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RUBY:

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

The wages and workplaces of Australians could be about to change.

The government’s new industrial relations packages promises to make pay more transparent and strengthen the hand of workers in negotiations.

But whether it passes, comes down to the decision of one man: David Pocock and his vote has become the most valuable commodity in Canberra.

Today, national correspondent for The Saturday Paper Mike Seccombe, takes us inside how David Pocock made his decision to back Industrial Relations reform.

It’s Monday, November 28.

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RUBY:

Mike. Right now the Labor Government is in its first real political battle as it tries to get its industrial relations bill over the line before the end of the year. And this issue, it's fundamental, isn't it, to what the Labor Government wants and how it wants to reshape the country?

Mike:

Well, you're right and it's fundamental actually to both sides of politics. I mean, industrial relations has always been the key point of differentiation between Australia's major political parties going back to when they were formed. There's the party of the workers and there's the party, the bosses. And the contest over how the nation's wealth is apportioned between capital and labour is the great constant of politics. So there's a clash of ideologies here and it's coming to a head over what's actually a very real problem, which is that for the past ten years wages in Australia have been stagnating. And for the past year or so, they've been going backwards. And this was one of the key problems that Labor set out to solve at the Jobs and Skills Summit earlier this year. And the result of this is the Fair Work Legislation Amendment. It's passed the House and it's currently about to go into the Senate. And the numbers in the Senate are very tightly balanced. And so there's one very unlikely figure, I think you would have to say, who has emerged as the decider between the two old forces in Australian politics, and he will decide whether this legislation will pass.

RUBY:

Right. So who is that? Who has found themselves in the role of key decision maker over IR reform?

Mike:

Well, he's a former footy player, a rugby union player elected at the last election. No previous history in politics and that's Senator David Pocock. And he's an unlikely umpire, I think you'd say, because these issues are very new to him. He's not an experienced player at all. And importantly, he hasn't been marinated, you know, in the ideology of any particular party, although he's got pretty progressive views on most social issues. And when he ran for his seat in the Senate at the election, his campaign was focussed on climate change and integrity in politics. So nothing, nothing about industrial relations in his platform. But as a consequence of the way the numbers fell at the election, he finds himself as the crucial swing vote on the Fair Work Legislation Amendment bracket, Secure Jobs, Better Pay Bill 2022. So he's kind of the umpire, the swing vote in the thorniest, most intractable issue in Australian politics. And he's being lobbied frantically by groups on all sides, you know, unions, employers, politicians. And of course, running the issue for the two major parties are two people who are absolutely steeped in this very complex area of policy for Labor. That's Tony Burke. And for the Coalition, it's Michaelia Cash.

RUBY:

Okay, well let's talk a bit about Tony Burke, the Industrial Relations Minister, because he's the one who is desperate to get this bill over the line. So why is that? What do these reforms mean to him and what is he saying about what he wants to do here?

Mike:

Well, first thing to say that he and Pocock have been just about in each other's pockets for the past week or so. They and their staff a constant round of meetings as they hammer things out. So like I said, unlike Pocock, Burke is absolutely steeped in the subject before the Parliament. In fact, he told this great story about how when he was a kid, he set up his first union. He was a paperboy in Beverly Hills in south west Sydney, and he found out that the newsagent that he worked for paid a smaller commission than another in the area. So he got all the other paper boys together and said that they were going to engage in some collective bargaining so, the newsagent gave in. And to celebrate, they spent their union fees on mixed lollies. So anyway, the point there is that from a very young age, he's been all over this stuff.

So from there he went on and became an official with the Shoppies union, which is Australia's largest private sector union. It represents some of the lowest paid and most casualised industries, you know, shop assistants, hairdressers, people who work in warehouses, that kind of thing. And he's also a lawyer and he's a veteran in the federal parliament. He's been there for eight years. He knows a lot about the subject, is what I'm trying to say. And he says that this bill will get the wages of Australian workers moving again after a decade of stagnation and that in particular they will lift up the low paid and the job insecure. And will address the yawning gender pay gap, which as I recall is about 14% currently. So Burke addressed the National Press Club a week or so ago and made all these points.

Archival tape -- Tony Burke:

“Over ten years. People had still gone backwards. And even with today's welcome figure of 3.1, that is still true that over the last ten years, real wages have gone backwards”.

Mike:

Productivity had risen about 10% over the past decade, but wages had not kept up with the productivity growth.

Archival tape -- Tony Burke:

“You wouldn't have found a minister for the last decade or so, even view this as a problem. Low wage growth was a deliberate strategy, a deliberate design feature of the previous government”.

Mike:

And he said that the popular wisdom had been that if you got unemployment down to a very low level in a sustained way, that in and of itself would create what he called hydraulic pressure to push wages up.

Archival tape -- Tony Burke:

“Any macroeconomist or tell you that the hydraulic pressure is there but wages aren't moving up in the way that they should. Why? Because as that hydraulic pressure comes through, there are leaks in the pipes”.

Mike:

Specifically that, you know, the traditional bargaining methods by which unions and workers engage with employers aren't working. So the bottom line is he's very keen to get this vote done. The government wants it through the Senate by the end of the year when Parliament breaks.

RUBY:

Okay. But there are significant hurdles that Burke would need to clear to be able to do that. And the Coalition's Michaelia Cash, she's been driving a lot of the criticism of this bill, hasn't she? So can you tell me a bit about the Opposition's concerns?

Mike:

Well, Cash is also a veteran in this debate. She is a lawyer and her practice specialised in employment, industrial relations law before she went into politics. And unlike Burke, she was born into a quite wealthy Perth family. Her father was a construction company owner and he went on to become, I think, the president of the Upper House in the State Parliament. So she's been steeped in Liberal Party politics and industrial relations from a very early age.

Archival tape -- Sky News:

“Let's get the reaction now from the Shadow Employment and Workplace Relations Minister Michaelia Cash. Thanks for joining us here today.”

Mike:

And as the shadow minister, she was the main person amongst coalition members on a Senate committee that looked into this legislation.

Archival tape -- Michaelia Cash:

“We will vote against this bill. This bill does nothing to increase wages in this country. When you have every employer in Australia…”

Mike:

And the coalition contingent put out a dissenting report on the bill, which had just two recommendations. First was that the Senate reject the bill. And the second was that the government, and I'm quoting here, apologise to the Australian people for promising that industry wide bargaining was not part of the policy before the election and then attempted to legislate it by stealth once they were elected.

So bottom line here is, of course, the coalition wants none of it. None at all. They just want the whole thing scrapped.

RUBY:

Right. So if those are the two sides of the debate, Mike, with Tony Burke on one side, trying to push through this legislation, saying that wages need to go up and Michaelia Cash, on the other hand, saying that the entire thing should be scrapped. As David Pocock was weighing that up, what was he thinking about?

Mike:

Well, Pocock is actually not opposed to most of it. In fact, he supports, he reckons, 85 to 90% of it. But there's one bit which is called the single interest multi enterprise stream, which he is not necessarily opposed to, but has a lot more questions about that he wants answered before he's prepared to support it.

RUBY:

Right. So can you tell me about what that is and why it's contentious?

Mike:

Well, essentially, it would allow workers to negotiate agreements with multiple employers who provided similar sorts of services, you know, in similar businesses. So, you know, employers could agree to this and could come in and they could work it out. Several employers and workers across that particular sector of industry. One of the key sticking points here is how big a business needs to be before it should be subjected to this multi-employer bargaining. Some unions have been suggesting one employee. Some employers have been suggesting a couple of hundred employees, as originally presented the legislation, figured it should be businesses with fewer than 15 employees.

So, you know, Pocock's trying to decide on that number. He has what he says are a whole bunch of other things that are to him ambiguous and unclear and in need of more consideration. So his solution is break the legislation into two bits, wave through the non contentious stuff and put the multi enterprise bargaining off to be dealt with at a later date, you know, in the next political year obviously. But Labor doesn't want to split the bill, so we have a standoff.

RUBY:

We’ll be back after this.

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Archival tape -- Tony Burke:

“Lot's happened since I first agreed to the interview, as late as 8:30 last night. There’s a reason why I'm in Canberra, Senator David Pocock and I were still meeting, and I can say now that we are confident that the secure jobs better pay bill will pass the parliament this year - with the support of Senator David Pocock”.

RUBY:

Mike, yesterday, Tony Burke announced that independent David Pocock, who really holds the deciding vote here, would support the government’s legislation – without splitting the bill. But there have also been some concessions to Pocock. Can you tell me a bit about what has been weighing on Pocock’s mind as he made his decision?

Archival tape -- David Pocock:

“Well, I'm actually busy reading the report as well”.

Mike:

When I spoke to him he said that he understands the argument from the government that there's urgency about getting wages moving.

Archival tape -- David Pocock:

“I agree with that. I share that view. And I've made it very clear that 85-90 percent of this bill, including the two streams that deal with lower paid workforces, and particularly the so-called feminised industries, the supporting couple of streams that they're good to go”.

Mike:

But he also hears the anxiety amongst small businesses in particular about what it means for them.

Archival tape -- David Pocock:

“You know, hearing yesterday, that Small business could incur real cost to try and bargain on top of being stretched”.

Mike:

And he's right. Most of Australia's employer organisations have put the argument that the cost to business, particularly small business of compliance, could depress activity, could send some of them out of business, even though they've claimed.

Innes Willox of the Australian Industry Group quite bluntly said, quoting again, wages growth will not come with a union gun being held to an employer's head, which was pretty uncompromising, I think. Now, you know, we've got to acknowledge, too, that there's a long established reality here, of course, which is that employers always warn that the economy can't afford higher wages. You know, it's never the right time as far as employers are concerned.
So it's a very, very vigorous debate.

RUBY:

And now it seems as if Pocock has gotten his way, to an extent. And with the makeup of the chamber – Pocock could be the deciding vote on a lot of contentious legislation. What does the way he has played this situation tell us about the man who holds one of the most powerful votes in Canberra?

Mike:

Well, the thing that struck me when I was speaking with him this week was just how calm he is. I mean, talk about the calm at the eye of the storm. That's him. You know, he's a very considered person. You know, there were times I was talking to him on the phone and there were times when I wanted to go, hello? Are you still there? Because you would ask a question and he would contemplate for a little while before he would give an answer. So he doesn't appear to be the slightest bit fazed by this storm raging about him. But nonetheless, you know, he knows he's the new boy. He said as much he knows he's on an incredibly steep learning curve. It's a very big decision. You know, I was speaking to one Labor person who very concisely summarised Labor's position, which is does he stand up in the Senate next week and vote against getting wages moving for the lowest paid in Australia or not? So it's on the line. They're putting it on the line there.

RUBY:

And the government did play hardball to a degree didn’t they, Mike? They didn’t split the bill as Pocock suggested – and Burke was speaking with Pocock late on Saturday night to get his support. We’ll now have a vote in the senate this week, and it’s a crucial moment for the Government to get this package right, isn’t it, Mike?

Mike:

That's exactly right. And as we've already discussed, frankly, something does have to be done. Of course, it's not the current government's fault that inflation is so high right now and wages are going backwards. You know, that's fundamentally down to global forces, you know, largely the fault of Vladimir Putin, really. But the fact is, wages have been stagnant for a long time before that, you know, a decade.

So clearly, the IR system, industrial relations system is broken. And pretty clearly also the benefits of such productivity improvements as we've had over that period have mostly flowed to business bottom lines, not to workers. So there does need to be some redressing of the balance, I would suggest. So, you know, that's the reality of the situation. The political reality of the situation is that the Labor Party's key message at the election was that they would get wages rising again. You know, you remember the slogan, I'm sure, everything is going up except your wages. And it resonated with people then because it was true. And the big problem for Labor is that it's still true.

RUBY:

Mike, thank you so much for your time.

Mike:

Thank you for yours.

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RUBY:

Also in the news today…

In Victoria, Dan Andrews secured a historic third term as premier over the weekend, with a comfortable majority in parliament.

The victory was a firm rebuke from voters for the Coalition. Former Liberal Party strategist Tony Barry told the ABC that the Victorian Liberal party room was filled with too many controversial figures and was stuck quote “drinking the kool-aid”.

And Democrats, anti-racist groups and some Republicans have condemned Donald Trump for having a dinner meeting with American white supremacist commentator Nick Fuentes.

Fuentes was a guest of Kanye West, at a meeting he held with Trump at Mar-a-Lago resort.

Former Trump ally and republican, Chris Christie said quote: “awful, unacceptable conduct from anyone but, most particularly, from a former president and current candidate.”

I’m Ruby Jones, this is 7am. See you tomorrow.

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