[Theme music starts]

RUBY:

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

The Albanese Government has begun pushing through their agenda in earnest.

There’s now a Labor budget on the table and a workplace reform package that could change the balance in Australian wage bargaining.

But as the detail comes into focus, criticism is mounting, and the government has been hit with a week of ominous news coverage about what their proposals could do to the economy.

Today, columnist for The Saturday Paper, Chris Wallace, on whether the government can sell its agenda, and how the Opposition will attack it.

It’s Friday, November 4.

[Theme music ends]

RUBY:

Chris, in the months since the election, Peter Dutton's opposition has been sidelined. They've been trailing in the polls, they've struggled to cut through. But it isn't unusual, is it, for an opposition party to take a bit of time after a defeat, to regroup and to find their footing again on the national stage?

CHRIS:

No, that's absolutely par for the course, and it's kind of necessary because especially governments that have been in for a while, you know, they need to do the old clean out the Augean stable, have a good, long, hard think about themselves and do basic things like adjust to the new resource list regime. But Peter Dutton's opposition has been so far behind in the polls, the Coalition parties are polling poorly. His own polling is not great. He's way behind Prime Minister Anthony Albanese in terms of preferred PM ratings and also in terms of approval. And so they've been sidelined pretty much in the Parliament. Much of the media attention is focussed on the newly elected deals and of course the historically high Greens representation. So it's not surprising that the Opposition has been sidelined, but suddenly this week and last week they've really come into contention again, at least in terms of the theatre of Parliament, if not the polling.

RUBY:

And that's because in the last week or two we've seen the Albanese Government put forward its agenda in real terms. We've seen the Budget be put forward. It was a real turning point. So as that happened, as the Albanese Government presented its budget and what did we start to see from the Opposition? How do they start to shift gears and find some new lines of attack?

CHRIS:

Well, that's it. Many people have simply counted the opposition out pretty much as being relevant or effective. And so I suspect a degree of complacency might have crept into Labor's thinking, at least subconsciously, as they approach this extremely important event in the life of the government, its very first budget. So it was a pretty restrained affair, the budget. It was really fiscally responsible while fulfilling several specific Labor election promises and it was squarely directed at fixing the appalling budgetary mess the Morrison government left it. If you compare it to the last several coalition budgets, it was kind of revolutionary in its lack of voter sugar hits and the absence of special interest largesse. So I think a lot of people inside the Labor Party probably thought with good reason that this would be well-received, that Labor being seen to be sensible economic managers.

But two things really kind of interfered with that. The first is, of course, the dominant media channels remain firmly in the coalition camp. And when the budget happened, you just had to look at the headlines to go, oh, my God. You know, there was “Jim's power deficit” in the Australian, “Dim Jim” in The Herald-Sun, “Jim’s Black out” in the Daily Telegraph, “inflation shock rocks budget” in the Financial Review. And, you know, on and on. It was just terrible headlines. And of course, Ruby, there's a reason revolutionaries no. When they enter a capital, there's a reason they seized, historically, the radio and television stations first - and, of course, these days social media networks as their first move - and that's because it's very hard to get real regime change, y’know really seize and be able to exercise power - If the old, sclerotic, corrupt regime can retain power over the communications channels that are the main influence on the populace. So Labor had not unreasonable expectations that its economic management chops would actually be recognised, and if not loudly applauded by commentators at least recognised for its responsibility and its restrained character. Because, you know, we're in an inflation crisis, remember, and a low wage economy which has got to be fixed. But the informed critics were really overwhelmed by the negativity in the press, and that gave the budget a very poor kind of landing.

RUBY:

And then of course, there was the second thing, and that was the 55 per cent power hike that was embedded in the budget forecast over two years. And I think the Opposition really honed in on that, on the reality of rising power prices versus what Labor had actually promised before the election. So can you tell me a bit about that?

CHRIS:

This was indeed the second thing that went wrong for Labor with the budget. There was this eye popping 55 per cent power price hike forecast by Treasury over the next two years. And you know, in the lock up, once people's eyeballs hit that number, they just went, oh my God, that's off the planet. And that became the overwhelming focus. You know, everybody just completely glommed onto that as the only thing in the budget and inside the government. There was kind of disbelief almost over the ensuing few days as they looked at what was in the budget compared to what was in the media. It was such a huge gulf. All of the good things in the budget pretty much disappeared from public discourse pretty instantly, and that's a big loss. Governments want big economic statements like that to really reinforce their position. So it was a bit of a blow to Labor.

RUBY:

Mm hmm. And so does it seem to you then that the Albanese government mishandled this issue or at least mishandled, I suppose, the messaging and the public conversation around it?

Chris: Ruby, the budget is this huge, dense, sprawling document. I don't know if you've ever been in a budget lockup, but it's really extraordinary to kind of get about six and a half hours to go through huge documents dense with the numbers and work out its meaning. So, if you're actually putting one together, of course, you're down in the bunker. Well, these numbers are running poster eyeballs for days and weeks. It's easy to lose sight of important details, which, you know, you might be really familiar with and not reacting to. But, you know, you may forget what it will look like to new eyes. So the irony is the government was handling its media strategy really well in the run up to the budget. It got several good news stories broken out and successfully placed in the media in the run up to budget day. But they just lost sight of how people were going to react to that extraordinary energy price rise forecast.

Archival tape -- Peter Dutton:

“Labor's budget was a missed opportunity to help you at a time when you need help. It didn't address our economic challenges or inspire confidence. It's a budget which breaks promises rather than keeps them…”

CHRIS:

And of course, Opposition Leader Peter Dutton targeted right in on the promise Labor took to the election that power bills would be $275 a year lower on average for voters by 2025. Problem? Dutton didn't mention the by 2025. The Coalition is really hammering this promise and leaving out the key fact that the Labor promise was by 2025.

Archival tape -- Peter Dutton:

“The fact is that they got it wrong and the Prime Minister on 97 occasions promised that power prices would reduce by $275. He doesn't have the decency now to apologise that they got it wrong.”

CHRIS:

Peter Dutton has framed this as Labor's first big broken promise and Ruby, you know, strapping, you're going to hear that thousands and thousands of times between now and the next election.

Archival tape -- Peter Dutton:

“Well, as I say, I think this is Labor scratching around for opportunities to try and give themselves cover to get out of the promise. I mean, Jim Chalmers in Question Time today said that this is all Vladimir Putin's fault, right?”

CHRIS:

You know, this was one of the problems with making that promise in opposition. Even Labor's spokespeople, I would hear, not mention that by 2025. Why would you create such a specific hostage to fortune as that when you didn't need to?

RUBY:

We'll be back in a moment.

[ADVERTISEMENT]

RUBY:

Chris. The other news in Canberra this week is the Labor Government's industrial relations package and amongst other things that package is really aimed at finding a way to enable wage growth. But already we're hearing some employer groups could be ready to mount a campaign against it. So why has this package already become controversial?

CHRIS:

This is a really, really important issue. Ruby, you would be familiar with the terrible, extraordinary increase in the profit share compared to the wage share in the Australian economy that's happened over the last 20 years, especially over the last six or seven. Getting real wage growth is a key Labor promise and of course in this current economic environment it's not going to happen right away. Adjusting how the industrial relations system works is crucial to solving the low wage growth problem in Australia. You know, it's one of the biggest equity challenges Australia faces. So Labor and Industrial Relations Minister Tony Burke have put together this package of tweaks to the current system to give working people and their representatives unions a chance to actually be able to bargain properly instead of being on their knees every time they go to employers.

Absolutely central in this is the ability of unions to be able to do multi-employer bargains. So what is multi-employer bargaining? Why is it so important? Well, if you're an employer, if you can keep workers isolated and strike bargains from a position of massive power compared to them, you're going to do a deal that's worse for the workers and better for you. If you as an employer are facing a union that's not only representing your workers, but the workers and several other employers across the sector, you're facing a bargaining opponent who's, of course, much beefier and more powerful. The odds are evened up in the bargaining process. So naturally, employers don't want it. They want to keep workers as atomised as possible so that they can drive the hardest possible wage bargains against them. And of course, what Labor and the unions want is a fairer system where workers in similar kinds of companies and similar parts of the economy can bargain together and get fairer wage outcomes than we've seen over the last 20 years.

Archival tape -- Tony Burke:

“If I can get it through this year, it means we can get wages moving faster. People have had ten years where wages were deliberately held back.”

CHRIS:

Tony Burke has been patiently in the public realm this week explaining the package, pointing out that there's nothing in it that's likely to cause economic problems.

Archival tape -- Tony Burke:

“Well, certainly for everybody, every agreement ends up landing you above the award. So at a time where we need to get wages moving, we've already pulled the first lever.”

CHRIS:

So, of course, the coalition and the friendly media have grabbed this. And it's the other big stick that they've started beating the government with in the last week.

Archival tape -- Michaelia Cash:

“Everybody in Australia wants higher wages, but unleashing an industrial relations system with radical changes that take us back to the 1970s is not the way to do it-...”

Archival tape -- David Littleproud:

“What this Labor government is trying to do is take the balance out of it and put it all or the power back in front of the unions…”

CHRIS:

And surprisingly, people like Senator David Pocock, the quite green independent senator - and he actually replaced the very right wing Zed Seselja - he's actually saying, look, this is all happening too fast, I want to look at this legislation more closely.

Archival tape -- David Pocock:

“This is the biggest industrial relations reform in, you know, a decade or so. It's so important that we get it right and the government has thrown in a whole bunch of things into this big omnibus bill. We got the first look at it on Thursday. There's a fair bit to go through…”

CHRIS:

And Labor's saying, look, that could push the legislation out of the parliamentary timetable such that it might not finally come to a vote until next year.

RUBY:

Hmm. Okay. And I mean, Chris, a lot of the argument against wage growth, it's really being framed as you know now is just not the time, given the economic conditions. So when you look at the economics of it, how true is that? Bearing in mind that, you know, wages, they have been stagnant for so long already?

CHRIS:

There are two things about that, Ruby. First is, no matter what the economic conditions are, that argument is always wrong. I've never heard a time when employers and their supporters in the media say now is the time for wage rises. That's going to make you prima facie pretty suspicious about their argument, doesn't it?

Archival tape -- David Speers (ABC):

“Tim Reid is the president of the Business Council of Australia and he joins me now live in the studio. Welcome to the programme.”

Archival tape -- Tim Reid:

“David, great to be with you.”

Archival tape -- David Speers (ABC):

“So inflation, we're told, will now hit 8 per cent by Christmas. Wages though are rising by less than half that…”

CHRIS:

I don't know if you saw BCA president Tim Reid's interview with David Speers on 730 Report this week. But you know, that was absolutely a classic.

Archival tape -- Tim Reid:

“If you look over the last three decades at the split between profits and wages, it's been pretty consistent across the Australian.”

Archival tape -- David Speers (ABC):

“Well over the last 20 years profits have risen far more than wages.”

Archival tape -- Tim Reid:

“Not if you remove the impact of commodity prices.”

Archival tape -- David Speers (ABC):

“Why would you do that?”

Archival tape -- Tim Reid:

“Because commodity prices go up and down.”

Archival tape -- David Speers (ABC):

“You don't remove that from the wages data, though.”

Archival tape -- Tim Reid:

“Well...what you do is…”

CHRIS:

He just outright made the unsustainable claim that the relative share of profit and wages over the last 30 years in Australia had been pretty consistent. Simply untrue.

Archival tape -- Tim Reid:

“If you then move to a multi-employer system, then what happens is you remove the flexibility for different workplaces to find solutions that will drive productivity in their workplace. And ultimately that means there'll be less lower real wages.”

CHRIS:

Anyone who can read a graph can see the really huge increase in the profit share compared to the wage share of the economy. That's happened especially over the last several years. Workers are not driving Australia's current inflation problem, so you don't need to worry about that aspect providing you're not having a total let it rip wages policy, which the Government is not proposing. In fact, it could help solve the inflation problem to this extent, pay people a bit more and you might get more willing to come into the Labor market and work.

RUBY:

Okay. There is no doubt, though, that the economic circumstances are posing a difficulty for Labor, and they're ahead in the polls right now. But there is the opposition on stand by looking for any missteps as we've seen in the past week or so, looking at what's happened post the budget. So, how do you think the Albanese Government should be approaching this current set of circumstances?

CHRIS:

There's a lot of seasoned people in the Albanese Government Ruby, they'd be disappointed but not surprised by the behaviour of the Coalition in the press and business at the minute. They're in for the long haul. There's so much ballast in cabinet. It's a really good frontbench. There's a lot of confidence internally that they can come up with good quality policy to meet the economic challenges. And if you look at the polls, it's a stain in the polls to the events of the last week or so have taken a bit of paint off Labor's polling and Albanese's polling, but not much, I suppose, psychologically in terms of the theatre of politics. On the other hand, it has enabled Opposition Leader Peter Dutton and the Coalition opposition to get off the mat and get back in the game.

So interesting. I think Labor's calm and motoring on and pretty confident it can deal with the situation and a couple of really important things to power on with now. They've got to sort out energy policy in a deep way. I would expect to see a reservation policy on gas, much like W.A. Labor brought in years ago. That's worked so well. And the other thing is they've got to get this IR package through intact. So, you know, expect a bit more love coming from Anthony Albanese and his frontbench towards people like David Pocock, trying to get them across the line to get those crucial extra votes to ensure multi-employer bargaining does indeed get up.

RUBY:

Mm. Chris, thank you so much for your time.

CHRIS:

Pleasure.

[Theme music starts]

RUBY:

Also in the news today…

Hillsong Church founder Brian Houston has appeared in a Facebook video to attack the Hillsong board for the circumstances around his resignation, claiming he was "squeezed out" by the board of the church.

The social media appearance happened at the same time as Houston's lawyer appeared in court to set a date for a criminal trial, with Houston facing a charge of allegedly concealing his fathers’ child sexual abuse.

Houston denies the charges.

And, in the past week, the Chief Medical Officers of Victoria and NSW have both issued warnings about a coming wave of Covid and have urged people with symptoms to stay home.

A swell in cases caused by two new variants of Omicron have health authorities on alert, although it's too early to know whether the newer variants cause more or less severe disease.

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

I’m Ruby Jones, see you next week.

[Theme music ends]