"What will happen to our social fabric when the vast majority of low skilled manufacturing workers are a)Unemployed, and b)Unhappy c) a Liability to the rest in social welfare."

There are many policy ideas that can be explored to answer these questions. The trick is get into the right policy debate framework. For example, have a look at the “active labour market” programs in this article:

http://www.onlineopinion.com.au/view.asp?article=75

David Boaz you are not a Manufacturer but yet another failed small business ,that lives in a tin shed. Why dont u go out and get a good job, with decent wages and conditions.Direct your anger and vitriol towards the top end of town and not the poor beggars below you.Stop trying to undercut decent employers who have the brains to make a quid,yet still pay decent wages. Resign from the Liberal Party and invest the savings.Many small businesses do very well, it is obvious u cant. They say a poor tradesperson blames thier tools, and a failed businessman blames the unions.

part 1

Facts of Life in Industrial Relations need to be told. In the early 1990s enterprise bargaining involved the unions representing employees and the employers and were vetted by the independant umpire, the Industrial Relations Commission, this ensured that the public's interest could be protected. Let me give you one example I worked for a union and was responsible for negotiating many of the first enterprise agreements, they formed schedules to the awards. After certifying two in a particular industry we negotiated an agreement which introduced the 38 hr week. When we the union and the employer initially went to the commission it was refused. The commissioner did not believe there was sufficient productivity improvements in the agreement, in short he thought we had beaten the employer into submission. Well we went away gathered evidence on savings as the arrangements had been put into practice and we were able to demonstrate at a subsequent hearing that sufficient productivity improvements were achievable from the agreement.
Sure this was inconvenient for me and the employer but it provided the public a necessary safeguard. If we had beaten the employer into submission then they because of the nature of the industry would simply have passed the costs on to their consumers.

Under both the current enterprise bargaining system and John Howard's system no one looks after the public'interest. No one really looks after those that cannot organise and achieve a pay rise and no one will look after consumers that have little choice but to pay increased costs.

We had the perfect system that gave appropriate weight to the needs of the workers, employers and the public and we abandoned it to take some foreign model because of our cultural cringe

part 2
We are seeing a slow down in labour productivity not because of over regulation but because the deregulation that has occurred to date allows many enterprises from effectively opting out of negotiating with unions for pay increases. Those that negotiate agreements achieve labour productivity increases as a consequence, those that direct their energies to avoiding or discouraging unions avoid pay increases and the negotiations necessary to make changes that lead to productivity gains.

When negotiations were on an industry wide basis changes that could increase labour productivity were available to all companies in the industry, now these changes only occur at an enterprise level and as a consequence may be less or more at particular enterprises.

Facts are that those employers with collective agreements have higher labour productivity than those that don't. The workers have higher wages. Through the 1990 when pay increases were negotiated on an industry wide basis labour productivity increases were higher. NZ which embarked on individual agreements had substantially lower labour productivity.

If we want to have real wage growth without inflation there has to be labour productivity improvement. A system which allows lazy or ideologically driven employers to opt out is not in the public's interest.

Just one final question has Mr Blandy ever negotiated an industrial agreement of any kind or is he one of these observer who develop theories without ever working in the field?

Thanks Realist - I didn't mean to sound like I was judging people for playing the pokies (I like to have a slap and a beer whenever I'm at the pub as much as the next person).
I was just saying that people do play the pokies and maybe that is what the State Government's are worried about.

Like i said - I don't see the changes being detrimental to every worker, they way the unions and Labor are saying - but if it did, playing the pokies might be one of things which suffers with a reduction in disposable income (especially considering it is entertainment). Not putting 10 bucks in the pokies does not affect quality of life but cumulatively it would affect revenue.

We all know the NSW and Vic govt make an absolute killing out of pokies taxes and this would play heavily on their opposition to the reforms. I doubt Mssrs Bracks and Iemma give a damn about the workers. Their big fat pokies treasury though - you betcha, the two of them should be called King of the Nile.

t.u.s

T.U.S:

If the government is so desperate for funds as you claim, that they cannot do without pokies, would it not be easier for them to either:

1. just print more money
2. tax the employer for half what he gained by lower wages
3. require by law every resident to visit the pokies and spend a minimum amount there per week (with death penalty for offenders)
4. send the police to the streets to issue $10,000 fines for J-walking
5. set up road tolls every block
6. hire thugs to hold up people in their home and in the streets, then shake off any money left on them into state coffers.

Don't we need creative governments?