Event: BCA Chief Executive Bran Black interview with Laura Jayes, Sky News AM Agenda
Topics: NSW Digital Work Systems Bill
E&OE
Laura Jayes, AM Agenda Host: Joining me live now is Business Council of Australia Chief Executive Bran Black. He joins me here in the studio. You have deep concerns about this. What do they pivot on, is it privacy, is it overreach, is it too much union power?
Bran Black, Chief Executive: It’s all of the above Laura and thanks for having me on the show. So I think the key point here is that we don’t see a gap in the legislation first and foremost. So we think that the powers that unions need in order to be able to do their jobs already exist. So that begs the question, well, then what does this law do, or what does this proposed law do?
It gives unions effectively unfettered access to email systems, to payroll systems, to HR records, to the confidential information that businesses hold, their proprietary systems, their contracts. Union officials going on to premises, accessing all of this, no adequate protections in place for privacy, and also no protections at all in terms of cybersecurity, in this era of cybersecurity risk. It’s just a massive problem.
Laura: How do you think the unions would misuse this information, the worst case scenario?
Bran: Well, there are a whole series of scenarios in which this is problematic. I mean, you could have something as innocuous as a union official coming onto site with a USB that happens to have a virus on it, they put it into a system, and all of a sudden that imperils an entire company’s records.
You could have a situation where a union official happens to have a sister or a brother or a wife or a husband with a business that’s competing with the business that they’re inspecting, and there is no protection in relation to that. But one way or the other, you’ve got people who have access to data that could be personal, because let’s face it, nobody distinguishes in their computer files between the personal and not the personal. I certainly don’t. I imagine none of your viewers do. So it’s not as though you can do that with unions coming onto site and just accessing the premises.
Laura: Why the unions pushing for this? What’s their argument?
Bran: Well, their argument is that they need this in order to be able to understand how decisions with respect to work allocations are made.
Laura: Rubbish.
Bran: Well, it is because the powers already exist for, well, certainly the obligations for safe workplaces already exist. And in circumstances where there is an employer who might have done the wrong thing, then you can say, “Okay, well then you explain why what you’ve done isn’t right”, and then the obligation does go to the employer, and they have to say, “Well, this is how I’ve sought to comply with the law.”
Laura: We’re living in an era since the election of the Labor Government at a federal level, at least, I know this is a state law, where what unions ask for they generally get. So they have asked for, and why wouldn’t they keep on pushing, but it seems with this legislation Bran in some circumstances, the unions would have more power than the police.
Bran: Well, that’s absolutely the case. So if you have, as things stand right now, the police need a warrant in order to go onto premises and access records. Now, there are some situations already where unions can go on to premises, but they can’t access records as things stand right now.
This Bill would give them the capacity just to access those digital records, and that goes beyond the powers that the police have.
Laura: Okay, let’s talk about the economy more generally. Of course, we’ve seen a rate rise this week. Inflation back out of the bag, is going to peak in the middle of this year at 4.2 per cent, it’s well out of the target inflation band that the RBA wants to see.
We have government spending in the frame forcing inflation up. Then we have, you know, a really consequential budget this year. First of all, what is the state of the economy? Are you concerned about government spending?
Bran: Well, we think that the key concern that we’ve got, more than anything else, is real wages, because that’s ultimately how we all get ahead. And the challenge that we have at the moment is that we do need to make sure we are putting more controls in place with respect to government spending, but at the same time, and as Reserve Bank Governor Michele Bullock has said, the key thing we’ve got to do here is drive productivity.
It’s productivity that ultimately lifts real wages, and that means that you are putting less pressure on inflation. So in this Budget, we’re looking for initiatives and measures that can help put that, I guess, downward pressure on spending.
Laura: We had that whole summit last year, some great ideas, some brilliant minds around that table. Has anything from that been implemented? What would you like to see in the Budget that would specifically address this productivity problem?
Bran: So I will say I thought the Productivity summit was a really worthwhile investment, and that there have been some good things that have come out of it. Jim Chalmers is doing a review with respect to some of the aspects of trade that could make a difference, nuisance, tariffs, single front doors and so forth, looking at FIRB, those are all really useful prospects they help drive our opportunity as a country to grow our economy.
We do need to see more investment in reducing regulation. We’ve been saying that we need a 25 per cent cut in the cost of regulation for business. We’d like to see a commitment in that regard come forward in this Budget. And let’s be clear here, all that would do is put us on par with our key competitors, like Canada, the US, the EU. They’ve all got their own regulatory targets for reduction, we’d like to do the same.
By the same token, we think we’ve got to see holistic tax reform, reform that encourages investment, reform that doesn’t distinguish between different types of businesses and ultimately helps drive the investment that facilitates stronger productivity growth.
Laura: And government spending, what do you say about that?
Bran: What we do need to see are additional controls, we’ve been calling for this for some time in terms of government spending. We’d like to see a cap, for instance, of 2 per cent a year on the growth in government spending. We think these types of initiatives are really important.
Laura: Growth in government spending is one thing but what about the I mean, depending on who you speak to, the facts can be cherry picked here, but there has been an explosion in government spending. The public service, I think, has grown by about 25 per cent. Yes, people want the services that the government funds and provides, but would you like to see not just a reduction in growth in spending, but a reduction in spending?
Bran: Yes, is the short point, and we think there are opportunities to do that as well. One of the key areas in which you can reduce spending is, of course, by reducing regulation. If you reduce regulation, you reduce the size of the bureaucracy that’s needed in order to manage that regulation. So that’s one thing.
A second opportunity is to look at the overlap between state and federal laws, particularly in areas like health and education, where we know there is extensive overlap. And then we need to start looking very seriously at programs and our costs and expenditure in that regard, we need to consider whether or not we should be investing more in preventative health rather than acute care, so that we’re trying to offset future costs by spending a little bit more now, and we need to consider programs like the NDIS, which are very seriously out of control in terms of spending growth at the moment. The government’s taking some important steps in that regard, but there’s still a long way to go.
Laura: What is your view when it comes to the capital gains tax discount, whether that should be reviewed, and would you distinguish between investments made in housing and other things, because, of course, we see everything through the lens of the housing crisis at the moment?
Bran: I think that’s a really important question. We are open to a conversation in terms of the capital gains tax discount, and we agree that if you’re looking at this particular discount, you need to have regard to what type of incentives are required to focus on the generation of new housing, because ultimately, if you want to put downward pressure on housing, you’ve got to generate more supply. It’s that simple.
But we do say that if you’re looking at the capital gains tax discount, you need to be doing it holistically, because the tax system is a system, the clue is in the name, it’s not the case that you just pull one lever and it has no effect on anything else. We think that we should be looking holistically at our taxes on individuals, our taxes on companies, our indirect taxes, and, of course, the type of taxation arrangements that we see at the state and territory level as well.
Laura: Okay, it’s not a no, but a warning?
Bran: We just think it’s important to look at the system holistically, and it’s by no means a no, we’re very open to that conversation but the country needs productivity growth, and we know that tax is a core lever to deliver that. We want to see that holistically, rather than simply having it in one key area.
Laura: Okay Bran, great to talk to you as always. We’ll see you soon.
Bran: Thanks so much. Laura.