Joe Hockey (North Sydney, Liberal Party, Minister Assisting the Prime Minister for the Public Service) Share this | Hansard source

No, I do not, for two reasons: one is, as I outlined in my response just 30 seconds ago, obviously the impact of a drought is significant when it comes to farm productivity, and that has an impact on the economy. Naturally enough, if a farmer and four farmhands are working on a farm and they have got no crop, productivity is down. And that is a significant issue. It is also the case that we have significant initiatives in the budget that the Labor Party voted against—that is, the Welfare to Work initiatives. On 1 July those initiatives will create a work obligation of 15 hours a week for around 233,000 Australians of working age who are currently in receipt of a single parent pension or a partnered parent pension. Those people who are coming into the workforce will represent probably the greatest surge of new employees into the marketplace since World War II in absolute numbers; there will be nearly a quarter of a million people coming into the workplace. Some of them do work. How much they work we are not sure, but it is estimated that around 140,000 of the 233,000—maybe a few more—are currently undertaking some work.

That infusion of labour into the marketplace is going to have a dampening impact on productivity because these people are essentially unskilled. They have been out of the workforce for an extended period of time in many cases; in other cases they have chosen to not be in the workforce, and therefore they are entering the workplace with low skills and need to be skilled up. Given the fact that, as revealed in these budget papers, the government is significantly increasing funding for training and is increasing funding for education, you can see that we are going to make a contribution to the skilling up of these people. Naturally enough, when you create a surge of nearly a quarter of a million workers into a workforce where there are 10.5 million workers, it is going to have an impact on productivity. But, overall, there is no doubt that our workplace relations changes do have a positive impact on productivity, because flexibility helps to deliver better productivity. It is not difficult to work out. If you have a home based mum who is remunerated on the basis of hourly effort and that home based mum is able to work from home and undertake the work at flexible hours of her choosing, then naturally enough it is more likely that she will improve productivity than if she has a very limited and inflexible arrangement on site at a particular workplace. It is also the case that you get the classic example of industrial relations reform helping to deliver better productivity.

The waterfront is the best example of that. The Labor Party was defending a system of 17 crane movements per hour prior to our reform of the waterfront, and after our reform of the waterfront there were 27 crane movements per hour. In fact, a shipping company came to see me recently and said they had massively improved their productivity in relation to shipping activity. They are happy to go on the public record—I just do not have the notes of the meeting in front of me—saying that, through reform of their workplace, they were able to significantly improve productivity, and that is one of the reasons why they are investing in a new ship that is currently being built to service Australian ports. So the evidence is out there that industrial relations reform does help to deliver better productivity. The best evidence is that what takes four hours to deliver in services today took five hours in 1996.

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