% barrier, the worst period in labour history since the 1930s depression.

The compensation for this devastation of labour conditions was the supposed provision of heath care, family assistance, quality education and so on. But ask a patient bedded on the floor of a corridor at Liverpool Hospital in Sydney's working class western suburbs, or teachers and students in one of the many overcrowded, dilapidated schools in Melbourne's west if they are at ease with social wage improvements.

"By the late '80s, we had restored the profit share", Keating said, and "we increased employment by one-fifth". He did not once mention the 15-25% reduction in real award rates of pay or the crisis of mass unemployment created by Labor's management.

He did explain that money wages had risen 20% in the early '80s boom, but rose by only a third of that late in the decade, a process which was responsible for "bringing inflation down and employment up through adjusting wages" (emphasis added).

It is clear enough that Labor systematically went about reducing real wages to improve the "international competitiveness" of Australian businesses. The '80s were a profit bonanza for Australian investors and speculators. Is this what we wanted?

"This is suburban Australia", Keating summed up, invoking a hazy image of Bankstown, where he grew up, "which is where most Australians live, but it is not wealthy or privileged or elitist. It's a good life out there for most people, with good houses, good schools and good to good colleges for kids who want to go on. There is child-care for working families, and quality treatment for everyone in public hospitals."

It has obviously been a long time since Keating made the trip from Elizabeth Bay to Bankstown. Or should I have said that the other way around?

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