Tue Jun 14

What Albanese needs to build a new industrial relations consensus

Written by Mark Bray, Emeritus professor, University of Newcastle

A few weeks before his election victory, Anthony Albanese made an important speech ^[1] to the Australian Chamber of Commerce and Industry. He talked of “socially inclusive growth – the kind of growth that is only possible with economic reform that lifts productivity”.

But how to do it?

Albanese’s answer was a good one: greater co-operation.

He harked back to the consensus approach of the Hawke Labor government, which after its 1983 victory brought together different interest groups to find common ground on how to produce more from the same inputs, enabling higher wages while protecting profits. Albanese said:

We must rediscover the spirit of consensus that Bob Hawke used to bring together governments, trade unions, businesses and civil society around shared aims of growth and job creation.

Now he’s prime minister his ambition ^[2] to revive Hawke’s approach seems to be catching on.

Business Council of Australia chief executive Jennifer Westacott, for one, has spoken of the need for ^[3] “co-operation between business, government and workers” to address issues such as labour shortages.

But consensus and co-operation are much easier to talk about than to achieve, especially in a political and industrial relations system as adversarial as Australia’s.

We’ve been researching co-operation at work for many years, including publishing a book about it ^[4] in 2017. What our research tells us is that achieving co-operation at work requires real and practical goals; time and trust; inclusive structures for decision-making; and strong leadership at national, industry and enterprise levels.

Only by heeding these lessons does the Albanese government have a chance to achieve its ambitions, and secure a legacy to match that of Hawke’s.

More than a summit

In terms of national leadership, it is especially important for Albanese to be staunch in his commitment to improving political behaviour ^[5].

Bringing together business and union leaders is a good start. But it’s only a start. During Labor’s last period in office, Kevin Rudd brought together 1,000 delegates for his “Australia 2020” convention in 2008. It is best remembered for what didn’t happen afterwards.

Australia’s prime minister Kevin Rudd addresses the 2020 summit in Canberra, April 19 2008. Alan Porritt/AAP

For the Hawke government, the National Economic Summit held a month after its election in 1983 was just one element in its consensus-building efforts.

Another element was the Prices and Incomes Accord ^[6] formalised between the government and the Australian Council of Trade Unions. Under the Accord, unions tempered industrial action in pursuit of higher wages, in exchange for the government improving the “social wage” (such as through introducing Medicare).

The Hawke government also established three bodies bringing employer, union and government representatives together to advance commitments made at the summit and subsequently.

These were the Economic Planning Advisory Council, the Advisory Committee on Prices and Incomes, and the Australian Manufacturing Council. They were critical in supporting the Accord and the agreements that gave effect to it (the last covering 1993-1996).

The Albanese government can’t just replicate this template – what worked in the 1980s and 1990s will not necessarily suit today. But it will certainly need processes and structures to ensure regular dialogue between stakeholders at the national level, and in ways promoting genuine co-operation.

Anthony Albanese with Bob Hawke Albanese in September 2016 at the launch of Albanese’s biography. Mick Tsikas/AAP

Industry plans could drive lasting change

One area for Albanese to leave a real legacy is to entrench greater co-operation at the industry level through industry councils: tripartite bodies bringing together government, employers and union representatives.

In the 1980s and 1990s, sector-based industry training councils and industry training advisory boards helped to design and implement competency-based vocational education and training.

Industry councils could be helpful now in guiding spending priorities for Labor’s proposed National Reconstruction Fund ^[9], a $15 billion pool to invest in industries that can provide jobs and prosperity.

Just handing out money will not work. We need industry plans on which government, employers and employees agree. This is important not just for manufacturing but sectors such as aged care and child care.

Skills for enterprise-level co-operation

At the level of individual enterprises, especially larger ones, effective co-operation requires good faith and leadership from both managers and union representatives.

It requires training in effective commmunication skills. Neither managers nor worker representatives necessarily know how to co-operate. They need success stories to emulate, and skills to overcome the adversarial attitudes entrenched by experience.

Our research also shows that third-party facilitation, such as that provided by the Fair Work Commission under its Co-operative Workplaces program ^[10], is vital for workplace parties who are unfamiliar with co-operative ways.

A legacy worth leaving

Fostering the co-operation needed to deliver inclusive growth will require overcoming a history of bad habits and soured relationships at the enterprise, industry and national levels.

This is rarely easy, so getting help from independent third-parties is necessary, especially at the industry and workplace levels.

If Albanese’s government can put in place the structures needed at all three levels, it has a chance of leaving a legacy as significant as its Labor predecessors.