We note the passing of the Road Safety Remuneration Tribunal, in Canberra this week, aged 4 years. The tribunal was abolished this week by the federal parliament after a short but intense battle with owner-drivers.
The Road Safety Remuneration Tribunal was established in 2012, under the Gillard Labor government and fathered by Labor minister Anthony Albanese. The tribunal’s godparents were the Transport Workers Union, which had campaigned for the wage setting body under the ruse of “road safety”.
As Grace Collier explained in The Australian:
In November 2011, Prime Minister Julia Gillard lunched with union powerbrokers at Kirribilli House. “She gave the unions everything they wanted,” Martin Ferguson later said. “It was ‘lock in behind me and I will deliver for you’.”
And Gillard did, in so many ways, although not all of these ways became apparent until much later on.
In 2012, not long before Gillard was overthrown by Kevin Rudd, “safe rates” legislation was passed and a new body, the Road Safety Remuneration Tribunal, was set up. Hansard shows that in 2014, the Coalition’s Minister for Northern Australia Matthew Canavan reflected on the event: “I remember thinking, ‘I do not exactly know how this is going to deal with safety’ … it was something that was pushed by the Transport Workers Union at the time.”
The Coalition government made a commitment before the last election to review the tribunal. The review in 2014 recommended that the tribunal be stripped of its power to set mandatory rates. The system was reviewed again in 2016 which showed that the orders of the tribunal will result in a net cost to the economy in excess of $2 billion over fifteen years.
These reviews found no link between rates of pay and road safety.
The practical effect of the RSRT is to push owner-drivers out of the market… The unique success of the TWU’s achievement in the establishment of the RSRT was that it framed a marginal issue – the link between rates of pay and safety – as the central issue and then drove legislative change through its political mates.
There were a series of events leading to the tribunal’s demise. It started with the Contractor Driver Minimum Payments Road Safety Remuneration Order 2016 that the tribunal made in December 2015 – which threatened to put 60,000 owner-drivers out of work. In summary the order forced owner-drivers to charge inflated rates, rather than being allowed to compete on price against unionised employee-drivers.
In one column Grace Collier explains the bizarre effects that the order would have on Keith, a self-employed owner driver:
Every week, Keith drives cattle for farmers all around NSW. Right now, if a farmer wants Keith to pick up a few head along his way they pay him $175. After April 4, for the same service, the farmer legally will be required to pay Keith $784. If the farmer does not pay this amount, they can be prosecuted by the Fair Work Ombudsman and might be fined up to $54,000.
In other, Collier pointed out that it would affect ordinary Australians just trying to move house:
According to official advice from the Fair Work Ombudsman, when you go to hire your removalist, through no fault of your own, you could be investigated, prosecuted and fined by the Australian government.
The Institute of Public Affairs’ Simon Breheny spoke with Craig Prosser, owner of Pross Haulage, about the human cost of the tribunal.
The order was to take effect from 4 April 2016. As that deadline approached, attempts were made to vary the commencement to give owner-drivers more time. On 1 April 2016, the tribunal decided not to vary the order, but later that day an interim order of the Federal Court stayed the operation of the tribunal’s order. However, on 7 April 2016 the Federal Court decided not to continue the stay on the tribunal’s order, making the new rates law.
On 10 April 2016, the Turnbull government committed to abolishing the Tribunal if it was re-elected this year. Just days later, the Turnbull government changed its mind and decided that it would introduce legislation to abolish the tribunal when parliament resumed to re-consider the bill to re-establish the Australian Building and Construction Commission.
One has to question why this did happen years earlier when the Coalition was elected to office – as the IPA’s Mikayla Novak pointed out in a piece for On Line Opinion.
On 17 April 2016 a convoy of hundreds of trucks descended on Parliament House to protest the Tribunal’s order, and urging its abolition. The following night, a bill to abolish the tribunal passed the Parliament.
The tribunal will be remembered for its loyalty and commitment to the TWU right up to its death. “The tribunal has today entertained a proposal by the TWU [to defer commencement of the order] that it emphatically rejected just weeks ago, when such a proposal was made by over 800 submissions by owner-drivers and opposed by the TWU,” employment minister Michaela Cash said.
The Tribunal is survived by the TWU, Bill Shorten and the Labor Party, who have refused to rule out bringing back Tribunal back to life if elected to government this year.