E&OE................................................................................................
Well thank you very much Kerry Bartlett, to Kevin Rizolli, the Mayor,
other distinguished guests, ladies and gentlemen.
It is a delight for me to be back in the Hawkesbury. It is a delight
for me to be back in the electorate of Macquarie and to commend to
all of you in the strongest possible way what a tremendous job that
Kerry Bartlett has done as your representative in the National Parliament
since March of 1996.
The first responsibility of a local representative is to pursue the
interests of his or her constituents. And Kerry has certainly done
that, be it constantly pressing the case of the maintenance of the
RAAF base at Richmond as an operational base of the Defence Forces.
And I can say to you this morning that there is no intention on the
part of the Defence Department to close the Richmond base and, in
fact, the Defence Minister has been informing those who bothered to
enquire. And I repeat the assurance he has given that the Defence
position is that it will be operational til at least through
to the year 2010. And given the nature of these things that is a very,
very significant commitment by the RAAF.
Kerry has also been extremely active in pursuing the interests of
self-funded retirees, many of which reside in the electorate of Macquarie.
And it's been in no small measure due to his representations
that we were able in the last budget to announce a very significant
extension of the seniors' card to large sections of the self-funded
retiree population. And when I come in a moment to talk about our
tax plan I'll also have something to say about the provision
in that plan for self-funded retirees. He has also been very active
in pursuing environmental causes and as a result of his representations
there have been significant provisions of funds with more to come
for projects in the Macquarie electorate out of the Natural Heritage
Trust. He's also, as a person with a deep understanding of economic
issues, he's also played a very active role in promoting what
the Government has done to restore the health of the Australian economy.
I don't need to remind any audience in Australia that at the
present time there is a good deal of turmoil on world financial markets,
there is a good deal of international pressure on the Australian economy.
And it is a remarkable thing that the Australian economy has performed
so well and has withstood that pressure so effectively. And of all
the things that I would like, the last two-and-a-half years that the
Coalition Government being in office, to be regarded well it is the
way in which we have handled the Australian economy. We did inherit
an Australian economy that was substantially in the red and in just
over two years we have turned a deficit of $10.5 billion into a surplus.
And we actually did it a year ahead of time.
When we came into power the Federal Government owed $95 billion. By
the turn of the century, that will have been cut by more than half
and, in fact, on present projections by the turn of the century, or
the early years of the next century, we will have the lowest national
debt to GDP ratio that this country has ever had. We have delivered
the lowest interest rates in 30 years. The average homebuyer in Australia
has a mortgage of $100,000 and on that average mortgage that homebuyer
is $300 a month better off than two-and-a-half years ago. And that's
the equivalent of a payrise from the boss of $100 a week. And that
is a very important thing to the average Australian. That's rolled
gold quality benefit to the average Australian because there is nothing
more important still to the average Australian family man or woman
than the acquisition of a family home. And the acquisition of a family
home, and providing through the ownership of that family home a stable
environment in which to raise children is still the aspiration of
the overwhelming majority of Australians. And all walks of life, whatever
their politics are, whatever their background may be, and providing
a more secure economic base for the foundation of a stable family
environment is a very, very important thing that any government can
do.
And those reductions in interest rates have extended into the small
business area as well and small business is now enjoying lower interest
rates than it has had for decades. And we have also seen a very high
level of business investment and we have seen significant improvements
in the industrial relations laws of this country. Some sections of
the union movement haven't liked them but the rank and file of
the Australian people have liked them because they have encouraged
workers and their employers to get together at an enterprise level
and to reach agreement that are valuable for the individual enterprise.
And we place very great store on the quality of our economic management
and at a time of international turmoil you don't change the team
in charge when that team has handled the affairs of state so very
effectively and so very competently. And that is the very strong message
that I would give to the Australian people. It is because of the international
economic turmoil that you need a group of people who have got the
runs on board in charge. It's because of that international economic
pressure that you can't experiment with failed policies of deficit
and debt. And it's because of those challenges that you need
to continue to press forward with necessary change and reform.
Now, to some people change and reform can be threatening. To others
it can be very welcome. And the art of good leadership of good statecraft
is to change those things that need changing but to tenaciously defend
and to hold on to those things that oughtn't to be changed. I
believe in changing some things. I believe in hanging onto and preserving
other things. I want to change the things that are holding Australia
back. I want to hang onto those things that are still an expression
of Australian unity and Australian cohesion. And one of those things
that we should hang onto as an expression of Australian cohesion and
Australian unity is the tolerance that Australians have always displayed
towards people from all around the world. And one of the great things
about Australia is that we have accepted people from everywhere in
the world and we have amalgamated and cohered into a united Australian
nation. And I would never like to see Australia lose its instinct
for tolerance and decency towards people from other parts of the world.
Racial tolerance and racial understanding and the equality of treatment
of people, irrespective of their racial background, is one of those
Australian values that we should all fight to defend and preserve.
It's a great Australian value and it's a great Australian
tradition.
Something else that I would like to preserve and defend is this flag
that hangs behind me as an expression ...[audience applauds]....as
an expression of the unity and the history of the Australian nation.
Our Federal system of Government has worked well and we are going
to give it a shot in the arm at our tax reform plan. The centrality
of the family unit has the most cohesive social influence within our
society. That should not only be preserved but it should be strengthened
and encouraged and not denigrated by those forces in the Australian
community. There's nothing old-fashioned about stable families.
There's nothing that's more positive within a community
than strong family and apart from the emotional support they provide
to people they also happen to be the most efficient social welfare
system that mankind has ever devised.
So there are a lot of things that in our society that are good and
are worth preserving and we should unite to defend them. Our tolerance,
the importance of family life, our great national symbols such as
the flag, and our Federal system of Government. Now, they are the
things we ought to keep and those people who come along and say we
want to get rid of them, they ought to be opposed. But on the other
hand there are things that are holding Australia back and just because
getting rid of them involves further change we shouldn't shy
away from that change. And one of those things, of course, and it's
something on everybody's mind at the moment is our present taxation
system. Our present taxation system is creaking and groaning and lurching
towards its last days. And unless we have the honesty and the candour
as a nation to face the need and the reality of the need for fundamental
reform, we are going to lose the economic battle in the years ahead.
Because if you have an inefficient taxation system, you have an inefficient
Australian economy. And, of course, we face challenges from overseas,
but we must press ahead with taxation reform.
Those people who say that because of the Asian turmoil we should stop
reform, are completely wrong. It is because of the Asian challenge
that we must press ahead with taxation reform. We have a taxation
system now that was built on an economy that was overwhelmingly based
on manufacturing industry in the 1930s. We have an indirect tax system
that has no application to service industries at all, yet 65 per cent
of the Australian economy is now services. And if we don't do
something about repairing or modernising our indirect taxation system,
we will not have the resources in the future to provide the welfare
support, the hospitals, the roads, the schools, the police services
that our community needs.
I want to take on the argument advanced by some people in the welfare
sector and I stress some because there are very divided
views in the welfare sector on this, that in some way the introduction
of a goods and services tax is a threat to welfare services. Can I
say that it offers a life raft to welfare services because what the
introduction of a goods and services tax will do is to provide a more
stable revenue base in the years into the future. The problem with
the present taxation system is that it is leaking. It doesn't
apply to everybody. A lot of people evade it. A lot of people dodge
their responsibilities, and if we can replace the existing wholesale
sales tax system with a comprehensive goods and services tax at a
lower rate, that will provide great assurance into the future that
the money will be there to provide the roads and the schools and the
hospitals and the welfare services. Apart from anything else, out
of our plan, we are going to give a greater guarantee of revenue to
the States and they will get more as the years go by under our plan
and they have the direct responsibility for police, for hospitals,
in the main for roads and for a lot of other social securities, and
of course security, and the primary responsibility for education.
We are arguing taxation reform because it is in the long term interests
of Australia. The debate about taxation is not just about how it affects
you and me but it is how it affects our whole nation and more than
anything else I would like our plan to be supported because it will
strengthen Australia and strengthen the Australian economy. It will
give us a secure revenue base. It will stop the leakage and cheating
and rorting that now occurs. It will reduce the cost of doing business
in this country because under our plan every item, every input item
to the production of a good or service, the tax on that will be fully
rebatable. You can claim it back in full, unlike the present system,
where because of the operation of the cascading effect of the wholesale
tax system, there are many taxes embedded in the costs of producing
goods and services in Australia. It has been estimated that it will
reduce the cost of business by about $10, 000 million a year, and
it will reduce the cost of exports by $4500 million a year. Now, in
a hostile world trading environment, with the Asian economies in a
very fragile situation and every country fighting like crazy to get
its market share, what could be more important than to reduce the
cost of Australian exports, because we've got to export to survive.
We are a trading nation. We have only 18 million people. We can't
seal ourselves off from the rest of the world and hope that we can
just rest contented within our vast continent. What we have to do
is go out and sell and succeed and compete on world markets. Our men
and women who export can do well providing they get the best help
the Government can provide and the best help the Government can provide
is to take the taxes off the back of exporters. And by introducing
a goods and services tax, exports will be GST free and the input costs
will be completely free of taxation. So therefore we'll be giving
a huge kick along to our exporters.
Now I know this change is, in the eyes of some people, big. It is
big. And some people may not think it is easy. But we really have
reached that stage in our history where we can't have the easy
bits without the fundamental reform. You can't hope, as I said
the other night, to play in the grand final without going to training.
You can't hope to present yourself at the HSC without having
studied hard and expect to succeed. And the same thing applies with
fixing our tax system. The easy lazy option is to say: well you can
all have a tax cut and I'll be happy and go we'll away have
a party and that's marvellous. But you can't do that. We
are providing an alcove for a significant personal income tax cuts.
But we are also doing the harder bits. We're also facing the
need to reform the system and that's the issue. Because if you
just give tax cuts and you don't fix the system they'll
disappear like melting snow in the hot sun. They won't last.
It's like building a fancy house on insecure foundations. You've
got to fix the foundations otherwise the house will get rolled over
at the first sign of a storm. They may be old analogies but they remain
true today in relation to taxation as they were in other circumstances.
So ladies and gentlemen, we have reached a stage in our nation's
economic history where compared with most other countries we're
doing very well. We have got low inflation, low interest rates. We've
got our debt down, we've got our Budget back in the balance.
We've generated 300,000 new jobs over the last two-and-a-half
years. We've improved our industrial relations system. But we
still face enormous challenges from overseas and the only way you
can beat them off is to be competitive and strong and you can't
be competitive and strong in the 1990s if you have a 1930s taxation
system. And it's for the sake of Australia's economic strength
more than for the sake of any individual section of the Australian
economy that we put forward this taxation plan. We are not doing it
for this group or that group. We are doing it for the future of the
Australian economy and the future economic strength of the Australian
nation. And I want our tax plan to be judged on what it does for the
entire country. I want it to be judged on the gift that it bequeaths
to future generations of Australians into the 21st century.
Now I do feel very strongly committed to it because I believe it is
in the long term interests of our country. I believe that it will
strengthen our economy. I believe that it will strengthen our families.
The reduction in fuel excise will reduce the costs of transporting
goods around this vast country of ours. Geoffrey Blainey coined that
evocative phrase years ago of the tyranny of distance. And he talked
then of the distance of Australia from Europe but you can equally
talk of the distance between one part of Australia and another. And
if you reduce the cost of carrying goods and services over those vast
distances then I believe you are striking a blow against the tyranny
of distance.
Now ladies and gentleman, Kerry Bartlett has played a very significant
role in shaping the votes and the arguments and the advocacy of the
Government particularly, but not only, in the areas affecting the
Australian economy. I've spoke earlier of his commitment to the
interests of self-funded retirees and one of the things that we've
taken very great care to do in putting together our tax plan is to
ensure that there is adequate support and adequate protection for
the retired section of the Australian community. We've introduced
a 30% tax deduction for the cost of private health insurance to take
effect from January next year. We're introducing a thing called
refundable imputation credits. Sounds complicated but it's not.
If you're a shareholder and your tax rate is less than 36% and
you've got a franked dividend from the company you know exactly
what a refundable imputation credit is. It means that if you pay 20
cents at the margin and 36 is being paid on the share you get 16 refunded
from the taxation office and that's something that you've
never been able to get under the present arrangement. We're going
to abolish something called provision of taxation which has been the
bane of existence of a lot of self-funded retirees and a lot of men
and women in businesses and on the land. And we're also providing
of course for special payments for people 60 years and over of $1000
in relation to their investment income and a further $2000 for self-funded
retirees of pensionable age. And on top of that of course, for all
pensioners there will be an increase in the pension of 4% up front
on the first of July in the year 2000.
And don't believe the scare campaign that that is inadequate
because it is not. It is 1.5% or more ahead of the projected increase
in the cost of living which across the economy we calculate to be
1.9% as a result of the introduction of the goods and services tax.
Some people say that that's too low. I noticed in the papers
this morning that a respected economic intelligence union called Econotech'
released a report through KPMG, the Italian firm, that calculated
at the price effect of a GST was nothing more than 0.9% which is less
than half the calculation made by the Federal Treasury. We think the
Treasury calculation is right. It's not a political calculation,
it's an economic calculation.
So my friends, can I finish by saying that it is a great pleasure
to be back in the Hawkesbury electorate. As somebody who grew up in
Sydney and who spent a good deal of time over the years because of
family connections in areas around the Castle Hills and Pennant Hills
and Baulkham Hills. It's an area that is not unfamiliar to me
and I've visited on many occasions. And Kerry holds an electorate
that straddles different parts of New South Wales and different parts
of the Blue Mountains and of course the Hawkesbury. He represents
it very well, he represents it very effectively and he is a person
of this electorate for this electorate and I very, very warmly commend
you to him and I ask you to give him every encouragement and every
support as your federal member.
Thank you very much.
[ends]