Govt and business attack Labor's new IR plan

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Govt and business attack Labor's new IR plan

The Federal Government and business organisations have accused Labor of threatening the nation's economy with its new industrial relations policy — a charge the ALP has rejected.

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The Federal Government and business organisations have accused Labor of threatening the nation's economy with its new industrial relations policy — a charge the ALP has rejected.

Opposition Leader, Kevin Rudd, said employer organisations were concerned about Labor's IR plans because they would lose the almost total power that the Government's WorkChoices laws had given them.

Prime Minister John Howard said that Labor had adopted an industrial relations policy that will undermine the economy.

'It will hurt small business,' he said. 'It will re-inject the union movement at a time when only 15% of private sector employees belong to unions, it will re-inject the union movement right back into every workplace.'

'Another recession'

Treasurer Peter Costello suggested that Labor's policies might bring about another recession.

Addressing the Liberal Party of Victoria conference, he said that in the old days of centralised wage fixing, wage settlements in profitable industries were applied across the economy, resulting in general wage increases, inflation and the inevitable hangover.

'Nothing could be a bigger threat to the Australian economy at the moment than moving away from decentralised wage fixation and going back to the past,' he said.

Costello said Australia historically faced a recession every 10 years.

'We normally end badly'

'We have normally ended badly after we have had prosperous times,' he said. 'We have normally had a recession every 10 years or so in this country and quite often because of prosperous times.'

He said centralised wage fixing would generate general wage and inflation pressures and would bring to an end a period of prosperity 'the like of which we have not seen in terms of continuous expansion in the Australian economy'.

'Threatens nation's prosperity' — BCA

The Business Council of Australia (BCA) said Labor's policy amounted to a significant reversal of workplace flexibility that would threaten the nation's economic prosperity.

BCA President, Michael Chaney, said despite claims Labor's policy was forward-looking and fair, 'in reality it involved a massive re-regulation of employer-employee relations which would turn the clock back on productivity and growth, and undermine job creation and real wage growth over time'.

'The extent of the radical shift for Australia's workplace relations outlined in the policy is very worrying,' he said.

'Will damage the economy' — ACCI

The Australian Chamber of Commerce and Industry (ACCI) described Labor's industrial relations policy, released today, as a great disappointment to business and a harsh and unnecessary hit that will damage the Australian economy.

'It is hard to see how the policy will create one new job in Australia,' said ACCI chief executive Peter Hendy.

Hendy said Rudd had capitulated to ACTU demands.

'Rudd promised business on 17 April that he would ease the regulatory burden, however his industrial relations policy has done the very opposite by imposing a triple whammy of new regulation on employers — new legislative obligations, new award obligations and new collective bargaining obligations,' he said.

Corrects imbalance, says Labor

However, Opposition IR spokeswoman, Julia Gillard said Labor's policy corrects an imbalance in industrial relations by putting power back in the hands of working families.

She said the policy will not be significantly altered in response to business objections.

'This package is Labor's election policy,' she said. 'We have said to the business community that under a Rudd Labor Government, when we turn this policy into law we will be happy to work with the Business Advisory Group on the very many details of the policy, now I don't think you can be fairer than that.'

Rudd said he understood why some businesses are concerned about the policy and he is aware of the concerns.

'Some business leaders would say that, and the core reason for it is this - Howard's industrial relations laws have placed virtually all the power in the hands of employers, have taken virtually all the power away from employees,' he said. 'He's gone too far with these laws and we have outlined our intention to restore the balance.'

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