Release type: Transcript


Interview - ABC Melbourne with Raf Epstein


The Hon Brendan O'Connor MP
Minister for Skills and Training


RAF EPSTEIN: The Minister for Skills and Training in the Albanese Government, he's also of course, MP for the Western Melbourne seat of Gorton. Good afternoon.
EPSTEIN: Can we start with the wages figure this morning? We've never had a such a big gap between how fast wages go up and how fast prices go up. When are wages going to start matching inflation? Do you think?
O’CONNOR: Well, our focus is on making sure we have an industrial relations system that can deliver fairer and better wages to working people. You're right, it's a very significant fall in real wages, over the 12 months of 3.5 per cent. Inflation is running high. And of course, yes, the government supported the increase to the minimum wage of 5 per cent and we've got support for the aged care submission through the Fair Work Commission, but a lot more has to be done. And obviously, we're engaged with employers and unions and others about that. And of course, it will feature in the engagement at the Jobs and Skills Summit and the first week of September.
EPSTEIN: Not saying it's nothing to support the minimum wage case and the aged care case. But that's not everyone and you haven't been there for a long time. But when can everyone listening go well, wages basically go up same way as inflation, is that end of the year, end of the term, it wasn't going to happen was a cut?
O’CONNOR: Well, firstly, there's no precise point where you could point to the fact that wages will prevail over inflation. What you can say is, we supported a 5 per cent wage increase for those on the lowest wages and the Fair Work Commission delivered that. We are supporting by way of submission increases to aged care workers - underpaid, who do remarkable work - we need to attract and retain workers in that sector, as you know, Raf. And so we need to do more. We can't just do it sector by sector. That's why there's a very significant the areas of reform in IR. But look, in my portfolio, if we can increase the skills that are in demand, you'll see workers receiving better wages if they're more skilled. So there's a there's no panacea. There's a combination of ways to bring inflation down. And obviously, to see wages increase in real terms.
EPSTEIN: I'm interested in what might come out of the jobs summit that is at the start of September, this reporting and some talk of increasing the number of people who come to work from overseas, is there going to be a big increase in workers from overseas?
O’CONNOR: Well, we're still examining the immigration intake. As you know, the permanent skilled migration stream numbers fell over recent times to 160,000. But of course, the reality has been that we had the suspension of movement of people globally, including in Australia as a result of the pandemic, which meant that when we might have seen 500 or 600,000 skilled migrants coming into the country, we didn't see that and we saw the flight of temporary visa holders who got no support –
EPSTEIN: Are you going to lift the limit because the ACTU seem to think you're going to lift the limit.
O’CONNOR: Let me just firstly, let me just finish the sentence. We then had a flight of temporary visa holders leaving the country because they were given no support under JobSeeker or JobKeeper. So we had a double whammy of no one coming in and people leaving the country because they had no support. Now, therefore, we have to look at how do we supply the labour and skills that is needed. The OECD has determined that Australia has the second highest labour supply shortage in the developed world. So of course, there is a significant role for the skilled migration streams. But it is not a binary choice. We think there's been a terrible level of underinvestment and mismatching of investing in skills. So we need to invest in our workforce, we need to invest in our workforce in areas of demand in a way that more effectively than we've done in the recent decade. And yes, we also have to look at skilled migration pathways to supply the skills and labour - like you've just talked about shortages in nurses in hospitals. We're talking about aged care shortages. We're talking about shortages in manufacturing, hospitality, retail, advanced manufacturing, engineering, wherever we look across the labor market, there are shortages. We can supply that by training Australian workers, in some ways, of course, in many ways, but we need to supplement that too.
EPSTEIN: So if you do supplement, and you understand these demands from the union movement they want they only want extra workers coming from overseas, if there are extra obligations on employers to prove they need those workers. Are employers going to have to satisfy some extra tests or do some extra things to show they really can't find workers? Are you going to place those extra obligations on employers?
O'CONNOR: When I was last the Minister for Immigration I introduced labour market testing. It got watered down by the previous government, but it was the last piece of legislation done by the Labor Government before we lost office in 2013. So I'm acutely aware of a need to have some level of demonstration before you ignore the workforce.
EPSTEIN: So you're going to bring something back?
O’CONNOR:  There is still existing legislation, we should examine what happens now. There's also as you know, there are imposts upon employers, there are costs associated with bringing in skilled migrants into this country at the present. So of course, we would like people to look locally first and fill the shortages with people in their communities in their cities and towns around the country. That should be a priority of a government and frankly, of employers. But it's also true to say, without a shadow of a doubt that we have skill shortages, that we could not right now supply with the existing workforce. So it's a combination of approaches that the government and employers and state and territory governments too, must take to deal with what is really a skills crisis in many sectors of our economy.
EPSTEIN: One other broad question, I'm going to get to some callers if they can bring an can soon about hospitals. I know you understand it, but broad an important question. The unions clearly want to be able to negotiate more broadly than they can now. I don't want to get into things like patent bargaining, all those sorts of things. But the union's clearly want to be able to negotiate across a few different companies, maybe across a part of a sector. Is the government going to back that?
O’CONNOR: Well look, I think we'll examine all of those things. What we know is bargaining has slowed or in some parts of the economy stopped, and we can't have that. How can it be that there's a skill shortage in the country and wages are still falling below cost of living pressures, how can that be?
EPSTEIN: Is the solution broader bargaining, the employers don't want it?
O’CONNOR: Well, we have to be open, I think, to all vehicles that will provide mutual benefits and that includes real wage increases in our economy, which is ultimately good for our economy, because, as we know, workers spend their wages in the economy. So I think it's fair to say that we have to be open to all of the options available to improve the bargaining system. It has really fallen into terrible decline. And many workers get no opportunities to get wages improvements through bargaining. So we need to have a greater focus on that. There's too many disincentives not to do it. So I know Tony Burke is looking closely at that with the unions and employer bodies.
But also can I just say in my portfolio, there needs to be a common purpose when we go to the summit. We should be working on these issues, put the national interests first and look at dealing with the challenges ahead and do so as much as possible together. And that is why the Albanese Government has brought this summit together to make sure we work through our issues. We won't agree on any everything. We know that. But we need to focus on those things that we do, and obviously look to find accommodation, and compromise when necessary to deal with the structural problems in our economy and labour market.

EPSTEIN: And just quickly on Scott Morrison's multiple ministries, do you want to know more about what the Governor General said?

O'CONNOR: Look, I guess our focus is on the conduct of the former Prime Minister. Obviously the Governor General takes advice of the Prime Minister. And I guess we're more interested to understand exactly what was the motivation behind Scott Morrison conduct?

EPSTEIN: Do you think he should leave parliament?

O'CONNOR: Well, that's really up to him and the Liberal Party. But I do think he has to account more effectively. I don't think his statements today go anywhere to explaining his conduct. It was a fundamental breach of the Westminster system. It was done in secret. And it really, I think, was a contemptuous act. And I understand why the Australian public are unhappy.

EPSTEIN: Thank you for your time.

O'CONNOR: Thanks.