Outsourcing Fiasco

21st century government is based on the idea the private sector always does it better and cheaper than the public sector. The latest outsourcing fiasco is centred around labour hire firms that bring out labour from the Pacific Islands to work on Australian farms under a program that was initiated, supported and is policed by the Australian government. Instead of running the program themselves, the Australian government in its wisdom decided to outsource the hiring of Pacific Islander workers to labour hire companies.

Whether it’s on a building site, a farm, restaurant or cleaning contract the majority of labour hire companies mercilessly exploit the workers they hire. If the cases of 22 Vanuatu workers that were employed by Queensland business man Emmanuel Bani in 2014 is anything to go by, blackbird (the 19th century practise of kidnapping men, women and children from the Pacific Islands to work in Queensland and northern New South Wales’ sugar industry in the late 1880’s for board and food) is alive and well in 21st century Australia.

Federal Circuit Court Justice Michael Jarrett found the 22 workers brought out by the Bani labour hire firm were badly exploited to the point of not having enough food to eat, let alone being paid for six months of seasonal work in farms across Queensland. Although the Judge ordered in favour of the workers, most will not receive a cent for the work done despite the farmers that had used the Vanuatu’s workers labour had paid the labour hire firm for the workers.

Labour hire firms that organise agricultural work are paid by the workers to be hired by the labour hire service (the Vanuatu workers paid $1,500 – a substantial amount in Vanuatu). The labour hire firm is normally paid $24-$28 an hour by the farmer for each hour the worker works. In the case of the Pacific Island workers, farmers normally provide accommodation and food. Labour hire firms come and go with monotonous regularity, few pay superannuation, leave loading or holiday pay. A significant number of these companies are Phoenix companies who pocket the tax they should be paying while paying workers between $10 and $12 an hour for repetitive back breaking work.

It’s ironical the exploitation that occurred, and continues to happen, occurred on an Australian government sponsored program. Why didn’t the government run its own program? It would have been cheaper, more efficient, workers wouldn’t have to pay an upfront fee to be hired and they would automatically have access to conditions and wages enjoyed by other Australian workers.

Government outsourcing is a scourge and a waste of money. Almost 40 cents of every dollar that is outsourced by the Commonwealth government goes into fees, charges and profits. Less than 60 cents per dollar spent goes to the people the money is earmarked for. Religious based and secular organisations tender for government work that runs into billions of dollars. What’s wrong with the Commonwealth public service doing the work? I’m pretty confident it would be done for a cheaper price, workers wouldn’t be exploited and profits would be ploughed back into Treasury. A win win situation.

Dr. Joseph Toscano

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