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Event: Interview with Sky News Politics Now panel
Date: 4 June 2024, 3.20pm AEST
Speakers: Denita Wawn, CEO Master Builders Australia
Topics: Skilled migration; housing crisis; industrial relations
E&OE
Tom Connell, Sky News: Within the portfolio of Andrew Giles, the government releasing its draft priority list. This is for skilled visas. These are the ones that employers can sponsor people for. Let’s have a look at some of the ‘ins’. So, these are the in demand ones: marine engineers, telecommunication technicians, chemical plant operators. They were the only three added, if you like to the ‘ins’. They used to be not listed now they are. Then next I think we’ve got the outs or the unsures, we’ll see what pops up. So, these are out. They don’t want any more economists. Newspaper editors? No thanks. Manufacturers, footballers and that’s rugby, soccer and AFL, so they can’t just bring over people from overseas, post office managers, bad luck if you want to grab one of them and this is what was really unclear to me, this is unsure but these are all listed as probable nots on this priority list, right, chefs and cooks. If you know someone in hospitality, they are hard to get to get a handle on.
Andrew Clennell, Sky News: Yeah.
Tom: Carpenters, mechanical engineers, bricklayers, childcare workers.
Andrew: Surely, we need carpenters and bricklayers?
Tom: Concreters are on here as well. Now this baffles me. I think we’ve got our next guest. Someone might nod along, but let’s get reaction first of all, from the Shadow Foreign Affairs Minister, Simon Birmingham on this.
Senator the Hon. Simon Birmingham, Shadow Minister for Foreign Affairs: We’ve got genuine skill shortages in Australia, but also a real population pressure problem in the housing market, in our infrastructure, and this government has none of the settings around migration right. You’ve got an immigration minister who’s dreaming of drones or UFOs in the sky, whilst failing to effectively target the skills we need and keep our population settings in check so that people can afford to get a house.
Tom: Joining the panel now, Master Builders CEO Denita Wawn for more on this. What did you think when you woke up, had your morning coffee and had a quick perusal through and thought oh no more tradies are coming to Australia?
Denita Wawn, CEO Master Builders Australia: Flummoxed, perplexed, bemused. I think were the best words to use. It did not make any sense to me whatsoever. It was a Canberra doozy special; I think.
Kieran Gilbert, Sky News: What would you put that down to?
Denita: Look, it makes, I can’t understand it. For example, carpenter and Joiner is on the definite list but carpenter and joiner separately is on the maybe list. So, we don’t understand. We’re certainly concerned that there may be undue influence by the unions who don’t want any migration in our sector at all. So, what has happened in the process? I don’t know. It is quite extraordinarily, how you can create these lists. Only in Canberra is all I can say.
Tom: You’ve been stalking the corridors. I know you’ve done a few interviews. Have you had time to talk to the Minister and got any response yet? Because we should say it’s what proposed or interim or whatever, so it’s not finalised.
Denita: It’s proposed and certainly we’ve been talking a lot to the Immigration Minister, the Home Affairs Minister, the Skills Minister, we’re assured that our submissions are being taken into account, but I cannot understand that every government agency, every part of the sector, has now been saying for years if we don’t have more workers, we are not going to meet the government’s own 1.2 million home target. And we know at the moment, construction costs are up by 40 per cent since 2019, and the vast majority of that is because of labour shortages. It’s taking us three years to build high-rise apartments instead of two years again because of shortages.
Andrew: Is the economy going to crash because of those construction costs? Do you fear that?
Denita: We’re really concerned that inflation’s going to stay way too high until we can get our construction costs down. Our productivity report said industrial relations, labour shortages and red tape are significantly curtailing our productivity, which means we simply cannot build to the extent that we can build. So, they will stay still way too high.
Andrew: And what do you make of Peter Dutton’s proposed migration cut?
Denita: Well, it is good that Peter Dutton has said that they will ensure that skilled tradies are on a priority list. We think that makes sense, particularly when you look at what Canada and the UK are doing, which they have put them on priority lists. We understand the reason why the coalition is looking at a reduced migration number while we try and build more homes, but it doesn’t make any sense to reduce the number of migration if we’re not going to get the tradies we need. Of course, we need to employ more Australians in our industry, absolutely.
Andrew: But it’s such a big net migration cut. Are you confident that they will deliver on the tradies, or we’ll lose out?
Denita: We’ve been assured by the Coalition that the tradies will stay on a priority list. We’ll take them at their word but obviously we’ll hold them to account as we get closer to the election.
Olivia Caisley, Sky News: The Deputy Opposition Leader told Coalition party room today that one of the reasons new homes isn’t being built is because of Labor’s industrial relations reforms. What do you say to that? Have you seen any evidence of that?
Denita: We recently put out CIE modelling on productivity of our sector and we know that the biggest contributor at the moment is industrial relations. That we simply cannot have increases in productivity because of IR. The scary thing is though that our modelling did not include the latest round of enterprise bargaining agreements that are currently on foot in terms of negotiations on the eastern seaboard, and it doesn’t include the latest in the Closing the Loopholes Bill that had a big impact on independent contracting. So, it’s all about IR, labour shortages and red tape. That means we cannot do our job properly.
Kieran: Anecdotally, talking to people in the industry, friends and so on, the amount of small operators or small or medium construction that are hurting or falling over in recent times has shocked me. It that was when I was trying to work out why would they have removed those tradies off the list, I was thinking is it because of that contraction? Is it because of interest rates? Because things have slowed down, at least in the short term, and does that anecdotal experience match up to what you’re hearing from your members?
Denita: Well, part of the reason why we’ve had insolvencies is because of labour shortages. When you have costs increase by 40 per cent and you as a builder are working under fixed price contracts, you are never going to price in an increase of 40 per cent into your tender two years ago. And so, the reality is that costs have skyrocketed, particularly in labour, and the builders are having to actually pay for all of those increased costs.
Andrew: Absorb the costs?
Denita: They’ve got to absorb the cost.
Kieran: Are you seeing a lot of those insolvencies around the country?
Denita: We are. Although interesting enough today, one of the lowest we’ve had in a couple of years in terms of insolvencies today, but we know a lot of good builders are simply not tendering for work. Why? Because they’ve got enough work in their forward book, and they don’t want to put up for any more tenders because they can’t guarantee labour.
Olivia: Just quickly, beyond migration, what else could the government be doing to encourage more Australians into trades?
Denita: Well, we certainly commend Brendan O’Connor with all the apprentice incentives and the reviewing into apprentice incentives at the moment. We need more apprentices, and we need them to continue.
Tom: Okay. Got to jump in to clarify, so the list is by this independent agency, but they’re going to give it to the government and the government makes the decision. So, this is where you can have your influence and say bring in the tradies.
Denita: Bring in the tradies.
Kieran: Carpenters and joiners.
Denita: Carpenters and joiners and bricklayers and the list goes on.
Andrew: Amen to that.
Tom: Only the good ones some of them love the work. That’s in the personal life.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au