Victoria's Labor government, the unions and the left

March 22, 2000
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Victoria's Labor government, the unions and the left

By Jorge Jorquera

MELBOURNE — In its first 100 days, the Victorian Labor government, led by Premier Steve Bracks, has established its priorities. Bracks has sought to secure business confidence.

This is what all the noise about "restoring democracy" has been about. Labor needs to convince to big business that it can still make profits in Victoria, even with a government committed to "transparent" finances, without relying on huge and questionable government handouts.

This is a big job considering the structural weaknesses of the Victorian economy (if Australia is an "old economy" in the "new" globalised market, then Victoria is one of its "oldest" parts).

Victorian Labor's Financial Responsibility Bill does more than restore the powers of the auditor general taken away by the previous conservative government. It also establishes avenues for greater business "input" into the government's financial priorities. Along with the new Expenditure Review Committee, it is part of an ambitious project to restructure and reinvigorate the Victorian economy based on investment in industry and services, rather than one-off privatisation and "casino" projects.

Former Coalition premier Jeff Kennett's fire sale of government services and enterprises allowed his government to partially avoid dealing with the Victorian economy's major structural problems. It also meant that Kennett did not confront the strength of the unions in the important manufacturing and construction industries.

Restructuring

Bracks' project of restructuring Victorian industry and services will not allow him the luxury of leaving the trade union movement's strength untouched. The Labor government's perspective will require major attacks on workers' wages and conditions in key industries that, from capitalism's point of view, require significant "modernising". Labor will also have to keep social spending tight, to butter-up business and provide some subsidies through infrastructure projects.

Consequently, Bracks' second priority has been to increase Labor's political grip on the best-organised sections of the Victorian working class, certain unions and the so-called community sector, which may create problems for Labor in implementing its agenda.

The government has organised a range of "consultations" with community and interest groups at which it has committed itself to fund 30 targeted social projects. These consultations have promised some reversals of the previous Coalition government's policies, mostly in terms of more community "input" rather than significantly improving services.

These concessions are only in areas of marginal concern to big business. Even so, promises like the reversal of legal service amalgamations or the repeal of voluntary student unionism legislation have yet to be fulfilled. Bracks has also moved swiftly to finalise the last regional forest agreement before the environment movement could mobilise, taking advantage of the increased divisions between the environment and the trade union movements.

The Labor government has sought to rebuild its credibility among sections of the labour movement with meagre — but political targeted — health and education spending initiatives, such as moving to keep Victoria's contract teachers into continuing employment.

Union opposition

The abolition of Australian Workplace Agreements for state public sector workers may give the Bracks government the opportunity to establish a government agreement and control over negotiations. However, its ability to control struggles in private industry through the state arbitration system is substantially limited because Kennett dissolved these institutions into the federal system.

The Yallourn power worker's dispute caught the Labor government by surprise. It expected the unions to not take serious industrial action after its election victory to give Bracks time to put something in place that could substitute for compulsory arbitration. This is not simply a "technical" problem for the Labor government. Without an industrial relations system that can coopt or demobilise the unions, there is little to restrain industrial action as Labor attempts to ease its restructuring agenda into place.

There are also signs that Victoria may be facing a recession. Consumer spending and business investment are on the decline and housing construction seems to have peaked. The maintenance of business confidence and high profits, especially with a possible inflation blowout fuelled by the GST, will require Labor to keep wage increases low.

The manufacturing industry remains fundamentally important to the Victorian economy. From the point of view of big business, it is backward and relatively uncompetitive. The trade unions remain strong in manufacturing. Bracks must tame the Victorian Manufacturing Workers Union, the union most politically distant from the Labor Party and most capable of prolonged and consistent independent action, if the manufacturing industry is to be "modernised".

In Victoria, a significant section of the union movement is mobilising its membership in defence of basic conditions and wages and, in certain cases, is even taking pre-emptive action. There is a small but independent layer of militant union leaders and an even thinner layer of Labor-aligned union officials with any significant credibility among rank and file militants.

Labor's dilemma

The federal Coalition parties' approach to this "problem" has been to intensify the attacks on unions (and the whole arbitration system with its aim of ameliorating class conflict).

Labor has no alternative plan that is sufficiently trusted by big business. Labor no longer has the prices and incomes Accord to shackle the unions, nor does it have cadre in the union movement to sell such discredited idea to militants.

Bracks' has little room to move. He cannot rely on an authoritative and legally powerful arbitration system and the ALP no longer has industrial cadre to spoil struggles. His best hope is that the Labor government can wear down the union left before it can realise the gains possible through militant industrial action are limited unless a political alternative to Labor is also built.

The Yallourn dispute was instructive in this respect. At a critical point in the dispute, electricity restrictions were increased in order to use "public opinion" against the power industry workers.

This is the challenge for the union left in Victoria. Every battle that is not won, in are only partially won, will demoralise the ranks and provide fertile ground for Labor union leaderships to minimise demands and cut struggles short. In big battles, industrial militancy alone can win only temporary gains.

At some point, the union left will have to take the political initiative and marginalise the Labor-aligned union leaderships now waiting in the wings to regain full political control. This will require a political agenda based on launching a counter-offensive for workers' rights against the Labor government.

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