24 MAY 2013
SUBJECT/S: Ford, penalty rates, same-sex marriage, Hazel Hawke
NEIL MITCHELL: Okay, the left and right debate, with me in the studio in Melbourne, Workplace Relations Minister Bill Shorten. Morning.
BILL SHORTEN: Good morning Neil, good morning Joe.
JOE HOCKEY: Morning.
NEIL MITCHELL: In our Sydney studio, Joe Hockey, good morning to you. Okay, now I'd ask you both and Bill Shorten first, how do you save manufacturing in Australia?
BILL SHORTEN: Well the Ford news is devastating news. When I was working as a union rep I worked in the auto components area, so I do know some of the people who'll be affected by this decision. In terms of the rest of manufacturing I think the story is a better story than the particular bad news of Ford. In preparation for this morning's interview I was just thinking what are some of the success stories which are happening as we speak...
NEIL MITCHELL: Are you denying there's a pressure on manufacturing? Significant pressure?
BILL SHORTEN: Oh no. I'm not denying there's pressure. There's the pressure of the high dollar, absolutely, but what I also know is that - and maybe today's not the day to talk about any good news. But I do think that when we think about manufacturing we should realise that there's 900,000 plus people working in it, there are small and medium and big businesses in manufacturing.
And that when you look at some Melbourne success stories I can think of Boeing down at Fisherman's Bend, I can think of Bertocchi in the northern suburbs of Melbourne. I look at what Carmen’s is doing and there are companies who are going well. So I think that we need to recognise that while we've got to stand alongside the Ford workers the total picture of manufacturing is not as grim as this particular terrible news yesterday.
NEIL MITCHELL: Joe Hockey, do you agree?
JOE HOCKEY: Oh look it's not grim but manufacturing in many countries around the world, including China, has changed dramatically and in China actually, you know, for an extended period there and I think it's probably still the case, there has been a reduction in the total number of people involved in manufacturing. Now what's happening is technology is improving and that means that machines are replacing human beings.
So labour becomes less of a cost to the overall manufacturing business and other inputs are important like energy costs, like logistics costs and obviously the impact of currencies. Now the fact is that Australia is still way too expensive as a manufacturing hub. It is also the case that world manufacturing is constantly assessed on the basis of the US dollar, so for example it was only a few weeks ago that a major Australia businessman said to me that he's moving his manufacturing from China to the United States and...
NEIL MITCHELL: Okay, but what do we do about it? You touched on costs...
JOE HOCKEY: Yeah.
NEIL MITCHELL: ...and Ford said yesterday their costs are four times those of Asia, double those of Europe, a large part of which is labour costs. What do you do about labour costs Joe Hockey?
JOE HOCKEY: Well the starting point is in a sense, I don't have much sympathy for the Ford Motor Company. I have great sympathy for the workers, but I don't have much sympathy for the Ford Motor Company who've made some bad decisions over a number of years here in Australia. And you just look at their dealer network which they bought the dealer network off the dealers and then ended up trying to run it themselves and then made the mistake of giving it back.
NEIL MITCHELL: Okay, so what do you do about labour costs?
JOE HOCKEY: Well the labour cost issue, it comes back to how you negotiate contracts and agreements. Now there have been enterprise agreements in the motor vehicle industry that have been ridiculous and one of them is that you have to get approval of the unions for any contractor that the company would use, effectively outsourcing to union leadership the right to veto anyone you use as a subcontractor.
Now Max Yasuda the head of Toyota, incredibly courageously, was on the front page of the Financial Review about a year ago saying industrial relations is one of the biggest challenges he faces in trying to hold Toyota in Australia.
NEIL MITCHELL: Well Bill Shorten, what do you do about labour costs?
BILL SHORTEN: Well I don't buy the argument that says because we've got a strong safety net of industrial conditions that therefore one, manufacturing can't survive or two, that's the reason why Ford has made the decision it's made. I think it's disrespectful to the Ford employees to say that the industrial relations that they've negotiated is part the reason for their demise.
NEIL MITCHELL: Well are you saying that Joe Hockey?
JOE HOCKEY: Oh well it's one - I'm not saying their negotiated - the unions - look, Max Yasuda, the head of Toyota and it's unbelievably rare to see a Japanese businessman going to the media, let alone the head of Toyota in Australia. He went on the front page of the Financial Review and said it is incredibly hard in Australia negotiating with the unions.
NEIL MITCHELL: Okay. But you're saying here...
BILL SHORTEN: Let's not start...
JOE HOCKEY: It is part of the equation, of course it is. Let's not mess around. It's part of the equation.
BILL SHORTEN: Okay...
JOE HOCKEY: Of course it is.
BILL SHORTEN: ...but Joe, what you seek to do is say that you're not blaming the workers but you say union officials have negotiated agreements with the company. I make two or three points. One is the employees at Ford in Broadmeadows and in North Geelong and people who I've met and their company negotiate these agreements. They vote on them.
I do not believe that because Ford decided not to make a small motor car in Australia that that's the fault of the industrial arrangements. I do not believe that the high currency is the fault of the workforce having decent conditions...
JOE HOCKEY: But they weren't making money Bill when they had a low currency. When the currency was in the forties...
BILL SHORTEN: Joe...
JOE HOCKEY: ...and fifty cents US, come on, let's be fair dinkum about this.
BILL SHORTEN: Okay, well I'll be fair dinkum mate because I've met these people.
JOE HOCKEY: Oh and I haven't.
BILL SHORTEN: The Ford car workers are very productive. I don't believe that there's any lack of productivity on their part. I don't believe there's any reluctance on change on their part. There has been an excellent record of industrial relations.
NEIL MITCHELL: But the company is saying that labour costs are part of this and I keep coming back to the point, if that is true what can be done about labour costs? Nobody wants to screw anybody but do we want to lose manufacturing.
BILL SHORTEN: Well the trick is to have win/win negotiations where people are contributing productively and collaboratively. But I do not believe that there is any amount of - let's put it really straight here - big black and white difference between me and Joe Hockey. I do not believe the workers, no matter what pay cuts they took, were going to be able to turn around the decisions made by Ford management, not to pick up on...
JOE HOCKEY: No, that's true too, I accept that.
BILL SHORTEN: Well let's not blame the workers and their conditions which...
JOE HOCKEY: Well no one is. No one's blaming the workers.
BILL SHORTEN: Well hang on Joe, you've sort of live in this world where you just blame their conditions but not the workers who receive them. Well let's be really straight. What has cost...
JOE HOCKEY: Ease up Bill.
BILL SHORTEN: Ford...
JOE HOCKEY: I mean I've said there are a number of factors and I've raised some of them.
BILL SHORTEN: Well because I'm...
JOE HOCKEY: Energy costs...
BILL SHORTEN: ...I'm particularly sensitive to the idea that employees have had bad news, the next day hear from potentially the next Treasurer of Australia saying your labour costs are the reason why you don't have a job. I don't buy that argument...
JOE HOCKEY: I said it was one of a number Bill, please don't play these games. I said...
BILL SHORTEN: Alright, I don't...
JOE HOCKEY: ...it was a number of factors...
BILL SHORTEN: Well I don't believe...
JOE HOCKEY: ...including logistics costs, including energy costs...
BILL SHORTEN: Well we're disagreeing on the role that the labour costs play in manufacturing in terms of the Ford Motor Car Company. The reason why Ford's hit the fence is because they didn't build a small car. Instead there's a great article if I can quote the Herald...
NEIL MITCHELL: So it's Ford's fault.
BILL SHORTEN: If I can quote the Herald Sun...
NEIL MITCHELL: Look, can I ask that. Is it Ford's fault?
BILL SHORTEN: Well I'm about to answer your question Neil. On that, page four of the Herald Sun, not the paper who owns 3AW but I will quote the Herald Sun, page four...
NEIL MITCHELL: Is that meant to be an insult?
BILL SHORTEN: No, of course not. I don't mind who owns 3AW but I'm...
JOE HOCKEY: I thought Neil Mitchell owned 3AW.
BILL SHORTEN: No, well he sort of - maybe the brand.
NEIL MITCHELL: If only.
BILL SHORTEN: Anyway page four, today's Herald Sun, writer Joshua Dowling makes it clear what he thinks has gone wrong at Ford and I think it's very instructive and it's about the inability of Ford to cope with changing times.
NEIL MITCHELL: Exactly and yet we put 1.1 billion in Government money into it.
BILL SHORTEN: Well car manufacturing is still viable in Australia. It still generates 50,000 direct jobs. It still generates research and development. I wouldn't give up on manufacturing.
NEIL MITCHELL: Let's take a quick call. Ashley, go ahead.
CALLER ASHLEY: Hi Joe. Now has the Bill Shorten, Bill. Have you ever been in any form of business in your entire life? Have you ever actually run a business, whether it's a tiny little micro business when you were a young kid, when you were fifteen or sixteen? Did you ever have a business somewhere there?
BILL SHORTEN: Yes, I have run a business where I had to make a profit and loss. I had to run a business where I've employed people...
NEIL MITCHELL: Is that the union?
BILL SHORTEN: …where I've had to lay people off, where I've had to hire people...
NEIL MITCHELL: ...And that was the union...
BILL SHORTEN: ...yes, where I've had customers.
CALLER ASHLEY: And Bill and were you involved - were the union involved in your business when you were running that business...
BILL SHORTEN: Oh yes.
NEIL MITCHELL: His business was...
CALLER ASHLEY: ...or did you run it...
NEIL MITCHELL: ...Ashley...
CALLER ASHLEY: ...yourself?
NEIL MITCHELL: ...Ashley, his business...
CALLER ASHLEY: Hold on. Hold on.
NEIL MITCHELL: No, hang on Ashley, his business was the union. That's the business he ran.
CALLER ASHLEY: Oh okay, so sorry, so you've never actually run a business apart from the union and - that's what I mean Bill. You don't understand buddy. You've got no idea.
BILL SHORTEN: Well Ashley...
CALLER ASHLEY: You're trying to pass on costs to business that can't afford it. Don't you get it Bill? Australia now is so uncompetitive it is ridiculous.
BILL SHORTEN: No mate. I don't...
CALLER ASHLEY: You just don't get it Bill. You just don't get it Bill. You're starting to quote people on page four of the Herald Sun. I mean for goodness sake Bill, grow up and just leave Australia alone.
NEIL MITCHELL: Okay, righto, righto Ashley. Okay, righto Ashley.
BILL SHORTEN: I don't assume there was a question there.
NEIL MITCHELL: I'd ask - running a union isn't running a business.
BILL SHORTEN: Sorry, if you've got to run a profit and loss, if you've got to hire people...
NEIL MITCHELL: But you have people who are members...
BILL SHORTEN: No, no.
NEIL MITCHELL: ...and they give you money. You don't have to go out and earn the money do you?
BILL SHORTEN: You have to go and find your customers.
NEIL MITCHELL: Who? Union members?
BILL SHORTEN: Potential members, yes.
NEIL MITCHELL: No closed shops.
BILL SHORTEN: Oh come on now, you know the job. But the point about - I think what that gentleman was saying is that you've got to understand what happens in business. Yeah, of course. But what I don't accept is that paying people low wages is the only way, only business model which will make Australia great. I don't buy that. There are 11.5 million people who go to work everyday.
They deserve to have a strong safety net of conditions and if that caller clearly has a very different view to me, that's his opinion, but I have a different vision of Australia.
NEIL MITCHELL: More from Bill Shorten and Joe Hockey in a moment.
NEIL MITCHELL: We'll be speaking Andrew Demetriou soon about the James Hird situation.
Just on the Victorian Premier Denis Napthine, Joe Hockey, a minute ago, I was talking to Denis Napthine, rather in the first half hour of the program about Ford, about the labour costs, about everything. He said everything should be reviewed including penalty rates. Do you agree?
JOE HOCKEY: Well, you can negotiate, as Bill knows, penalty rates during the course of the enterprise negotiations so I couldn't say whether penalty rates were the particular industrial relations issue there but…
NEIL MITCHELL: No, no, not there but more broadly.
JOE HOCKEY: Well, look, they can be negotiated as part of an enterprise agreement. There's a flexibility there in the current Fair Work Act but the issue is it's not just that.
I mean I gave a speech the other day in Brisbane and a manufacturer gave me his numbers which I published and the fact is the cost of his energy inputs in Australia are, you know, 100 hundred per cent higher than his energy costs in the United States.
NEIL MITCHELL: Okay.
JOE HOCKEY: And his cost per worker in Australia are $40,000 higher than each worker in the US. And it's red tape as well. I mean I must say he - and he will say it publicly if he is prepared to. He needed a five kilometre gas pipeline, he has to lodge 306 kilos of paperwork to get approval from state and federal governments.
NEIL MITCHELL: Well, I'd love to talk to him. Bill Shorten, what's your view on what Denis Napthine said about penalty rates?
BILL SHORTEN: I think Denis Napthine's signalling what a federal Liberal government would do if they came to power.
JOE HOCKEY: Stop it, Bill.
BILL SHORTEN: Well, sorry, I only went for three seconds, Joe. But the Victorian Liberals have said a few crazy things lately. They've proposed, at their conference, privatising the ABC and now Denis Napthine's saying that he wants to open up the question of penalty rates.
I would just say, as I've said previously on this show, the people who most need penalty rates are the lowest paid Australians. I think that any government who wants to open up taking away the conditions of low paid Australians is a danger and a risk for people in Australian workplaces.
NEIL MITCHELL: Can we change topic a little? Kevin Rudd this week, speaking of changing his mind on gay marriage. Have you changed your mind, Joe Hockey?
JOE HOCKEY: No.
NEIL MITCHELL: So what is it?
JOE HOCKEY: As it was last week.
NEIL MITCHELL: Which is?
JOE HOCKEY: I believe marriage is between a man and a woman.
NEIL MITCHELL: Okay. Conscience vote?
JOE HOCKEY: It's a matter for others, not for me.
BILL SHORTEN: What?
NEIL MITCHELL: So you don't have a view on whether there should be a conscience vote or not or you…
JOE HOCKEY: l do but I'll share it with my party room.
BILL SHORTEN: Share it with us, Joe. We can - we'll tell the…
NEIL MITCHELL: Just the three of us.
BILL SHORTEN: And that chap Ashley. I hope he got it off his chest this morning, that caller.
NEIL MITCHELL: Why is it? Why wouldn't you share it with us? I mean this - we're all grown-ups, we can debate this issue, surely?
BILL SHORTEN: I mean you're offering yourself for Parliament, why keep your views a secret from the electorate?
JOE HOCKEY: About whether the Liberal Party has a conscience vote on it?
BILL SHORTEN: Yeah.
JOE HOCKEY: Well, it's, you know, my view is for the party room because that's where people make those decisions. But I've said - look, if you don't agree with me on marriage then people are free not to vote against me or to vote against me.
NEIL MITCHELL: As you well know, though, if there was a conscience vote then it might get up, it might get through.
JOE HOCKEY: Well, no, I don't think it would actually because it was two to one to vote against it in this Parliament in 2012.
BILL SHORTEN: Let's find out then. Why don't we just - this is an issue…
JOE HOCKEY: Well, do you want to put it back up before the election, Bill?
BILL SHORTEN: No, I'd just like the Liberal Party to let its Members of Parliament exercise their conscience on a moral issue.
JOE HOCKEY: Well, yeah, well, I mean it's…
BILL SHORTEN: I don't think you need party discipline…
JOE HOCKEY: I wish - you know what, in our party, Bill, you don't get expelled if you cross the floor as in the Labor Party you do, don't they?
BILL SHORTEN: Yeah, but Joe…
JOE HOCKEY: So, for example, Malcolm Turnbull crossed the floor…
BILL SHORTEN: …Neil asked you…
JOE HOCKEY: …on an emissions trading scheme and we haven't expelled him.
BILL SHORTEN: Yeah, but you knocked him off as leader.
NEIL MITCHELL: But in terms of the conscience vote…
JOE HOCKEY: Well, that was - we voted after actually, after he was leader.
BILL SHORTEN: In conscience…
JOE HOCKEY: Robert Hill crossed the floor seventeen times.
NEIL MITCHELL: I don't care about people crossing the floor. I think if some people care about gay marriage…
BILL SHORTEN: Okay. Well, why don't the people who believe in gay marriage and the Liberal Party just cross the floor?
JOE HOCKEY: Well, they're entitled to if they want.
BILL SHORTEN: Yes, but why don't you make it easier? I think people when they vote for MPs should know what they think about these issues.
NEIL MITCHELL: All right. Where do you stand on gay marriage?
JOE HOCKEY: Well, I've just explained that.
NEIL MITCHELL: No, no, no. Sorry, I was asking Bill Shorten.
BILL SHORTEN: Sorry, Joe. I voted for it.
NEIL MITCHELL: And you remain for it?
BILL SHORTEN: Yep.
NEIL MITCHELL: Why?
BILL SHORTEN: Well, I think that either you think that homosexuality is evil or you don't. Either you think that homosexuality…
JOE HOCKEY: Come on.
BILL SHORTEN: Well, no, wait a sec. I'm just - I'm explaining my views, Joe.
JOE HOCKEY: Yeah, okay.
BILL SHORTEN: Sorry, if you - you're welcome not to agree with - you either think that homosexuality is not socially acceptable or you don't and I can't see why it is acceptable for most laws but not for all laws.
But also, I have to say, it's not my biggest issue. I can respect the counter-arguments and people have faith in their views on it - on this matter.
NEIL MITCHELL: So is Kevin Rudd playing a game?
BILL SHORTEN: I just think it should be a conscience vote.
JOE HOCKEY: Well, I just want say I don't think homosexuality is evil.
BILL SHORTEN: No, I'm sure you don't.
JOE HOCKEY: And I think a lot of people that actually believe in marriage is between a man and a woman, are perfectly accepting of homosexuality.
BILL SHORTEN: Yep.
JOE HOCKEY: I just think there's a view in the community which people are entitled to have, that a marriage is between a man and a woman and…
BILL SHORTEN: Okay.
JOE HOCKEY: …I know it's a very hard issue for a lot of people on both sides. I think we need to temper the language.
NEIL MITCHELL: Did you see - did you both see Peter Costello said today that Tony Abbott's Budget and Reply speech was the best for decades. What does that say to John Howard?
NEIL MITCHELL: He's finally fixed him up, hasn't he?
BILL SHORTEN: It's a sort of back-handed compliment.
NEIL MITCHELL: Final word. Hazel Hawke, did you know her, Bill Shorten?
BILL SHORTEN: I knew her slightly. My wife knew her much better. I think it's very sad, very sad.
NEIL MITCHELL: Great person. You don't need to look in the boardroom to a find female role model when you’ve got people like Hazel Hawke around.
BILL SHORTEN: When you look at what she did and sometimes in the sort of 24 hour news cycle, it's easy to forget the contribution or not quite recall the contribution that people have made.
But the fact that she was the patron of the stillbirth and neonatal death support because of the loss of her little one. Raising children, she was a pro-choice advocate. Married to Bob Hawke for 38 years.
The fact that she took on - the fact that she took on Alzheimer's with such courage. She was a great pianist, could have been a concert pianist.
NEIL MITCHELL: He never would have made it without her, I reckon.
BILL SHORTEN: You know them both better than I did, Neil. But I suspect that's right and a little bit of me just recognises in Hazel Hawke the sacrifice that all Parliamentary or political partners make.
NEIL MITCHELL: Joe Hockey, did you know her?
JOE HOCKEY: Yes, I did. She was a constituent of mine and Bob Hawke's a mate of mine.
NEIL MITCHELL: Well, I don't think either would vote for you.
JOE HOCKEY: Well, the bench mark for me whether I really achieve it in politics is if Bob Hawke is prepared to hand out Liberal how-to-votes at one of my booths. And I haven't got there yet.
JOE HOCKEY: But I keep encouraging. He's got to be close this time, I reckon. But look, you know, she was always incredibly gracious, always had a smile on her face and, you know, I think again, it proves you don't - you know, the - some of the very best role models in life are those who are around us in the community and she was a terrific role model in many ways.
Very tolerant, very stable and particularly given that - I'm sure she held the family together during that terrible period for their family when - during the 1984 election campaign.
And you know, I think we should just recognise the incredible courage she had and I think Bill's right. Our wives and husbands go through an, you know, incredible amount in politics and, you know, it's a reminder of how valuable they are to us.
NEIL MITCHELL: Thank you very much for your time. We'll catch up soon. Joe Hockey, Shadow Treasurer, Bill Shorten, Minister for Workplace Relations, thank you.
BILL SHORTEN: Thank you. Cheers, Joe.
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