Much of the talk about IR Reform is based on assertion – and misinformation, or perhaps creating an impression which proves to be untrue on closer inspection, if that’s a different thing. The current contention that a panel of experts is needed to assess the economic impact of federal minimum wages, because the AIRC is unduly legalistic and acts only by picking a figure between submissions between the parties’ ambit claims, is quite wrong in fact.
The Workplace Relations Act 1996 (Cth) already contains this provision in S.3(a), the Principal Objects of the legislation:
…encouraging the pursuit of high employment, improved living standards, low inflation and international competitiveness through higher productivity and a flexible and fair labour market…
and the Commission takes into account the impact on employment in the National Wage Case each year, and hears economic evidence. This is perfectly clear if one goes to the AIRC’s website and reads the submissions on the current National Wage Case and the reasons for decision from previous years’ determinations. But you’d never know it if you listened to the disingenuous rhetoric from the Government and Business groups. On Lateline just now (I imagine the transcript will be available tomorrow morning), a business spokesperson claimed that business “usually” supports a small rise. In fact, the pattern over the life of the Howard years more often than not has been for business to argue for no rise, the government to argue for a small one, and the ACTU to argue for a modest rise. The impression was also created by Professor Mark Wooden, who should know better, that the Commission meets in a trice and plucks a figure out of the air somewhere between those advocated in the submissions before it. In fact, the hearings go for months, and a wide range of parties outside the “IR Club”, including church social welfare bodies, small business groups, ACOSS, state governments and others are represented and heard. Inevitably, if a board of some sort composed of Treasury and Reserve Bank officers takes over the task, the process will be both much less transparent and much less open to different perspectives.
As I’ve recently argued, all this is really just about ratcheting down returns to labour at the lower end of the job market.
It’d be nice to get some actual arguments and facts going in this “debate”. At least in the late 1980s and early 1990s, the BCA and other lobbies felt they had to commission research and publish books and papers to bolster their IR arguments. Now they can’t even be bothered doing that, just banging on with the endless repetition of the mantra of “reform”, and warnings to the government not to waste its Senate majority accompanied by lengthy wishlists and making faith-based ideological assertions in the hope that no-one will be the wiser.
I have another question for the labour market economists, based on the constant position of business for years, and the current rhetoric of the government – if the effects of the Commission’s setting minimum wages have had such a baleful impact on employment for so long, then why is unemployment so low?