Rudd Labor: what to look for


Kevin Rudd is a prime minister in a big hurry. Only a fortnight has passed since the Howard government was thrown into the dustbin, and the new Labor cabinet is already scurrying about its work.

The big splashy initiatives are well-known — ratification of the Kyoto protocol, the replacement of Work Choices by its close cousin Forward with Fairness and the launch of the broadband, education and health "revolutions".

However, there's a lot more to the Rudd agenda, and the plans that will most affect the working, living and environmental conditions of working people over the next few years have been less publicised.

Central to getting a grip on Rudd's agenda is understanding the nature of his pact with Australian big business. This contract has been shaped by the circumstances in which Labor won office — on the crest of union and worker mobilisation against Work Choices.

That fact has set a limit to how far Rudd and deputy leader Julia Gillard can go in feeding the anti-union appetites of the big end of town. Forward with Fairness practically strangles the right to strike and severely limits unions' right of entry into the workplace. However, it leaves the unions as institutions, as players in the game, and this in a situation where around 900,000 non-unionised workers have said they would join a union tomorrow if they could.

What compensation can Rudd offer the corporates, given that their dream of a union-free workplace is off the agenda for the time being?

The answer is an all-round economic rationalist recipe which goes further even than the Howard government. In areas like business deregulation, a business-friendly restructuring of federal-state relations and boosted infrastructure spending, Australia's corporations are about to enjoy a field day under Rudd.

At the level of economy-wide management, Rudd has already moved to underline his credentials as an economic conservative. Last week treasurer Wayne Swan signed a new agreement with Reserve Bank of Australia governor Glenn Stevens that further entrenched its independence (the governor can now only be sacked by parliament), recommitted it to an inflation target of 2-3% and required "disciplined fiscal policy" from the government.

That "disciplined fiscal policy" will soon show up as $10 billion worth of cuts to be implemented by a razor gang under finance minister Lindsay Tanner, and public sector workers in Canberra can expect to be in the front line.

In a similar vein, the treasury and its secretary Ken Henry is going to be brought into an "expanded policy role" under the Rudd government. Henry, who earlier in the year achieved notoriety with a leaked internal treasury speech criticising the "middle-class welfare" and election-time bribery practised by the Howard government, will be a powerful force for a disciplined fiscal policy — even as his department flirts with proposals to further reduce the company tax rate.

The Rudd government is also moving to hand big Australian capitalists very juicy plums in the area of infrastructure spending, where a huge backlog that began building up under the Hawke and Keating governments is crying out to be tackled.

New minister for infrastructure and transport, Anthony Albanese, has said that Labor's new Infrastructure Australia authority would be aiming to make it easier for private public partnerships (PPPs) to get off the ground. He told the December 3 Financial Review:

"You have two things in this country. One you have a considerable infrastructure deficit. But secondly you have available capital, it's a matter of developing policies at the national level that encourage those two things to be put together.

"The obvious potential is there of $1.1 trillion sitting in superannuation funds, and superannuation funds in terms of investment in infrastructure are a good match."

Albanese is obviously the sort of minister with whom the big construction corporations like Leighton Holdings look forward to doing business. The perspective for increased PPPs in infrastructure spending at the federal level will follow in the footsteps of Victorian premier John Brumby's government, the state administration most gung-ho about PPPs.

(In a nice piece of timing, the latest research on PPPs by Allen Consulting and the University of Melbourne — commissioned by the big infrastructure corporations — unsurprisingly found that governments would save $6 billion if 10% to 15% of their estimated 10-year $400 billion capital works program were carried out through PPPs!)

The impact of the Rudd approach will not just be confined to the federal level. The core of his proposals to restructure state-federal relations is basically to bribe and threaten the states into adapting "best practice" in service delivery and infrastructure construction in health, education and energy, water and public transport provision. That is, the goals that the Rudd government has set for improving services (like cutting the 25,000 queue for elective surgery) will be the pretext for an assault on "outmoded practices" at the state level.

Most squarely in the sights of the federal government will be those Labor governments — New South Wales and Queensland — which are still dawdling over the privatisation of those services that were handed over to business in Victoria by the Jeff Kennett government, and which the subsequent Bracks and Brumby governments never took back into public ownership.

The Rudd tactic here will be an intensification of John Howard's approach, making increased Commonwealth funding conditional on state acceptance of the federal Labor pro-corporate agenda.

Let public sector workers at all levels of government beware: the price of the Rudd government's compact with the Australian corporate elite is likely to be their jobs, wages and conditions of work.

[Dick Nichols is the national coordinator of the Socialist Alliance.]