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2014-05-19

abc cuts

Telco e-Bulletin 2014 - #8

1.  Abbott budget slashes "social wage"

2.  Budget brings bad news for apprentices, trainees

3.  Workers' safety net cut

4.  Award modernisation update

5.  CWU meets with Visionstream on new Enterprise Agreement

6.  NBN workforce set to increase in NT

7.  NBN must pass 100,000 premises a month

8.  Abbott keeps minimum wage in firing line

9.  Low wage labour in the US: a warning to Australian workers

Abbott budget slashes “social wage”

The Abbott government’s federal budget represents a systematic attack on the living standards of ordinary Australians.

The most vulnerable –the aged, the unemployed, students and apprentices, those with disabilities – will be the hardest hit.

But all Australians will be asked to pay more for certain services which it should be the role of government in a modern, democratic society to provide.

The introduction of the Medicare co-payment will, in the first instance, hurt low income families hardest and may not be noticed by those who are better off.  But it is the thin edge of the wedge in getting Australians to accept the winding back of free, universal health care and moving to a user-pays system where only the wealthy can afford top quality care.

At the same time, cuts are being made to federal health and education payments to the states. The changes are designed to save the federal government $80bn in total by 2024-25.

Meanwhile unemployed youth will have to wait 6 months before they are eligible for benefits and the real value of pensions, including the aged and disability pensions, will be deliberately whittled away.

The union movement has condemned what ACTU President Ged Kearney has described as the biggest attack on the social wage Australia had seen.

“This is a savage attack on the standard of living that Australians have worked hard for,” she said.
“The Liberal Government vision is of a harsher, less equal Australia.”

Budget brings bad news for apprentices, trainees

Young people will have to carry more of the costs of their own education and training in the brave new world of Treasurer, Joe Hockey.

And it’s not only university students who will be feeling the pain, with higher fees and higher interest on HECS repayments.

The Coalition government also wants apprentices to pay up.

Under the new regime the Australian Apprenticeships Incentives Program, known as 'Tools for your Trade', will be wound down, with its spending reduced by $914.6 million over four years. The programme gave cash to apprentices to buy equipment needed for their work.  

In its place, the government will introduce a new programme to support apprentices which is based on a higher education loan-style model. The Trade Support Loans Program will give apprentices a loan of up to $20,000 over a four-year apprenticeship.

The new program will cost $439 million over four years. So the government has “saved” half a billion – or taken it out of the pockets of apprentices.

At the same time, the government will wind up the National Workforce Development Fund (NWDF) which has provided funding for both apprenticeships and traineeships in areas where there are skill shortages such as the NBN roll-out.

It is to be replaced by an Industry Skills Fund which will have a narrower industry focus and which will be tailored largely to the needs of small and medium businesses.

Not much use for the NBN project then!

Workers’ safety net cut

Sometimes it’s the little things that tell you most about people – or governments.

One of the less publicised measures in the Coalition’s budget is the cut to the safety net currently provided to workers whose employers go broke and can’t pay them their entitlements.

Under the current Fair Entitlements Guarantee scheme, the federal government underwrites those entitlements when a company collapses.

Now it will only compensate such workers at the minimum level set by the National Employment Standards. Too bad if you have had better entitlements as a result of successful bargaining.

Interestingly, though, the Abbott government is not being nearly so thrifty when it comes to looking after its industrial policeman for the building industry. The Fair Work Building Inspectorate is getting a 16% boost in funding.

Now what does that say about this government’s priorities?

Award modernisation update

The process of modernising the Telstra and Optus awards is proceeding slowly but surely.

As reported in earlier E-bulletins, the CWU is supporting the creation of modern enterprise awards in both these companies. In the absence of such awards, most of our members in Telstra and Optus would be covered by the modern telecommunications industry award.

The CWU considers that, on balance, that award would provide a weaker safety net for bargaining.

Discussions with both companies have proceeded productively over several months but are now reaching the point where unresolved issues will have to be referred to the Fair Work Commission.

A further report on these issues will be provided to members once the discussions have concluded.

CWU meets with Visionstream on new Enterprise Agreement

The CWU is continuing negotiations with Leighton’s subsidiary, Visionstream, for a new Enterprise Agreement.

The agreement will cover directly employed workers at the company, not the many sub-contractors it engages.

It will also cover a number of employees who have been transferred to Visionstream from other companies such as John Holland (another Leighton’s subsidiary) and Optus, which last year outsourced its 4G mobile network construction to Visionstream.

The previous entitlements of these employees are currently guaranteed by the transmission of business provisions of the Fair Work Act but their conditions will be determined by the new Visionstream agreement once it is made. 

Ensuring a fair outcome for these employees will be one of the challenges of the negotiations.

To date the main items under discussion have been the classification structure and allowances, including travel allowance. Visionstream members wishing to put any particular items on the agenda for the negotiations should contact their state branch.

NBN workforce set to increase in NT

The number of NBN subcontractors working in the Northern Territory is set to jump by 60% as NBN Co moves to engage a new prime contractor for the region.

NBN work in the NT has progressed slowly. Following the collapse of the initial contractor for the area, Syntheo, in March last year, management of the roll-out was taken over by NBN Co itself. But at the end of 2013 there were still only 304 premises in the NT in a position to receive an active service.

That number has now risen to over 5,000.  The President of the CWU’s SA Branch, Steve Butterworth, says the increased number of serviceable premises reflects the closer supervision provided by NBN Co to those doing the work. This has increased efficiency by reducing the number of reworks needed.

But according to reports, skill shortages still pose a major problem for construction in the Territory.

With the federal government now cutting Commonwealth funding to programmes that have supported NBN training, this problem is set to continue well into the future.

NBN must pass 100,000 premises a month

NBN Co will have to increase its run rate to 100,000 a month if the roll-out is to be completed on time according to NBN Co Chair, Ziggy Switkowski.

Currently, he told a recent Australian Industry Group event, NBN Co is passing about 6,000 premises a week.

“We have to increase that by a factor of four,” he said, if the project is to be completed “2020-ish”.

That’s hardly news, though. In fact NBN Co corporate plans have always projected an even higher peak “run-rate”  - 6,000 a day or 30,000 a week (assuming no weekend work), in fact.

According to the initial 2011-13 plan, NBN Co should be hitting that target now, in 2014. But of course it’s not.

“A significant risk to achieving this planned rate,” that Plan warned, “is a possible economy-wide shortage of construction resources at an acceptable cost. In particular, this will be dependent on the overall market demand for labour.”

The move to Fibre-to-the-Node will help lift the run-rate by reducing the need for civil works and enabling multiple premises to be “passed” by the construction of one node. But it is by no means clear that this will entirely solve the skill shortage problem.

Such shortages can only be overcome by greater investment in training than has occurred to date, not least because of the pyramid contracting structure being used in the roll-out.

The Coalition government has yet to show that it understands the obstacles facing the project at this level.

Abbott keeps minimum wage in firing line

The Abbott government has confirmed that the minimum wage will be one of items on the agenda for the Productivity Commission review of Australian workplace laws.

The confirmation comes in the wake of the government’s Commission of Audit report which recommended cuts to the real level of the minimum wage over the next 10 years.

Under the Commission of Audit plan, Australia's minimum wages would have been reduced to 44% of average weekly earnings, wiping off $136 per week in today’s dollars, taking the minimum wage down to around $480 per week, or just $12 per hour.

After ten consecutive years of real wage cuts, Australia's minimum wage would end up as one of the lowest in the OECD. The pool of cheap labour created by such cuts would in turn undermine wage levels throughout the whole economy. In fact, that’s the idea.

Unions are warning their members not to be complacent and said the Productivity Commission review into the Fair Work Act could also come up with radical changes to the minimum wage.

"This review will put the whole workplace system on trial – pay and conditions, rights at work, collective bargaining and unfair dismissal and now the wage safety net," ACTU President Ms Kearney said. 

“Workers need to understand the scope of this review, because its outcomes will have a direct impact on them.

Low wage labour in the US: a warning to Australian workers

Recent figures from the US show that low wage jobs in that country are continuing to grow at the expense of decently paid jobs, despite the so-called “economic recovery” in that country.

A report issued by the National Employment Law Project in late April shows that since the financial crash of 2008, 1.9 million high- and average-paying jobs in the US private sector have been eliminated and replaced with some 1.8 million low-wage jobs.

In the auto sector alone, wages for new workers have been slashed by more than 50%. Three decades ago, an auto assembly worker would have received $30 per hour or more.

Now, the starting wage for new auto workers is $15 per hour or less, barely above the wages that prevail in the retail and food service sectors, where the “working poor” are concentrated.

Over 10 million American workers are officially classified as “working poor” i.e. in work but living below the poverty line. But then in the US the federal minimum wage is $7.25 an hour. And there is plenty of opposition to the Obama administration’s proposal to lift it to the princely sum of $10.10.

The US is rapidly becoming a low skill, low wage economy where millions are trapped in poverty. This is the future that could face Australia if the agenda of big business, as seen in the Commission of Audit recommendations, is adopted by the Coalition government.

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