ALP to take fast track on penalty cuts

Labor will try to get the reversal of penalty rate cuts through the Senate before June 30 if it wins the election.

Opposition Leader Bill Shorten at the Salvation Army’s Lighthouse Cafe in Melbourne yesterday. Picture: AAP

Labor is preparing to “maximise its chances” of getting the reversal of penalty rate cuts through the Senate before June 30 if it wins the election with a quick resumption of parliament to consider some of its industrial relations reforms.

Bill Shorten has vowed to make penalty rates a priority of ­industrial relations changes, with changes to be enacted in the first 100 days of a Labor government.

Labor has already approached several crossbench senators to ask generally about a passage of ALP legislation before the Senate of the 45th parliament expires on June 30.

Between the May 18 election and June 30, the existing senators remain in place. They are a “known quantity” for Labor, which has succeeded in getting legislation the government opposed through the Senate.

Some crossbench senators and Labor MPs believe the current Senate, with 11 independent and micro-party senators plus the Greens, could be more likely to pass Labor’s tax changes and penalty cut reversals than the new Senate after the election.

The danger for an elected Labor government is that the new Senate could include fewer Greens members, more conser­vative independents from Queens­land and a smaller group holding the balance of power, which would make negotiations more difficult.

Chris Bowen has said it’s ­“impossible to predict the outcome in the Senate” and a “mug’s game” if you try. The Labor Treasury spokesman has also indicated that Labor’s tax package may not require passage before July 1, the start date for changes, ­because these could be addressed administratively.

Moves to legislate before June 30 would still give Labor a second chance with the new Senate if they failed.

Business groups have been lobbying crossbench senators for weeks to ensure that Labor’s industrial relations proposals are properly considered by Senate committees and time is allowed for the promised consultation on sweeping changes to the Fair Work Act and implementation of a living wage. Just before parliament was prorogued for the election, the Labor Party, joining the Greens and four independents, was able to force through the medical evacuation laws ­enabling doctors to permit the ­removal of asylum-seekers from Nauru and Manus Island for medical treatment.

Crossbench senators who have been approached by Labor in “general terms” about a final June Senate sitting told The Weekend Australian they would attend and consider whatever a Labor government submitted.

Labor is keen to legislate its own tax package, including an ­increase to the top marginal rate, tax cuts for low-to-middle income earners and even tougher rules on trusts and franking credits before July 1.

The Weekend Australian ­understands the Greens have ­serious reservations about the ­opposition’s proposed franking credit ban — worth an extra $56 billion in revenue over a ­decade — because of Labor’s pensioner exemption.

Greens sources said the two-tier treatment of franking credit holders could give retirees an incentive to churn through assets to get on the pension.

While Labor is expected to put all its tax changes into one parcel — with low-income tax cuts tied to passage of the increase of the top marginal tax rate from 47c to 49c — there is opposition to the changes in the current ­Senate.

Although the central promise to reverse penalty rate cuts is expected to be put to the Senate if Labor is elected, wider radical changes to the Fair Work Commission are likely to be left longer for consultation with business.

The idea of putting the tax changes and penalty rate reversals to the existing Senate, even if it is seen to be hostile, is aimed at maximising Labor’s chances of passing the legislation. If it fails before June 30, Labor will try again after July 1 and will have kept its promise of giving priority to penalty rate cuts.

On Thursday, Labor’s employment spokesman, Brendan O’Connor, said underemployment was a major problem and penalty rates had to be restored. “Under the Liberals, the underemployment rate is stubbornly high at 8.2 per cent,” he said. “Coupled with increasing insecure work, this is leaving too many Australians struggling to keep up with the cost of living.

“As treasurer and now Prime Minister, Scott Morrison has presided over the lowest wages growth since records began, and yet he supported cuts to penalty rates and voted against restoring penalty rates eight times.”

NSW Liberal Democrat senator Duncan Spender said he would ­attend any June sitting because ­absentee crossbenchers would not be given a pair from the major parties and “could hand Labor a ­majority on a platter”.

“Any defeated senators who fail to attend the Senate at the end of June would be derelict in their duty,” Senator Spender said.

Independent South Australian senator Tim Storer, who is not re­contesting his seat, confirmed he would attend any June sittings.

South Australian crossbench senator Rex Patrick of Centre Alliance, who is not up for re-election, said his group’s position on tax and industrial relations had not changed. It has opposed ALP plans on franking credits and negative gearing while agreeing to parts of its personal income tax changes.

Senator Patrick said the independents would be unlikely to support any contentious changes without a full Senate committee ­investigation.

Additional reporting: Michael Roddan