This article was co-written with Michael Costa and Tom Forrest, probably in mid-1993, and was for internal discussion in the Labor Council of NSW.
The role of peak councils in the trade union movement has come under examination from a number of sections of the Labor movement. The most recent example of this questioning is the paper tabled at the ACTU executive in March 1993 entitled ACTU Future Directions Discussion Paper.
The Future Directions discussion paper is in one sense a logical extension of and an attempt to progress some of the issues initiated in the 1987 Future Strategies for the Trade Union Movement discussion paper, which initiated the move toward the 20 industry unions.
The union rationalisation process has proceeded very rapidly and there is no doubt that within the next three years the initial vision of 20 major industry groupings will be achieved.
It is therefore appropriate that the role of the federal and state peak councils be thoroughly examined to ensure that the scarce resources of the trade union movement are effectively utilised.
Organisational structures and activities which currently exist by virtue of history must be tested against the emerging operating environment for trade unions.
An accurate assessment of the emerging operating environment is crucial in developing the structure which will facilitate the goals of trade unionism.
Unfortunately, some of the discussion in the trade union movement about the emerging operating environment lacks depth or is merely a projection of past trends. The dramatic events of the recent years, both domestically and internationally, make abundantly clear that past trends cannot be regarded as an adequate basis for predicting the future.
The trend in the 1980s in Australia was towards centralisation. Politically this was facilitated by the fact that Labor controlled, for the first time, all the significant state governments and the federal government.
Industrially the Accord between the trade union movement and the Labor government ensured that the institutions of the federal industrial relations system would dominate the industrial landscape in a way they had never done before.
The union rationalisation process was very much an activity that reflected the realpolitik of the 1980s, that is, the growth in importance of the federal system and related structures. The forces propelling Australia’s institutions towards a more central focus were largely political forces.
In 1993 it is clear that much of the political pressure toward centralisation is out of kilter with emerging international trends and domestic pressures at both the macro and micro level.
Internationally, centralised federalism, central government and even the nation state are in economic and strategic decline. Globalisation has moved beyond the integration of national economies into the world economy, the process has reached the level where global regional integration is the most important international economic linkage.
The ability of national governments utilising economic structures, policies and instruments designed for national economic management to independently shape national direction has diminished. The challenge for government in the 1990s is to develop policies and structures that facilitate growth and development at a more micro level be it regions or enterprises.
The trend away from larger organisations to more focused, localised structures is reflected in the evolution of business and administration.
Recently the respected journal The Economist devoted its cover and editorial to the topic of the ‘Fall of Big Business’. The Economist pointed out that computer technology has narrowed organisational economies of scale not expanded them. The plummeting price of computers has enabled smaller organisations and firms to employ the same logistical techniques, sophisticated financial models, and other administrative tasks that were once only available to large organisations. In short, economies of scale can now be achieved with very small volumes.
This crucial economic revolution is behind the calls for greater enterprise focused industrial relations. Competitive advantage based on economic flexibility and responsiveness is the key to success in the 1990s for all organisations. The trade union movement cannot be insulated from these trends.
Industrial relations in Australia is already reflecting the trend towards the micro. Enterprise bargaining, and the declining influence and authority of the central industrial relations structures, are but one example of this.
The continuing decline in trade union participation rates, largely as a result of the structural change within the Australian economy linked to global regional economic integration, is a clear manifestation of the consequences of the shift towards decentralised technology and organisational structures.
STRATEGIC STRENGTHS AND WEAKNESSES OF TRADE UNION PEAK BODIES
The ACTU, as a peak body undoubtedly has a number of significant strengths. The ACTU over the last decade has helped set the national agenda both in industrial relations and more broadly in other areas of social policy.
There is a unanimous consensus within the trade union movement about the desirability of the national peak body. This is reflected by the fact that every significant union is affiliated to the ACTU. Many of the state peak councils are yet to achieve full affiliations.
The political relationship the ACTU has with Federal Labor is a significant strength.
The ACTU has significant and crucial relationships with all its major affiliates and the major employer organisations. It has national credibility and is internationally recognised. It plays a key co-ordination role in major areas of importance, for example, superannuation.
The ACTU has benefited from the strong leadership shown by its key officials.
The ACTU has a number of perceived weaknesses. It is seen to be remote from the rank and file and to sometimes lack understanding of the grass roots decision-making process and its resultant activities. A related point is the deficiencies in translating support of and understanding concerning ACTU policies and strategies.
The continuing strength of state systems and state governments, particularly when these institutions are in the hands of conservative governments, can undermine the ACTU’s ability to coordinate nationally.
Some of its current activities are partly dependent on external power relationships and funding, e.g., government grants.
The strong relationship with federal Labor often leads to the perception that the ACTU is partisan, which can be a particular problem with conservative state governments. But this is not currently a very significant weakness.
THE STATE PEAK COUNCILS
State peak councils have a number of significant and crucial strengths which tend to arise from their strategic position vis-a-vis the state industrial relation systems, state governments and instrumentalities.
State peak councils have statutory recognition in a variety of areas. In addition, their strong political links with state Labor ensure that the institutions play an important role within the state arena. State test cases and state legislative initiatives (e.g., long service leave, occupational health and safety, redundancy and employment protection) have been the key vehicle in establishing new conditions.
In addition, state peak councils are often regarded as being closer to the grass roots than the national peak council. This is because of the regular contact between the officers of state peak councils and the organiser level of the trade union movement.
State peak councils provide forums or vehicles for the expression of a state perspective at the national level and are an indispensable arena for debate and discussion within the broader trade union movement.
The services currently provided by state peak councils fall into two broad categories, coordination and representation services, and specialist services such as OH&S training. (See Appendix A)
State peak councils have a number of important weaknesses. Many, particularly the smaller ones, are under-resourced. These resource pressures are increasing as the trend towards national industry based unions accelerates.
Affiliation fees are coming under pressure as the national offices of unions consolidate their hold on trade union resources.
The activities of peak councils are often seen by the national offices of unions as a lower priority and therefore less justified in their claim on scarce trade union resources. In periods of financial difficulty, it is often easy to regard state peak councils affiliation fees as an item which should be reduced.
The trend towards centralisation, which characterised the 1980s, reduced the role of state peak councils in setting the industrial relations agenda.
State peak councils are sometimes regarded by the national union movement as an irritant due to what is perceived to be improper and/or unthoughtful intervention in national issues.
The activities of the ACTU and state peak councils are poorly coordinated, sometimes resulting in a duplication of effort, particularly with regard to research and policy formulation.
STRATEGIC OPPORTUNITIES AND THREATS TO TRADE UNION PEAK COUNCILS
The next period presents a number of strategic opportunities for the ACTU. A prime opportunity is the development of better coordination with its state branches.
Greater coordination with the international trade union movement particularly with regard to the transference of successful trade union enhancing techniques is of crucial importance.
The ACTU has opportunities for expanding the provision of member services to affiliates. Of importance in this area are the extension of financial services and greater participation in the development of training. More focused information and research services will be of great assistance to the trade union movement.
The ACTU purchase of significant property interests in Canberra indicates that a section of staff and resources will be located for lobbying and liaison purposes in the nation’s capital.
The ACTU faces a number of real and potential threats.
The most significant threat relates to its ability to adjust to an industrial relations environment dominated by enterprise bargaining.
The ACTU’s power and influence grew as a consequence of centralisation. The process of devolving authority to the enterprise level will require the ACTU to adjust its skills base, culture and activities to accommodate the more independent, hands off approach, which is characteristic of enterprise bargaining.
The growth in national unions may well see a reduced demand for the involvement of the ACTU in industrial relations activities. In addition, the greater resources available to national unions may reduce the demand for information research services currently provided by the ACTU.
The decline in trade union participation rates, and the diminution in importance of the federal centralised industrial relations system could undermine the authority the ACTU developed during the 1980s.
Many of the activities that the ACTU has proved to be skillful in providing in the past, will no longer be as essential in a devolved industrial relations environment which is dominated by large industry unions. The high-level advocacy skills the ACTU developed during the 1980s is an example of a set of skills that may well be redundant in the new industrial relations environment.
STATE PEAK COUNCILS
The emerging political and industrial relations environment provides a number of opportunities for state peak councils.
The election of conservative state governments has seen an expansion of the coordination role played at the state level. State peak councils have coordinated most union and community campaigns against conservative policy agendas.
State peak councils have responded to the decline in union participation rates by enhancing their services to affiliates both at consumer level, e.g., financial services/union shopper, and also in terms of research, information, public relations and training.
Many state peak councils have become more active in the coordination and facilitation of provincial Trades and Labour Councils (TLCs).
The most significant opportunity that arises in the next period is the ability to better define the role of state peak councils in regard to the ACTU.
There is great logic in the proposition of a greater integration of the industrial role played by state peak councils with that played by the ACTU. With the devolution of Australian industrial relations, the ACTU will not be in a position to exert the same degree of influence as it has in the past on the national industrial relations environment. The ACTU and the state peak councils will need to liaise more closely than they have in the past to ensure that the process of devolution is handled in a way that maximises the benefits to the trade union movement.
State peak councils face significant threats if they are unable to respond to the new environment.
The most significant threat relates to the lack of a clearly defined role for peak councils vis-a-vis other trade union organisational structures, particularly the ACTU and the large national industry unions.
The state peak councils need to define and gain consensus for a mission which guarantees that they play a positive role in the future. Fractious competition with the ACTU as has occurred on various occasions in the past needs to be avoided.
As well, the ill-defined relationship between the ACTU and peak state councils, with the roles of the state councils not being clearly set out in the ACTU rules is a threat.
The decline in trade union participation rates and the resultant decline in trade union resources has placed greater pressure on state peak councils to justify their value. In this context disaffiliation has emerged as a threat.
Associated with this threat is the potential for substitution of the services currently provided by TLCs, by unions at the national level, possibly in combination.
Hostile state governments and the introduction of negative state legislation are also a significant threat.
Peak councils’ strategic positions enable them to play an indispensable role in ensuring that the broader interests of both organised and unorganised labour are protected and advanced.
Peak councils developed and have been strongly supported because the trade union movement recognised that no individual union, no matter how large or professional, is able by itself, due to sectional pressures, to provide a voice for labour which is perceived to be both independent and credible.
The sectional interests represented by individual unions are fully understandable, totally justifiable, and the basis of the support that unions enjoy at the workplace. It is the sectional pressures that provide peak councils with the important role of coordinating the union movement’s broader interests.
Notwithstanding the above, trade union peak councils, be they national, state, or regional face an increasingly complex and rapidly changing strategic environment.
The key strategic variables influencing the emerging environment are the development of a small number of large national unions and the devolution of industrial relations to the enterprise level.
It is too early to determine the detailed operational consequences of these variables on peak councils. Nevertheless what is already evident is that declining participation rates (exacerbated by the recession) is causing financial pressure on many unions.
It is incumbent on peak councils that they act immediately to ensure that they operate as effectively as possible, with minimal call on the scarce resources of their affiliates.
As a significant first step a meeting of the ACTU with the state peak councils needs to be convened to:
(1) clarify the role and responsibilities of all peak councils (including provincial Trades and Labor Councils and their relationship to the peak councils); the aim would be to ensure effective integration without undue loss of autonomy;
(2) develop organisational structures and funding that reflect the clarified roles and responsibilities;
(3) draft rule alterations which reflect the clarified roles, responsibilities and organisational structures to be put to the 1993 ACTU Congress.
Agreement on this process will enable the detail to be worked out for the August/September Congress.
FUNCTIONS AND SERVICES OF STATE PEAK COUNCILS
Presentation of State Wage Cases and Test Cases
General advice and involvement in projects and disputes
Multi-union negotiations and awards
Workplace reform and enterprise bargaining
Representation on training and community organisations
Committees of inquiry and review
Organising major campaigns
Press releases and media interviews; community functions
Information to unions
Assisting trade union training
Lobbying politicians and industry groups.
Superannuation – representation and advice
Occupational health and safety (Policy)
Employment/workplace reform (including representation on policy and industry committees)
Education, including advice and assistance to school students on industrial relations
Skills training and labour market issues (policy)
Literary and information
Financial, advisory and “discount” services advice.
At the August 1993 ACTU Executive, prior to the ACTU Congress in September that year, a discussion paper was put forward on the future role of state Labor Councils (sometimes called Trades & Labor Councils and the like in some states) and whether there should be continued representation on the ACTU Executive.
I recall convening a couple of meetings with state union peak councils. Their thinking ranged from the “if you can’t beat them, join ’em” thinking of Queensland, where the Queensland Trades and Labour Council was briefly renamed the ACTU, Queensland Branch, to suspicion by the South Australians about anything the right wing Labor Council of NSW leadership might cook up.
Without consensus, a policy of “creative ambivalence”, or drift, predominated. In other words, to defer anything and “see what happens”.
The paper, as above, bore a lot of Michael Costa’s input. Dawson Petie (who had also been a Vice President of the Labor Council of NSW and who was now secretary of the Queensland Trades and Labor Council/ACTU, Queensland Branch) assisted with some suggestions and additions.