06 Feb 2018

KIERAN GILBERT: Now to discuss a range of issues, including the push for a living wage, which we’ve heard from Mr Shorten and others for a number of days now. The Chamber of Commerce and Industry warns this could cost up to $8 billion a year. Do you accept those numbers?

BRENDAN O’CONNOR, SHADOW MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS: Well, I think they are referring to an ACTU claim. We haven’t presented our policy position. I don’t know whether their costings are right. We will have a look at it.

As we said, we’re open to debating this with employers, and unions and others. But we are very concerned, Kieran, that wage growth is flat lining, which is hurting workers and it’s hurting the economy. Looking at the Commonwealth Bank report on Friday last week, it refers to weakness in wage growth as a significant economic risk.

So it’s not just a social issue for us, it’s an economic imperative that we make sure that wages do not continue to fall -

GILBERT: But you’d still be open to pegging it to the median wage?

O’CONNOR: That was put to me by your colleague David Speers, and I said we haven’t ruled anything out, and that’s all I said. I didn’t introduce it into the conversation, David did.

We haven’t closed our mind to any of the propositions, but our goal is to lift wages to ensure people are not falling in real terms - that will affect our economy-

GILBERT: Isn’t it better to drive economic growth as opposed to trying to make some arbitrary change?

O’CONNOR: It’s a combination of things. But we don’t want to see profits at 20 per cent – look, we’re happy to see profits going up. But where profits are 20 per cent and wages are two per cent, there’s something amiss here. You would have thought - given that the Prime Minister wants to give $65 billion of tax cuts to big business - you would have thought it was the other way around, and somehow wages were out of control and profits were flat-lining.

The fact is profits are doing quite well. Productivity is going quite well. In the construction industry, productivity is going very well, and yet, there is no commensurate wage increases across the-

GILBERT: Labor previously has been supportive of corporate tax reduction. Mr Bowen has made those arguments before, Mr Shorten has as well. Now we are seeing the Australia Institute poll out today which shows two-thirds think there should be more money spent in services like health and education. But that’s not going to drive the sort of economic growth the nation needs, is it?

O’CONNOR: I think there has been a reset in a lot of the economic debates recently, not just in Australia - the IMF and World Bank and other institutions have been saying that inequality actually affects long term sustainable economic growth.

If you have a less equal society, you are actually going to have less economic growth over the longer term. Why? Because we need to make sure we have a good citizenry, who have invested in skills and education who are performing well in a knowledge-based, globalised economy.

For that reason, it’s no good to impoverish our working people and allow profits to continue. Economic growth will happen when we are also tackling inequality. It’s not one or the other. We need growth – but it’s not right to say-

GILBERT: If big business came out and said we will deliver this percentage of wage increase when these tax cuts go through, would Labor reconsider?

O’CONNOR: It will be interesting to see if they did that. In the case of the United States -

GILBERT: Would you reconsider?

O’CONNOR: - a handful of companies have done something.

I have never heard any big business say that they would do that. They say “let’s let the market decide” and yet they want the Government to intervene on tax, but they don’t want the Government to intervene in any way to deal with wages.

It’s not just the minimum wage either Kieran – enterprise bargaining has started to fall. We are seeing fewer agreements being struck – the lowest since 1995. So, there are problems with our IR system that we need to attend to – to deal with job insecurity, to deal with casualisation, but also to deal with the fact that we have very low wage growth.

The Commonwealth Bank, last Friday indicated that it is an economic risk to see wages in such a parlous state.

GILBERT: One of the other issues I want to talk to you about is Foreign Interference Laws. Senior Government sources tell me that these were drafted broadly, they will be fine-tuned during the committee process. “Of course they will be fine-tuned” was how it was put to me in relation to the implications for journalists and others. Are you reassured by that?

O’CONNOR: The Shadow Attorney General Mark Dreyfus and Bill Shorten and certainly my colleagues and I have concerns with the construction of the Bill. It does seem that you could criminalise conduct of journalists that should not be criminalised. Of course you have to deal with national security matters, but you also have to ensure that the media have a capacity to investigate and to report on matters of national interest.

I think the Government – and they may have even conceded this – have gone too far insofar as the construction of this Bill, and the implications for journalists and media outlets to do their job.

I am glad to hear that they might be pulling back from an overreach because we live in a democracy – we require the free press to do their work.

GILBERT: Well, they drafted it broadly, and they say it will be fine-tuned, a senior Government source told me. Thank you Brendan O’Connor, we will talk to you soon.

O’CONNOR: Thanks Kieran.

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