Twenty years ago tonight, just before 11pm, waves of security men, some in balaclavas, accompanied by dogs trained to intimidate, swarmed across the Australian waterfront.
At home in Sydney’s Point Piper, Patrick chief Chris Corrigan, with the enthusiastic secret support of the Howard government, was unleashing his nuclear option, having authorised simultaneous raids on the company’s terminals to lock out 1400 union employees.
The late-night mass sackings stunned the nation and propelled the country into a dramatic, divisive confrontation that ultimately would change the wharves forever.
“I cannot think of a bigger industrial dispute certainly in the post-second world war period,” says Greg Combet, the then ACTU assistant secretary and later Labor minister who rose to national prominence during the dispute. “It was a massive thing, a huge contest between a government, a large company and the labour movement.
“I am proud of it, and I think the (Maritime Union of Australia) is. It was a very hard dispute, to say the least. It was an existential issue for the members of the union in terms of their employment. Certainly an existential dispute for the union. It could have gone up in smoke.”
Two decades on, the key combatants remain divided as they emerge to re-pitch their narratives, hoping fading memories will allow them to reshape public opinion and enhance their legacies.
What is undisputed is that Corrigan, the outsider and stockbroker turned stevedore, was a winner, as his big-bang gamble led him eventually to halve his workforce, change restrictive labour practices, lift crane rates and make his company, his fellow directors and shareholders truckloads of money.
“There were many times when things didn’t go to plan. We used to talk about plan A, plan B, we needed plan Z,” says Corrigan, speaking to Inquirer from Switzerland, where he now resides.
“(But) it was an extraordinarily worthwhile exercise from the point of view of the Australian economy and, frankly, from the point of view of the company.”
John Howard and workplace relations minister Peter Reith, who held clandestine meetings with Corrigan and ensured significant taxpayer funds were advanced to aid his covert strategy, used the removal of hundreds of jobs, the increase in productivity and changes in work practices to argue the Coalition succeeded in delivering “waterfront reform”.
Describing the industrial battle as the most bitterly fought domestic issue of his 11 years as prime minister, Howard says he regards the outcome “as one of the really great economic reforms of my government”.
“I think the government came out of it as having displayed, at long last, the guts to do something the Australian economy demanded,” he tells Inquirer. “We have a modern, productive Australian waterfront and this has been something that people for years had called for and, almost for an equal amount of years, disbelieved it would ever happen.
“It did happen.”
Significantly, when Howard, in his autobiography, asks who won the dispute, the answer is not his government but “Australian productivity”. This was no accidental conclusion. After years of planning, Howard and Reith, in particular, lost the political contest and failed in some of their deeply desired but deliberately less publicised objectives.
During the dispute, Howard consistently denied the government wanted to destroy the MUA. But the truth was that after the unionised workforce was locked out, the government did not expect or want Patrick to allow a single union wharfie back.
Reith said as much in the days after the lockout when he typically and unwisely declared early victory. “These former Patrick employees are not going back to Patrick,” he told Laurie Oakes on April 12. But subsequent decisions by the Federal Court that the workers could not be terminated were huge blows to the government.
Indeed, Reith, whose handling of the dispute was by then under attack even from his colleagues, went to see Howard at Kirribilli House and offered to resign. Howard refused, not willing to make what would have been a devastating political concession to his political enemies.
“For him to go, that would have put the seal on the argument from the opposition and our critics in the media that the whole thing has been a giant mistake,” Howard says. “It hadn’t been, and if we held our nerve, it would still work out OK — and it has.”
Despite years of planning, most of it beyond the public eye, the government’s biggest disadvantage was that Corrigan’s assault on his workforce had been anticipated for months. On December 3, 1997, Corrigan’s plan to train an alternative non-union workforce in Dubai had been exposed in federal parliament. Reith disingenuously denied knowledge of the operation, as did Corrigan initially, before admitting involvement in February 1998.
Corrigan says dramatic action was required, given the financial pressures on his company and his belief that he could not secure agreed change from the MUA under its national secretary, John Coombs. “I remember my first visit to Port Botany (as managing director). It must have been the early 90s. I went to the cafeteria, got some lunch, and went and sat with a group of people who all immediately got up and left and went and sat at another table,” he says.
“I was just sitting there by myself. No one would come near me. That was the mindset of the place. It was not a place in which management and employees could engage in any kind of productive discussion.”
Corrigan says he asked the terminal manager how many employees were working that day. “He said, ‘I have no idea.’ I said, ‘What are they working on?’ He said, ‘I don’t know that either.’ It just became clear to me that the place was completely out of control, or to put it slightly differently, it was in the control of the union. The union decided who attended work and who didn’t, and how fast they worked, and everything. And they were not doing much of a job of it.”
Corrigan was seeking a significant increase in container movements on the docks, as was Reith, who was pushing the government’s goal of 25 movements an hour, up from 17.6.
Howard argues the union was not interested in change and dismisses subsequent claims by MUA officials that it could have been achieved through consensus.
But the exposure of the Dubai exercise changed the dynamics. Corrigan went to his fallback option, leasing out Melbourne’s Webb Dock to the National Farmers Federation-backed non-union operation Producers and Consumers Stevedores. PCS director Paul Houlihan says their agreement was signed in November 1997 and the farmers had no clue about the Dubai operation. The duo, he says, had a shouting match in the middle of Sydney’s Kent Street at 8pm one night.
“I said, ‘You could have told us about it’, and he said, ‘I saw you guys as a second string to the operation.’ It’s pretty tough when your key ally has got a second game going. Dubai was always going to fail. You cannot train a workforce anywhere in the world without someone knowing about it.”
Corrigan paid PCS to train the non-union workers, but his insistence that the Dubai recruits join the Webb Dock workforce caused tensions and another confrontation between Corrigan and Houlihan, as the latter struggled to find an accredited trainer who was prepared to risk working with the operation. “We had another shouting session and Corrigan says, ‘I am paying you all this money and not getting anyone trained,’ ” Houlihan says. “I said, ‘If you had not been so bloody stupid by doing Dubai, we could, but we can’t get trainers.’ ”
This week Howard lauded the efforts of the NFF and its then president, Donald McGauchie. But after the dispute was settled there was no work for PCS employees and the company was wound up.
As the Webb Dock conflict played out in the media, the union movement was preparing for a bigger battle. Aided by leaks and reassurances from rival stevedore P&O that the company was not interested in a similarly radical path, Coombs and ACTU secretary Bill Kelty knew Corrigan was planning to unleash industrial hell. Kelty was convinced Howard and Reith were up to their necks in the plan.
“Lindsay Fox (the owner of logistics company Linfox) told me that Howard was going to f..k us over,” he says. “I said to him, ‘Put your money on us, mate.’ You see, I wanted Howard to go after the MUA. That was where we were strong, but I couldn’t believe what they actually did.”
In September 1997, Kelty sent a warning to Howard, threatening “the biggest picket that’s ever been assembled in this country” if the government went after the MUA. “To weaken the Maritime Union of Australia is to weaken the union movement as a whole,” he told the ACTU congress. “The day we give away that support is the day we rip out our own heart and leave it pumping in irrelevancy.”
Kelty said this week: “This is probably the best-planned dispute in the history of the union movement from our point of view. It’s a dispute that if we had to have one with the Howard government, this is the one we wanted.”
After the wharfies were locked out, the ACTU raised millions of dollars to support the workers through union contributions and private donations. “The unions raised enough money to keep the waterside workers at between 70 and 100 per cent of normal earnings for nine months,” Kelty says.
Critically, Kelty delivered on his congress promise and some of the biggest pickets in the history of the country were mounted, with dramatic stand-offs documented in evening television bulletins.
At the height of the dispute, Melbourne’s East Swanson dock resembled a war zone as thousands of unionists and their supporters linked arms in the pre-dawn semi-gloom, their faces floodlit by a police helicopter.
Like the post-apocalyptic setting of a Mad Max film, the road before them was blocked by metal spikes, railway sleepers and an overturned semi-trailer. Among those on the frontline were Kelty and former Victorian premier Joan Kirner. Suddenly, hundreds of police officers marched out of the darkness, slowly advancing during the next half-hour until the groups stared at each other from a distance of a few paces. But the police were hopelessly outnumbered and subsequently found themselves hemmed in between the picketers and about 1000 construction union members who had walked off the job to provide reinforcements.
The crowd celebrated before realising the police had secured another gate. “At that stage in Melbourne, it was really, really serious stuff,” says Houlihan. “It was close to a civil war out there.
“We took the names off the trucks but we ultimately couldn’t get them through. There were a lot of farmers who wanted to come down there to force the issue. But if we had tried to push through the trucks, it could have really gone off the rails.”
ACTU secretary Sally McManus, then a young union organiser, was on the Port Botany picket, part of the union telephone tree designed to ensure unionists could be marshalled at short notice to block entry to the terminal.
She recalls mates being hauled into police vans and her best friend fainting on the picket. The dispute had a “huge” impact on her. “There was that sense of being part of a national movement. It was such a tough dispute and high stakes,” McManus says. “I cannot even list the lessons out of it but it really forged a generation of trade unionists and it prepared us for Work Choices.”
The government also was rocked by revelations that federal cabinet devised a secret master plan in July 1997 involving the mass sacking of union workers on the waterfront and their replacement with non-union labour. In a letter to Reith 12 months before the lockout, Howard signed off on an “interventionist” strategy.
Howard and Reith met Corrigan in late 1997 and the businessman outlined action the company believed necessary. Howard insisted this week he provided little detail. “We hoped that Corrigan had the commitment and the plan to implement reform and we provided the framework if he was so disposed to do it, but we were not plotting it, hand in glove,” he says.
“Obviously, the willingness to advance the funding for redundancies was part of it. You had to do that. Otherwise why would he be the least bit serious given that other governments before us had caved in when something like this had arisen?”
Corrigan, excruciatingly coy about his dealings with the government during the dispute, admits he told the government in 1997 about his plan to remove the unionised workforce and bring in non-union contract labour.
“We had to tell them we had a plan to remove the workforce in certain circumstances,” he says. “There were certain circumstances in which we could declare the companies that employed these people bankrupt, and that’s what we did.”
Asked now to respond to the longstanding charge that he engaged in a conspiracy with the government to remove the union workforce, he says the company was responding to the Coalition’s desire to take on the MUA.
“People get this a little bit back to front,’’ he says. “If you remember, Howard was elected on a platform of industrial reform. He had identified the waterfront as an area of reform. So it was after that we went to see the government and said, ‘We agree with you about the opportunities here and the need for change, but here’s how we would go about it’, and they started to think about that.
“I wouldn’t say they endorsed it but they certainly respected the fact that we had a point of view and they said, ‘What do we need to do to facilitate that?’ We said, ‘First of all, back off, don’t intervene when things get difficult, and secondly, we think redundancy payments ought to be funded by government and repaid out of the productivity initiative.’ ”
During the dispute, Reith cheered on Corrigan while feigning ignorance of his intentions. His performance was not credible. The taxpayer-funded redundancy scheme had been devised well in advance. Corrigan would not move unless he knew he could get his hand on the cash, which Howard says was later recouped through a stevedoring levy.
On the night of the lockout, an excited Reith released a statement almost simultaneously with the Patrick announcement, called a late-night press conference and had redundancy legislation ready to be submitted to parliament the next day. His evasiveness when questioned about his knowledge of the Patrick strategy was too much for the electorate. The use of the dogs and security guards unsettled Australians while the tricky-looking complex corporate restructuring used by Corrigan to sack members of the industrially strongest union was used by unions to argue that if the MUA went down, other union-busting employers would follow suit.
Eventually, a High Court judgment opened the way for a negotiated settlement. The deal changed the way the waterfront worked but the outcome was not as straightforward as claimed by the government. More than 600 jobs went, but the MUA had conceded 220 of those positions before the dispute started. The union’s labour monopoly was not broken, and it retains a near-monopoly today.
Combet says he told the workers: “This is not about protecting everything on the job. If it’s something like the nick system, that’s got to go. What it’s about is your job, to get you back there, to protect your entitlements, to protect collective bargaining, to protect your right to be in a union, to have a collective agreement, to give you a say in your own workplace.
“But it’s going to be a different workplace and it has to be a productive one. If you are prepared to accept those conditions, that’s the objective of the dispute, then we can win it. But if you think it’s going to be about protecting the indefensible, then forget it, we cannot win some of the things that have gone on.”
He says Corrigan used the government to obtain the redundancy funds: “His objective is to make money. He got $150 million out of the government, and a productive and very profitable business.”
Combet attributes improved crane rates to productivity bonus payments that formed part of the settlement. But he acknowledges the dispute drove “cultural change”. “I should not diminish the importance of that. Everyone knew after that dispute, there’d been a near-death experience and that would have focused everyone’s minds on the job somewhat. It took the waterfront from the postwar arrangements that were very, very highly regulated, into a modern economy.”
Howard says Reith, Corrigan and the NFF are “the three heroes” of the dispute. “It’s not a reform that’s been unwound in terms of its economic dividend. Not everything turned out exactly as we wanted, but as far as economic reform is concerned, it did.”
But Kelty says the hero is Coombs. Reith and Coombs are both in poor health and could not be interviewed. “The union was a big winner. Corrigan was a big winner. The only real loser was John Howard and the anti-union strategy. They lost,” Kelty says.
“Did they destroy the unions? No. Did they destroy the MUA? No. Did they get change? Yes. Was there going to be change? Yes. Did the public get the benefit of the change? No. They paid the price because the stevedores passed on the cost of the levy to customers.
“John Howard desperately wants to reinvent the past because he lost. He wants to make it something that he didn’t win to claim some pious victory about improvement in the waterfront.”
Employers acknowledge the Howard government’s claims to have diminished the MUA’s influence are undercut by the current alarm about its merger with the construction union. But Paddy Crumlin, the present MUA national secretary, who helped co-ordinate the Fremantle picket in 1998, dismisses the claims. Two decades on, he says of the Patrick showdown: “We looked the devil in the eye and the devil blinked.”
THE FLASHPOINTS
1997
Apr 21: John Howard signs off on interventionist waterfront strategy in a letter to Peter Reith.
July 7: Reith and transport minister John Sharp take their waterfront plan, including the mass sacking of union workers, to cabinet.
Sep 3: Bill Kelty promises the “biggest picket line that’s ever been assembled in this country” if Howard moves against the MUA.
Dec 3: Chris Corrigan’s plan to train replacement non-union workforce in Dubai exposed in parliament. After initial denials, he admits involvement two months later.
1998
Jan 28: National Farmers Federation-backed Producers and Consumers Stevedores set up at Webb Dock.
Apr 7: Corrigan sacks Patrick workforce.
Apr 8: Federal Court says Patrick
cannot terminate workers’ employment.
Apr 23: Full Federal Court upholds decision.
May 4: High Court upholds Full Federal Court.
May 7: Workers go back through gate.
June 15: Draft settlement of dispute.
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