RESOURCES and Energy Minister Martin Ferguson has warned that Australia’s capacity to secure billions in LNG investment over the next 18 months will depend on its ability to remain competitive, declaring that wage demands must be based on capacity to pay.

On 8 November, Mr Ferguson released the Labor government’s energy white paper, which warns that the policy focus needs to be on market-based outcomes of competitiveness and efficiency.

The minister said there was still a lot of investment interest in Australia but only if the nation remained competitive.

“Otherwise you don’t get the investment…And you don’t have a job and in this instance your children and grandchildren will not have the same opportunities we’ve currently got in the mining and gas sectors if we don’t remain competitive,” Mr Ferguson said.

Mr Ferguson predicted strong opportunities for the energy sector over the rest of the decade. He stated that the focus should be to expand capacity, grab or maintain market share and, in doing so, drive down costs.

“Wages always have to reflect the capacity to pay” he said.

“That’s not new; that is the history of employer-employee relations.”

As part of its submission to the Fair Work Act Review, AREEA called for meaningful reform to facilitate good faith bargaining in greenfields (new project) agreements.

AREEA has also urged the federal government to implement reforms to provide employers with reasonable leverage against unreasonable union demands along with mechanisms by which unions can be compelled to negotiate if they are acting unreasonably and threatening the national interest.