What went wrong – decline of trade unions in Australia?

What Went Wrong?

Bob Carnegie

It is a huge honour to be here tonight. My talk centres on an issue that’s been discussed many times, but not necessarily from a rank-and-file militant staff position, so I think it’s one that should be examined once again.

For the last few weeks I’ve been tied up in a big struggle that we are having up in Hay Point there, where our 22 tug workers are in the process of being replaced by BMA, who is the largest coking coal operator in the world. BMA is owned 50 per cent by BHP the largest mining council in the world, and the other 50 per cent is owned by Mitsubishi Corporation, which is one of the ten largest industrial conglomerates on this planet.

So we’re up against the top end of capital there. There’s 22 of them, and we’ve decided as a Union and hopefully as a Movement that we’re going to tackle them – tackle them industrially, and then tackle them politically, tackle them socially and we’re going to fight them, because sometimes in life – I’ve told my membership this quite bluntly – that the odds of us winning initially are probably 5%, but it’s a fight that has to be fought, and we’ve got some wonderful people there, particularly, there’s a grouping of some young women there that have been able to get work in a male-dominated industry, and they’re just the salt of the working class movement and it would be so irresponsible for us to walk away from it and say, ‘Well, you’ve got to spend hundreds and hundreds of thousands of dollars fighting for 22 jobs. It doesn’t make much financial sense,’ but when Trade Unions start speaking about how much they spend on fighting right against wrong, that’s when we’ve really got a problem, and that’s one of the reasons we’ve really got a problem. So we’ll keep fighting up there and my promise to Jenna (who is one of the young women there who’s just bought a house with her husband, a young boilermaker whose life’s been turned upside-down.)

The simple reason is that he had a job in the coal mine, the coal mine finished, and now he’s thrown into the lap of labour hire in the manufacturing and mining industry where wages have been cut by 50-60% over the last 12 months. So they’re some of the issues we are fighting at the present time. But it’s not all doom and gloom. I just wanted you to know that you always have to fight for right, even though it’s not easy. I was just thinking about it because we get tied up so much in the Union Movement with legalities and whatever, and you pay legal bills and whatever and it gives you the shits. Lawyers are not free. Well, these three men [Bob Reid, Terry Fisher and Craig Buckley – in the audience – BR] have given, fair dinkum, more free legal advice to working class people I know than the entire Bar Association, the entire Caxton Street Legal Service, the whole lot. They’ve been some of the unknown stalwarts of the Labor Movement. They’ve done so many wonderful, wonderful things that kept so many union members out of jail and out of all sorts of trouble that it’s absolutely amazing. Really: these three men, I just think they need acknowledgment.


Okay. The last thing I’d like to say is to Margaret Ellis’s family. Your Dad was an outstanding person. He was a man of great honour and great dignity who did so much for the movement. He was one of the few Trade Union Leaders of his time or any time that actually understood the great need to develop musty between working class people and the Unions, very much in the same model as a Jack Mundy type leader. It’s a real, real big honour to me to be able to speak here tonight. What’s gone wrong, and why hasn’t the bleeding in the Trade Union Movement been addressed? This talk tonight is not that of a scholar. I had to leave school 40 years ago to relieve the financial stress on my family at 15. So this talk is part of my own analysing of life’s experiences, of a genuine rank-and-file militant, and I hope at times now of a relatively hard-working, and I hope still militant Trade Union leader. In my life I’ve had three great intellectual passions, and the greatest one of all has been a lifelong interest and passion in the US Trade Union Movement, where the strikes have meant bloodshed, where strikes have meant struggles, and some of the great personalities of the entire international working class and Trade Union Movement have come out of that. I remember when I was a young lad of about 13 being at the John Oxley Library and reading about Eugene Victor Debbs and Big Bill Hayward and the stories were like something out of the old West and the battles they had to try to build a union against gun thugs and things.

The other two great interests in my life have been the great struggles between the Wehrmacht and the Red Army, between 1941 and 1945 where by a thread, the forces of evil were defeated by a Red Army that had suffered such losses that, you know, they were almost, and still are, almost unbelievable. Thirdly, the great other interest of my life has been Stalinism, and I remember being a Stalinist at one stage in my own life, sadly when I was a young guy. One thing that I didn’t put in that biography is that in 1980 I spent seven months at the Marxist-Leninist Institute in the Soviet Union. They closed the Marxist-Leninist Institute down. I don’t know whether that was because of a combination of Boris Yeltsin listening to me at a philosophy lecture. I’ll give you the hint about my brilliant analysis of dialectics after this lecture, because if you ever hear about it, it’s not brilliant. The poor old Philosophy Professor, he just looked at me and he said, “What?” He said, “Do you just not get anything”. You know, he said, “You say something in Australia about your understanding of Philosophy” I said, ‘Oh, what?” He said, “A drongo.” I said, “Oh, thanks very much.” And in particular the great terror from 1936 to 1988, and about how a nation can be ruled by fear. The effects that it had on the Australian Trade Union Movement are still profound, in my view.

What went wrong? In 1957, at the time of the great Labor Party split in Queensland, this state had one of the largest trade union densities in the developed western world, approximately 85 per cent. Today, 60 years later, it is less than 15 per cent and it may be just over 10 per cent in the private sphere.

I tried to find out some of the reasons, not only the objective but also the subjective reasons for this massive decline in trade unions and some ideas so that we might have a re-birth. In the Australian Bureau of Statistics data released on 27 October 2015, there was a headline: Characteristics of Employment Australia, August 2014. The following data can be extracted: The proportion of employees who are Trade Union members in their main job fell to 15 per cent down to 17% in August 2013, so there was an effective two percentage point decline in trade union membership during the year. The more historic account of 1982, some 53 per cent of employees were in their main job trade union members, and in 1992 it was some 40 per cent of eligible employees, so today it’s gone down to 15 per cent. Already, according to the OECD figures, the Australian Trade Union density figures had gone from 25 .4 per cent in 1999 to 15.5 per cent today. Why is it so severe in Australia, and what can we learn from it?

It can’t just be what many of the union leaderships believe, that it is just a neoliberal sop. If it was, the same level of decline would be seen across the whole of the OECD, but it simply isn’t. David Pets, in a book called, Unions in a Contrary World, argues that there are four areas of concern. One is structural, casualisation, industries growing from very low traditional densities, growth in certain self-employment areas, tradies, franchises and all that, according to Peetz, accounts for about 50 per cent of the loss. Institutional factors, which he calls things such as legislative changes, and he uses New Zealand as a very powerful example of that. The New Zealand experiment 9 when they put in the Employment Contracts Act in 1991 saw the elimination of unions in lots of areas. The Employment Contracts Act was put in by a Conservative Government, but prior to that they had “Rogernomics” under a Labour Government, under their Finance Minister. He was the Labour Minister that started it all off.

Peetz also talks about aggressive employer strategies and the inability of Unions to respond. The Unions’ inability to respond to the great attacks has been one of the historic problems. I think that we’ve really got a huge problem. I disagree with Peetz when he talks about the effects of the Prices and Incomes policies of the government, that it gave the Australian Trade Union Movement a certain amount of time, and it sort of gave us the ability to respond to some of the attacks that were happening elsewhere in the world so they weren’t so severe here. To me, going through that period of time, I have to say that my account of things is completely different. What I saw and realised little bit later on – it took me a few years to actually understand this – is that what I saw was a slow strangulation of a once-militant Union Movement in this country. The genius of Hawke and Kelty is not so much in the development of a Price and Income Accord – they’ve been done in other countries of the world. In my opinion, their genius was in the way they co-opted the Left, the way that 10 the CPA dominated influence in the Metal Workers Union. The Communist leadership was turned into a prime mover of what one could call the disciplining of the Australian Left and the Australian Trade Union Movement. The SPA which influenced the Building Workers Industrial Union, was led by Casey McDonald and Sharkey, was another prime example of what happened. So you had the two great Lefts in Australia, the CPA and the SPA – one was a Moscow line, the other one was Euro-Communist, but it’s very interesting to see how a section of the SPA dominated, and also the CPA dominated the two major left unions in Australia. And they both came to a common conclusion that jumping in bed with a Labor Government was going to somehow sort out all the problems that the working class faced in this country. It was a huge mistake. The wider history I think has proven that.

What I have noticed through this period was the trade union response to employer attacks became much more muted. And in this particular area if I could zero in on a specific year, it would be 1985.

In 1985 not just because I was involved in a major industrial dispute at that time as a support, but it had a critical tum to it. In 1985, four things happened in the Australian trade union movement. They are all negative. One, the first one, is Mudginberri and the Meatworks Union where through the help of the Westpac Bank Corporation, the almost ironing out of existence of the Meatworkers Union where some of the meetings in the end were up for over $5million in fines and damages, simply because of the struggles to try to do fundamental trade union principles. The response from the working class and the Australian trade union movement and its leadership was muted at best. We then get down to the SEQEB dispute, one of the biggest disputes that any of us, all of us here, have been involved in, in the last 30 years in this country, a dispute that was over fundamental, basic principles than an industry shouldn’t be sub-contracted out, that an industry deserved to have workers on union rates of pay being the driving force in that industry Because of that, 1007 linesmen were sacked in February 1985, and a massive dispute arose from that. Once again, we saw a very piecemeal effort in trying to resolve that dispute, some of it treacherous, some of it totally unprincipled, but also we saw wonderful things, because many of us here got involved in picket-lines back in 1985. There wouldn’t have been too much need for us to be so involved in picket-lines if we had shut down the country for a day, it wouldn’t have needed much. Our appeals to the Trade Union leadership, including the wonderful appeals that Bernie Neville (who’s here in the audience – stand up, Bernie, please). Bernie Neville led the rank-and-file movement of SEQ EB workers and saw much of the treachery first-hand.

And so, after seven months of torturous and difficult, hard struggle, eventually the dispute was sort of run down. It never really to my way of thinking, never really was called off, but in the end 1007 men, working people, had lost their economic livelihood, 1007 families were thrown onto the scrapheap and it took the ETU almost a generation to re-build.

The third one is an area I don’t think has been examined enough in Australia, and that has been the de-unionisation of the Pilbara. When I was a young man, I was up in the Pilbara, and the Pilbara was a hard, tough environment, long distances between towns, just a hard, difficult place to earn a living. But the unions were very strong and very tough, and they extracted decent wages out of rapacious multi-nationals such as BHP and CRA Australia, who became Rio Tinto. Around the ’85 period, Rio Tinto decided to pick a blue, which they did, and they used that blue then to go on like the Mormons. They were like the Mormon Church on steroids, going round and knocking on peoples’ door and forcing contracts down their throats. The Pilbara went from a place where there was almost 100 per cent union density within a couple of years to 11 10 per cent, and today it’s non-union paradise. I was up there only recently. Apart from the waterfront and a few little spots, it’s just completely nonunion, and it’s had an enormous effect – you know, you can talk about your miners earning a hundred grand a year, but fair dinkum, you’d want a hundred grand a year just to look at the joint. What happens is that there’s no collectivity, everybody has been atomised and turned into individuals. Then of course, in 1985 I think the worst of the process began, and that was the de-registration and proceedings started against the Builders’ Labourers Federation and don’t let anyone ever think that that wasn’t a planned, sustained attack by sections of trade union leaderships and the Labor Government. I actually stayed as a young man for a weekend course in Marxism-Leninism, at a senior BWU Official’s place down on the Central Coast of New South Wales, and just over a steak, having a hamburger, talking about what was going to happen to the BLF and it was not going to be a slaughter-house as far as they were concerned. What did they destroy? Well, in fact what they did was, it was like the scenario would be, but the sword that they thrust through the heart of the BLF, eventually they actually thrust into themselves, and we to some extent today we still haven’t recovered in the labour movement from those deregistration proceedings. That I believe is by far the most sinister thing that’s 12 happened under the whole Prices and Income Accord.

I’m spending a lot of time on this, you know, because it’s a process that I think this lays down the whole basis and the whole foundations for what came after. The other thing that Prices and Income Accord did, was to’ achieve the cooption of certain people in trade unions into the capitalist system. My argument is fundamentally this: that large sections of the trade union movement’s leadership was co-opted into the system where they were never were before. Okay? Trade union officials prior to the Prices and Income Accord, didn’t tend to sit on any boards. They didn’t, but after the Prices and Income Accord and things such as so-called universal superannuation, they started sitting on industry super boards. Self-proclaimed communists and socialists, started sitting down with employers, and even more so than that, they started meeting with funds managers, the so-called masters of the universe. In Finland, Iceland, Denmark, Norway and Sweden, trade union density is an average of around 70 per cent. In Iceland it’s 85/90, but they’re different countries, and this is something you don’t often want to talk about, on the Left I believe. They’re homogenous cultures. People in Sweden are Swedes. People in Norway are Norwegian. Plus the trade unions a long time even before the Depression years decided that it would be very MUA members and supporters during 2015 waterfront dispute. Photo courtesy of MUA smart to get involved in the paying of social benefits, so they negotiated with long-term social democratic governments, that the Unions be an essential party in the payment of such things as unemployment benefits. Consequently, it’s very, very difficult to get rid of the trade union in the Scandinavian Countries, because it’s such an integrated and integral part, not just of your life, but also of the whole society. So it’s much different. I think we’re much more close to, say, Great Britain and the United States, but also I did a speaking tour of Britain last year, and a couple of things really impressed me about the British trade union movement, in spite of all the problems that they have faced over the last 30 to 35 years.

One is most of the big unions have annual conferences; I think that’s a great thing. Huge conferences. Some of it is somewhat bureaucratic, but every Union’s big conference has fringe groups on the side, so although you mightn’t be able to speak it at the main conference, your organisation or the Party that you’re a member of, or your Socialist grouping, or whatever, you’d have fringe events at all these conferences, and it was a wonderful expression, I think, of the democratic culture within their organisation. They’ve allowed these things to happen, and we don’t seem to do that a great deal here in Australia.

Also in Great Britain, in comparing that to Australia, I think in Australia the real problem that’s happened is that our Fair Work Commission (you know, the mis-named Fair Work Commission) is that this system of labour courts in. Australia has turned everything terribly legalistic about how you put on a blue, how do you get on to a worksite, how do you do everything. It’s a legal nightmare. People talk about the legal problems that the British Unions face. It’s not the same.

A British Union’s big problem is when they might call a strike and then it’s challenged in the High Court and the 13 ballots are examined, whatever, but fundamentally a British Union has a lot more freedom in the basic workplace than we do in Australia. On the other hand, you have the United States, where one great thing I think in the States is that if you get 50 plus 1 per cent, in the 27 of the 50 States, that means that you get 100 per cent Union coverage. In the other 23 right to work states you have union density rates down to like in Texas, where it’s less than 2 per cent, South Carolina is 2.9 per cent. In our sort of country union density does have a definite reflection on what our standard of living is eventually going to be. If you have poor union density level in a developed industrial or post-industrial economy then you’re going to see a collapse in living standards. Now some thoughts on how can we fix these problems up. I think Trade Unions must always be fundamentally oppositional. We have to be oppositionists. We must be the oppositional force in Australian society, and we must never allow again for the co-option of our movement into the arms of Government, or employers, or any private organizations like that. No more Prices and Income Accords. If we really have a growth problem, we’ll all sit down together and we’ll work it out. No. We can work with the Government in certain areas, that’s good, but let’s always have our standards very clear, because once they put their arms 14 around you, once they embrace you, once they place you on the Boards, the saddest part is that most people-from the trade union movement – not all, but most – will start trying to ape what you call their social betters. They do. I’ve seen it all my life.

It’s embarrassing at times, but it’s also a tragedy for our movement. I think trade unions must become a lot leaner in the way that they are run, and that’s a reflection of my own organisation where our national office has become very heavily bureaucratised. I’ve seen it again in other organisations. For example, 15 years ago we might have had a million extra members in absolute terms in Australian trade unions, but there is now probably 25-30 per cent more union officials running around the place.

One of the reasons is that EBAs have been a nightmare. Any union official or delegate that’s here will tell you, it’s an absolute nightmare to try and – I just finished one, EBA that took eight months to run. My mate Graham here worked for Kew for Chris Corrigan’s Kew, this bloke should get a Victoria Cross he’s been there 20 years. He was in the last round of talks with Kew and it took two years. Why would it take two years to run an EBA? My thinking is that if you can’t do it after six weeks, you might as well put in for protected action and goes and have the blue.

We really need to be lean. We need to be able to delegate our responsibilities to delegates. I think trade unions have to be far less bureaucratic in their dealings with their members, potential members, and with the public. I went to the Miners Union building yesterday, some of my great and dearest comrades in coal-mining, wonderful people, some wonderful leadership, great people. You go to the building, and fair dinkum, you’d have more chance of getting into the Australian Mint than getting into the Miners Union building. You have to press a button. You have to wait before that button opens the door and when the door opens, you go up the stairs, and then you have to press another button. Make it a bit harder to get into a union office – union offices have to be open. Okay? They have to be. They have to be welcoming places.

What we’re doing indirectly is that we’re just putting barriers in front of what we’re going to become, or what we’re supposed to be about. I think there has to be a radical re-development and re-engagement in industry though the development of the shop stewards movement in this country that’s not particularly run by union officials. We need some type of shop stewards movement that can come across in all different types of industry.

One of the things I hope to develop if our merger’s successful with the CFMEU, where we’ll have five or six different lots of groupings where we can start developing strong shop stewards culture across industry, so that if you start cross-pollinating ideas and start getting people really keen about each other’s problems, that it’s not just your own industry that’s the problem.

I think all Unions really have to have monthly meetings open to all members. The CFMEU General Construction Division, you know, a wonderful union, great, fighting organisation, fantastic, but if you’re a Building Labourer who’s just been amalgamated with the CFMEU, General Construction Division, you’d probably think something is odd. The BLF, despite all its difficulties and it’s, you know, a bit rough around the edges at times but the BLF used to have monthly general meetings, and at that monthly general meeting under the rules of he BLF, the secretary of the Union could be fired by the monthly meeting, and in fact that’s how John Cummings in the end got rid of Norman Gallagher. He did it from the floor of a meeting in Melbourne of the BLF. So we need to do those things, the sort of basic things that I think really sort of democratise us.

This place here used to have monthly meetings. Then they went to quarterly meetings. I don’t know whether they have meetings – I think only the Executive meets now, so once upon a 15 time, and in fact when I was a younger man – and Alan Muir, he would certainly remember – is that we used to have fortnightly meetings in the Trades Hall. Remember?

And they were fair dinkum. People would get up; you’d have really powerful debate, different sides. It was fantastic. I think the other thing we have to do on the legislative front is really fight for genuine legislation to make organising a less torturous business than it is, and that requires institutional reform. We have to have it; we have to demand that a Labor Government looks at things like anti-scab legislation, like they actually have in Canada. Another thing we need is an unfettered right of entry to any workplace. The third is you have a bargaining agent or an anti-freeloading legislation, because the part that gives me the greatest shits of all is you organise and organise and organise. You get EBAs up, you get improvements in conditions, and then dozens don’t join the Union. The last thing that I want to speak about goes to that idea about becoming leaner. Trade unions in Australia have’ to really look on the fact that in Britain the average price of union dues is round about four quid a week – okay – about eight bucks. At our National Conference in February, I was the only official who spoke against it, the union dues at the National Conference. The average union dues the wharfie’s going to pay from July 2017 will be $52 16 a week, $208 a month. The average wharfie will also in the terminals pay $5 a week into their own hardship fund, and they also pay another $4 a week to the State Branch. That will put their dues up to about $61 or $62 a week. They’re going to find some wharfies will start baulking over it – not many, but some will start baulking, but it starts the rot. It’s got out of hand. Organisations really have to start saying, ‘Well, look, you can’t just keep increasing and increasing.’ This isn’t just an MUA thing. Unions are supposed to be social movements. We didn’t become Union leaders just to dress nicely. We really have to examine those issues and really make sure that joining the union has to be a really easy process. It shouldn’t be a difficult process. It shouldn’t be a torturous process. You shouldn’t have to wait out in the rain or something, waiting for somebody to buzz you in. It should be simple. It should be easy. It should be friendly, so that people really think that the union is an absolute part of their lives, not just something that they have to pay for because all their workmates pay it, so I’ll pay it, because that, doesn’t create the sort of union movement we want, one with a militant fighting spirit.

Note: This paper is a transcription of Bob Carnegie s address to the BLHA for the 2016 Alex Macdonald Lecture.


Part I

Part II

Part III

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