tag:theconversation.com,2011:/es/topics/cabinet-papers-1992-93-34355/articlesCabinet papers 1992-93 – The Conversation2016-12-31T20:33:43Ztag:theconversation.com,2011:article/701392016-12-31T20:33:43Z2016-12-31T20:33:43ZCabinet papers 1992-93: the rise and fall of enterprise bargaining agreements<p>1992 was landmark year in Australian industrial relations. The Keating government pushed for enterprise bargaining in the face of reluctance from the Industrial Relations Commission and employers’ concerns at the prospect of wage inflation. </p>
<p>The 1992-93 cabinet papers – released by the National Archives of Australia – mark this historic major reform, in the context of a set of broader economic reforms implemented by the Hawke/Keating Labor government. This all occurred when the economic outlook for growth and unemployment at the time was highly uncertain.</p>
<h2>Before the changes</h2>
<p>Up until this point, most people relied on National Wage Cases – or Living Wage Cases, as they had become known – handed down by the Industrial Relations Commission for improvements in wages. These generally happened yearly, and accounted for more than 90% of all wage movements during the period prior to enterprise bargaining. </p>
<p>Not only was bargaining a minor part of the system, but industrial awards were the primary instrument that set out, in a comprehensive way, terms and conditions of employment for most workers. </p>
<p>There were literally hundreds of awards – covering different occupations, industries, and even for some single companies, that set minimum employment conditions. </p>
<p>Australia had no formal minimum wage, unlike most other advanced industrial relations systems. And strikes remained unlawful tactics, although this was not reflective of practice. </p>
<h2>What the introduction of enterprise bargaining meant</h2>
<p>The decision to introduce enterprise bargaining was also taken in the middle of the period in which the broad elements of economic policy – including the wages system – were negotiated through the Prices and Incomes Accord. </p>
<p>The Accord was an agreement first struck between Labor and the unions in 1983 while Labor was in opposition. It formed the centrepiece of economic and industrial relations policy for the both the Hawke and Keating governments for more than a decade. </p>
<p>In many ways, the largely peaceful negotiation that enabled this shift to enterprise bargaining – or a system of “managed decentralism”, as it was often referred to – may not have happened without considerable industrial dispute if it hadn’t been negotiated as part of the Accord.</p>
<p>At the time, many unions were not convinced that enterprise bargaining was the best approach. But under Bill Kelty’s forceful leadership, the Australian Council of Trade Unions (ACTU) saw it as inevitable, and sought to ensure that it occurred in a fair and equitable manner.</p>
<p>A key feature of the reforms approved by cabinet in 1992 was the choice to include a role for awards as a safety net to protect those without bargaining power. Equally important were provisions to ensure that gains made in more productive sectors of the economy – or where unions were able to leverage greater bargaining power – did not flow to other groups through pattern bargaining. </p>
<p>While these provisions did not prove as effective as hoped, these changes formalised an end to the longstanding principle of comparative wage justice as a guiding one for determining wage outcomes. This principle dictated that individuals doing the same job in different sectors or firms should be paid the same irrespective of the profitability of the firm, or the economic state of the industry.</p>
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<span class="caption">The Keating government pushed for the introduction of the enterprise bargaining agreements.</span>
<span class="attribution"><span class="source">The National Archives of Australia</span>, <span class="license">Author provided</span></span>
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</figure>
<h2>The controversy</h2>
<p>At the time, the introduction of enterprise bargaining was not only momentous but also controversial – although you would barely be aware of these controversies based on the cabinet submission that formed the basis for this decision. </p>
<p>Perhaps surprising for many, the ACTU, not employer groups, was the strongest advocate for the introduction of statutory provisions for enterprise bargaining.
Employers were fearful that it could lead to a wage-price spiral associated with the end of wage indexation in the 1970s. </p>
<p>The national tribunal – which was then called the Industrial Relations Commission, was by and large opposed to a shift towards enterprise bargaining. It had just a year earlier, in the <a href="http://www.airc.gov.au/safetynet_review/decisions/J7400.htm">April 1991 National wage Case decision</a>, refused a request by the ACTU to enunciate principles for enterprise bargaining on the grounds that the industrial parties were not yet mature enough to engage in collective bargaining with exacting economic damage on the Australian economy. </p>
<p>By October, in a reconvened National wage case hearing, the Commission yielded to pressure form the ACTU and government and set out the first principles for enterprise bargaining. However, for government these proved too restrictive and so in 1992, changes to the legislation to create a new form of statutory agreement were introduced. These reforms also limited the ability of the Industrial relations Commission to veto enterprise agreements struck by employers and unions, but rather sought to provide a more active role in the oversight of implementation.</p>
<p>Yet, 1992 was not the end of the process of reform. In April 1993, in a speech to the Australian Institute of Company Directors, Prime Minister Keating signalled that his ambition was to further entrench enterprise bargaining and restrict the role of awards. </p>
<p>It was widely acknowledged the speech caused some rift between the ACTU and the Keating government. For many in the union movement, it was a step too far down a slippery slope towards labour market deregulation.</p>
<p>That fear has proved unfounded. After the battles around the introduction of Australian Workplace Agreements in the mid 1990s, which allowed employers to create agreements directly with individual employees, and then <a href="http://www.findlaw.com.au/faqs/1916/what-was-workchoices-and-why-was-it-so-unpopular.aspx">the Work Choices controversy in 2006</a>, the Fair Work Act first introduced under the Rudd government has proved stable. </p>
<p>It has found some common ground with the conservative side of politics, and the current government has no plans for a major haul of the system at this stage. <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/">The Fair Work Act</a> embeds enterprise bargaining as the primary mechanism by which wages and conditions are determined. Awards have shrunk in relevance – in the scope of issues they cover and the proportion of the workers reliant on them. </p>
<p>But will enterprise bargaining survive? If the trends reported in recent data on agreement making are any indicator, enterprise bargaining is now facing a period of decline. The <a href="https://docs.employment.gov.au/node/37341">latest release from the Commonwealth Department of Employment</a> shows the number of enterprise agreements being made is falling, and now the number of workers covered by enterprise agreements is also shrinking significantly. </p>
<p>This is of course closely related to the dramatic falls in union membership that have been occurring over several decades. This data suggests that neither the hopes and fears around the introduction of enterprise bargaining agreements have been realised. The ambitious hopes held by unions for the Fair Work Act to reverse their declining fortunes, nor the worst fears of many employer groups that the same legislation would lead to unions given a new found source of power to raise wages and reduce employment. </p>
<p>If anything, after 21 years of growth, we are now witnessing a decline of enterprise bargaining – a decline which will not be reversed without some legislative reform to support it.</p><img src="https://counter.theconversation.com/content/70139/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The Centre for Workplace Leadership receives funding from the Commonwealth Government. </span></em></p>Even though enterprise bargaining agreements proved controversial when introduced, their use is actually in decline today.Peter Gahan, Professor of Management + Director, Centre for Workplace Leadership, Faculty of Business and Economics, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/700592016-12-31T20:33:37Z2016-12-31T20:33:37ZCabinet papers 1992-93: Keating government fights for Indigenous rights on multiple fronts<figure><img src="https://images.theconversation.com/files/151218/original/image-20161221-14208-a2bfgq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Paul Keating recognised the significant opportunities – and political risks – the High Court's Mabo decision presented.</span> <span class="attribution"><span class="source">National Archives of Australia</span></span></figcaption></figure><p>Paul Keating’s first term as prime minister is often remembered for divisive debates over Indigenous affairs. He sought to pursue his vision of reconciliation between Aboriginal and non-Aboriginal Australians, negotiated passage of the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/nta1993147/">Native Title Act</a> and acknowledged the injustices and cruelties of Australia’s colonial history in his famous <a href="https://antar.org.au/sites/default/files/paul_keating_speech_transcript.pdf">Redfern Speech</a>. </p>
<p>However, economic priorities often overshadowed these events. Australia was <a href="http://www.abc.net.au/radionational/programs/boyerlectures/lecture-4-the-recession-of-1990-and-its-legacy/3353124">emerging from recession</a> with high unemployment and a growing budget deficit.</p>
<p>Cabinet documents from 1992 and 1993, released today by the National Archives of Australia, reveal the extent to which the government was torn between concern for fiscal responsibility and a desire to tackle Indigenous disadvantage and pursue meaningful reconciliation. </p>
<p>This tension was clear in the two major issues the government responded to in this period: the <a href="http://www.austlii.edu.au/au/other/IndigLRes/rciadic/">Royal Commission into Aboriginal Deaths in Custody</a> report, and the High Court’s <a href="http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/high_ct/175clr1.html?">Mabo decision</a>.</p>
<h2>Deaths in custody</h2>
<p>The response of the minister for Aboriginal and Torres Strait Islander affairs, Robert Tickner, to the royal commission unusually ranged across all aspects of Indigenous disadvantage. It recognised the commissioners’ strong argument that incarceration was a symptom of a long history of social, cultural and economic exclusion – one that demanded a more committed policy response. </p>
<p>Tickner had negotiated and co-signed policy measures with counterparts in the portfolios of employment, education and training, health, housing and community services, attorney-general, primary industries and energy, and others.</p>
<p>He proposed an expansion of the Community Development Employment Projects to provide both services and employment, particularly for Indigenous youth and women.</p>
<p>The package also proposed the appointment of an Aboriginal and Torres Strait Islander Commissioner in the Human Rights and Equal Opportunity Commission who would <a href="https://www.humanrights.gov.au/our-work/aboriginal-and-torres-strait-islander-social-justice/about-aboriginal-and-torres-strait">report annually</a> on social justice and human rights.</p>
<p>The policy package was slashed, however, from A$540 million to A$150 million over five years. This was in response to the demands of Treasury and Finance, which insisted that only the policies most obviously related to criminal justice be funded. The rest were to be reconsidered later if offsets could be found elsewhere.</p>
<p>This short-sighted response to the commission’s 339 recommendations is <a href="http://www.smh.com.au/federal-politics/political-news/patrick-dodsons-takedown-of-appalling-demonstration-of-ignorance-by-nigel-scullion-20161021-gs7vzu.html">still criticised today</a>. This is especially the case as Indigenous incarceration rates <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/4517.0">continue to spiral</a> in response to profound and complex disadvantage.</p>
<h2>Mabo and native title</h2>
<p>The government’s response to Mabo was similarly contested. This time the enemies were outside cabinet.</p>
<p>Keating understood the significant opportunity the decision presented. However, it placed the government in an almost impossible position. It was caught between Indigenous expectations, mining industry demands, fiscal constraints and state government recalcitrance – in addition to heightened international scrutiny.</p>
<p>The Mabo decision was complex. The media and most MPs understood the issues poorly. It was also clear that legislative recognition of native title was more likely to lose the government electoral support than win it more votes. As Keating’s speechwriter, Don Watson, <a href="https://www.australianbookreview.com.au/about/61-november-2011/618-don-watson-recollections-of-a-bleeding-heart-second-edition">noted</a>:</p>
<blockquote>
<p>Designing a legislative response to Mabo was a moral imperative and a political death trap … [with] all the elements of political horror.</p>
</blockquote>
<p>Cabinet nominated a Mabo committee, which consisted of Keating and Tickner along with the attorney-general, Michael Duffy. At its meeting on October 27, 1992, cabinet noted the dangers of “uncertainty” for the mining industry and observed:</p>
<blockquote>
<p>… the importance of the threshold across which the High Court has taken the nation and the ultimate need for government decision.</p>
</blockquote>
<p>At the same time, cabinet prepared itself for potential political disaster. It was aware it could not satisfy all the competing interests, and that there was little chance of support from the Liberal opposition. </p>
<p>Negotiations extended through 1993, following the federal election in March. </p>
<p>Cabinet adopted Keating’s “principles for a response” to the Mabo decision on June 1, 1993, in anticipation of a <a href="http://webarchive.nla.gov.au/gov/20040709211354/http://www.coag.gov.au/meetings/080693/index.htm">very tense Council of Australian Governments meeting</a>. State premiers were keen to demonstrate their objections to Commonwealth intervention in their management of land and Indigenous affairs. </p>
<p>The states would test the Commonwealth’s patience throughout 1993. Queensland demanded the Commonwealth pay compensation for any invalidated mining leases. Western Australia passed its own pre-emptive legislation attempting to extinguish native title altogether.</p>
<p>When Keating presented a draft native title bill on September 1, the cabinet minutes hinted at nervousness about the potential political fallout. Ministers were encouraged to “be ready to discuss the proposals with interest groups”. Keating was exhorted to “take whatever action was necessary to advance and protect the Commonwealth’s interests”. </p>
<p>Cabinet saw fit to afford Keating “latitude” in his negotiations. This prime ministerial prerogative would prove critical to the legislation’s ultimate success. Its passage was based on delicate compromises made with state premiers, Greens and Democrats senators, the National Farmers Federation and Aboriginal leaders.</p>
<h2>ATSIC’s role</h2>
<p>Throughout the year, the Aboriginal and Torres Strait Islander Commission (ATSIC) repeatedly insisted in cabinet submissions that alternative forms of redress be provided for the majority of Indigenous people who no longer enjoyed an unbroken connection with traditional lands. </p>
<p>The government prepared a “social justice and economic development package” within the constraints of the ever-present “fiscal realities” the government faced. Both ATSIC and the Council for Aboriginal Reconciliation requested more time for consultation. The package was thus delayed and disconnected from the Native Title Act, which received royal assent on December 24, 1993.</p>
<p>One notable feature of this period is the role of ATSIC, which the Hawke government created in 1990 as a practical expression of self-determination. As an elected body with administrative responsibility for much of the portfolio of Aboriginal affairs, ATSIC fulfilled both <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/Publications_Archive/CIB/Current_Issues_Briefs_2004_-_2005/05cib04">representative and executive functions</a>. </p>
<p>Cabinet documents reveal ATSIC was assertive in advising its junior minister. It commented on all relevant cabinet submissions and made additional submissions on key issues. This ensured the senior ministry took Aboriginal perspectives into account. </p>
<p>The Howard government abolished ATSIC in 2004, amid controversy. The bureaucrats were folded into mainstream departments, and the government abandoned the representative function entirely.</p>
<h2>How much has changed?</h2>
<p>Cabinet records from this period reveal some constants in Indigenous politics. Indigenous interests confront many powerful adversaries – including state and territory governments, and industries with interests in Aboriginal land. </p>
<p>Proposed expenditure tackling Indigenous social and economic disadvantage remains subject to the hard-headed decision-makers inside cabinet representing Finance and Treasury. </p>
<p>Finally, the task of tackling Indigenous priorities is even more challenging today, given the absence of ATSIC or some other representative body engaging in cabinet-level co-ordination and negotiation.</p><img src="https://counter.theconversation.com/content/70059/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Diana Perche does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Cabinet papers reveal the extent to which the Keating government was torn between concern for fiscal responsibility and a desire to tackle Indigenous disadvantage and pursue meaningful reconciliation.Diana Perche, Lecturer in Politics and Public Policy, Macquarie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/701192016-12-31T20:33:29Z2016-12-31T20:33:29ZCabinet papers 1992-93: the balance of head and heart<figure><img src="https://images.theconversation.com/files/151217/original/image-20161221-14212-u3tv8x.jpg?ixlib=rb-1.1.0&rect=0%2C57%2C700%2C514&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Paul Keating took the prime ministership with a ‘comprehensive plan to get the country cracking’, but the task was daunting.</span> <span class="attribution"><span class="source">National Archives of Australia</span></span></figcaption></figure><p>The two years covered in today’s release of cabinet records by the National Archives of Australia are neatly bookended. Paul Keating became prime minister on December 20, 1991; on December 21, 1993, the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/nta1993147/">Native Title Act</a> was passed after the <a href="http://www.aph.gov.au/Parliamentary_Business/Statistics/Senate_StatsNet/legislation/longestdebate">Senate’s longest</a>, most tumultuous debate.</p>
<p>In between, Labor’s project of economic transformation, which began in 1983, hit some harder realities. And a new push on remaking Australia stirred a brooding reaction of its own.</p>
<h2>Looking for a ‘kick-start’</h2>
<p>Don Russell, Keating’s principal private secretary, remarked that the top job would only come to his boss when the government was a wreck. Keating <a href="http://www.naa.gov.au/collection/explore/cabinet/by-year/1990-1991/background.aspx">began with</a> a “comprehensive plan to get the country cracking”, but the task was daunting. </p>
<p>With personal approval ratings at 25%, a slump in the dollar, and unemployment levels tracking past 10% – levels not matched since the Great Depression – Keating was under pressure. Cabinet, and a vanguard of senior officials, rallied to craft him an aria: the <a href="http://www.voced.edu.au/content/ngv%3A675">One Nation package</a> of economic stimulus and promises to return the nation to “jobs and prosperity” over four years.</p>
<p>Offering an initial program of A$2.3 billion in new spending, and promises of $8 billion in tax cuts, One Nation marked a shift in Keating’s thinking as treasurer. It began with the concession that:</p>
<blockquote>
<p>After seven years of growth, Australians are now experiencing hard times … families are worried about the future.</p>
</blockquote>
<p>A focus on infrastructure provision and regionalism might have looked like old-fashioned nation-building. Some dismissed it as pork-barrelling. There was no doubt a desire to mark a sharp contrast with the <a href="http://australianpolitics.com/1993/01/15/liberal-party-video-fightback.html">opposition’s Fightback! manifesto</a>.</p>
<p>Whatever the politics, cabinet discussions revealed that One Nation’s options were sifted with fine attention to what would still serve to advance Labor’s fundamental, continuing, microeconomic goals of increasing competition, boosting labour market productivity, and driving efficiency. That message had not shifted, but the settings had. </p>
<p>Cabinet frequently revisited the commitments of early 1992 as the “kick-start” faltered and the deficit deepened. Even as signs of recovery came, they were uneven. In mid-1992, cabinet was advised that:</p>
<blockquote>
<p>Australia is likely to be one of the many countries that will be characterised by only moderate growth, relatively high unemployment and low inflation for quite some time to come. </p>
</blockquote>
<p>If industries could not become more competitive, then “living standards will have to fall”.</p>
<p>Into 1993 the government began edging toward a more comprehensive approach to these challenges. This included the optimistically titled 1993 green paper, <a href="http://trove.nla.gov.au/work/11221539?q&versionId=45062330">Restoring Full Employment</a>, preparing the ground for <a href="http://www.voced.edu.au/content/ngv%3A8846">Working Nation</a> in 1994. </p>
<p>In these processes, a wider – now familiar – policy agenda was also locked in place, from the “greater self-regulation” of workplace bargaining to mandatory detention for the “boat people” who sheltered behind community compassion in evading, and eroding, immigration law.</p>
<p>The politics of these issues could be volatile. Labor <a href="https://en.wikipedia.org/wiki/Wills_by-election,_1992">lost</a> Bob Hawke’s seat of Wills in April 1992 to an independent who opposed trading working-class jobs for tariff reduction. Car manufacturers began to make the same point about their own insecurity. </p>
<p>In October, Jeff Kennett led the Liberals to <a href="https://en.wikipedia.org/wiki/Victorian_state_election,_1992">victory in Victoria</a> and set about showing how sharp the knives of “deficit reduction” could be. Political leaders took stock. Labor <a href="https://en.wikipedia.org/wiki/Tasmanian_state_election,_1992">lost government</a> in Tasmania, in part because of perceptions of capture by environmentalists.</p>
<p>Keating in particular was aware of these trends. Some accorded with the tensions that had driven his challenge to Hawke’s leadership, particularly on resource security and development. Cabinet submissions on these issues in 1992-93 promoted a “no-regrets policy”, defined as:</p>
<blockquote>
<p>… actions which involve little or no additional cost, cause minimal disruption to industry or the community, and which also offer benefits other than conservation-related. </p>
</blockquote>
<p>That was a new, harder line.</p>
<p>Equally, there was a need for a more conciliatory position on the impact of deregulation and the ending of protection. Keating began to argue that any further cuts in budget outlays would be “indecent” and “unfair”. </p>
<p>Labor’s unexpected <a href="https://en.wikipedia.org/wiki/Australian_federal_election,_1993">March 1993 election victory</a> was, as Keating put it, a victory for the “true believers” who had stayed the course of reform (or who had been spooked by the Liberal’s GST) and at last deserved the benefits of “a plan … born of national necessity”. </p>
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<figcaption><span class="caption">Paul Keating and Labor’s win in the 1993 election came as a shock.</span></figcaption>
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<p>Those rewards were slow in coming. Keating’s constituency was beginning to transition to the “battlers” John Howard would promise to rescue from the fatigue of reform in 1996.</p>
<h2>Raising the thresholds</h2>
<p>These years show a government still wrestling with the long-term agenda of economic reform and its consequences. But there was also that rising agenda of redefining the nation: the flag, the republic, the oath of allegiance, the centenary of federation and so on.</p>
<p>As Keating reflected to caucus after the 1993 election, Gough Whitlam had been all heart and no head; the 1980s had been head but little heart. Now was the chance to strike a better balance.</p>
<p>This, no doubt, is where the enduring legacy of Keating’s leadership in native title has its importance. It marked a break with a past of Indigenous dispossession for a future centring on a negotiated recognition of rights of land ownership, access, use and compensation. </p>
<p>This stance had several parallels. Among them, and running through many cabinet submissions, was fresh attention to the position of women.</p>
<p>Building on the 1992 <a href="http://www.voced.edu.au/content/ngv%3A18075">Half Way to Equal report</a>, chaired by Michael Lavarch, and the appointment of Anne Summers to Keating’s staff, several cabinet papers addressed the specific impact of policy measures on women. </p>
<p>The priority was on increasing women’s access to and efficiency in the labour market. But such instrumentalism was leavened by support for provisions in education and training that would enable women to take those opportunities, and particularly to tackle:</p>
<blockquote>
<p>… the lack of affordable child care as the major barrier to workforce participation. </p>
</blockquote>
<p>Aware that decentralised bargaining might not address all areas of workplace reform, cabinet also agreed to make dismissal on grounds of family responsibility unlawful, and a range of discriminatory acts – including sexual harassment – more enforceable in industrial awards. A determination that such principles should become “mainstream” was evident in these discussions, and is another legacy of these years.</p>
<p>Similarly, in 1992 cabinet endorsed the amendment of the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/rda1975202/">Racial Discrimination Act</a> to include an offence of racial vilification, encompassing acts:</p>
<blockquote>
<p>… that publicly incite others to hate, have furious contempt for or severely ridicule a person or group of people because of their race, colour, nationality, ethnic or national origin. </p>
</blockquote>
<p>Justice Minister Michael Tate emphasised the educative as much as the enforcement role of this measure in dealing with practices that were deeply shaped by persistent social inequality:</p>
<blockquote>
<p>By prescribing certain beliefs and acts as antisocial, warranting the imposition of legal sanctions for a breach of community standards in this regard, we would deny emphatically whatever legitimacy may have been afforded so far to racist views because of government inaction and community indifference.</p>
</blockquote>
<p>Again, the familiarity of these issues is striking. So is a sense that – whatever the strains of transformation then – some benchmarks set in those years make a stark contrast with the terms of debate over reform today.</p><img src="https://counter.theconversation.com/content/70119/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Nicholas Brown does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Labor’s project of economic transformation hit some harder realities as Paul Keating assumed the top job. And a new push on remaking Australia stirred a brooding reaction of its own.Nicholas Brown, Professor in History, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/705352016-12-31T20:33:18Z2016-12-31T20:33:18ZCabinet papers 1992-93: Australia reluctant while world moves towards first climate treaty<figure><img src="https://images.theconversation.com/files/151163/original/image-20161221-14216-zu3pa4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Despite international efforts, greenhouse gas emissions have continued to grow. </span> <span class="attribution"><span class="source">Coal image from www.shutterstock.com</span></span></figcaption></figure><p><a href="http://naa.gov.au/collection/explore/cabinet/by-year/index.aspx">Cabinet papers from 1992 and 1993</a> released today by the National Archives of Australia confirm that Australia was a reluctant player in international discussions about climate change and environmental issues under Prime Minister Paul Keating. </p>
<p>Internationally, it was an exciting time for the environment. In June 1992, the UN <a href="https://en.wikipedia.org/wiki/Earth_Summit">Earth Summit</a> was held in Rio de Janeiro. Here the world negotiated the <a href="http://unfccc.int/">UN Framework Convention on Climate Change</a> (which last year gave us the Paris Agreement) and opened the <a href="https://www.cbd.int/">Convention on Biological Diversity</a> for signing.</p>
<p>So what was Australia doing?</p>
<h2>Australia stumbles towards climate policy</h2>
<p>Domestically, the focus was on <a href="http://www.environment.gov.au/about-us/esd">Ecologically Sustainable Development</a> (ESD), a policy process begun by Prime Minister Bob Hawke. Working groups made up of corporate representatives, environmentalists and bureaucrats had beavered away and produced hundreds of recommendations. </p>
<p>By the final report in December 1991, the most radical recommendations (<a href="https://theconversation.com/tax-or-trade-the-war-on-carbon-pricing-has-been-raging-for-decades-46008">gasp – a price on carbon</a>!) had been weeded out. Democrats Senator John Coulter <a href="http://trove.nla.gov.au/newspaper/article/122394679">warned of bureaucratic hostility</a> to the final recommendations. Keating replaced Hawke in the same month. </p>
<p>The August 1992 meeting, where the ESD policies were meant to be agreed upon, was <a href="http://www.cambridge.org/gb/academic/subjects/history/regional-history-after-1500/history-australian-environment-movement?format=PB&isbn=9780521456869">so disastrous</a> that the environmentalists walked out and even the corporates felt aggrieved. </p>
<p>Two interim reports on the ESD process from the cabinet papers fill in some of the detail. </p>
<p>The first interim report, in March 1992, said that government departments had not been able to identify which recommendations to take on board. Cabinet moved the process on, but the only policies on the table were those that involved:</p>
<blockquote>
<p>…little or no additional cost, cause minimal disruption to industry or the community, and which also offer benefits other than greenhouse related. </p>
</blockquote>
<p>By May, federal ministers were told that the states and territories weren’t committed to either ESD or greenhouse gas policies.</p>
<p>The policy process rumbled on after the walkout, finally producing a <a href="https://www.environment.gov.au/about-us/esd/publications/national-esd-strategy-part1">National Strategy for Ecologically Sustainable Development</a> and a National Greenhouse Response Strategy. The greenhouse strategy contained only – surprise! – toothless voluntary measures, which proved ineffective in keeping emissions down to 1990 levels.</p>
<p>The November 1992 minutes mildly note that:</p>
<blockquote>
<p>Most major interest groups have voiced concerns about their lack of involvement in the drafting of the NGRS [greenhouse strategy] document. Officials made provision for community input through the public comment process and a public consultative forum held in August [the one the environmentalists walked out of]. Reaction from conservation groups is likely to be negative, given the limited changes made to many of the responses in the revised strategy. They are likely to want to see more concerted efforts in areas such as fuel efficiency and renewable energy sources.</p>
</blockquote>
<p>Indeed.</p>
<p>With equal prescience, the document warns:</p>
<blockquote>
<p>Coal producers and resource-intensive industries (eg. aluminium) may express concern about their prospects in the medium to long term.</p>
</blockquote>
<p>There are not many surprises here. The dithering over climate and environmental policies has been well covered by <a href="https://books.google.co.uk/books/about/Running_from_the_Storm.html?id=TOFQcm_96XAC&redir_esc=y">Clive Hamilton</a>, <a href="http://library.sl.nsw.gov.au/record=b1830272%7ES2">David Cox</a>, <a href="https://joanstaples.files.wordpress.com/2012/11/joan-staples-phd-thesis-for-printing1.pdf">Joan Staples</a> and numerous academic papers (see <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8497.2005.00371.x/abstract">here</a>, <a href="http://www.tandfonline.com/doi/abs/10.1080/0951274052000319346?needAccess=true">here</a>, <a href="https://www.academia.edu/2628883/Institutionalizing_Unsustainability_The_Paradox_of_Global_Climate_Governance">here</a>, and <a href="http://www.mitpressjournals.org/doi/pdf/10.1162/glep.2007.7.4.118">here</a>). </p>
<p>And while we won’t know officially <a href="http://naa.gov.au/collection/explore/cabinet/notebooks/index.aspx">who said what for another 30 years</a>, there are tantalising hints in <a href="http://www.abc.net.au/7.30/stories/s47383.htm">Neal Blewett’s A Cabinet Diary</a>. Published in 1999, it reveals the antagonism between the environment minister and others in the Keating cabinet. </p>
<h2>The international stage</h2>
<p>International climate policy was dominated by the US threat, under President George Bush senior, not to attend the Earth Summit if the UN Framework Convention on Climate Change (UNFCCC) included specific emission-reduction targets. The US attended, and the UNFCCC didn’t include targets. </p>
<p>In Australia, the cabinet papers point out, not for the first or last time, that:</p>
<blockquote>
<p>Australia is the only developed megadiverse country; it is a major user and exporter of greenhouse gas producing fossil fuels and energy intensive products; it could be significantly affected by global environmental change. </p>
</blockquote>
<p>In May 1992 cabinet endorsed in principle support for the UNFCCC. There are three ironies here. </p>
<p>First, it was a major concern that the media statement to accompany Environment Minister Ros Kelly’s signing should be amended to include the fact that:</p>
<blockquote>
<p>The Convention does not bind any signatory to meet any greenhouse gas target by a specified date. </p>
</blockquote>
<p>Second, the minutes note that:</p>
<blockquote>
<p>A decision by Australia not to sign the Convention would be criticised by domestic environment interests and could also attract international criticism, particularly in the Pacific region.</p>
</blockquote>
<p>In later years, Prime Minister John Howard would not worry about this when repeatedly nixing ratification of the Kyoto Protocol.</p>
<p>Third, an emphasis on assisting developing countries in the Asia-Pacific region with climate adaptation looks odd given there had been zero mention of greenhouse gases in a March 1992 discussion document of aid to Cambodia (that <a href="https://www.iucn.org/content/climate-change-and-its-impact-lao-and-cambodian-people">country is feeling the effects</a> already).</p>
<p>Keating’s willingness to let Kelly sign the convention may have been related to the following: </p>
<blockquote>
<p>The Convention contains several safeguards which protect Australia’s interests … [A]llowance is made for “the differences in Parties’ starting points and approaches, economic structures and resource bases, and the need to maintain strong and sustainable economic growth, available technologies and other individual circumstances”. Additionally, Parties are obliged to take into consideration the situation of Parties with economies that are highly dependent on the production, processing, export and use of fossil fuels. These two provisions will give relevant countries, including Australia, flexibility in fulfilling their obligations under the Convention.</p>
</blockquote>
<p>And they probably thought they had more time than they actually did. The May 1992 note argues:</p>
<blockquote>
<p>[The UNFCCC] is likely to take some years to obtain the necessary ratifications to bring it into force.</p>
</blockquote>
<p>It took two. Australia <a href="http://unfccc.int/essential_background/convention/status_of_ratification/items/2631.php">ratified the treaty in December 1992</a>, but not before noting that the UNFCCC would worry industry for being too strong, and environmental groups for being too weak. So no changes there. </p>
<h2>What happened next</h2>
<p>At least when it comes to climate policy, there are no real secrets worthy of the name. We have always known that the Australian state quickly retreated from its already hedged promise to take action, and told us all along that this was because we had a lot of coal. </p>
<p>While Australia’s international credibility has flatlined (with a brief bump from 2007 to 2009), two other things have soared over the last 25 years: Australia’s coal exports, and atmospheric concentrations of carbon dioxide. Both look set to continue their upward trend.</p>
<p>Reading the documents, it is striking how concerned the cabinet was to minimise its financial commitments (unsurprising, perhaps, given the overall state of the economy at the time), and just how unimportant the climate issue was to leaders who ask us to trust them on the long-term future of the country. It seems it was a distant abstraction that many didn’t really think was real. How times have changed.</p><img src="https://counter.theconversation.com/content/70535/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc Hudson does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The 1992 and 1993 cabinet papers confirm that Australia was a reluctant player in international discussions about climate change and environmental issues under Prime Minister Paul Keating.Marc Hudson, PhD Candidate, Sustainable Consumption Institute, University of ManchesterLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/703432016-12-31T20:33:11Z2016-12-31T20:33:11ZThe 1992-93 cabinet papers reveal the chaos behind the government’s economic statement<figure><img src="https://images.theconversation.com/files/151336/original/image-20161222-4100-ou038e.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The government was forced to respond to John Hewson's plan.</span> <span class="attribution"><span class="source">The National Archives of Australia, Author provided</span></span></figcaption></figure><p>The 1992-93 cabinet papers, released today by the National Archives of Australia, reveal a government struggling for solutions to myriad problems. </p>
<p>These were tough, lean years for Australia. The recession “we had to have” was still biting deeply into the economy and showed no signs of lifting. The rural drought was still in full sway. Business confidence was shot.</p>
<p>The Labor government was entering its fourth term in government, unsure of its direction and suffering a crisis of confidence. It appeared besieged on all fronts, not least as the John Hewson led Opposition released Fightback! in 1991 – a neoliberal plan advocating major social and economic change. </p>
<p>Initially blindsided by the Opposition’s agenda, Labor gambled by changing its leader for the first time while holding office. Frustrated at the economic meltdown that had greeted his pro-market policies, new Prime Minister Paul Keating was uncertain as to the best steps to take going forward. He did not want to reverse his reform legacy, but was searching for solutions. </p>
<p>But newly released cabinet papers show that while the Labor government was trying to reassure itself that it was “not weakening our resolve”, many ministers were clearly reform fatigued. </p>
<p>To fill this void, much policy work was going on behind the scenes, largely led by a small number of key public officials, central agency bureaucrats and tireless taskforce working groups. The minions were busy crafting an omnibus agenda for a government that had tired itself out. </p>
<h2>The issues</h2>
<p>The Keating government was preoccupied with two big issues in 1992. First, a surging unemployment rate, and especially the increasing number of long-term unemployed workers who were virtually unemployable. Second, a budget deficit then hovering at around A$5.5 billion and getting slightly worse by the month. </p>
<p>Unemployment was 10.6% in December 1991 and expected to grow to 11% by 1992 before falling slowly thereafter. Government spending was still growing by 4% per annum and had increased Commonwealth outlays to 26.2% of GDP, while revenues were weak but slowly trending upwards. These twin problems overshadowed almost all the government contemplated and did. Cabinet briefs, with anything up to six or seven listed options to “do something”, were invariably about setting out the lowest cost option in the longer-term. </p>
<h2>Scrambling for solutions</h2>
<p>In the first few months of 1992 the Keating government busied itself pulling together its major economic statement named the <a href="http://trove.nla.gov.au/work/27011447?q&sort=holdings+desc&_=1482367830659&versionId=197866735">One Nation statement</a>. It built on a series of other economic and employment packages, from Building a Competitive Australia (1991) through to Working Nation (1994)). </p>
<p>The wonderfully named “Ad Hoc Committee of Cabinet”, seemed to be making the lion’s share of the key decisions. Senior ministers on the ad hoc committee were able to indicate pending decisions even before portfolio ministers had been consulted or agreed them, or cabinet had formally endorsed such decisions. </p>
<p>The statement reflected the frenetic policy process across government that had driven its construction. It was called a “stocktake of the government’s achievements” and reaffirmation of the “further pursuit of microeconomic reform”. Even items earmarked for release separately (such as the science and technology measures) were folded into the economic statement to maximise its breadth and intended impact.</p>
<p>The nation-building package became a grab bag of initiatives, most of which were only loosely related to the main themes. It included tax cuts, science and technology measures, R&D concessions, transport and electricity shakeups (Trans-Tasman shipping), mobile and radio frequency spectrums, postal services, housing needs, regulatory relaxations, selective privatisation of government business enterprises, the establishment of a new national rail corporation, infrastructure projects especially road network improvements, heritage and environmental projects, support for union amalgamations, drought relief, urban projects and city planning, various submissions called “further proposals”, and even funding for the newly announced second Sydney airport at Badgery’s Creek! </p>
<p>Much of this activity was rebadging existing programs or tweaking them to imply the government was doing something. </p>
<p>Various assistance packages were announced but most were short term adjustment programs. Not many amounted to much in terms of dollar amounts. There was a more general interest in labour market programs, with some continual renaming of employment creation schemes as the targeted cohort changed or proved difficult to place in jobs. Job scheme programs called Jobtrain were replaced by Jobstart and Jobskills, and others were invented to target those that did not fit the eligibility criteria such as the self-employed adjustment program or SEAP. </p>
<h2>Moving forward</h2>
<p>The government would later go onto other agendas in 1992 and 1993 (social, cultural, industrial relations, regional, Indigenous, refugees, disabilities, aged care etc.) once it had released its major economic paper. But the difficult years of 1992-93 show that while the main agendas of the government’s daily business sheet remained economic matters, grand politics began to triumph over the dismally-inclined economic agendas. </p>
<p>The One Nation economic statement did not itself turn around the economic malaise or improve the immediate political standing of the government, but it did provide a circuit-breaker to allow Paul Keating to boast he still had economic credentials while he dismantled “more slowly” John Hewson’s Fightback! strategy over the remaining months of 1992-93.</p><img src="https://counter.theconversation.com/content/70343/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Wanna has received funding from the ARC for academic research on Australian governance.</span></em></p>Blindsided by John Hewson’s policy platform, the Keating government scrambled to come up with solutions to the “recession we had to have”.John Wanna, Sir John Bunting Chair of Public Administration, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/699922016-12-31T20:32:45Z2016-12-31T20:32:45ZCabinet papers 1992-93: Australia moves to make Her Majesty obsolete<figure><img src="https://images.theconversation.com/files/150246/original/image-20161215-2529-1ntc3um.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Paul Keating put the idea of a new flag, shorn of any traces of the Union Jack, on the political agenda.</span> <span class="attribution"><span class="source">AAP/David Moir</span></span></figcaption></figure><p>By 1992 Australia was in its deepest economic crisis since the 1930s. Unemployment was 11%; business failure was widespread. The political stocks of the Keating Labor government were low. A reinvigorated opposition under Liberal leader John Hewson seemed set for a return to government.</p>
<p>In December 1991, no-one could have predicted that Paul Keating would spend so much energy during the first year of his prime ministership on national identity issues. </p>
<p>By the end of 1992, Keating had done more than anyone to place on the political agenda issues of this kind that had been either dead or dormant for years: most significantly, a republic and a new flag, the latter shorn of any traces of the Union Jack.</p>
<p>But that wasn’t all. The 50th anniversary of the <a href="http://www.ww2australia.gov.au/japadvance/singapore.html">fall of Singapore</a> became an occasion for recalling Britain’s supposed abandonment of Australia, which Keating saw as aided and abetted by local lickspittles. </p>
<p>He earned from a British tabloid the sobriquet <a href="http://www.smh.com.au/lifestyle/how-not-to-greet-the-queen-famous-gaffes-20111017-1lt08.html">“The Lizard of Oz”</a> when he had touched the Queen on the back while guiding her at an event during her February tour. And he used a visit to Port Moresby for Anzac Day to <a href="http://www.keating.org.au/shop/item/anzac-day---25-april-1992">bolster the claims of Kokoda</a> to a central place in Australian war memory and historical consciousness. </p>
<p>In a dramatic gesture, Keating kissed the ground where young Australians had fought and died defending their country in 1942. Who could have envisaged such flamboyant symbolic politics during the years when Keating made his reputation as a reforming treasurer?</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=406&fit=crop&dpr=1 600w, https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=406&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=406&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=510&fit=crop&dpr=1 754w, https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=510&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/150409/original/image-20161216-26071-e0x0vn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=510&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Paul Keating made international headlines when he touched the Queen on the back during a visit to Australia.</span>
<span class="attribution"><span class="source">Screenshot/Sydney Morning Herald</span></span>
</figcaption>
</figure>
<h2>A new oath</h2>
<p>This year’s cabinet papers release by the National Archives of Australia reveals that it was in the middle of dealing with these matters that the government elevated the oath of allegiance recited by new Australian citizens to national prominence. </p>
<p>Throughout the 1980s, the idea of increasing the value attached to citizenship had taken hold. It was an attitude that figured in the <a href="http://www.multiculturalaustralia.edu.au/doc/fitzgerald_2.pdf">federal government review</a> chaired by Stephen FitzGerald in 1988, which had suggested a revival of the citizenship ceremony and a more meaningful oath. It even proposed a text, a very long one.</p>
<p>In June 1992 Keating had publicly complained that the existing oath, which required citizens to swear allegiance to Queen Elizabeth and her heirs and successors, needed to be made more “Australian”. It should, he said, state that:</p>
<blockquote>
<p>… Australia stands for – including liberty, tolerance, social justice – those very beliefs which underpin multiculturalism.</p>
</blockquote>
<p>Keating did not yet specify whether a revised text would exclude mention of the Queen, but there had been efforts along these lines in 1973 and 1983, foundering each time on the rocks of Senate opposition.</p>
<p>When cabinet considered a submission on the matter from the justice minister, Michael Tate, in August 1992, it was clear the government was now committed – as Keating’s speechwriter Don Watson would later put it – to a pledge that “made God optional and the Queen obsolete”. </p>
<p>The existing oath “can be seen as sterile in its brevity and anachronistic in its reference to a sovereign”, the cabinet paper declared. </p>
<p>Although Tate said he had considered the possibility of leaving open the option of swearing allegiance to the Queen, he:</p>
<blockquote>
<p>… rejected this as there is no justification for some new citizens to make a commitment to Australia which is different in content from others.</p>
</blockquote>
<p>Tate and his advisers had travelled to Taree, seeking the assistance of a man many increasingly regarded as Australia’s leading poet, Les Murray. A republican who regarded the existing monarchical pledge as “hopelessly grovelling” and wanted something fit for recital by “a decent grown-up person”, Murray advised that Australia should have a “pledge”, not an “oath”.</p>
<p>Jesus had forbidden oaths, he explained, which ruled out the Christians, and they were irrelevant to non-believers. That left just a few minorities – such as Jews and Muslims – for whom the idea made any sense at all.</p>
<p>A devout Catholic who is today a priest, Tate accepted the “pledge” idea, but he had concerns about the text Murray suggested:</p>
<blockquote>
<p>(Under God) from this time forward</p>
<p>I am part of the Australian people.</p>
<p>I share their democracy and freedom.</p>
<p>I obey their laws.</p>
<p>I will never despise their customs or their faith</p>
<p>and I expect Australia to be loyal to me.</p>
</blockquote>
<p>That one was never going to get past the politicians and public servants, especially the last line with its disturbing suggestion of a barely minted “sovereign citizen” imposing obligations on the state.</p>
<p>There were other suggestions floated in cabinet. The Department of Prime Minister and Cabinet thought a reference to “territory” or “land” might be included.</p>
<p>But the spare text on which cabinet eventually agreed is still with us:</p>
<blockquote>
<p>From this time forward, (under God) I pledge my loyalty to Australia and its people, whose democratic beliefs I share, whose rights and liberties I respect, and whose laws I will uphold and obey. </p>
</blockquote>
<p>In 2013, Murray <a href="http://www.smh.com.au/national/affirmation-criticised-by-the-poet-who-wrote-it-20130124-2d9nf.html">called it</a>:</p>
<blockquote>
<p>… heavy and pompous and sort of farting with sincerity.</p>
</blockquote>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=394&fit=crop&dpr=1 600w, https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=394&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=394&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=495&fit=crop&dpr=1 754w, https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=495&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/150410/original/image-20161216-26062-xnm0v0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=495&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Poet Les Murray was called on to draft Australia’s revised citizenship pledge.</span>
<span class="attribution"><span class="source">AAP/Alan Porritt</span></span>
</figcaption>
</figure>
<h2>Passed despite concerted opposition</h2>
<p>It was not, however, a lack of poetry that worried opponents in 1992. </p>
<p>Tate’s submission predicted, accurately enough, that the proposal would attract:</p>
<blockquote>
<p>… strong criticism from those groups who may see such proposals as reflecting a tendency towards republicanism. </p>
</blockquote>
<p>Returned and Services League leaders condemned the move, as did some Liberal State leaders. Bronwyn Bishop, then a Liberal senator, <a href="http://www.crispinhull.com.au/1992/12/12/1992_12_december_leader20/">described it</a> as “a tasteless and opportunistic way to dance on the grave of the dead marriage of the Prince and Princess of Wales” – the drawing of a long bow that itself seemed a little tasteless. </p>
<p>Hewson, meanwhile, complained that the pledge would do nothing for the unemployed; the Coalition opposed the proposal when it came before parliament. And after the new pledge was introduced in 1994, some municipal councillors initially refused to perform citizenship ceremonies. They said they feared being charged with treason.</p>
<p>The controversy soon receded, as usually happens soon after changes of this kind are made to national ritual or symbolism. But Tate was being unduly ambitious when he predicted that the pledge:</p>
<blockquote>
<p>… will appeal to Australian children and teenagers who will learn it off by heart. </p>
</blockquote>
<p>That hasn’t quite come to pass, but affirmation ceremonies are held at which existing citizens can recite the pledge and receive a certificate for their efforts.</p>
<p>But here’s a modest proposal – that we revert to Murray’s more poetic, democratic and meaningful words. Perhaps then the pledge would, as the 1992 cabinet submission envisaged, help “make the concept of citizenship mean more to both native born and migrant citizens”.</p><img src="https://counter.theconversation.com/content/69992/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Frank Bongiorno does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>By the end of 1992, Paul Keating had done more than anyone to place on the political agenda issues of national identity that had been either dead or dormant for years.Frank Bongiorno, Professor of History, ANU College of Arts and Social Sciences, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/701402016-12-31T20:32:38Z2016-12-31T20:32:38ZHow changes noted in the 1992-93 cabinet papers affect our super today<p>While superannuation changes were debated all through 2016 we were often reminded that the superannuation system is still maturing. Many workers retiring today were not members of a superannuation scheme for much of their working life. </p>
<p>The cabinet papers of 1992-93 released today by the National Archives of Australia give an insight into how, and why, the system was originally designed; and how some of those decisions are reflected in the current policy debate.</p>
<h2>A new super scheme</h2>
<p>The Superannuation Guarantee came into force from July 1 1992. In that year about 64% of employees had access to superannuation including white collar workers, public servants and workers covered by an award based scheme. </p>
<p>Award superannuation had been in place since 1987, following the Australian Council of Trade Unions (ACTU) agreement to trade off a wage increase for an occupational superannuation scheme. Industrial awards required employers to contribute 3% of wages for a worker paid under the award to superannuation instead of being received in the pay packet.</p>
<p>Under the 1987 agreement a further 3% was to be introduced between 1991 and 1993, however this didn’t happen because of the failed <a href="http://www.airc.gov.au/safetynet_review/decisions/J7400.htm">1991 National Wage Case</a>. As a result, the ACTU, supported by former Treasurer Paul Keating who was then on the backbench, called for a legislative scheme.</p>
<p>The Superannuation Guarantee was announced in the 1991 Federal Budget. It required employers to contribute to superannuation for all workers earning more than A$450 per month. The guarantee as legislated was 3% (or <a href="https://www.legislation.gov.au/Details/C2004C07278">4%</a> if payroll exceeded A$1 million), increasing to 9% by the year 2000. </p>
<p>In February 1992, amid slowing economic conditions, the cabinet considered whether to defer the implementation of the levy by six months.</p>
<p>Not surprisingly the guarantee was not popular with employer groups, who regarded it as an additional cost imposed during a recession. This was because the new guarantee was estimated to increase labour costs by 1.4% in the first year, mostly for employers whose employees had not been previously covered by award superannuation, although there was an expectation that future wage increases would be moderated by the amount of the levy. </p>
<p>On the other hand, the ACTU was strongly opposed to any deferral, as there was already a division between those employees who did have access to a super guarantee and those who didn’t. The 1992 cabinet minutes record concerns that the ACTU would increase wage claims that year if the guarantee did not proceed as scheduled, and that this would threaten the eventual implementation of a legislated superannuation scheme. </p>
<p>Cabinet decided not to defer the implementation and the bills were introduced into the parliament on April 2 1992. When a similar set of circumstances arose in 2014, the <a href="http://jbh.ministers.treasury.gov.au/media-release/026-2014/">Abbott government chose not to follow</a> this precedent, and deferred the proposed increase.</p>
<h2>The 10% rule</h2>
<p>In 2016 the <a href="http://www.budget.gov.au/2016-17/content/glossies/tax_super/downloads/FS-Super/07-SFS-Tax_deduction_for_personal_contributions-161109.pdf">“10% rule” was abolished</a> to improve flexibility by removing inconsistency of treatment for contributors, however this was also the reason for the introduction of the rule. </p>
<p>The <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s290.160.html">rule limited tax deductions</a> for superannuation paid by a person who earned more than 10% of their income from a source already covered by the super guarantee. </p>
<p>A person who is primarily self employed, or receives less than 10% of their income from employment sources, could claim an income tax deduction for personal super contributions. But an employee, who does not pay income tax on superannuation contributions paid on their behalf by an employer, couldn’t claim a tax deduction for additional personal contributions. </p>
<p>Prior to 1992, the income tax deduction for personal contributions was limited, with different limits applying to self-employed, employees covered by award superannuation or employees contributing to a non-award scheme.</p>
<p>The proposal before cabinet in June 1992 removed the distinction between employees covered or not covered by award schemes, denying tax deductibility for personal contributions. In this context the 10% rule was a safe harbour that ensured a person who was mostly self-employed did not lose the tax deduction for their superannuation contributions. </p>
<p>The abolition of the rule this year was not bipartisan: Labor and others opposed it. However the labour market has changed, and in the more casualised and flexible work environment of 2016 workers move between employment, contract work and self-employment far more than in 1992. The safe harbour of 1992 has now become an impediment to retirement savings.</p>
<h2>Regulation of super contributions</h2>
<p>Federal regulation of superannuation funds was limited before the introduction of award superannuation. This was exemplified in tax schemes where employers “contributed” on behalf of employees who were unaware of their entitlements, or who only became entitled after meeting onerous service and contribution requirements. </p>
<p>The Superannuation Industry Supervision legislation was enacted in 1993 to protect employee superannuation entitlements.</p>
<p>Under the new framework, the responsibility for employee benefits was placed with the employee, allowing employees to change between funds, protecting employees from fraud by the trustee and limiting control of the fund by the employer. Arguably this portability has also led to a structural change in superannuation funds, as the accumulation of funds in one account has replaced separate defined benefit funds as the default form of superannuation. </p>
<p>One of the <a href="http://www.pc.gov.au/research/completed/superannuation-post-retirement">current policy challenges</a> is how to use these types of accumulated funds to provide a tax effective income stream, like those delivered by defined benefit funds.</p>
<h2>Gender superannuation gap</h2>
<p>Another consequence of an employment based retirement savings system is the gender pay gap is carried on into retirement. As noted in the 2016 Senate Committee Report, <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Economic_security_for_women_in_retirement/Report">A Husband is Not A Retirement Plan</a>, women and men experience work very differently, and this is reflected in their retirement savings.</p>
<p>This issue was also identified back in 1992 in the <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/House_of_Representatives_Committees?url=reports/1992/1992_pp98report.htm">government report Halfway to Equal</a>. The recommendations from this report included designing the superannuation scheme that takes into account women’s broken work patterns and superannuation funds ensuring that women retain membership rights while on maternity leave. </p>
<p>Cabinet papers show both recommendations were supported by the government at the time. These reforms did ensure that women’s contributions were preserved, but the structural problem of the link between retirement savings and earnings was not addressed in the design of the system. </p>
<p>The current superannuation gender gap was foreseeable. The remedies implemented by the government in 1992 protected entitlements rather than addressing the root cause: the superannuation guarantee legislation is gender blind, and this gender blindness has continued to the current day. </p>
<p>Looking back at the decisions of 1992, the superannuation guarantee scheme has served the purpose it was designed to. Most working Australians now have some superannuation to supplement the age pension. </p>
<p>The next radical reform to superannuation, which allowed massive injections into superannuation savings, was in 2007. I look forward to reading the cabinet papers for those discussions.</p><img src="https://counter.theconversation.com/content/70140/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Helen Hodgson receives funding from AHURI and ARC. Helen is a member of the Social Policy Committee and a Director of the National Foundation for Australian Women, and is on the Tax and Superannuation Advisory Panel of ACOSS. Helen was a Member of the WA Legislative Council in WA from 1997 to 2001, elected as an Australian Democrat. She is not a current member of any political party.</span></em></p>The changes to superannuation discussed in the 1992-93 cabinet papers shaped the system we have today for better and worse.Helen Hodgson, Associate Professor, Curtin Law School and Curtin Business School, Curtin UniversityLicensed as Creative Commons – attribution, no derivatives.