The Impact of the ABCC on Construction Industry Remains Unknown

Wednesday, March 30th, 2016
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Malcolm Turnbull is telling voters his building industry watchdog will make the construction sector more productive but that’s not what the Productivity Commission says.

The prime minister is also pledging a restored Australian Building and Construction Commission (ABCC) would be a tough cop stamping out criminality in construction.

But Australia has just had a two-year royal commission – with powers similar to the ABCC – investigating trade unions and the construction union in particular.

Its record to date is a series of charges against union officials dropped or dismissed by courts – most recently this week.

Mr Turnbull has claimed that when the ABCC and its predecessor, the Building Industry Taskforce (BIT), was last in operation, productivity in the construction industry lifted by 20 percent.

He cited analysis of the industrial relations landscape by the firm Independent Economics.

However the reliability of the Independent Economics work, commissioned by the Master Builders’ Association, has been questioned by the Productivity Commission.

“When scrutinised meticulously, the quantitative results provided by IE or others do not provide credible evidence that the BIT/ABCC regime created a resurgence in aggregate construction productivity or that the removal of the ABCC has had material aggregate effects,” the Productivity Commission said in a 2014 report.

The PC concluded that the ABCC did achieve some productivity gain in a problematic industry but said it was unlikely the watchdog would make a significant difference.

“Restoring it will not be sufficient to address the IR environment as a whole, a subject as much exposed to cultural factors and boom and bust cycles … as it is to poor behaviour,” it said.

Mr Turnbull has also said the ABCC will fight corruption and criminality in the construction industry.

He is supported by the Australian Industry Group, which says the watchdog will deter law-breaking.

Professor Anthony Forsyth, a professor of workplace law at RMIT University, has doubts because the ABCC will be empowered only to act in matters of industrial law such as unlawful industrial action or coercion of employers.

Evidence of bribes being paid, for example, could not be investigated by the ABCC.

“Anything like allegedly criminal behaviour, it just doesn’t fall within the role of the ABCC,” Professor Forsyth said.

Recently the Brisbane Magistrate’s Court dismissed two common assault charges against Queensland CFMEU organiser Justin Steele, who was charged following evidence in the trade union royal commission.

It takes to five the number of CFMEU officials named by the royal commission who have had charges dropped or dismissed.

CFMEU construction national secretary Dave Noonan said the charges in each case had no chance of success and accused the Turnbull government of pushing a political agenda to get its ABCC bill passed.

Professor Forsyth said the government’s proposed registered organisations law, which would require union officials to meet the same transparency standards as company directors, is the piece of legislation that would deal with union corruption.

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