House debates

Tuesday, 18 October 2016

Grievance Debate

Building and Construction Industry

6:40 pm

Photo of Andrew WallaceAndrew Wallace (Fisher, Liberal Party) Share this | | Hansard source

I rise to support the government's tenacity in re-establishing the Australian Building and Construction Commission. I am proud to be part of a government that seeks to clean up the building and construction industry and I am very pleased and proud to see that the Building and Construction Industry (Improving Productivity) Bill 2013 was passed in the lower house this afternoon.

The building and construction industry is one of the largest industries and employers in our nation. It employs one in 10 Australians. It represents eight per cent of our gross domestic product. The building and construction industry is the third largest industry on the Sunshine Coast. Indeed, based on 2011 statistics, more than 6,550 individuals in the electorate of Fisher were employed in the construction industry. I expect, given the current building boom on the coast, that figure is likely to have become significantly higher since 2011.

I have had the privilege of being intimately involved in the building industry in Victoria and in Queensland as a carpenter and joiner, a builder, a barrister, a mediator and an adjudicator over the past 30 years. In my maiden speech I advised the House that the building and construction industry was racked with self-interest and corruption. I saw that self-interest and corruption firsthand from day one of my apprenticeship.

At the age of 19, I started my carpentry apprenticeship. With all the bright-eyed enthusiasm of a young person starting out in a new career, I reported for duty on a commercial high-rise building site in the city of Melbourne. This was in the days of the now deregistered Builders Labourers Federation, run by the infamous Norm Gallagher. At morning smoko, I was confronted by two BLF henchmen. Whilst both standing over me—bearing in mind I was 19 years of age, probably about 65 kilos wringing wet—these two grown men, these two brave souls from the BLF, sought to intimidate me verbally and physically. It appears that the productivity of a first-year apprentice on his first day on the job was to great for these two fearless advocates of the union movement. Anyone who has ever worked on a building site would understand that the productivity of a first-year apprentice, let alone on their first day, is not exactly earth-shattering. It appears that I was sweeping the floor with too much energy and enthusiasm for these two heroes. One of them, poking me in the chest, warned me in a menacing fashion to, 'Slow down, son, slow down.'

I learnt that day to be very cautious of the union movement. Coming from a family of small-business operators, prior to that day I had no involvement with unions, least of all the militant unionism that was badly damaging the building industry in Victoria, which would see strike after strike bring the industry to its knees in the late 1980s. That same militant unionism is now rife in the Queensland building and construction sector, perpetrated by the Construction, Forestry, Mining and Energy Union.

I should point out that I am not anti-union. Although I have had a number of unfortunate experiences with the standover tactics of some union organisers, I actually believe that unions fulfil an important role in our modern-day society. Without unions, some unscrupulous employers would take advantage of their workers. But what I am opposed to is any form of corruption in our society, and that includes union corruption.

We on this side believe in the freedom-of-association laws that were introduced by the Howard government in 1996. Those reforms saw what we thought was an end to the signs that hung on almost every gate of every building site around the nation which boldly stated, 'No ticket, no start'. Some 20 years on, the signs have not returned, but the effect of those signs has. But now it is not just the unions that are enforcing forced unionism; it is the building companies themselves, who do the unions' bidding for the sake of industrial harmony. I reiterate: I am not anti-union, just anti-union corruption. Union members around this country would be well within their rights to demand answers of their union delegates and organisers, when we have seen recent proven, flagrant cases of stealing and fraud from union members' hard-earned membership fees. What we need in this country is workers to be able to choose who they want to represent them, if they want anyone at all, rather than be forced to be represented by some conglomerate, all-powerful, supposedly all-knowing super union.

The Royal Commission into Trade Union Governance and Corruption has found that union corruption in the building and construction industry is rife in almost every state and territory in this country. There has been conduct that the royal commission has referred to regulatory authorities and police for further investigation. Time does not permit me to go into the specific details of the many and varied case histories examined by the royal commission, nor would it be appropriate for me to do so in this venue whilst criminal proceedings are pending. However, the findings of the royal commissioner are a chilling reminder of how badly damaged the building and construction sector has become in this country—damage that has been caused by greed, self-interest, lawlessness and a misplaced belief in individual impunity. Indeed, the culture of lawlessness in the building and construction industry is so endemic that many of its participants seem to have lost all perspective of what is considered to be appropriate conduct.

It is time to restore the rule of law into the building and construction sector in this country. It is time to adopt the recommendations of Commissioner Dyson Heydon, a retired High Court judge and one of the most respected jurists in this country. In support of His Honour's recommendations, let us just take a quick look at history, when the ABCC was in existence between June 2005 and June 2012, until it was dismantled by Labor. When the ABCC was in operation, labour productivity in the construction industry grew by 20.6 per cent, or an average of 2.8 per cent per annum, while labour productivity for the whole of the economy grew by 8.2 per cent, or 1.1 per cent per annum. In other words, labour productivity in the building industry was three times greater than in the whole economy when the ABCC was operational. In the following three years post abolition, between June 2012 and June 2015, labour productivity in construction grew by 2.8 per cent, or 0.9 per cent per annum, while labour productivity for the whole economy grew by 6.2 per cent, or two per cent per annum. Between June 2005 and June 2012, when the ABCC was operating, an average of 10.6 working days were lost per 1,000 employees per quarter in the construction industry, which compares with just 4.3 working days lost per 1,000 employees for all industries. In the period post the ABCC, between June 2012 and June 2014, an average of 13.4 working days were lost per 1,000 employees per quarter in the building and construction industry, which compares with just 2.8 working days lost for all industries. While all industries' lost working days are on a downward trajectory, the building industry has been increasing post the abolition of the ABCC.

It should be remembered that, for every corrupt payment made in the building and construction industry, for every person receiving an illegal or inappropriate benefit, there is a party that writes the cheque or performs the work.

Corruption is a two-way street that leads to increased costs for the building and construction industry. There seems to be a misconception in the community that these increased costs are somehow confined to those within the industry itself. Nothing could be further from the truth. Collusion, third-line forcing, secondary boycotts and illegal strike activity, all of these types of activity, lead to increased costs for contractors, subcontractors, principals and ultimately the end user. Every dollar overspent in the building and construction industry is a dollar that is diverted from another worthy recipient project. It is a dollar that is not spent where it should be, with the mum and dad subcontractors, who have continuously to fight tooth and nail for every cent they earn. When government is the principal, every dollar that is overspent on a project is a dollar that is not spent on the construction and maintenance of roads, bridges, schools and hospitals. I call upon those opposite and those on the crossbench in the Senate to put partisan politics aside. (Time expired)