29/03/2008

News Item

Enough talk, time for Labor to deliver

AS far as the business community is concerned, the new Labor Government is finally reaching crunch time.

Almost five months after the landslide victory delivered Kevin Rudd to the Lodge but, more importantly for business, Wayne Swan to the Treasury, Australia's business leaders are ready to judge.

The honeymoon period is effectively coming to an end and this week's Council of Australian Government (COAG) meeting in Adelaide was a litmus test.

COAG has been the target of criticism for years for being a complicated talkfest that delivered little for industry and stalled genuine reform that was needed for business.

There are two key platforms of interest to business, in the Rudd Government's push to simplify business regulation and make reform more efficient.

At the top of the agenda is the plan to harmonise on a national basis the current maze of occupational health and safety (OH&S) laws which exist among the states. Second is reshaping the payroll tax system.

The biggest leap forward on the OH&S front, which has been on the COAG table for years, was the establishment of a definitive timetable to put the new laws in place.

COAG set the date that an intergovernmental agreement needed to be set up by May this year, with the legislation to be developed by September next year.

The Government has placed the onus on the states' workplace and industrial relations ministers to bolster the framework for the laws.

The move to put a time line in place has been welcomed by business, which sees it as a long-awaited burst of pace being injected into the snail's pace development of the national harmonisation.

But for all the enthusiasm, there is an understandable worry about what exactly the new national laws will contain.

Peter Anderson, the acting chief executive of the Australian Chamber of Commerce and Industry (ACCI), believes the time has come for content to be added to the Government's plans.

"There's a big open question that if the OH&S regulations end up looking like NSW's laws, that would be a very large regressive step," Mr Anderson said.

"We're saying that we see the national harmonisation has regulatory efficiencies and that would be attractive to nationally operating companies.

"But the key question is what the content is."

The ACCI's major concern is that the national laws could include the clause that exists in NSW that the onus of proof in a workplace accident automatically lies with the employer.

"That is a completely unacceptable proposition from a business point of view," Mr Anderson said.

Second on the list of worries is that in NSW, OH&S breaches are dealt with criminally, meaning workplace bosses could find themselves in jail.

For the major companies, the worry in the laws is any hindrance to attracting talent. Who would want to manage a mine site with the constant threat of a stint behind bars if a major accident were to happen?

The corporates have lobbied to make sure the jail clause is not duplicated in the national legislation.

Heather Ridout, the chief executive of the influential Australian Industry Group, said the pace of the Government would be judged on the pace of the reforms.

"The momentum will need to be maintained if real progress is to be made," Ms Ridout said.

"The area of OH&S harmonisation is rightly nominated as a top priority. However, even 18 months is a long time to wait for consensus to emerge on a policy area that has been the subject of many reviews and analysis at a state level."

Australian Bankers Association chief executive David Bell is fearful that the influence of unions in the area of workplace safety could duplicated in the new laws.

Under the current NSW situation, "moiety" exists -- a scenario in which third parties can take action on a worker's behalf and can be entitled to receive part of any compensation that is awarded. "It's inefficient and costly to have different rules in different states," Mr Bell said. "With moiety -- the third party can be a trade union -- we think that's entirely inappropriate."

The core component of the current COAG agenda is the abolition of the red tape which exists for businesses that operate across state borders.

The Business Council of Australia has estimated that the excess of regulation costs domestic businesses $16 billion a year.

Its research findings show there are about 32,000 businesses that operate across state borders.

Greg Gailey, the former boss of Zinifex who now heads the BCA, said business in some quarters faced a stranglehold operating interstate.

"Business regulation remains an outdated state-based system that has more in common with the 1950s than the needs of an economy operating in a fast-paced, competitive international economy," Mr Gailey said.

The Rudd Government in its first few months has taken on a corporate focus. With the global equity markets in tumult, the Government has been forced to examine reforms for financial market transparency and operation.

On the COAG agenda was a bold government initiative to address federal-state financial relations at the same time as looking at credit protection for mortgage broking customers and clearing up the grey areas of margin lending. The forum ordered a green paper into margin lending and into the role of non-bank lenders in the financial system.

So far in the first five months, corporate figures have been impressed by the Government's consultative approach to business. Mr Rudd and Mr Swan have done the rounds of the boardrooms and spoken to prominent senior bankers, keen to gauge their thoughts on the state of the financial markets. The approach is seen as different from the previous government's jawboning on some issues.

"The Government has made a pretty strong start and has indicated that it needs to work with the private sector," Mr Anderson said. "We've been through the political process ... now it's time to roll up the sleeves and get into delivering the reforms."

source: http://www.news.com.au/business/story/0,23636,23450246-462,00.html