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Boral and the CFMEU and housing supply


2GB MONEY PROGRAM. 22/9/2015

Luke Grant (Host):  I want to get as I mentioned to Wilhelm Harnisch from Master Builders Australia. He’s the CEO and he’s on the line to talk about the Royal Commission and what happened to Boral in Melbourne.
Wilhelm thanks for your time.

Wilhelm Harnisch (CEO Master Builders Australia): Good Evening Luke.

Look the CFMEU are trying to portray the Royal Commission as witch-hunt but they have done the same thing previously with other Royal Commissions over the last two decades.

These other Royal Commissions have found exactly the same evidence as the current one. The reality, as you said earlier, is that the CFMEU have been caught out by the Royal Commission.

If anyone has any doubts about the bastardry of the CFMEU they need to read the transcript or the watch the proceedings from today’s Commission hearings in Brisbane.

If that doesn’t convince anyone that the CFMEU are behaving outside of normal community behaviors then nothing will!

Luke Grant: You’re absolutely right Wilhelm. Listeners should really go to the Royal Commission website and look at the hearing today and you will get a clear picture.

Can we just quickly talk about Boral? There is a big damages claim that the CFMEU has to pay to Boral. Will this send a message to the union that they have to change their ways or will they just continue as they have done?

Wilhelm Harnisch: Look, one would hope that the CFMEU will change their behaviours.

But when you listen to their response to the terms of their settlement with Boral they are openly defiant, they are still taunting Boral’s shareholders and Boral’s CEO Michael Kane, and they keep trying to portray Boral as irresponsible.

The CFMEU are trying to put a spin on this to somehow convince people that they are good citizens when the community knows that they are not.

The Boral case should send a chill down the spine of listeners about the sort of behaviours that the CFMEU are imposing on the community. Listeners out there need to remember what this actually means.

It means that the CFMEU is cheating you as a taxpayer when it comes to the cost of the schools and the hospitals that you and your community need.

That’s what the CFMEU is doing, they are cheating the community and robbing taxpayers of community infrastructure that all Australians need.

Luke Grant: Just explain that a bit further. How are the CFMEU robbing communities of infrastructure projects?

Wilhelm Harnisch: The CMFEU makes the community pay a very high price for schools and hospitals through their labour agreements, through their EBAs, through their stoppages and through their threats.

Listeners should look at the example of Boral where the CFMEU tried to close down a lawful business by trying to bleed it dry, tried to make it go broke. But the CFMEU picked on the wrong company.

Lesser companies in the construction industry basically cave in to the CFMEU’s threats and intimidation and pay the price to buy industrial peace.

Luke Grant: But hang on minute Wilhelm. At the time the CFMEU were arguing that were supporting their members and helping them through a very difficult time. Basically being there for their members.

Wilhelm Harnisch: Not at all. When you look at the causes of the CFMEU’s black banning of Boral, none of them had anything to do with protecting worker’s rights, it had nothing to do with protecting wages.

No, it was only about the CFMEU brutally exercising raw power.

What a happened is that the CFMEU lost a court case in their war on Grocon and they didn’t like losing. The CFMEU had to shell out for a hefty fine and their black banning or Boral was payback.

This was John Setka trying to get revenge because he lost against Grocon, he lost a court case, he lost in having to pay a heavy fine and he lost because the court exposed to the community to the actions of the CFMEU.

Listeners should remember, the CFMEU’s action against Boral were all about that and nothing to do with worker’s rights or standing up for worker’s wages and absolutely nothing to do with safety.

Luke Grant: Wilhelm you talk about Boral, what about Boral’s CEO Mike Kane who refused to back down to the CFMEU? What about him? He was brilliant.

But just in Canberra, if we can cover down there because I know that there have been some dramas there, highlighted in the Royal Commission.

It seems to me and there has been evidence brought forward at the Commission to suggest, that unless you play ball with the CFMEU, you’ll have visit after visit from their officials, you’ll have confected safety issues raised and; we need to be careful here because the union deny it; but alleged threats being made to small building contractors to shut them out of getting work.

Surely that just adds dollar upon dollar to the costs of projects in Canberra and any city where we have to contend with the CFMEU and their tactics?

How does a business offer a dwelling or a building to anyone when they have to deal with these sorts of increased costs all thanks to the CFMEU and their EBAs and their black bans?

Wilhelm Harnisch: Yes Luke, you’ve got it absolutely right! This is exactly my point.

In the end it is the community who actually pays the price.

It’s the consumer who pays because builders have to pass on those costs to survive, and so what happens is that the cost of building houses for consumers goes up, the cost of a school or hospital goes up.

This means that everyone in the community has to pay more for something they should have got for up to 30% less.

But the CFMEU don’t seem to care, they simply don’t seem to care about the community.

Julian Lorkin (Co-Host): Ok Wilhelm, can I ask you about something completely different now?

We’ve been talking a lot on 2GB’s Money Program about the supposed housing bubble over the last couple of days.

But you are the person in the know, because you’ve actually got boots on the ground out there with thousands of Master Builders putting up houses.

We’ve heard a lot about the Baird Government releasing land for over 30,000 new homes being built (nearly the size of Bathhurst) 80 kilometres from the Sydney CBD. We’ve also heard about this tsunami of new properties that’s going to come onto the Sydney market.

What’s you’re feeling about the property market in Australia? Is there an over-supply of housing?

Wilhelm Harnisch: Not at all. If there was an over-supply no one would be buying properties.

Let’s look at a basic market test.

No builder or developer will put up houses or apartments if they aren’t going to be sold. But when a new apartment block goes up the apartments are sold within hours!

So, the idea that there is an over-supply of housing simply doesn’t hold up.

Now, in terms of your earlier question, yes we are getting closer to a peak in the current housing cycle but in terms of a house price bubble we need to very careful not to sensationalise.

Yes, there is some exuberance in some very small pockets of the Sydney housing market but it’s nowhere near as bad as it is sometimes portrayed in the media.

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