"...the secret Treasury advice, the department, under Treasury secretary Ken Henry, concluded that the abolition of AWAs and the return of guaranteed penalty rates would cut jobs, put "upward pressure on prices", create more "flow-on" wage claims from sectors such as mining to less productive sectors and allow unions to "bid wages up above their market level".
"The shift to a more centralised wage system might reduce employment and increase inflation. For example, higher unit costs, either through higher real labour costs, lower productivity, or a combination of both, will place upward pressures on prices, which effectively lowers real disposable incomes, consumer spending and thus employment. The rate of flow-on of wage increases from high-productivity firms and sectors to low-productivity ones may increase. Reinstalling union power will raise the ability of unions to bid wages up above their market level."
In addition abolishing unfair dismissal laws will cut jobs, increase red tape for small business and make it more difficult for people to move from welfare to work.
Treasury said WorkChoices was "expected to allow a more expansionary monetary policy setting and result in higher rates of employment".
Where's Labor's cheer squad on this one?
This document was written before the last election but despite Julia Gillard's denials it is definitely applicable to Labor IR policies. The unemployed of Australia and those facing higher mortgage repayments and higher inflation can attribute part of these problems to inept Labor IR policies and to those sections of the leftwing intelligensia who, against all reason, supported these particularly inept and foolish proposals to reregulate the Labor market.