Consideration in detail: PM&C

17 June 2015

Dr CHALMERS (Rankin) (10:03):  As the parliamentary secretary knows, in this place if you snooze you lose. I am happy to go first and perhaps, when he does not answer my first question, he will get some of his opening statement jammed into that five minutes allowed for his response.

This is a good opportunity to talk about the appropriations bill as it relates to the Department of Prime Minister and Cabinet. As the parliamentary secretary would know, to provide a whole-of-government focus on the deregulation agenda, the Office of Deregulation was created within the Department of Prime Minister and Cabinet on 18 September 2013 and remains in the organisational structure of the department today.

The parliamentary secretary would also be aware that in the autumn red tape repeal day of 2014 the government abolished the Commonwealth Cleaning Services Guidelines, which regulate the minimum pay and conditions for cleaners. As a result, from 1 July 2014—that is, between the government's first budget and their second budget—some of Australia's lowest-paid workers had their wages cut.

At the Department of Foreign Affairs, for example, cleaners have had their wages cut by $6,000 a year. Cleaners at the Department of Immigration and Border Protection are now receiving $2 less an hour, which means their annual wages will be reduced by thousands of dollars, while cleaners at Parliament House are facing a wage cut because of the abolition of the guidelines and the Clean Start rates. It should not have to be pointed out to members in this place that these are the people who clean our own offices—people we see around the building, people we interact with, people we spend a lot of time with. The government's deregulation agenda has had, is having and will have a very direct and very substantial impact on their take-home pay and their ability to pay the bills and raise their kids.

These wage cuts fly in the face of the Prime Minister's promise just over a year ago today that abolishing the guidelines would not affect cleaners' pay. He said:

I want to make it absolutely crystal clear that no cleaner's pay is reduced.

That was in question time on 16 June 2014. On Monday, at the front of this building on International Cleaners Day, I was proud to join so many colleagues from our side of the House, and indeed some of the crossbenchers as well, to stand with the cleaners who clean this building, to stand with people who just want a fair go. They are just doing their job; they do not want their wages cut. They do a fantastic job.

Mr Porter interjecting—

Dr CHALMERS:  I am surprised that the other parliamentary secretary is interjecting at this point. I would have thought that he would agree that they do a fantastic job in this building. I am surprised he would object to that point. They do deserve a fair go, they deserve respect and they deserve fair wages and conditions as well.

Given that this government views cleaners' wages as red tape, my question is: will the PM&C Office of Deregulation conduct a review this year of the impacts of this particular measure in their deregulation agenda? Can the parliamentary secretary inform the House: how many cleaners are affected? How much money are they losing? And can he tell us the Office of Deregulation's estimates of how much money is being saved from this budget as a result of taking the wages out of the pockets of some of Australia's lowest paid workers?


Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:09):  I am very happy to address the question from the member. Ultimately, the question had two specific parts—first, in his words, 'How many cleaners were affected by the deregulatory decision?'; second, 'What was the effect on the wage of the cleaners?' And, third, I think the question was, 'What was the regulatory compliance cost saving that was attached to the actual decision?' The third answer is certainly one that we can get to you with clarity. I do not have that to hand at the moment, but that is something that would have been subject to internal assessment, as to the compliance cost. From recollection, it was not insignificant that the guidelines had placed an onus on—

An honourable member interjecting—

Mr PORTER:  I will get to that. The guidelines had placed an onus on employers, which was viewed by this government, certainly as unnecessary, and it was costing employers. The other two questions were: 'How many cleaners were affected by that deregulatory decision; and what was the effect on the wages?' To be able to answer that properly, what needs to be put on record here by the member—and it is something that I have seen failed to be put on record anywhere—is: 'What is the causal link between the deregulatory decision and whatever subsequent enterprise agreement was bargained between the cleaners and their employers?' As the member would know, having had some experience in these matters, enterprise agreements set wages. They are bargained often between union representatives for the individuals involved and they are the result of those arrangements.

In this instance, deregulatory changes were made. Immediately after those deregulatory changes were made there were no changes whatsoever to the wages and or conditions. Enterprise agreements that had a known termination date were then renegotiated by unions—many of which are affiliated with your side of politics—with their employers. What remains to be proven with any kind of substantial form is that there is a direct causal link between the two.

An opposition member interjecting— 

Mr PORTER:  It might assist my friend if I describe how wages are actually set. I might use the example that my parliamentary secretary colleague raised, which is Clean Event. Clean Event provides a perfect example of how wages are actually set. Wages are determined in enterprise agreements by negotiation, almost invariably, by unions negotiating on behalf of the workers with employers, to finalise an enterprise agreement that has a fixed term.

What has been put by the member for Rankin is that there is some kind of causal link between the enterprise agreement that was negotiated many months after a deregulatory decision—which was a far broader decision—was made. To clarify how it is that wages are set, I will use the example of Clean Event. A union negotiates on behalf of its employees with an employer to determine wages and conditions where the conditions will often involve things like leave, leave loading, holiday pay and other conditions of that type. Certain calculations must be made as to whether or not those employees are better or worse off, under the subsequent agreement, compared to previous agreements. Using the example of Clean Event—which has become somewhat topical of late—a view has been put that the cleaners, the employees, who were contracted with the relevant company, Clean Event, would not have been better off under the second compared to the previous agreement. In fact, they would have been substantially worse off. Interestingly, this decision—as the member for Rankin might be happy to concede—was not prefaced or predated by any regulatory or deregulatory decision, was it? It was just an enterprise agreement—

An opposition member interjecting— 

Mr PORTER:  What is being put without any evidentiary foundation is that the direct necessary condition that led to a subsequent enterprise agreement had something to do with a deregulatory decision in and about the same industry. What we are pointing out is that here is an example where, in a subsequent decision, a subsequent DVA—

(Time expired)



Dr CHALMERS (Rankin) (10:21): I ask the parliamentary secretary, in response to his last answer: can he confirm for the House that he sees no link between the change in the Commonwealth Cleaning Services Guidelines and the subsequent wage cuts for Commonwealth cleaners? Will he sit down with the cleaners of this building and their representatives to explain to them why he thinks that there is no link whatsoever between the change to the guidelines and the changes to their wages, and to the wages of Commonwealth cleaners in DFAT and around the Commonwealth Public Service? That is my first set of questions for the parliamentary secretary.

The second set of questions also relates to the deregulation agenda. I want to remind the parliamentary secretary of some of the absolute crowning achievements in this area when it comes to deregulation carried out by him and by his predecessor, the now Assistant Treasurer. These are some of the achievements so far in the deregulation space: the government has changed clauses in 11 different pieces of legislation where from now on the law will omit the word 'e-mail' with a hyphen and substitute 'email' without a hyphen. There are 16 pieces of legislation where from now on the law will omit the words 'facsimile transmission' and substitute the word 'fax'. There are six pieces of legislation where from now on the law will omit the word 'trademark' and substitute the word 'trade mark', with a space. They have corrected a spelling error in the Great Barrier Reef Marine Park Act so that the word 'committing' has the requisite two t's. They have corrected a punctuation error in the Fair Work Act 2009 to insert a comma between the words 'aircraft' and 'ship'; and there are 10 clauses in legislation in which a reference to the 'Legislative Assembly for the Northern Territory' must now be substituted with 'Legislative Assembly of the Northern Territory'.

Can the parliamentary secretary inform us if the Office of Deregulation will conduct a review this year to determine the real economic impact of the repeal of these tremendously significant spelling errors, typos and lapsed legislation? And can he confirm for the House that the punctuation errors corrected in some of this legislation still saves the Commonwealth $350,000? Does he stand by that costing?




Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:24):  One of the things that I have noted about having the stewardship of this deregulatory agenda is that laziness in one area breeds laziness in all areas. I know that members opposite may be happy to put up with poor grammar and over-hyphenation. It may be that you are radically pro hyphen, that you would hyphen everywhere you could and that you would ignore over-hyphenation. It is very interesting, because when we read the annual report what we found was that, for the first time ever, this government undertook a very thoroughgoing audit of the costs of regulation on the Australian economy. The figure that was derived from that report was $65 billion worth of cost effect on the Australian economy from Commonwealth regulation. We broke that down very thoroughly, per department, and we also broke it down in ways that show that the more minor contribution to that $65 billion worth of effect on the economy is in what you might call the acts and regulatory instruments, in the way in which they are devised and written. Underneath that, from recollection, around 80 per cent of the impact of the cost occurs from departmental-level decisions, forms and ongoing issues that relate to the way in which departments interpret the acts and regulations. What we have done—and I think that this is a virtue, not the vice that members opposite would have it be—is that we chase both the big things and the little things.

It is very interesting that the member raised the Great Barrier Reef Marine Park Act, which I agree had grammar which was appalling. It should never have been drafted in the way that it was. I cannot remember whether it was a previous Liberal or Labor government; I do not know. But, very interestingly, alongside those amendments—which were indeed very grammatical and would have had minor cost effects—there were also changes, because we identified that there were state regimes in the very act that the member talks about, which governs the installation and maintenance of pontoon devices on the Barrier Reef according to the Commonwealth regulation. We did tidy that up, as you point out, in a grammatical way, but also there was a slightly more substantive change. What that did was, in effect, redact those parts of the Commonwealth legislation that purported to have, and for some time had had, an impact the users and installers of pontoon devices on the Great Barrier Reef.

We went through a business cost calculation method. The saving was admittedly modest. From recollection, we calculated that the savings were in the vicinity of about $5,000 per year, because under the very act that my friend talks about there were a very small number of operators who were forced to abide by both a Commonwealth regime and a state regime that were doing precisely the same thing. To the member for Rankin, that may be something which is unimportant, but if you are operating a pontoon on the Great Barrier Reef and have to abide by two separate regimes which both require you to do essentially the same thing and fill in two sets of forms then the requirement that you have is too onerous and unnecessary, and it is worth looking at. If we can tidy up the grammar of the act at the same time, so be it. The sort of laziness that we had opposite is a laziness that not only stops you from looking at commas and hyphenation but then stops you from looking at and investigating acts like the very one that he mentioned, where there were significant cost savings to be had from businesses not having to go through a dual application and maintenance process for pontoons on the Barrier Reef.

The thing about looking at the acts, if you bother to do so, is that, very interestingly, what we have done is not merely to chase down those rats and mice but to look at much larger operational items. For instance, for the first time ever the e-tax system prepopulates. On calculations inside this government and the departments on the business cost calculator model, that saves 1.6 million-odd self-assessing Australians $156 million of their time.

Now I will get to the cleaners. Let me explain to the member for Rankin how causation works. Causation is not proved by saying if event A happened before event B then event A caused event B. What stands as proof quite clear of that— (Time expired)

The DEPUTY SPEAKER:  I call the member for Ryan.

Dr Chalmers:  Hang on a sec. Deputy Speaker, you will note that the member for Ryan, for whom I have great respect—I love her scarf today in particular—was nowhere near on her feet when the time elapsed. I let you have the first one, Deputy Speaker, which you were also not correct on, but this time I was up on my feet well in advance.

Honourable members interjecting— 

Mrs Prentice interjecting—




Dr CHALMERS (Rankin) (10:30):  Don't reflect on the chair, member for Ryan.

Mrs Prentice:  No, I am going to reflect on you when I am in the chair!

Dr CHALMERS:  That is very professional. The member for Ryan is being very professional about her stewardship of the chair. Thank you for the call; a very fair decision. I ask the parliamentary secretary for commas and hyphens: will he meet with the cleaners of this building to explain to them his position that there is no link between the Commonwealth cleaning guidelines being changed by the Abbott government and the cuts to their pay?

Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:31):  Is the member opposite—

Dr Chalmers:  Just answer my question!

Mr PORTER:  going to meet with the employees of Clean Event to explain to them how it is that the EA—

Dr Chalmers:  It is your budget, Christian!

Mr PORTER:  negotiated by the leader of his political party produced an outcome for them that left them with very substantially less.

Dr Chalmers interjecting—

The DEPUTY SPEAKER:  Order! Let him answer please.

Mr PORTER:  It is a very interesting issue. It is, in a sense, quite astonishing that you would choose cleaning as the issue to pursue here. As I said, you are presupposing that event A that occurs before event B causes event B. You explain to me what it is—

Dr Chalmers:  Are you saying there is no link?

Mr PORTER:  I am saying there is no link. The terms and conditions for employees are set by enterprise agreements, bargained under the Fair Work Australia system—the system that your side of politics devised—and negotiated by the union movement, which your side of politics has links to. Simply because event A occurs before event B does not mean event A causes event B. And when you look at the Clean Event example, what was it that caused the employees in the Clean Event EA to receive a less favourable outcome than in their previous EA? It was the way in which that EA was negotiated by the now Leader of the Opposition. It is fascinating because when you look at that process, everything turns on the enterprise agreement—signed by the now Leader of the Opposition. It is a document for Clean Event employees that benefits the employer and disadvantages the workers.

What was it that caused that outcome? Was it a deregulatory agenda? Was it a failure to properly negotiate with the employers? Was it some form of ancillary advantage that was seen as more important, like joining people up to a union? Very interestingly, you can print out the examples, and I advise you to do it, about how that particular EBA worked. Interestingly, the total award rate, had it been negotiated under the award, would have been $673.46, but the multi-hiring clause under the EBA that was negotiated ultimately by the now Leader of the Opposition produced a rate result of $586.32, which has put those workers in a significantly poorer position than they were in previously.

That was a result that came from the negotiation of the EBA under the Fair Work Act system, the system that the Labor Party put in place when in government. The contract was negotiated by the now Leader of the Opposition. In fact, the result was this: many of the Clean Event workers would have been better off staying on the minimum wage and receiving penalties as prescribed under their award rather than working under the now Leader of the Opposition's enterprise bargaining agreement that he negotiated on their behalf. The outcome of an EBA is determined by the negotiation of the EBA and the terms of the EBA. Trying to link that to the deregulator agenda is simply, completely, to misunderstand the causal nature of what produces outcomes in the EBA process.

Returning to the government's deregulatory agenda as a whole, what we have managed to do is enact decisions which, when fully implemented, will reduce compliance costs in the Australian economy by $2.45 billion. And, yes, inside that agenda there is a range of rather mundane cleaning-up of legislation, which has gone undone for too long, but also some incredibly substantive matters. Those will continue with the money that this budget has provided to the Digital Transformation Office. The interface with government will become clearer and crisper for people, whether they are undertaking tender and procurement processes, or whether or not they are going through Centrelink application processes. What we have done is a thorough top to bottom analysis of where regulatory costs are imposed in the economy, and we are tackling them all—both big and small.

When you look at some of the fantastic things that have happened here, and in this recent budget particularly, they have gone directly to organisations such as small business. Fringe benefits tax can now be claimed on two devices even if they have an overlapping functionality, like an iPhone or an iPad—a very significant benefit for business.

The DEPUTY SPEAKER (Ms Landry):  The member for Ryan has just advised me she is at the Petitions Committee, so she will be late. I give the call to the member for Rankin.




Dr CHALMERS (Rankin) (10:38):  I ask the parliamentary secretary to respond to a story in the Canberra Times that said:

Paid parental leave for tens of thousands of federal public servants has been plunged into limbo by the Abbott government's controversial cuts to the entitlement. Departments are saying that they cannot finalise the arrangements for their workforces until they have been given clear guidance from public service authorities.

When will that guidance be provided?




Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:38):  I have not read the article that the member refers to. Of course, any lack of clarity that might arise from the coalition's Jobs for Families childcare package—which of course includes both the new expenditure to increase the subsidies for child care but also, as the member points out, the savings measures which revolve around both the FTB(B) changes and the eligibility criteria for the state run, government run, system of paid parental leave—with respect to those proposals does not arise from the nature of the proposals, or the way in which the proposals are described, formatted or legislated.

That is entirely clear. Of course, uncertainty, very unfortunately, will arise because the position of members opposite is, it appears, to not support those changes, which would give very significant increases to subsidy for those seeking child care. Maybe it is something that members opposite need to discuss with the relevant unions that they have close contact with, but there is no lack of clarity in what is being proposed. If there is any, you could try to point it out, but I think that the drafting is very tight. Of course, clarity may be an issue because of the fact that the legislation is going to meet, it appears, some opposition from Labor.




Dr CHALMERS (Rankin) (10:40):  I refer the parliamentary secretary to his earlier response about paid parental leave, and again I quote The Canberra Times article:

The key Department of the Prime and Cabinet says it simply does not know what to do about its workforce's paid parental leave entitlements in the wake of the bombshell announcement in May's budget.

Until there is an agreed position across the public service, which was singled out and accused of "double-dipping" in an attempt to sell the policy, everything is up in the air.

Can he respond to this assertion in the article? Can the parliamentary secretary confirm that his colleagues in the Department of the Prime Minister and Cabinet have absolutely no idea how to implement the government's policy on paid parental leave?




Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:41):  Perhaps I can make this comment with respect to The Canberra Times article, which I have not read but you have gracefully quoted a part of: what a sloppy and hopeless piece of journalism that is. The idea that there is some form of a lack of clarity—

Dr Chalmers interjecting—

Mr PORTER:  There are journalists of varying quality and acumen, and, based on the very little excerpt you have given to us about this particular article, I must say that is not the highest point in the art of investigative journalism which has graced the vocabulary of this chamber.

The position that the coalition has taken is that the $11,000-odd of paid parental leave that is provided for by the taxpayer through the auspices of the government should not be available to be taken by Commonwealth public servants who already have expansive and generous paid parental leave systems. The principle is that if you are a Commonwealth public servant who has a large, expansive and generous entitlement, which is of course also funded by the taxpayer of Australia, then you should not be able to also get a further taxpayer-of-Australia funded benefit. The principle is very clear.

The way in which that principle is enacted in the legislation is also very clear. What is less clear is whether or not there is going to be support to ease the passage of that principle, which is well-defined in legislation, through the parliament. To the extent that there may be uncertainty as to the future, that is not uncertainty created by the coalition government, nor pursuant to the principle nor pursuant to the drafting. That is uncertainty that you are creating, so maybe you should—

Dr Chalmers:  It is your policy, defend it!

Mr PORTER:  The policy is sound and the legislation is sound. Whether there is complete certainty is something which unfortunately is out of the control of any government who faces bloody-minded opposition. Maybe it is the case that we will find good support for this, as we did with our pensions package last evening from individuals—

An honourable member:  Why are you putting the Greens down?

Mr PORTER:  The Greens are lovely people. But any uncertainty here is caused by your side of politics refusing to do what is the right thing—that is, to move savings in one area of spending on families to very important, productive spending in another area.




Dr CHALMERS (Rankin) (10:44):  My question is to the parliamentary secretary. The Prime Minister told his cabinet earlier this month that there would be 'political and personal consequences' for leaking, after Fairfax Media published very detailed revelations of a cabinet debate on plans to strip citizenship from suspected terrorists.

My question is: can the parliamentary secretary tell us if the cabinet division is investigating ways to prevent future leaks and how much resourcing is devoted to finding the source of this leak?

The DEPUTY SPEAKER:  As it is 10.45am, the Federation Chamber will now consider the Indigenous affairs segment of the Prime Minister and Cabinet portfolio, in accordance with the agreed order of consideration. Perhaps, parliamentary secretary, you could take the member for Rankin's question on notice.




Mr PORTER (Pearce—Parliamentary Secretary to the Prime Minister) (10:45):  I would be very happy to do so.