Prices and Incomes Accord
[1] To address this crisis, many capitalist nations had imposed wage freezes including Britain (the Social Contract), New Zealand, France, and the Netherlands.
[1] In Australia, the Fraser government had imposed a wage freeze with the goal of lowering inflation and increasing international competitiveness;[2] however, it was ineffective due to trade union resistance.
The first Accord was implemented after Bob Hawke was elected to power in March 1983, but was the product of a long series of prior negotiations between the ALP and ACTU.
[5] Also, they saw the devalued dollar as an opportunity to improve the country's trade deficit as long as they could prevent labour costs from rising.
[2] The third edition of the Accord, established in March 1987, marked the end of formal wage indexation and the introduction of a two-tiered system.
While the previous Accord tended to promote short-term cost-cutting measures,[5] the SEP had a broad, positive conception of productivity improvement.
[2] It encouraged unions to establish skill-based career pathways; broaden the range of tasks each worker could perform, to enable multi-skilling; and minimise demarcation disputes; among other things.
Additionally, their awards would need to permit greater flexibility in working hours and change certain sick leave entitlements.
They stated that employers and trade unions were not yet ready for enterprise bargaining because they held differing perspectives on this reform that they would first need to resolve.
[7] This seventh edition of the Accord was hugely influential: it began a process of decentralisation from national, industry-wide agreements and awards to the enterprise level.
[2] In the era when neoliberal reforms were being made by Thatcher in the UK and Reagan in the US, it was not the conservatives who held power in Australia, but the Labor Party.
[3] Her analysis is that although neoliberalism was introduced by conservatives in the UK and US, Australia followed a different pathway in which Labor and the unions played an active role.
Due to abandoning the militant struggle for wages, "Unions suffered from declining membership they could not reverse, decreased activity and organisation at the workplace level".
To the contrary, Humphrys notes that trade union resistance prevented the previous Liberal government from carrying out adequate neoliberal reforms.
[2] In 1983, the Hon Jim Carlton (Liberal member for Mackellar) argued that the Accord would discourage employment: Today, in my remarks on this Bill, in particular, I speak on behalf of the unemployed.
Again, as I do not represent an existing interest group dependent on government protection or largesse and am not fearful of a cessation of benefits, I do not feel obliged to congratulate the Prime Minister (Mr Hawke) on his capacity to assemble and charm the group of people most likely to provide willing or conscripted endorsement of the disgraceful deal cooked up between the ALP and the Australian Council of Trade Unions before the election.
This so-called accord-this deal-was and is a recipe for the continuing exclusion of 10 per cent or more of the work force from the opportunity to earn gainful reward for employment.
As we saw, under such policies an unemployment rate of 10 per cent was needed to bring wage claims down to their present state, one in which virtually no increases at all are taking place.
In the lead up to the 1984 budget, unions agreed to a wage/tax trade-off in which they forwent an indexed wage increase in return for a tax cut geared towards low and middle-income earners.
