[Theme music starts]

RUBY:

From Schwartz Media I’m Ruby Jones this is 7am.

This week, rates rose to seven year-highs and inflation still won’t be easing off anytime soon.

It’s a problem the government has promised it’s aware of, but there will be increasing pressure for it to start implementing practical solutions that actually help people who are struggling.

So what is the Albanese doing, how is it different and what can we expect the government to pass now that parliament is back?

Today, Columnist for The Saturday Paper, Paul Bongiorno on Labor’s attempts to reign in a cost of living spiral.

It’s Friday, September 9.

[Theme music ends]

Archival tape – News Host (7 News):

“Good afternoon. The cost of living has taken another hit with the Reserve Bank increasing interest rates for the fifth month in a row-...”

Archival tape – Alan Kohler (ABC):

“This is the fastest series of rate hikes since 1994-...”

Archival tape – News Reporter (9 News):

“The previous cash rate being 1.85 - a full half a percent added to 2.35%...”

RUBY:

Paul, Parliament returned this week and at the same time we had another rate rise, taking interest rates to seven year highs. So that's put cost of living right back on the agenda, hasn't it?

PAUL:

Yes. So Ruby, the RBA did hike rates again this week and it probably won't be the last rise we see. And that's because inflation is already running at 6.1% and forecast to reach nearly 8% by the end of the year. And we have to remember the target range is 2 to 3% and the RBA says inflation won't actually return to those levels until 2024. And there was firm evidence mid-week in the national accounts that the economy's been powering along. Driving the numbers were exports and households spending on things like travel, clothes and restaurants. Economist Stephen Koukoulas says the economy can be expected to slow in the current quarter, but he doubts it'll cool off as much as the RBA wants it to.

RUBY:

And so with Parliament back this week and the cost of living being a big concern, what have we heard about how much the government is willing to do to offer some relief to people who are struggling?

PAUL:

So Ruby, the cost of living has been a big focus for the Government this week, starting on Tuesday, when Anthony Albanese told his party room that Labor does need to address cost of living issues.

Archival tape – Albanese:

“I was just being straight with the party room as I've been straight with the people of Australia. We've inherited a trillion dollars of Liberal Party debt. When the interest rate rises, so do the repayment costs…”

PAUL:

He told his troops they had to quote, “be straight with Australians about the challenges before us and the difficult decisions we must take.” But while difficult funding decisions will have to be made, there are a few bits of relief coming, Ruby. First this week on the cost of prescription drugs.

Archival tape – Albanese:

“This Labor government is putting in place this measure which will make an enormous difference to millions of Australians, to their out-of-pocket costs, to their health…”

PAUL:

The Government has introduced a measure that will mean for the first time in the 75 year history of the Pharmaceutical Benefits Scheme, the cost of general scrips will fall by 30% and that relief will begin in January.

Archival tape – Albanese:

“What we're doing is we will reduce the cost of pharmaceuticals. And next week we'll have got the legislation to reduce the costs of childcare…”

PAUL:

Then the Government will introduce legislation next week to establish its comprehensive childcare policy, offering more generous subsidies to assist 1.2 million families. It costs a cool $5.4 billion a year and will start next July.

Archival tape – Jim Chalmers:

“In the middle of next year, which is not that far away. There will be a game changing investment in making childcare cheaper at the same time as we invest in one of the key drivers of economic growth in this country…”

PAUL:

Chalmers is resisting calls for it to be brought forward to January and that's mainly on cost grounds. Albanese and Chalmers, you might have noticed, are determined to establish a reputation for fiscal discipline.

But I think what shouldn't be missed is the revolution underway in industrial relations, and how people can be hired, fired and negotiate pay rises. After last week's Jobs and Skills Summit, Albanese and Workplace Relations Minister Tony Burke have embarked on nothing short of a wholesale renovation of the Gillard Government's Fair Work Act.

RUBY:

Yeah, last week, Paul, we spoke about the jobs summit and the Fair Work Act was up for discussion there. Now the Government has committed to what it's calling immediate changes to the Fair Work Act. So just how significant is what we're going to see?

Archival tape – Tony Burke:

“Workplace relations at its best, it forges good. Relationships. I know sometimes we all instinctively retreat to our corners, but wherever we can foster cooperation, compromise and collaboration. When we do that, we deliver for every budget…”

PAUL:

Well, Ruby, Tony Burke says the government will legislate to ensure workers and businesses have flexible options for reaching agreements, including removing unnecessary limitations on access to single and multi-employer agreements, which would allow unions to more easily come to arrangements across sectors or several similar employers.

Archival tape – Tony Burke:

“So additional mechanisms to fix bargaining. Getting wages and productivity. Moving. Closing loopholes that can drive wages down. Including examples like unilateral termination of agreements. Closing the gender pay gap. Creating safe and fair workplaces…”

PAUL:

The Minister says this will open up agreement making to workers who can't access the benefits of enterprise agreements such as women in the care sector and community services areas and first nations people.

Archival tape – Tony Burke:

“Within the workforce of seeking work right now. We have many people, including older workers, first nations workers and people with disability who are here wanting to work and hoping for barriers to be removed…”

PAUL:

This is important in a cost of living crisis because the hope is it can get wages moving by giving more people access to robust workplace negotiations.

And this gives Tony Burke something of a head start. With in-principle agreement already hammered out by business groups and unions. And this is the kind of profound change we're seeing in government. It's a real departure from the way Australia's affairs have been managed not only over the past decade but really since the arrival of the Howard Coalition Government almost thirty years ago.

RUBY:

We'll be back in a moment.

[ADVERTISEMENT]

RUBY:

Paul, we've been talking about the changes to the Fair Work Act that appear to be on the horizon just as cost of living pressures are becoming worse. But if we take a step back, why is it in your opinion, that the workplace relations system is where it is in need of urgent reform?

PAUL:

Well, one senior government adviser told me it's not unusual for major pieces of legislation, like, for example, the Tax Act, to need constant amendment as clever accountants and lawyers find ways around it or circumstances change. And he says the Fair Work Act is now in dire need of that kind of attention. And former Prime Minister Paul Keating and Australian Council of Trade Unions Secretary Bill Kelty, well, they agree. They say that some elements like the better off overall test that is supposed to make arrangements and enterprise agreements fairer has become a roadblock.

Instead, in practice, it's actually undermined wages, growth and productivity, according to Keating and Kelty. You know, in the Government's view, the reason for that is the Coalition's neglect over the past ten years to address the loopholes and problems as they arose with the Fair Work Act, leading to the erosion of wage justice. And Ruby, the evidence is incontrovertible. There's been a record fall in real wages, despite a record rise in profits. But not everyone is open to this reform discussion or bringing unions to the top table in such a prominent way. This week in Parliament we've seen a sustained attack from the Liberals.

Archival tape – Peter Dutton:

“Mr. Speaker, I refer to the Prime Minister's captain's calls to invite militant… invite militant unionist from the CFMEU Christie McCain-...”

Archival tape – The Speaker:

“I thank the Leader of the Opposition for-...”

Archival tape – Peter Dutton:

“That's specific, Mr. Speaker…”

RUBY:

The Coalition clearly haven't been enamoured with Labor's approach, Paul. The Liberal Party didn't even take part in the jobs summit, so what have they been honing in on this week?

PAUL:

Ruby Peter Dutton persists in peddling the stereotype of the typical unionist being a militant blue collar, quote, 'CFMEU thug'.

Archival tape – Peter Dutton:

“This question is about the thugs at the CFMEU, that go around, breaking arms go around with all sorts of misogynistic behaviour…”

Archival tape – The Speaker:

“I ask the minister to resume his seat”

Archival tape – Peter Dutton:

“…and this Prime Minister won't make-... (mic cut)”

PAUL:

That's the line he's used this week. Despite business leaders seemingly happy to sit down with unions and discuss ways to create wages growth in the job summit process.

Archival tape – Sussan Ley:

“Will the Prime Minister apologise for inviting this misogynist thug, or was it payback for millions in dirty CFMEU donations?”

Archival tape – The Speaker:

“Order. I call the Prime Minister.”

PAUL:

It's a line of attack that misses completely that the typical union member these days is more likely a woman in the services or care sectors of the economy. And, you know, women account for 55% of union membership. Dutton sees all unions only in terms of being political allies of his opponents in the Labor Party.

RUBY:

But the Liberal Party, practically speaking, isn't really going to have much of a role to play here, are they? Because the government, if they can get the support of the Greens, can pass these changes if they want to. So as they embark on that and these programmes that we're going to see in Parliament in the next few weeks, things like the childcare benefit, I wonder what it is that we're starting to learn about the way the Government is approaching these bigger challenges that have sat unaddressed for so long.

Paul: Well, first of all, we are seeing real change, profound change, Ruby, in the approach from this government when it comes to big challenges like industrial relations. The Prime Minister put it succinctly on Monday. He said his jobs and skills summit late last week…

Archival tape – Albanese:

“Changed the whole mood of politics in the way that it's conducted…”

Paul: We’re seeing unions, business and government at the same table with conflicting interests, but still trying to work on challenges that face us. Well, it's a return to the tripartite world that was particularly in evidence in the Hawke-Keating era. Many would remember the Hawke government brought people together for major reform of the taxation system and bargaining. Well, times and challenges have changed. But the Albanese project, if I can put it that way, owes a lot to this successful precedent. By contrast, Peter Dutton is still operating as if nothing has changed since the election and one senior minister told me the Liberals clearly believe voters got it wrong. And he says the first lesson of an election defeat is to let the electorate know you’ve got the message loud and clear. Ruby It looks like the world is passing them by.

RUBY:

Paul, thank you so much for your time.

Paul: Thank you, Ruby. Bye.

[ADVERTISEMENT]

[Theme music starts]

RUBY:

Also in the news today...

Further details have been reported about the documents seized by the FBI from Donald Trump’s Mar-A-Lago home. According to The Washington Post, some of the documents describe the nuclear capabilities of a foreign nation – and due to their sensitive nature, had a classification level beyond top secret.

In a separate development relating to the Mar-A-Lago documents, Trump won a delay in the case after a judge ruled that the documents should be reviewed by an independent arbiter before they can form part of a criminal inquiry into Trump.
And...

In Australia’s Parliament, Labor’s infrastructure minister has introduced legislation towards establishing a high speed rail.

Minister Catherine King wants to establish a High Speed Rail Authority, a body which would advise on the construction of Australia’s own fast train. King said that while a high speed rail is a long-term project, quote, “No project captures the imagination of Australians quite like the high-speed rail.”

7am is a daily show from The Monthly and The Saturday Paper. It’s produced by Kara Jensen-Mackinnon, Alex Gow, Alex Tighe, and Cheyne Anderson.

Our technical producer is Atticus Bastow.

Brian Campeau mixes the show. Our editor is Scott Mitchell. Erik Jensen is our editor-in-chief.

Our theme music is by Ned Beckley and Josh Hogan of Envelope Audio.

Additional music this week composed by Alex Gow

I’m Ruby Jones this is 7 am, see ya next week

[Theme music ends]