Voters will make a choice on builder-union cartels

Victorian voters will soon decide the fate of the Napthine government’s push to legislate against builder-union cartels.

The Victorian election will be the first 'infrastructure election' in Australia’s history. It is likely to be the model for the next NSW and Queensland elections plus the 2016 federal election.

The incumbent Victorian government is lagging in the polls, but has one huge advantage over the opposition -- it can build most items of infrastructure 15 to 30 per cent cheaper than an ALP government because of the Coalition government’s code of building conduct that ends the cartels between big builders and unions.

The Australian Labor Party wants to restore the cartels because of the power they give unions over building sites and over deciding who can be sub-contractors. But those big builder-union cartels come at a huge cost to the community.

Already the elimination of the cartels in Victoria has enabled the Box Hill Hospital to be substantially increased in size at no extra cost.

The Brumby Labor government did the initial planning of the giant regional rail plan. It was a brilliant project which will vastly improve regional and suburban train services. The original ALP cost estimate was around $4.3 billion but when more detailed estimates were made the anticipated cost blew out to $5.3bn and the finish date was extended to 2016.

Thanks in part to the Victorian government’s anti-cartel building code, it looks like the regional rail will be operational in 2015 and the cost will be just $4.1bn.That represents a $1.2bn or 22 per cent saving on the peak cost estimate. Of course there is political controversy casting doubt over the $5.3bn cost and the 2016 completion date estimates.

Accordingly, the savings may be less than $1.2bn but they are certainly substantial and run into many hundreds of millions. In the case of the Victorian regional rail link, the project is now almost entirely funded by a $3.9bn Commonwealth grant and the money allocated by the state to complete it can be spent on hospitals, schools, overpasses and a myriad of other projects. All of these new projects will be built at a fraction of the cost that it will cost Victorian taxpayers if the cartels are restored by the ALP, should it gain government.

You would think that such an advantage would make the Napthine government a shoo-in at the election.

But the ALP is well ahead in the opinion polls. More particularly the ALP has brilliantly sold the building code to the journalists as simply a union bashing exercise and there has been no coverage in any print media, either in Victoria or federally, showing the enormous cost reductions it delivers to infrastructure.

Given the great smokescreen put up by the Victorian ALP, if Premier Denis Napthine mentions the code, he will be declared to be union bashing. 

NSW and Queensland have passed mirror legislation to Victoria and will enjoy similar cost reductions in infrastructure. The NSW and Queensland legislation was introduced much later and they have not been as vigorous in enforcing it, but the cost reductions are coming.

However, NSW and Queensland will need to be much more skilled than the Victorian government in explaining to voters what the banning of the big builder-union cartels delivers to the community.

In Canberra the Abbott government is struggling to get the enhanced Australian Building and Construction Commission legislation, which locks in the ban on the cartels, through the Senate. But Victoria has shown that Federal action is not necessary to gain substantial rewards for a state prepared to take on the big unions and big builders.

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