Unions work towards a fairer, more equal Australia. All Australians deserve to live in dignity and be socially included. The social contract upon which our living standards are based should give people the opportunity to achieve their potential but high and rising income inequality undermines these objectives.
Income inequality is an important and complex subject. Rising inequality is caused by many factors, including technological change and globalisation, as well as policy-related factors such as a reduction in the progressivity of the tax system, a fall in the relative value of the minimum wage, and a fall in union density. Inequality can have a range of negative consequences, ranging from increasing social atomisation and isolation and poor intergenerational social mobility, to possible effects on health and crime, to negative effects on economic growth. Concern about income inequality is not the domain of the eccentric. It is a central issue of mainstream economic theory and international economic policy institutions.
Our initial submission to the Productivity Commission clearly set out how policy makers had long ago devised the industrial relations system out of an acceptance that it was necessary to intervene in the relationships between workers and employers, so workers would be protected from exploitation and so that market incomes are distributed more equitably.