John Passant
The newly elected O’Farrell conservative Coalition government in New South Wales is removing unions from the public sector pay negotiating framework and imposing public sector wage cuts by limiting funding for pay increases to 2.5 percent.
Governments across Australia have been cutting public sector wages. Here in the ACT the local Labor Government imposed a 2.5 percent pay limit on its own employees. The Community and Public Sector Union leadership huffed and puffed for a little while before surrendering completely.
Federally the Gillard Labor Government has imposed an effective 3 percent per annum pay limit on its employees in negotiations over pay rises for the next 3 years.
And you guessed it, the CPSU leadership is huffing and puffing right now but you can be confident they will do nothing to fight their ‘own’ Government. Commonwealth public servants are stuffed, unless they organise in their workplaces and across Departments to fight Gillard Labor for real pay increases.
You see, 2.5 percent and 3 percent per annum are real wage cuts. According to the Reserve Bank of Australia inflation in Australia for the year ended 31 March 2011 was 3.3 percent. Removing ‘volatile’ items like fruit and veggies reduces that to 2.6 percent and even on that ‘unlived’ figure – most of us do in fact eat fruit and veggies – 2.5 percent wage rises are wage cuts.
But that is not the end of the story. The RBA noted in a meeting of 3 May this year that ‘if economic conditions continued to evolve as expected, higher interest rates were likely to be required at some point if inflation was to remain consistent with the medium-term target.’ The target is 2 to 3 percent.
In other words the RBA fears that inflation may increase above that 3 percent figure in the longer term because, basically, of the resources boom.
Historically wage rises for public sector workers are lower than for private sector workers. That at least has been the experience over the last few years as some private sector wages are boosted by the resources boom. However the spread is very uneven.
What Labor federally and in the ACT have done or are attempting to do is to cut real wages both to reduce government spending and make workers pay through cuts and further inefficiencies in public services like hospitals, schools and public transport.
But this is also about Labor trying to send a message to private sector employers – don’t increase wages. Tell that to a company desparate for skilled workers.
There’s the rub. The mining boom has created a demand for specific skills, so much that the average mine worker, according to the Australian Bureau of Statistics, now earns $117,500 a year, well above the national average wage of $68000.
The failure of government neoliberalism to adequately fund education, training and skilling for the current and foreseeable future workforce, the cuts to immigration and the xenophobia that both major parties encourage for base political reasons, means that some workers are in an extremely good bargaining position.
For example, according to the same ABS report, mining employers make over $600000 per mining employee. They are for that reason prepared to pay over the odds to secure skilled workers and exploit them. The mining industry has the highest profit rate of any in Australia – over 33 percent.
Barry O’Farrell and his conservative Coalition were elected in New South Wales in March this year after 16 years of Labor rule. His first piece of legislation removes the power of the New South Wales Industrial Commission to set wages and conditions and gives it to the Government. This takes Labor’s attacks on public sector employees like nurses and teachers and firefighters much further than Labor was or is prepared to countenance.
Whereas Labor’s approach has been to use the trade union leadership to control the workforce and oversee an historic shift in gross national income to capital at the expense of labour, O’Farrell is about removing unions altogether from the wage fixing process.
O’Farrell has gone much further by removing arbitration, having the government set conditions as well as wages and removing any way for union bureaucrats to meaningfully act as negotiators between labour and capital within the system.
What happens in the public sector then has the potential to flow on to the private sector.
This is a fundamental attack on workers’ rights. It is positioning the ruling class for the future when it knows it will have to viciously attack all workers’ living standards to restore profit rates.
It is positioning those employers now who are on the slow track of the economy – the non-mining sector essentially – to do the same by attacking jobs, wages and conditions.
O’Farrell will limit funding for public sector pay increases to 2.5 percent. Any pay increase above that must be paid for out of ‘savings’. ’Savings’ mean job losses – less nurses, less teachers, less firefighters, less transport workers.
The real question is will the union bureaucracy and workers fight for a role for unions in wage negotiations and for more pay without ‘savings’ . Or will they accept the abolition of any role for unions and real wage cuts and job losses?
The union leadership looks as if it will argue for some sort of advertising and information campaign, some demonstrations and a useless ‘vote Labor’ approach. That is a 4 or more likely 8 or 12 year strategy. Waiting doesn’t feed the kids or pay the other bills.
All around the world workers and others have taken direct action to fight dictatorships, austerity programs and defend union rights. From Egypt to Wisconsin to Spain workers and young people have shown their strength and fought against a global ruling class and its local equivalents intent on making workers pay for the crises of capitalism.
Is there a way to beat O’Farrell’s attacks on union rights and living standards?
Yes. Bring Tahrir Square to Sydney, and in the words of Egyptian blogger and socialist Hossam el-Hamalawy then take ‘Tahrir to the factories, the universities, the workplaces.’
Some unions and members have mentioned strikes. There are 350,000 NSW public sector workers whose pay, conditions and jobs Barry O’Farrell is attacking. Teachers, nurses and firefighters could shut down the schools, hospitals and fire stations across New South Wales tomorrow. That is the way to beat O’Farrell.
Governments across Australia have been cutting public sector wages. Here in the ACT the local Labor Government imposed a 2.5 percent pay limit on its own employees. The Community and Public Sector Union leadership huffed and puffed for a little while before surrendering completely.
Federally the Gillard Labor Government has imposed an effective 3 percent per annum pay limit on its employees in negotiations over pay rises for the next 3 years.
And you guessed it, the CPSU leadership is huffing and puffing right now but you can be confident they will do nothing to fight their ‘own’ Government. Commonwealth public servants are stuffed, unless they organise in their workplaces and across Departments to fight Gillard Labor for real pay increases.
You see, 2.5 percent and 3 percent per annum are real wage cuts. According to the Reserve Bank of Australia inflation in Australia for the year ended 31 March 2011 was 3.3 percent. Removing ‘volatile’ items like fruit and veggies reduces that to 2.6 percent and even on that ‘unlived’ figure – most of us do in fact eat fruit and veggies – 2.5 percent wage rises are wage cuts.
But that is not the end of the story. The RBA noted in a meeting of 3 May this year that ‘if economic conditions continued to evolve as expected, higher interest rates were likely to be required at some point if inflation was to remain consistent with the medium-term target.’ The target is 2 to 3 percent.
In other words the RBA fears that inflation may increase above that 3 percent figure in the longer term because, basically, of the resources boom.
Historically wage rises for public sector workers are lower than for private sector workers. That at least has been the experience over the last few years as some private sector wages are boosted by the resources boom. However the spread is very uneven.
What Labor federally and in the ACT have done or are attempting to do is to cut real wages both to reduce government spending and make workers pay through cuts and further inefficiencies in public services like hospitals, schools and public transport.
But this is also about Labor trying to send a message to private sector employers – don’t increase wages. Tell that to a company desparate for skilled workers.
There’s the rub. The mining boom has created a demand for specific skills, so much that the average mine worker, according to the Australian Bureau of Statistics, now earns $117,500 a year, well above the national average wage of $68000.
The failure of government neoliberalism to adequately fund education, training and skilling for the current and foreseeable future workforce, the cuts to immigration and the xenophobia that both major parties encourage for base political reasons, means that some workers are in an extremely good bargaining position.
For example, according to the same ABS report, mining employers make over $600000 per mining employee. They are for that reason prepared to pay over the odds to secure skilled workers and exploit them. The mining industry has the highest profit rate of any in Australia – over 33 percent.
Barry O’Farrell and his conservative Coalition were elected in New South Wales in March this year after 16 years of Labor rule. His first piece of legislation removes the power of the New South Wales Industrial Commission to set wages and conditions and gives it to the Government. This takes Labor’s attacks on public sector employees like nurses and teachers and firefighters much further than Labor was or is prepared to countenance.
Whereas Labor’s approach has been to use the trade union leadership to control the workforce and oversee an historic shift in gross national income to capital at the expense of labour, O’Farrell is about removing unions altogether from the wage fixing process.
O’Farrell has gone much further by removing arbitration, having the government set conditions as well as wages and removing any way for union bureaucrats to meaningfully act as negotiators between labour and capital within the system.
What happens in the public sector then has the potential to flow on to the private sector.
This is a fundamental attack on workers’ rights. It is positioning the ruling class for the future when it knows it will have to viciously attack all workers’ living standards to restore profit rates.
It is positioning those employers now who are on the slow track of the economy – the non-mining sector essentially – to do the same by attacking jobs, wages and conditions.
O’Farrell will limit funding for public sector pay increases to 2.5 percent. Any pay increase above that must be paid for out of ‘savings’. ’Savings’ mean job losses – less nurses, less teachers, less firefighters, less transport workers.
The real question is will the union bureaucracy and workers fight for a role for unions in wage negotiations and for more pay without ‘savings’ . Or will they accept the abolition of any role for unions and real wage cuts and job losses?
The union leadership looks as if it will argue for some sort of advertising and information campaign, some demonstrations and a useless ‘vote Labor’ approach. That is a 4 or more likely 8 or 12 year strategy. Waiting doesn’t feed the kids or pay the other bills.
All around the world workers and others have taken direct action to fight dictatorships, austerity programs and defend union rights. From Egypt to Wisconsin to Spain workers and young people have shown their strength and fought against a global ruling class and its local equivalents intent on making workers pay for the crises of capitalism.
Is there a way to beat O’Farrell’s attacks on union rights and living standards?
Yes. Bring Tahrir Square to Sydney, and in the words of Egyptian blogger and socialist Hossam el-Hamalawy then take ‘Tahrir to the factories, the universities, the workplaces.’
Some unions and members have mentioned strikes. There are 350,000 NSW public sector workers whose pay, conditions and jobs Barry O’Farrell is attacking. Teachers, nurses and firefighters could shut down the schools, hospitals and fire stations across New South Wales tomorrow. That is the way to beat O’Farrell.
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