AiG

Submissions

• Submission (91 Pages) (PDF Format) - February 2004

Table of Contents

1. Introduction		6
	Australian Industry is Facing Serious Challenges in 2004	7
	Needs of the Low Paid and Employment Impact	8
	The Commission Should Reject the Proposal for Another Large Safety Net Adjustment	10
2. Ai Group's Position		11
3. Economic Conditions And Outlook		13
	Overview	13
	2003 was weaker than assumed	14
	Changing global dynamics affecting wage settings	18
	Impact of higher Australian dollar	19
	Impact of global over-capacity	24
	Impact of China's rising industrial strength	27
4. Safety Net Adjustments And Productivity		33
	The Imperative of Continuous Productivity Improvement	33
	Union Attitudes to Productivity Improvement	37
	The Important Role of the Commission in Creating the Right Environment for Productivity Improvement	38
	Proposed Link Between Any Safety Net Adjustment Awarded in 2004 and Productivity	41
5. The Needs Of The Low Paid And Income Tax And Income Support Arrangements		44
	Introduction	44
	The role of taxation and income support in supporting the needs of the low paid	45
	Income tax and income support changes in the past year	46
	Income tax changes	47
	Changes in income support arrangements	47
	The impacts of changes in income taxation and income support arrangements	49
	The dimensions of the increases in disposable income	51
	The significance of the changes to income tax and income support arrangements	52
	Key findings	52
	Other household types and income support payments	54
	Conclusion.	55
6. Underemployment, Unemployment And The Needs Of The Low Paid		56
	Introduction	56
	The central place of underemployment and unemployment among the low paid	57
	Conclusion	60
7. Minimum Wages And Low Paid Underemployment And Unemployment		62
	Introduction	62
	The economics of the impacts of minimum wage increases and employment opportunities for low paid workers	62
	Testing this economic logic	63
	Evidence of the slower growth of employment opportunities for low paid workers	64
	Conclusion	69
8. Ongoing Need For Survey Research Into The Employment Effects Of Safety Net Increases		71
9. The Actu Claim Is Excessive		73
	Rising Interest Rates - Impact on Businesses	74
	Rising Interest Rates - Impact on Employees	76
	Reducing the Primacy of Enterprise Bargaining	77
10. Skills-Based Classification Structures And Relativities		80
11. Award Structures		84
12. Conclusion		91

List of Charts and Tables
Chart 1: Annual Growth In Economy, Manufacturing And Construction	15
Chart 2: Quarterly Growth In Profits (Before Income Tax)	16
Chart 3: Annual Change In Major Manufactured Exports, Annualised To September 2003	17
Chart 4: Annual Change In Wage Adjustments Relative To Selling Prices	18
Chart 5: Movement In Australian Dollar Versus Commodity Prices	20
Table 1: Movement Of Australian Dollar Against Selected Currencies	21
Chart 6: Survey Response On Impact Of Higher Dollar	22
Chart 7: Survey Response To Whether The Higher Dollar Will Lead To Greater Offshore Production	24
Chart 8: Export Prices For Manufactured Goods	26
Chart 9: Annualised Change In Labour Productivity	27
Chart 10: Impact Of Stronger Australian Dollar On Import Purchases (2003)	29
Chart 11: Annual Value Of Imports From China	30
Chart 12: Annual Change In Manufacturing Employment.	31
Table 2: Labour Productivity Growth By Industry	34
Table 3: Increases To Key Income Support Payments And Thresholds January 2003 To January 2004.	48
Chart 13: Dispersion Of Pay And Employment Growth For Males 1986 To 1996	65
Chart 14: Dispersion Of Pay And Employment Growth For Males 1996 To 2000	65
Chart 15: Dispersion Of Pay And Employment Growth For Females 1986 To 1996	66
Chart 16: Dispersion Of Pay And Employment Growth For Females 1986 To 1996.	66
Table 4: Dispersion Of Growth In Hours Worked 1986 To 2000	68
Table 5: Relativities In The Metal Industry Award	82

Annexures
1	Where Will The Soaring Dollar Land?
	Australian Industry Group, December 2003
2	Aussie Dollar Challenges Manufacturing Competitiveness
	Australian Industry Group, January 2004
3	Impact of Tax and Income Support Changes on the Low Paid
4	Changes in Disposable Income due to Taxation and Income Support Arrangements and the Equivalent Increases in Wage Income
5	A Guide to Australian Government Payments
	The Dept of Family and Community Services and The Dept of Education, Science and Training, 1 January - 19 March 2004
6	The Case For Increased Taxation
	Michael Keating, Academy of the Social Sciences, 2004
7	Statement on Monetary Policy
	Reserve Bank of Australia, 9 February 2004
8	Review of TCF Assistance
	Productivity Commission Inquiry Report, 31 July 2003

• Reply Submission (26 Pages) (PDF Format) - March 2004

Table of Contents

R1 Introduction		3
	Australian Industry Continues to Face Serious Challenges in 2004	3
	Needs of the Low Paid and Employment Impact	4
	The ACTU and State/Territory Governments' Proposal Remains Excessive	6
R2 Economic Conditions And Outlook		7
R3 Safety Net Adjustments And Productivity		11
R4 The Needs Of The Low Paid And Income Tax And Income Support Arrangements		13
R5 Underemployment, Unemployment And The Needs Of The Low Paid		17
R6 Minimum Wages And Low Paid Underemployment And Unemployment		20
R7 Award Structures		23
R8 Other Matters		25
	The Proposed ACCI Change to the Principles	25
	The Commonwealth's Proposal to Defer the Decision Date	25

• Annexure 1

• Annexure 2