Put windfall tax and price controls on agenda, says CFMEU boss Zach Smith

New CFMEU construction division secretary Zach Smith calls for a national debate about imposing windfall taxes and price controls on companies.

New CFMEU construction division secretary Zach Smith. Picture: Aaron Francis

New CFMEU construction division secretary Zach Smith has called for a national debate about imposing windfall taxes and price controls on companies, insisting taxes that “target excessive corporate profits” have “got to be on the table”.

Mr Smith, taking over from Dave Noonan, said price controls on power and energy companies should be considered, arguing government intervention over the price of essential services should not be seen as radical in a high-inflation environment.

Mr Smith said the CFMEU had necessarily been on the defensive during years of attacks by the Coalition but he would seek to be at the forefront of public debate on issues impacting workers, including housing, cost of living, the economy and climate change.

He said the electorate needed to have a serious discussion “about this idea that the only way we curb inflation, the only way we curb cost of living, is by hitting working people with interest rate increases”.

“There needs to be a serious conversation in this country about profit restraint, price restraints and even taxes that target excessive corporate profits. There are other mechanisms to control inflation other than just going after workers through either interest rates or saying that you have to show restraint on wages,” he said.

Mr Smith said there had been a “real lack of voices on the left calling out this economic orthodoxy and challenging the economic orthodoxy”.

“Windfall taxes, that’s got to be on the table. How can we discount that and rule it out? That’s got to be on the table for certain,” he said. “I think in the public debate, mining and energy companies, banks and supermarkets would certainly be high on the list. It’s not an unusual place for the CFMEU to sit, prosecuting more progressive policies than the ALP and trying to bring the ALP along on the journey.”

The British Conservative government last year introduced a windfall tax on the extraordinary profits of the oil and gas sector. It is forecast to raise $80bn over six years.

“Remember this inflationary crisis was not caused by workers,” Mr Smith said.

“Overwhelmingly, the research has shown that corporate profit-taking (and) supply-side shocks led by a war in Ukraine are causing the inflationary pressures that we have at the moment, so we have this crisis.

“Workers didn’t create it, yet all we can conceptualise in this country as a remedy is workers bear the pain of interest rate rises, workers have to show wage restraint.

“Where is the charge to say there needs to be restraint at the corporate board tables? That’s where I think our union has a real leadership role to play. Not just for our members but for the working class more broadly.”

In a wide-ranging interview, Mr Smith called on Michael O’Connor, the union’s former national secretary, to resign as head of the manufacturing division.

The construction division has been engaged in a civil war with rival divisions representing mining and energy and manufacturing workers.

Mr O’Connor has launched Federal Court action to bring on a vote of the manufacturing division to split from the union. He is seeking to challenge a Fair Work Commission decision last month that rejected the division’s bid to ballot members.

Mr Smith questioned whether the manufacturing division would be able to effectively represent its members if it broke away from the union.

“Their financial position being so parlous as it is, how are they going to actually serve and represent those members as a stand-alone union or is the intention to fold that coverage into some other larger union?” he said.

“I think that division should be upfront and articulate to the members because that’s a massive consideration for the members in that division.

“I can’t see how you can continue to survive – they’ve whittled down their asset base, they are posting million-dollar losses after million-dollar losses. You can’t survive like that. If this was a corporate situation, you’d have shareholders screaming.”

Mr Smith said Mr O’Connor was his first boss, employing him as a 19-year-old.

“It makes me sad … that this is where we have got to as a national union, that it got to this point and that egos have sort of taken over,” he said.

Mr Smith said the situation could not be fixed “without a leadership change at their end”.

Asked if he was saying Mr O’Connor should resign, he said: “Yeah, I don’t say that as a demand. I just say that as a matter of practical reality. He and others have staked their leadership on this de-amalgamation application. It’s not so much an ultimatum. It’s more just a matter of practical reality. I don’t see how you resolve this issue with those people at the helm.”

He expressed “full support” for the union’s NSW construction division secretary, Darren Greenfield, and his son, assistant secretary Michael Greenfield, who have been charged over alleged bribery offences.

“Darren and Michael categorically deny these allegations and intend to fight them in court,” Mr Smith said. “They have my full support and the backing of our union. Out of respect for the legal process we’ll be making no further comment on the matter.”

Mr Smith said he would have a working relationship with the ALP to pursue policy objectives in the interests of members, “but I am not going to be dictated to by the party and I’m not going to be subservient to the party”.