LAURA JAYES, HOST: Let’s go live now to James Cullen, he’s the senior director of government relations at Cornerstone Group, he joins us here. Now, plenty of stories in the news at the moment about wages theft, it seems like it’s hit after hit, different industries as well. What does this tell you, that these big companies are doing this on purpose or the system’s too complicated?
JAMES CULLEN, SENIOR DIRECTOR, CORNERSTONE GROUP: You would hope that they’ve got the right objectives, these companies. It’s quite concerning, because some of these cases are going back decades. You look at the case of Woolworths, they did go back decades. So I think we’re going to see more of it. Clearly I think it’s a combination of the right systems not being in place, the right amount of vigilance applied, and you would have seen why the response of some of the trade unions as well in recent days that their powers have been whittled away over time. They used to have a right of entry in terms of being able to inspect payrolls. And you can see they’re calling for that now as well. It is a bit of a concern that it’s been going on, and I think you’re right, we are going to see it extend well beyond the hospitality sector to other sectors, so watch this space for more announcements over the next few months.
PETER STEFANOVIC, HOST: Amazing where it’s come from, isn’t it, because it’s almost like this has started as a trickle, because it was restaurants and Calombaris and what not, then it became a flood, with Woolworths and Coles and the various liquor stores so where do you see this ending, and how does big does it get?
CULLEN: I think there’s a lot more ASX-listed companies, so right at the top, yet to come, and a lot more sectors. I think you’ll see boards, you’d hope through good corporate governance, asking questions right now, if they haven’t already been exposed, asking their payrolls and legals to be going back over the books. Working with the appropriate unions and workers, and get out in front of it. And most importantly, unions and workers will be watching very carefully about how they respond and how far they go back in time to be able to organise that backpay as well.
JAYES: Surely there’s a better way to fix this. I know the Attorney-General Christian Porter has left open this idea of if you commit wages theft, let’s call it, underpay your workers, perhaps you could be branded with a sign that you need to display in the front window, your shopfront, the front of your business. I mean, really?
CULLEN: For a Coalition Government, it’s got no choice than to be tough because Labor will always be there on the side to say “you’re not going far enough” obviously and you can hear what trade unions are saying already, and fair enough.
JAYES: Is it a failure of the unions I might say as well, even if they don’t have those powers to inspect payroll anymore?
CULLEN: Well you can’t have it both ways. Trade unions have rightly been criticised for extremes in some instances, but the reality is, as you know we’ve got record low wages growth, generally speaking over time, where there’s a stronger and more proactive union movement, you have more buoyant wages. And that’s good for workers and good for the economy. So I think we probably do need to see a little bit more of a restoration, a bit more the pendulum swinging back a little bit more and perhaps a bit more of a role for unions to be a more proactive in this space. But hats off to the Government too. They are now putting civil and criminal enforcement penalties on the table, beefing up the powers of Fair Work, the Ombudsman and the Commission. I think it’s a start, I think there’s more to go.
STEFANOVIC: Jim Chalmers in The Australian this morning, trying to channel, potentially, Jacinda Ardern with a well-being budget. We had Josh Frydenberg on the show saying well this is an excuse…
STEFANOVIC: … to increase taxes. So what are your thoughts on that?
CULLEN: I think it probably highlights a difference between Labor and Coalition about the role of the budget, the centrality of the budget. Labor historically comes from a philosophical perspective that budgets are a means to an end, they’re not an end of itself. Budget surpluses and deficits are all very important and they always will be from a government accounting perspective. I think Australians rightly expect debt to be paid down and responsible budgeting. That’s here to stay, that’s fine, but I think where Jim’s going and where Jacinda Ardern’s gone in New Zealand is looking at putting other indicators on the board like well-being, living standards, things like child poverty, family violence, obviously we’ve seen that tragic case overnight, another shocking case in Queensland. Talking about government expenditure, where are they going, where are these inputs going into, and are we getting bang for the buck, and are we really improving our overall livelihood.
Yes, the economy’s important and government finances are important, but are we really making a difference. So I think it’s a wider and more all-encompassing view of the budget, the economy and society. It’s challenging, but I think it’s great that Labor’s out there with those ideas.
JAYES: It’s a big pivot, and Jacinda Ardern has had some success I think in New Zealand with putting these well-being measures in, child poverty and domestic violence. But why do we find it so difficult here, what are the differences in the cultural environment, if you like? We can’t even do things without controversy like domestic violence leave. I mean that’s been a huge battle between the unions, big business and all sides of politics.
CULLEN: You’re right, culturally we do really struggle. I think the way forward is we just need to be finding every opportunity, including tragically when these cases come up of just continuing to talk about it and putting it on the national agenda. Bill Shorten had a really progressive and strong policy on domestic violence before the last election. We’ve got to keep on talking about them and making these debates at the centre of public life. Jacinda Ardern’s obviously made a really strong step forward in the last year or two on this. I think there’s more to come. I think also we do need to be careful on the way through that the power of governments to do everything is somewhat limited. So things like child poverty and family violence, absolutely government can be doing more and be having better targeted programs on those things. But there’s a whole lot of factors outside of the control of government so we just have to be careful when you measure these things in terms of expectations about what government can actually do.
STEFANOVIC: The Government has no doubt had a rotten run of luck when it comes to the economy, with recent problems, and Frydenberg just sort of alluded to that. First of all you had the US-China trade war. Then you’ve got the drought. Then you’ve got the coronavirus. So you’ve had a number of hits in sequence. Doesn’t that prove why it is so important to have a surplus? Have that money in the bank to be able to get things going again in the tough times?
CULLEN: Ultimately yes. But we’ll see how things pan out. We wouldn’t want to have a Pyrrhic victory where in a couple of months the Government says “fantastic, we’ve got a surplus” but in the meantime we’ve registered a negative quarter of growth. Trade’s starting to fall back, the domestic economy is stalling – it has been stalling for a while – living standards, wages growth really low, the productivity challenge, what are we doing on those things?! I think it’s fine as long as those other indicators are going in the right direction. A surplus by itself, an accounting surplus, where the rest of the economy is suffering all these challenges, I think people at home watching the budget being delivered will be like “Well, what’s happening to me and do I feel like the economy is going really well?” So I think the debate Jim’s encouraging today is really good, we’re talking about these things from a broader economic and societal perspective.
JAYES: Well that said, I can’t expect Labor to make a political point when they don’t make that budget surplus right? They’ll let it slide?
CULLEN: You can always have your cake and eat it too, right? That’s politics.
JAYES: James, thank you.