BP2001/4690, Transcript of Proceedings [2002] AIRCTrans 179 (8 January 2002)

AUSCRIPT PTY LTD
ABN 76 082 664 220

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TRANSCRIPT OF PROCEEDINGS


O/N VT01881
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT LACY

BP2001/4690

APPLICATION FOR TERMINATION
OF BARGAINING PERIOD

Application under section 170MW of the Act
by Yallourn Energy Pty Limited for orders
to terminate bargaining periods in C Nos 30809
of 2000, 11926 of 2000, 37656 of 2000 and
38880 of 2000

MELBOURNE

4.36 PM, WEDNESDAY, 19 DECEMBER 2001

Continued from 18.12.01

PN414

THE SENIOR DEPUTY PRESIDENT: Yes, Mr McDonald.

PN415

MR McDONALD: If the Commission pleases, there are two further matters I wish to raise with Mr Bonwick before I close the case on behalf of the applicant; I wonder with the leave of the Commission if Mr Bonwick could be recalled to the witness box.

PN416

THE SENIOR DEPUTY PRESIDENT: Mr Bromberg is - - -

PN417

MR McDONALD: I have raised it with Mr Bromberg; I don't understand he has any objection to that.

PN418

MR BROMBERG: He has raised one further matter with me. I am not sure what the second matter is.

PN419

MR McDONALD: I don't think my friend has got any objection.

PN420

THE SENIOR DEPUTY PRESIDENT: Mr Bromberg is yet to cross-examine the witness in any event, isn't he?

PN421

MR McDONALD: That is correct.

PN422

THE SENIOR DEPUTY PRESIDENT: Yes, yes, all right.

<ANDREW DAVID BONWICK, ON FORMER OATH [4.37pm]

<EXAMINATION-IN-CHIEF BY MR McDONALD

PN423

MR McDONALD: Thanks, Mr Bonwick.

PN424

I wonder if I can hand the witness a document. I will hand up a copy of the document to the Commission as well.

PN425

If you will just take a moment to have a look at that document please, Mr Bonwick; are you familiar with this document, what it is, what it relates to?---Yes.

PN426

Can you explain to his Honour what this document is and who has issued the document?---This is a printout from NEMCOs market information systems. NEMCO sends out a variety of notices to the market. In this case this is a reserve notice and it informs the market that the calculation of demand and available capacity has indicated that under certain conditions there will be inadequate demand available to - supply available to meet demand. This is the lowest level of reserve notification, but it is the first step of NEMCOs notification system.

PN427

All right. And just looking at the notice:

PN428

Based on current information NEMCO considers its specified short term reserve standards are violated in South Australian and Victorian regions.

PN429

What does that refer to, "specified short term reserve standards", what does that mean?---We talked yesterday about what happens if there is insufficient supply in order to meet demand. That calculation is based on current temperatures and what it is likely to do to demand, and NEMCOs requirements to keep some capacity spare to take account of generator failures like those that occurred yesterday.

**** ANDREW DAVID BONWICK XN MR McDONALD

PN430

And it then identifies Wednesday, 19 December, South Australia region 10 to 11.30 maximum deficiency estimated 6 to 7 megawatts, and Vic region 11-11.30 maximum deficiency estimated to be 85 megawatts. If you direct your attention to the position in the Victorian region, what does that statement "maximum deficiency estimated to be 85 megawatts", what does that actually mean?---This is - there are different levels of reserves, LOR1, 2 and 3. LOR1 is when you are actually turning customers off. LOR2 is the next credible contingency, losing a Loy Yang A unit will actually result in customers being turned off. LOR3 is there are two credible contingency events and then we will turn a customer off. This is below that, so this is saying if we have two credible events occurring in that time period in Victoria, we would be turning off 85 megawatts worth of customers.

PN431

Can you give an example of a credible event?---Well, the most common credible event is a generator trip due to a boiler leak - boiler tube leak, a relatively common event. About 4 per cent of the time Yallourn is subject to tube leaks.

PN432

Yes, thank you. I would seek to tender that document, if the Commission pleases.

EXHIBIT #Y4 LOW RESERVE CONDITION ADVICE FROM NEMCO

PN433

MR McDONALD: Now, I wonder, Mr Macauley, if I could just ask you please - sorry, Mr Bonwick - Mr Bonwick, could you please go back to attachment 3 of your witness statement which we looked at yesterday, and correct me if I am mistaken, but attachment 3 is the medium term PASA document based on information from NEMCO taking out of the equation the 1450 megawatts which Yallourn generates; correct?---Yes.

**** ANDREW DAVID BONWICK XN MR McDONALD

PN434

Now, we have got the blue line, NEMCO forecast demand, we have got the red line, capacity. You have got a red line right at the bottom of the document which, looking at the right-hand column, net interchange, appears to be at 1500; could you just explain what that is?---That is the maximum stable capacity of the Victorian to New South Wales interconnector to import power into Victoria.

PN435

All right. And then you have got a green line which appears above that 1500 megawatt red line at the bottom; what does the green line represent?---That is the arithmetic difference between the NEMCO calculated demand and the capacity. Under the conditions that are modelled there, for example, it is showing for the whole of the time that the arithmetic difference is greater than the import capability of the New South Wales lines. So therefore for the whole time that the green line goes above the capacity, you would be turning customers off under those conditions.

PN436

Yes. And to take a specific example, take 3 January where there is a bit of a spike to about 2200, so that is about 700 megawatts above the 1500 megawatt New South Wales import?---So that says if that demand and supply conditions prevail and there was no additional outages due to generator failure and you had the full capability of the New South Wales/Victorian interconnector, you would still be turning off 700 megawatts worth of customers.

PN437

All right. And the assumption on the NEMCO forecast demand line, the blue line, you have got - if you look in the box at the bottom of the page you have got the blue line, then you have got NEMCO forecast demand 10 POE; what does 10 POE mean?---It is a shortening of 10 per cent probability of exceedence, so it is a one in 10 hot day.

PN438

All right. And so to the extent that this document covers 22 November through to the present date, using the assumptions underpinning this model there would have been blackouts; why haven't there been?---Well, we have had a one in 150 cold December. We haven't had any of the conditions that are looked at by the low reserve system. You would normally - if we don't have any 30 degree days in December, then it will be the first time since records were kept that we haven't had a day over 30 degrees in December, and that is 1875 or something according to the radio.

**** ANDREW DAVID BONWICK XN MR McDONALD

PN439

Does the NEMCO model assume weather at 30 degrees plus?---Yes. The NEMCO model is designed to manage the system stress, the risks of a system.

PN440

Yes. Thanks, Mr Bonwick.

PN441

THE SENIOR DEPUTY PRESIDENT: Do the number of days that it goes over 30 make any difference or if it is just one day over 30 would that be the result that is depicted in that?---There is evidence to suggest that if we have a long run of cold days, if we get a - like today - if we get a 28, people will feel it is hot and start turning air-conditioning on earlier than what you would expect to do for a 28 degree day, so that a long run of cool days tends to mean that the demand will tend to overrun what this is. So under those circumstances, one hot day can be problematic. Your biggest concern is the runs of hot days, two and three which are common in Victoria and less so in South Australia. Under those circumstances again it overruns the forecasts in these forecasts. These are designed to be single events. These are designed to model single events.

PN442

Just one other question before Mr Bromberg asks you some questions. In exhibit Y4, the Low Reserve Condition Report or Advice, where it says:

PN443

NEMCO is seeking a market response to the LRC in accordance with clause 3.12.4.

PN444

What does that mean?---What happens then is that NEMCO starts ringing around people who have got planned maintenance and asking you - and there are structures within the code that says you are required to look at it and give due - not due diligence, but due care and attention as to whether the outage could be moved and that sort of thing. As the condition notices increase in severity, then the actions NEMCO is able to take increase. At this point, they are just ringing around.

PN445

Anything arising out of that, Mr McDonald?

**** ANDREW DAVID BONWICK XN MR McDONALD

PN446

MR McDONALD: No, your Honour.

PN447

THE SENIOR DEPUTY PRESIDENT: Yes, thank you Mr Bonwick.

<THE WITNESS WITHDREW [4.43pm]

PN448

MR BROMBERG: Well, your Honour, if the temperature in this room is anything to go by, the likelihood of people acting prematurely to turn on air-conditioning doesn't seem to have reached the Commission's personnel. In any event, your Honour, we were hopeful of next dealing with our adjournment application and dealing with the evidence in relation to that before doing anything further subject to one matter I want to raise with your Honour.

PN449

THE SENIOR DEPUTY PRESIDENT: So you want to renew your adjournment application.

PN450

MR BROMBERG: Yes, I understood that yesterday - - -

PN451

THE SENIOR DEPUTY PRESIDENT: Yes, yes, that is right.

PN452

MR BROMBERG: - - - we would do that.

PN453

THE SENIOR DEPUTY PRESIDENT: All right. What is the matter you wanted to raise first?

PN454

MR BROMBERG: Can I tell your Honour first what our position is in relation to our adjournment application. We indicated yesterday that we wanted to call Mr Price or perhaps Mr Macauley from NEMCO. Mr Price is the public relations executive and Mr Macauley is the managing director of - or general manager, I think, he might be of NEMCO. We have been in contact with both Mr Price and Mr Macauley today. We managed to contact them on their mobiles. They are both in Sydney. I have spoken to Mr Macauley personally this afternoon. He is available to give evidence tomorrow at 2. We have got a draft subpoena which we will ask the Commission to issue, returnable at 2 tomorrow and direct to Mr Macauley. We have also made some inquiries today about the possibility of getting assistance from other expert witnesses. I understand that this witness, for instance, is put up as an expert on the area of - - -

[4.49pm]

PN455

THE SENIOR DEPUTY PRESIDENT: That is the substantive hearing you are talking about or?

PN456

MR BROMBERG: Yes, yes, we are.

PN457

THE SENIOR DEPUTY PRESIDENT: Yes. Similarly, Mr Price and Mr Macauley, their evidence would go to the substantive matter, too, wouldn't it?

PN458

MR BROMBERG: It would go to both. If we failed on the adjournment application I would expect that it would go to the substantive application as well. To date, although we have identified one person who we thought could give evidence and be a person of expertise in the area it turns out that having spoken to the person he is not an appropriate person to call because of his lack of expertise. We are not in a position at this stage to have identified any other appropriate person. It may be, however, that the evidence of Mr Macauley will suffice for our purposes.

PN459

Our current expectation is that Mr Macauley will give evidence in line with public statements made by NEMCO which I think I indicated to you - I indicated the content of them from the bar table yesterday. In those circumstances, subject to the matter I want to raise, we don't - we are not able to proceed on either the adjournment application or the substantive application. We do, however, think that there is a way in which the time available this evening can be usefully utilised, and that is a matter that I want to go to if I may.

PN460

MR McDONALD: Well, before my friend goes to, it seems to be a subsidiary matter - - -

PN461

THE SENIOR DEPUTY PRESIDENT: I thought he was just going to tell me or suggest what we could do today. I don't know that you were going to go into the detail of that, were you, Mr Bromberg?

PN462

MR BROMBERG: I was going to put an offer from my clients and suggest that there be conciliation about it. And I was going to tell your Honour the nature of the offer and - - -

PN463

THE SENIOR DEPUTY PRESIDENT: All right. Well, perhaps I will hear what Mr McDonald says, first of all, about the application for the adjournment. Mr McDonald.

PN464

MR McDONALD: Well, the application is strongly opposed, your Honour. The unions have now had the material upon which the applicant relies, including the statement of Mr Bonwick, for a good 48 hours. In my submission that is, particularly having regard to the nature of the application as supported by the evidence which has been heard already from Mr Bonwick, that is ample time for experienced practitioners to be in a position to make a good fist of cross-examination of a witness who has been presented in the circumstances in which Mr Bonwick is presented.

PN465

Mr Bromberg's submission seems to boil down to this. Under the veil of blurring the issues of the adjournment and the substantive merits of the matter he seeks an indulgence which, in our submission, having regard to our submission that there is a real threat to the welfare of the Victorian community puts those interests very much in a subordinate position to the interests of his client. In my submission it would appear and indeed it is conceded by Mr Bromberg that the evidence that he seeks to lead from Mr Macauley goes, not simply, to the matters of the adjournment application but indeed goes to the substance of the issues which your Honour will have to determine. That is, Mr Macauley's evidence will go to the question of whether or not there is a threat to electricity supplies in Victoria. Now - - -

PN466

THE SENIOR DEPUTY PRESIDENT: But Mr Bromberg probably wishes to get instructions from Mr Macauley for the purpose of cross-examination.

PN467

MR McDONALD: Well, firstly, he has indicated he has had a discussion with him today. Secondly, there has been a period of 48 hours within which Mr Bromberg could have sought instructions from Mr Macauley or indeed anybody else he wanted to seek out for the purposes of obtaining instructions regarding Mr Bonwick's statement. With respect, it is cavalier in the extreme for a practitioner to come to court and simply put their hands up in the air and say "I am not ready to go on with it" in circumstances where your Honour indicated yesterday you would adjourn the matter for 24 hours.

PN468

Well, in circumstances where a matter is adjourned for 24 hours practitioners should come to the Commission and be ready to get on with it and, with respect, it is simply not good enough for a practitioner to come to the Commission and contend: Well, I can't get on with it. Mr Bromberg should be required to do the best he can whatever is the outcome of the cross-examination of Mr Bonwick. And I do hark back to the fact that Mr Bromberg was ready to launch into, in the course of his submissions was ready to launch into matters that he wished to put to you based on the contents of Mr Bonwick's statement and the attachments thereto.

PN469

He has obviously had good opportunity to have a look at them. Whatever be the position in terms of the cross-examination of Mr Bonwick and even if it be the case that the evidence went in unchallenged, Mr Bromberg has the opportunity tomorrow to lead evidence from Mr Price and Mr Macauley and, presumably, evidence which would, if it is presented in the manner he hopes it will be presented, cut across the evidence of Mr Bonwick.

PN470

With respect, your Honour, it is a totally unsatisfactory situation where in the days leading up to Christmas where we all are operating under tight time lines that effectively we lose a day's hearing because that is what this is, although it is starting at 4.30 it is the day's hearing, we lose it because Mr Bromberg says: Well, I just can't get on with it. Now, with respect, that is not good enough and he should be required to get on with it.

PN471

THE SENIOR DEPUTY PRESIDENT: But on the face of it attachment 3 and Mr Bonwick's evidence would suggest that nothing is going to be detrimentally affected before 1 January. And if I start to hear the matter at 2 o'clock tomorrow - I am referring to attachment 3 - - -

PN472

MR McDONALD: Yes, your Honour.

PN473

THE SENIOR DEPUTY PRESIDENT: If I sat until I finished hearing the matter from 2 o'clock tomorrow, then in the event that you were successful then that would be sufficient, wouldn't it?

PN474

MR McDONALD: Well, with respect, your Honour, I can't accept your Honour's observation because attachment 3, firstly, it is only based on the 1450 megawatts of Yallourn being out of the system. The evidence of Mr Bonwick was that yesterday there was another 1200 megawatts out of the system so that alters the equation significantly. In any event, even on these figures, your Honour, they show a negative supply situation on the 27th - yes, on the 26th, 27 December, and further - - -

PN475

THE SENIOR DEPUTY PRESIDENT: But that is based on a 30 degree day.

PN476

MR McDONALD: Yes, your Honour, well, it is almost 30 degrees today.

PN477

THE SENIOR DEPUTY PRESIDENT: Probably is, I don't know, I haven't been outside.

PN478

MR McDONALD: Yes, yes. We are - needless to say, your Honour, we are very concerned that - - -

PN479

THE SENIOR DEPUTY PRESIDENT: Look, I have no doubt - - -

PN480

MR McDONALD: - - - these proceedings be concluded within the time frame that your Honour has indicated that you have available to hear the matter. We are very concerned and - - -

PN481

THE SENIOR DEPUTY PRESIDENT: Well, I have indicated that I will sit from - if I sat tomorrow afternoon at 2 o'clock I would sit until we conclude hearing the matter tomorrow. Let me hear, first of all - did you want to say anything more?

PN482

MR McDONALD: No, your Honour.

PN483

THE SENIOR DEPUTY PRESIDENT: I will just hear what Mr Bromberg has to say about the proposal for - - -

PN484

MR McDONALD: One other point that I would make, your Honour, is that this issue - that it being exchanged - again, I make the point that I made yesterday, I make the submission that I made yesterday that one dimension of this case is concerned with the issue of electricity supply. The other issue, of course, is concerned with the question of potential stand-downs of employees who can't be usefully employed. And this, again, doesn't go to that matter.

PN485

THE SENIOR DEPUTY PRESIDENT: I should indicate by the way that I have time available tomorrow morning now, my other matter has finished today, so if Mr Bromberg's proposal for conciliation is acceptable to everybody then perhaps we could use tomorrow morning usefully doing that. But, anyway, let me hear what Mr Bromberg has to say.

PN486

MR BROMBERG: Your Honour, can I make a couple of preliminary comments? First of all, the personal criticism made by my learned friend was unfortunate and - - -

PN487

THE SENIOR DEPUTY PRESIDENT: What was that?

PN488

MR BROMBERG: About a practitioner of my experience - - -

PN489

THE SENIOR DEPUTY PRESIDENT: I thought he was saying that you were a very able and capable practitioner.

PN490

MR BROMBERG: Well, he was saying, as I took him, that it is inexcusable for a person standing here in my shoes to be making the application and I took the remarks personally. If my learned friend didn't mean them personally then he should have chosen his language a little bit more carefully, in my respectful submission. In any event he - - -

[5.03pm]

PN491

THE SENIOR DEPUTY PRESIDENT: Well, I mean the point was that I did indicate yesterday that the matter would proceed today, and I said that you could renew your application for an adjournment. In the event that you were unsuccessful, then you would obviously take whatever course you might have been inclined to take.

PN492

MR BROMBERG: That is right, your Honour.

PN493

THE SENIOR DEPUTY PRESIDENT: My indication was that, if you were unsuccessful, you would probably proceed.

PN494

MR BROMBERG: Absolutely right, your Honour. And we have made every possible effort today; I have devoted the whole of the day to this matter. We have made every possible effort to be in a position to continue should your Honour have declined our application. The fact is that my learned friend having objected to the way that we wanted to put the application yesterday, and the Commission having indicated that the evidence that was to be put yesterday should not be put by way of hearsay, we have taken steps as indicated yesterday to bring Mr Macauley or Mr Price here today.

PN495

As a result of matters beyond our control, neither of those individuals are available. I have had a short conversation with Mr Macauley in the midst of a meeting that he was involved in in Sydney. I can tell your Honour that my expectation is that his evidence will be confirmatory of the very brief point that I made to you yesterday about NEMCOs conclusion. Now beyond that I have not had an opportunity to speak to Mr Macauley. I have not had an opportunity to get instructions about the statement of Mr Bonwick, and in particular the very complex evidence he gives in an area of specialised expertise. I have not had an opportunity to get instructions about that, because we have not yet had an opportunity to speak to a like expert in order that understanding - - -

PN496

THE SENIOR DEPUTY PRESIDENT: Have you received the data upon which those attachments were formulated?

PN497

MR BROMBERG: Sorry?

PN498

THE SENIOR DEPUTY PRESIDENT: The data. You were asking yesterday for the data.

PN499

MR BROMBERG: Yes. We have received the data.

PN500

THE SENIOR DEPUTY PRESIDENT: When did you get that?

PN501

MR BROMBERG: I saw it about lunchtime today. I don't know when my instructor got it. We think about 11. There are some 20-25 pages of numbers. Deciphering that in itself is a matter which is clearly beyond the capacity of a lay person to deal with without some instructions from someone skilled in the terminology, the specialist terminology and the specialist data that we see provided. In terms of the suggestion that we have had 48 hours to seek instructions, I told your Honour that I was briefed yesterday at 11 o'clock, and I can assure your Honour that I have been devoted to this matter since that time exclusively.

PN502

Now, my learned friend seeks to deny us the opportunity to call evidence in support of our application for an adjournment, and have your Honour reject that application and have your Honour require that cross-examination occur in circumstances where clearly cross-examination is inappropriate. I saw this morning your Honour's decision in the Esso case that my learned friend mentioned yesterday. It is J.S.M Trading v The AMWU and Others. I think the print number is 903260.

PN503

There was a discussion there in your Honour's reasons about adjournment applications and the time that might be necessary, and your Honour recounts the fact that, when the matter was called on for hearing, there was an adjournment application made by the unions. Your Honour granted an adjournment application in relation to that application. You granted an eight day adjournment, and your Honour specifically says at paragraph 9 that you did so because you regarded the time allowed, that is the eight days, as adequate in the circumstances of the case. Now, your Honour knows that case, and it is not unfamiliar in terms of its scope from this case.

PN504

THE SENIOR DEPUTY PRESIDENT: There were a number of applicants in that case, weren't there?

PN505

MR BROMBERG: There were a number of applicants; they were all sub-contractors working at Esso. And that case raised 170MW(3) in the context of a threat to energy supplies, on that occasion gas, on this occasion electricity. It involved, as I understand it, evidence about previous occasions where industrial action was alleged to have led to shortages of supply, in that case gas, in this case electricity. It involved evidence about future forecasts of both capacity to supply, very many of the same issues that are here being agitated. And as I read it, although I could be wrong, I presume that much of the evidence came from people with the expertise to give it.

PN506

So in circumstances where your Honour considered eight days to be adequate in that case, it is rather bizarre, in our respectful submission, for my learned friend to be suggesting that we ought to in the space of just over 24 hours be in a position to cross-examine or otherwise run a case that we will need to run should the proposal we want to put now not be accepted. Now, in our respectful submission, the Commission would fall into significant error - and I took your Honour yesterday to the cases where the principles are set out, including the Federal Court decision in - I forget the name of it; I think I have got it in my bag.

PN507

MR McDONALD: Sullivan.

PN508

MR BROMBERG: Sullivan, was it, yes, the Federal Court decision in Sullivan where the very point at issue there was whether the lack of an adjournment led to a breach of the principles of natural justice. Their Honours decided that it did. So, in our respectful submission, your Honour would be falling into error if the matter was to proceed today. We propose that, subject to what I have in relation to the proposal that I make, the matter resume tomorrow at 2.

PN509

I am hopeful of meeting Mr Macauley tomorrow in the morning, and I hope to be able to - well, with the summons issued, I have no reason to believe that Mr Macauley won't be here and available to give evidence from 2 o'clock tomorrow. I understood also your Honour was available on Friday. Is that still the case?

PN510

THE SENIOR DEPUTY PRESIDENT: Part of Friday, yes. part of Friday. But if I sat tomorrow at 2, I would want to hear this to its finality tomorrow, subject to whatever number of witnesses you say you have. But at this stage, as I understand it, you have got perhaps one and possibly two, Mr Macauley and perhaps an expert apart from Mr Macauley.

PN511

MR BROMBERG: Yes, if we are able to find one, and depending on what Mr Macauley might tell us about the nature of the evidence he can give. We have also identified the likelihood of at least one other witness. Now, I am not saying that that is the extent of it, but we have at the moment identified one other witness to deal with a number of other matters.

PN512

THE SENIOR DEPUTY PRESIDENT: All right. Do you want to address the proposal that you have?

PN513

MR BROMBERG: Yes, thank you, your Honour. Can I before putting the proposal just indicate to your Honour some of the history, and I try to do this in a non-contentious way by going to some of the facts that underpin the current application. Your Honour, negotiations for a new certified agreement commenced in May of 1999. There was industrial action taken by the unions for whom I act and their members, followed by a lock-out by Yallourn Energy of those persons in January and February 2000.

PN514

On 11 February 2000, shortly after the 7 February return to work, a 13 point in-principle agreement was reached between the unions and Yallourn Energy. On 2 November 2000, Commissioner Lewin terminated the bargaining periods of the CFMEU, APESMA and the ASU, but declined to terminate bargaining periods initiated by the unions for whom I act. He did so expressly for the reason that he was not satisfied that there was no reasonable prospect of agreement between the parties for whom I appear and Yallourn Energy.

PN515

THE SENIOR DEPUTY PRESIDENT: That is over 12 months ago.

PN516

MR BROMBERG: Yes, that is true. What happens then is surprisingly very little until recently. What seems to have happened is that it took until 17 August 2001 for Yallourn Energy to present to the unions its proposed certified agreement, both presumably on the 13 point in-principle agreement.

[5.15pm]

PN517

Yes, I am sorry. A proposal was put on 17 August which wasn't based on the 13 point agreement which the unions regard it as reneging by Yallourn Energy of the 13 point agreement. Industrial action commenced on 3 December 2001 and on 17 December 2001, barely two days ago, a further proposal from Yallourn was put to the mine maintenance employees. Now, as we see the position, it is one of agreement, followed by inaction, followed very recently by further attempts towards an agreement.

PN518

Now, it is in that context that the unions take the view that further collective bargaining with the assistance of the Commission can be productive and ought to be encouraged. And on the basis that all parties put aside their industrial armoury my clients are prepared to give the Commission undertakings about industrial action. The maintenance unions propose the following offer. Now, we make an open offer. They propose to recommend an immediate return to work of their members and no further industrial action in furtherance of a certified agreement until at least 28 February 2002.

PN519

That proposal is made on the basis that Yallourn Energy undertakes to - that it will not take any industrial action by way of lockout or other means for the same period, and that each of the 170MW applications which have been made to the Commission, both in this proceeding and the other proceeding before your Honour, are adjourned and remain adjourned at least until 28 February 2001. The unions would welcome the Commission assisting by way of conciliation in first of all having the offer I have just put accepted, or at least properly considered, and secondly, if accepted the unions would welcome the assistance of the Commission in terms of the resolution of the underlying issues between them and Yallourn Energy.

PN520

In our respectful submission the proposal put is a far better way of dealing with the issues at hand. It involves compromise on both sides and if surety about the impact of the bargaining upon others and potential detrimental effects upon others is a matter of importance, as we believe it is, then the best and most definitive way of ensuring that that matter is dealt with and are put beyond question for the rest of summer, is for the proposal to be accepted and for the parties to try and conclude their ongoing negotiations in a period where all industrial weaponry, be they industrial action or applications to the Commission, be taken off the table. If your Honour pleases.

PN521

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Bromberg. Mr McDonald, what do you say?

PN522

MR McDONALD: Well, perhaps if the matter could just be stood down for five minutes and I will get some instructions about all that, your Honour.

PN523

THE SENIOR DEPUTY PRESIDENT: Yes. I have in mind, Mr McDonald, to allow the adjournment until 2 pm tomorrow, subject to whatever might be said about the other matters.

PN524

MR McDONALD: Yes.

PN525

THE SENIOR DEPUTY PRESIDENT: But would it be more convenient for you to have tomorrow or this evening and to let my associate know and Mr Bromberg know first thing tomorrow morning your response to the proposal, or do you think five minutes now would be sufficient? You might want to give that some - - -

PN526

MR McDONALD: I think five minutes will be sufficient. Could I just say in relation to the question of the adjournment till 2 pm tomorrow, in my submission if the matter is going to follow that path, then it would be appropriate for your Honour to give a direction under section 110 of the Act that the proceedings will conclude tomorrow, that to impose upon both sides the discipline of a time limit, at least for the completion of the evidence. It may be that if necessary there could be some small amount of time on Friday for the purposes of submissions, but I am concerned to hear Mr Bromberg floating the prospect of some other expert witness being called and the potential of that elongating the proceedings. In my submission if the matter is going to be pushed in tomorrow then there should be a direction imposed that the evidence will conclude tomorrow.

PN527

THE SENIOR DEPUTY PRESIDENT: Well, I have in mind if I grant the adjournment, as I am proposing to do, then I would sit until the conclusion of the proceeding tomorrow, starting at 2 o'clock and that it would at least be until the conclusion of the evidence. I mean if it is getting too late then I wouldn't impose on counsel to give final submissions. We could do that Friday morning but we would sit until the conclusion of the evidence tomorrow.

PN528

MR McDONALD: As your Honour pleases. Yes, perhaps if your Honour would allow us till 25 to 6 would be sufficient.

PN529

THE SENIOR DEPUTY PRESIDENT: To consider the proposal?

PN530

MR McDONALD: Consider the proposal.

PN531

THE SENIOR DEPUTY PRESIDENT: Did you have a note of the proposal?

PN532

MR McDONALD: Those instructing me do, your Honour.

PN533

THE SENIOR DEPUTY PRESIDENT: Yes, all right. Well, I do ask that you give it due consideration and as I say, if you require more time then perhaps you could give a response in the morning.

PN534

MR McDONALD: As your Honour pleases.

PN535

THE SENIOR DEPUTY PRESIDENT: Yes. Stand the matter down for 10 minutes.

SHORT ADJOURNMENT [5.25pm]

RESUMED [5.37pm]

PN536

MR McDONALD: Can I indicate to the Commission that on reflection we are inclined to take up the Commission's offer to give that matter further consideration overnight. There are some other people within the organisation who need to be consulted and we will inform both the applicants and we will inform your associate first thing in the morning what our response is. Can I just, whilst I am on my feet, I raise the matter concerning the MW7 application.

PN537

The directions which your Honour previously issued required the applicants to have filed their material by close of business today - sorry, the respondents to file their material by close of business - the respondents to that application to file their material by close of business today. Now, we have had some communication from the solicitors who are acting for the respondents and they have indicated that they wouldn't be in a position to meet that time line. We are concerned that given the lead up to Christmas and the like, we are concerned as to when we are going to see the material and I wonder if Mr Bromberg might be able to shed some light on that matter.

PN538

And thirdly, Mr Bromberg has provided me with a draft of a subpoena directed to the company in which he seeks production of unit control log books and power shift manager log books for the period 7 February to 24 February 2000. Subject to what Mr Bromberg has to say about the matter our position is that we are quite content to produce those log books if they are in existence. We will produce them at the hearing tomorrow. There is no need for a summons to be issued in relation to that.

PN539

MR BROMBERG: I am content with that but if they could be produced tomorrow it would assist if they could be produced before 2 o'clock so that I could have an opportunity to look at it rather than take up the Commission's hearing time.

PN540

THE SENIOR DEPUTY PRESIDENT: It is in relation to this proceeding, is it?

PN541

MR BROMBERG: It is in relation to this proceeding.

PN542

THE SENIOR DEPUTY PRESIDENT: So just tell me what they were again, unit control log books?

PN543

MR BROMBERG: I will specify, your Honour. They are the unit controller log books for the period 7 February 2000 to 24 February 2000 and the power station shift manager log book for the period 7 February 2000 to 24 February 2000. If they can be made available either - probably not later tonight but at the earliest possible time tomorrow morning that would facilitate matters.

PN544

THE SENIOR DEPUTY PRESIDENT: First thing in the morning. Well, it is all subject to the response that Mr McDonald gives you in any event.

PN545

MR BROMBERG: Yes, of course. Can I - - -

PN546

THE SENIOR DEPUTY PRESIDENT: Just before you go on, what about the - and again this is subject to Mr McDonald's response in the morning, or the applicant's response in the morning - the issue of the material or the directions for the other matter?

PN547

MR BROMBERG: Well, we have written to your Honour and to our friends today, as I understand it. To put it bluntly, your Honour, if my learned friend's expectations are that we have not been affected by their current application which comes along with little notice in relation to the other application - the preparation for that - then he is manifestly wrong. I can tell, your Honour, that it is my understanding that my instructors first became briefed in the other matter on Wednesday or Thursday of last week and that I was briefed in the matter shortly thereafter.

[5.41pm]

PN548

That from my point of view, other than perhaps a period of a day since Thursday of last week, I have been devoted to one or other of these applications. We had intended to devote the whole of this week - certainly I had intended to devote the whole of this week to the other application and your Honour knows that that has not been possible because of the second application. We are not in a position to file statements at the moment, and until we get off this case and on to the other one, I am not in a position to tell your Honour when those statements can be filed. I am very conscious, your Honour, as are my clients that Christmas is upon us and there is a lack of availability as regards both counsel and instructors and potential witnesses between Christmas and New Year.

PN549

THE SENIOR DEPUTY PRESIDENT: So what was the nature of the communication today? Was that an application or seeking consent from - - -

PN550

MR BROMBERG: No, it was notification to your Honour that we are unable to meet the direction. It told your Honour that was - that our capacity to meet the direction depends very much upon the second application and our dealings with that. And it is unable to tell your Honour very much more, as I am unable to tell your Honour very much more.

PN551

THE SENIOR DEPUTY PRESIDENT: You were only briefed in this matter yesterday, were you not, didn't you say yesterday?

PN552

MR BROMBERG: Yes.

PN553

THE SENIOR DEPUTY PRESIDENT: So when did you become aware that you wouldn't be able to meet the deadline for today?

PN554

MR BROMBERG: Well, essentially last night, your Honour, when the application for an adjournment was not able to be dealt with and it became clear that we would be occupied, at least today, on this matter, as we have been. I might say, your Honour, that I have had some doubts since becoming involved in the matter, that the deadline would be able to be met but until that position was able to be confirmed there was no point - - -

PN555

THE SENIOR DEPUTY PRESIDENT: When was the direction issued?

PN556

MR BROMBERG: It was issued - I think 5 December.

PN557

MR McDONALD: On 5 December.

PN558

THE SENIOR DEPUTY PRESIDENT: So that is 14 days. It is more than the time that was allowed in the JSM matter.

PN559

MR BROMBERG: It is, your Honour, but your Honour needs to understand that that comes in the context of my instructors becoming first instructed in the matter, Thursday of last week.

PN560

MR McDONALD: That is simply not true. Mr Maddison said on the 10th - yes - - -

PN561

MR BROMBERG: Are you calling me a liar now?

PN562

MR McDONALD: On 10 December Mr Maddison has said that the solicitors had been instructed. It is paragraph 147 of the transcript. do you want to read it?

PN563

MR BROMBERG: If my learned friend wants to cross-examine my instructor about when they were instructed I welcome him to do it. I am telling you, your Honour - - -

PN564

MR McDONALD: Are you telling or are you making a submission?

PN565

MR BROMBERG: - - - what I am instructed is the case. I don't know what Mr Maddison said but I am telling your Honour that Maurice, Blackburn, Cashman, as I am instructed, were first instructed in the matter last Thursday.

PN566

MR McDONALD: Are you calling Mr Maddison a liar because that is what the transcript says?

PN567

MR BROMBERG: I don't call anybody a liar lightly - - -

PN568

THE SENIOR DEPUTY PRESIDENT: All right, well, in any event, there is a direction there, whether it is Mr Maddison's tardiness or the fault lies elsewhere it seems to me that the Commission's directions are there just to be disregarded by everybody or anybody.

PN569

MR BROMBERG: Of course they are not, your Honour.

PN570

THE SENIOR DEPUTY PRESIDENT: And - so what is the situation? Do you want an extension of time for that or - - -

PN571

MR BROMBERG: Yes we do, your Honour - - -

PN572

THE SENIOR DEPUTY PRESIDENT: Yes.

PN573

MR BROMBERG: - - - but we are unable to tell your Honour at this stage what the necessary extension is. It depends greatly, your Honour, on whether we are able to spend the rest of the week on the second application or need to deal with the first application.

PN574

THE SENIOR DEPUTY PRESIDENT: Well, again, as I say, a lot will depend on the response of Yallourn tomorrow morning. At this stage I will consider the application for an extension of time but I can indicate that I would expect the material to be filed by Monday, at the very latest, of next week, which is 24 December, close of business on 24 December. That is assuming that the matter is going to proceed.

PN575

MR BROMBERG: Yes.

PN576

THE SENIOR DEPUTY PRESIDENT: And hopefully your proposal might mean that it won't. But in the event that it does, that will be my intention at this stage, tomorrow to issue a direction, or a further direction, amending the time for filing of your material - the union material to close of business on Monday.

PN577

MR BROMBERG: Your Honour, we are grateful for that. If and when we are able to tell your Honour what our position is we will seek to do so.

PN578

THE SENIOR DEPUTY PRESIDENT: Yes.

PN579

MR BROMBERG: If matters can be hastened they will be. If the new direction can't be met we will seek to tell your Honour that that is the case as soon as we can.

PN580

THE SENIOR DEPUTY PRESIDENT: All right, well, now - - -

PN581

MR BROMBERG: Can I raise a matter, your Honour, that is of some importance to me. My friend suggested that I have lied to the Commission. I invite my friend to retract that allegation - - -

PN582

THE SENIOR DEPUTY PRESIDENT: I don't think he suggested you lied. He said, Mr - - -

PN583

MR BROMBERG: He said that is a lie in relation to what I had put to your Honour. I ask him to retract it because there are places where allegations of that sort - unfounded and incorrect allegations of that sort - can be dealt with and my friend ought to have an opportunity to retract it if he so desires.

PN584

THE SENIOR DEPUTY PRESIDENT: Yes, before you sit down, Mr Bromberg, you understand do you, that the adjournment that I am granting now of this proceeding until tomorrow at 2 pm is on the basis that starting at 2 o'clock tomorrow this matter will proceed at least until the end of evidence and hopefully to the end of the proceeding?

PN585

MR BROMBERG: Well, your Honour, I understand the position your Honour puts about that and I am prepared to be here for as long as your Honour wants to sit. But the first matter that your Honour will need to consider tomorrow, as we understand it, is whether or not to grant an adjournment. We haven't yet - - -

PN586

THE SENIOR DEPUTY PRESIDENT: No, no, no. I have granted the last adjournment until 2 pm tomorrow.

PN587

MR BROMBERG: Well - - -

PN588

THE SENIOR DEPUTY PRESIDENT: Obviously you can always make an application but my intention now is, in granting the adjournment until 2 pm tomorrow, subject to again what happens in the morning, is to proceed until the end of the hearing tomorrow.

PN589

MR BROMBERG: Yes, well, it has been - I understand your Honour's position. Our position from the outset has been reasonably clear, as we understand it, and that is that we want to have an application for an adjournment dealt with, and given the comments that came from your Honour, we have sought to do that by way of evidence from NEMCO. We will seek to re-agitate that application tomorrow and we will be in a position to call Mr Macauley in relation to it and it will be a matter for your Honour as to whether that application succeeds or not.

PN590

THE SENIOR DEPUTY PRESIDENT: But you ought to be in a position to proceed to the finality of the hearing tomorrow in the event that your adjournment isn't granted.

PN591

MR BROMBERG: Yes, your Honour. We will endeavour to do whatever we can in the interim to be in a position to put all the evidence that we want to call, that is available to us before your Honour, and we understand that if that means sitting until 3 o'clock in the morning, we will be here. That is not to say, your Honour, we will be in a position to call all the evidence we want to call. For instance, the issue of an expert is a matter that we are continuing to make enquiries about. And I can't tell you any more about it than I have already.

PN592

Now, in the morning - sorry, at two tomorrow, I will be in a better position to advise your Honour as to who we intend to call and whether or not all the witnesses that we would like to call are able to be called. But certainly, your Honour, we will try and do the utmost to be in a position to proceed, should your Honour require it.

PN593

THE SENIOR DEPUTY PRESIDENT: Yes. And you wanted some summonses issued too, did you not?

PN594

MR BROMBERG: Yes, I did.

PN595

THE SENIOR DEPUTY PRESIDENT: I think - I mean, Yallourn has undertaken to give you the material that you have asked for - - -

PN596

MR BROMBERG: Yes.

PN597

THE SENIOR DEPUTY PRESIDENT: - - - if they have it.

PN598

MR BROMBERG: Yes, the summons that we wanted to have issued is the summons to Mr Macauley. Can I hand up a copy?

PN599

THE SENIOR DEPUTY PRESIDENT: Yes.

PN600

MR BROMBERG: And the only other matter I wanted to raise, your Honour, was the availability of transcript. I think your Honour did make a direction yesterday, but we haven't received any transcript.

PN601

THE SENIOR DEPUTY PRESIDENT: I think I saw it on my system at about 4.30 - 4.45 this afternoon or just before I came up here anyway this afternoon.

PN602

MR BROMBERG: Yes.

PN603

THE SENIOR DEPUTY PRESIDENT: So, hopefully, when you get back it will be there but - - -

PN604

MR BROMBERG: Thank you.

PN605

THE SENIOR DEPUTY PRESIDENT: - - - I will ask my associate to enquire of the Court reporting service and impress on them the need to have it as soon as possible.

PN606

MR BROMBERG: Yes.

PN607

THE SENIOR DEPUTY PRESIDENT: Mr McDonald, what do you have to say to Mr Bromberg's request for you to retract the statement you made?

PN608

MR McDONALD: Well, I will say this, your Honour. The transcript will disclose that there was no statement from me that Mr Bromberg was lying to the Commission. What I did seek to put on the record, and for the sake of clarity, I put precisely on the record now, is that on 10 December Mr Maddison, who is an employee of one of the parties for whom Mr Bromberg stands before you today, made this statement. And you will recall that it was made in the context of responding to a submission from myself that the timelines contained in the earlier directions should be shortened.

PN609

THE SENIOR DEPUTY PRESIDENT: Yes.

PN610

MR McDONALD: And in response to that submission Mr Maddison said, your Honour, this witness statement - that was the witness statement in support of the application for certification - is prepared for an application to certify an agreement. It is not a witness statement for an M7 application. It is a brief seven page statement from one person. Your Honour, we have instructed solicitors who will be doing the MW(7) matter that is before you early in the New Year. They have received some instructions in relation to the matter.

PN611

They are not in a position at this stage to say what the material they intend to submit in compliance with your directions but I would hazard a guess that it maybe somewhat more substantive than this in respect to the CEPU. And I simply put on the record that that submission which was made to you by the CEPU on 10 December is entirely at odds with the submission - - -

PN612

THE SENIOR DEPUTY PRESIDENT: Yes.

PN613

MR McDONALD: - - - which Mr Bromberg makes to you today.

[5.55pm]

PN614

THE SENIOR DEPUTY PRESIDENT: That is the case, Mr Bromberg. I recall the submission being made by Mr Maddison. In fact soon after Mr Maddison made that statement, Mr McDonald withdrew the application to have the matter brought on earlier. And in fact I think I indicated that in view of the fact that legal representatives had been briefed, it was not appropriate to have the matter brought on earlier.

PN615

MR BROMBERG: Yes. Well, your Honour, I rose to make some protest, and I think justifiably, at the way that Mr McDonald put his position. He put it rather differently before than he puts it now. I cannot tell your Honour at the moment the basis upon which Mr Maddison said what he said. I will certainly seek to have that explained. Your Honour will appreciate that there is more than one firm of solicitors in Melbourne who might - - -

PN616

THE SENIOR DEPUTY PRESIDENT: Yes, and it occurred to me that that might be the case, that he might have asked somebody else.

PN617

MR BROMBERG: Yes.

PN618

THE SENIOR DEPUTY PRESIDENT: But, I mean, I would like to know what the situation is, given that Mr Maddison told us at that time, when there was an application before me, to bring the matter on earlier, that there had been solicitors briefed in the matter.

PN619

MR BROMBERG: Yes. Your Honour, I will ensure that your Honour gets an explanation of that.

PN620

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Bromberg.

PN621

MR BROMBERG: But I can assure your Honour that what I put to you is a matter of truth.

PN622

THE SENIOR DEPUTY PRESIDENT: Yes, I do not doubt that for one minute. Now, Mr Bromberg, the summons I will have to have issued out of my chambers because I need to put the seal on it, so if you could wait around, my associate will bring it back up to you.

PN623

MR BROMBERG: Yes.

PN624

THE SENIOR DEPUTY PRESIDENT: As he did yesterday, but you were not here.

PN625

MR BROMBERG: We were here, but unfortunately behind a door.

PN626

THE SENIOR DEPUTY PRESIDENT: I see.

PN627

MR BROMBERG: No, it was our fault - - -

PN628

THE SENIOR DEPUTY PRESIDENT: Well, I withdraw that, sorry.

PN629

MR BROMBERG: Yes, it was our fault because we momentarily forgot that your associate might be looking for us, be we were here.

PN630

THE SENIOR DEPUTY PRESIDENT: Okay, well, I will take this back to chambers and seal it and have it brought up to you. Is there anything else, Mr McDonald?

PN631

MR McDONALD: No, your Honour.

PN632

THE SENIOR DEPUTY PRESIDENT: I will adjourn this matter now then until 2 pm tomorrow, subject of course to Mr McDonald confirming with my associate tomorrow his intentions in relation to the proposal that has been put by Mr Bromberg on behalf of the unions.

ADJOURNED UNTIL THURSDAY 20 DECEMBER 2001 [5.58pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

ANDREW DAVID BONWICK, ON FORMER OATH PN423
EXAMINATION-IN-CHIEF BY MR McDONALD PN423
EXHIBIT #Y4 LOW RESERVE CONDITION ADVICE FROM NEMCO PN433
WITNESS WITHDREW PN448