Lack of IR reform deterring Japanese investment: former minister

A former federal minister now working as a lawyer in Japan has said that Japanese companies are baffled at a lack of industrial relations policy from the new government and are withholding investment in Australia..

The Australian reports that Andrew Thomson, a former sports minister in John Howard’s government and member for the federal seat of Wentworth, said  he understood the sensitivity around workplace reform, but said Japanese companies – none of whom he would name – had become reluctant to invest due to labour prices and other issues.

"Japanese CEOs have said: 'We don't really understand this. We thought you guys were going to clean up industrial relations,'" The Australian quotes him as saying.

"They understand the business of the divided parliament, but they are puzzled about why there's not more rhetoric and enthusiasm about it (industrial relations reform)."

The unpopular WorkChoices legislation was blamed as one of the reasons behind the Howard government’s 2007 election loss, and prime minister Tony Abbott as opposition leader repeatedly ruled out a return to the policy or anything like it.

"It is never going to happen," Abbott said in August, for example.

"We learnt our lesson. We lost an election on it."

Japanese companies involved in Australian joint ventures, for example Mitsubishi (with BHP Billiton) and Asahi (with Schweppes) have been involved in industrial disputes with workers.

"It's the uncertainty of the possibility of industrial action or being forced into collective bargaining situations because you are midway through a project. Halfway through a project you get attacked by these guys (construction unions), but you can't just stop," according to Thomson.

Image: Herald Sun