Subjects: Tax debate; Immigration; Rollback; Expenditure on infrastructure, health, education; Industrial Relations;
E&OE..................
Thank you John for those very kind remarks. Rosemary Craddock, the President of the South Australian Division, my Federal and State parliamentary colleagues and fellow Liberals. Can I start this address by expressing my gratitude to the members of the party here in South Australia for the tremendous support and loyalty that you have given me and my Federal parliamentary team over the past twelve months. Can I also record my particular thanks to my South Australia parliamentary colleagues. It is true that South Australia now has, I think on a historic basis since Federation the largest ever representation in the Federal Cabinet. And I want to thank Robert Hill and Alexander Downer and Nick Minchin and Amanda Vanstone and the parliamentary secretaries and all of my other colleagues here in South Australia for the way in which in a sense you have punched above your weight in proportionate terms inside the Federal Government. And when I mention those names, each of them has made a real impact on the constituencies and a real impact in the ministerial areas for which they have been responsible. In the case of two of them, Robert Hill and Alexander Downer continuously over the last five and a half years. And part of the restoration of the respect in which Australia is now held around the world and part of the reason why we have successfully re-balanced our foreign relations, moving away from an obsession with our region to a proper priority for our region but also recognising that we have important linkages with Europe and North America. A great deal of the credit for that success must of course go to the Foreign Minister, Alexander Downer.
My friends we meet within a few months of a Federal election. That';s give or take a month or two or a few weeks, or a few days, and if that hasn';t totally confused the picture of when it will exactly be, because I don';t know yet but it has to be before the end of the year and I know this as each day goes by that claim by me becomes more believable.
We meet at a time when within a few months we do have a very important challenge. We have the challenge, against the odds in a sense, of being re-elected for a third time. We have a challenge against the odds in a sense of being re-elected as government that has not been unwilling to undertake massive change and reform for the long term benefit of the Australian people and the Australian community. But it has not been easy. We went through a horror stretch earlier this year, everyone knows that. I believe that we are now performing a great deal more effectively. And I find that as I go around the Australian community there is a growing recognition as we get closer to the moment of truth. But in reality people are no longer just passing a judgement on whether they agree on everything the Government has done or whether they disagree with some of those things that we have done. But we are getting closer to the moment when people realise that they have to make a choice. They will have to decide whether they want to go back to the seventeen percent housing interest rates, the vastly higher home mortgage repayment of $300 a month or more, as was the case under Labor, the $96 billion of government debt that we inherited from Mr Beazley in March of 1996 and by the end of this financial year we will have reduced by about $60 billion. Or the 11.1 percent unemployment rate which was the peak when the Labor Party was last in office. Or whether they want to continuation of the trifecta for the working men and women of Australia whereby we have delivered higher real wages, lower mortgage repayments, more than 800,000 additional jobs, and we have more than doubled the apprenticeships available, remembering that seventy percent of young Australians when they leave school do not go on to university but they in fact go on to some other kind of training or education. And apprenticeships in that context are of incredible importance. And one of the really proud things that this Government has done is to give a far better deal to the sons and daughters of the working families of Australia who don';t want a university choice than was ever available under a Labor Government. I believe that there has been a recovery in our fortunes. But we';ve still got a long way to go.
The Aston byelection in Victoria was a great result for the Liberal Party. It was a byelection that the Labor Party knows it should have won. And they know that I know they know they should have won it as well. It was a by-election that was there for the taking, you only need a swing of 4 to 5% on average you get that on average in by-elections and they didn';t get it. And it marks something of a physiological turning point. It said to me and it said to many people, many Liberals around Australia that while the public may have been unhappy with some things that we';ve done they are not embracing Labor, they see no clear alternative. And as the weeks have gone by since then, people have been focusing on that choice, they recognise that this Government has delivered a stronger Australia and a better economy. That we are despite our mistakes - inevitably we';ve made them - and I acknowledge that, but this country is fundamentally heading in the right direction. It is stronger and better than it was five and a half years ago. Our economy is the best it';s been since the late 1960';s. In many ways it';s even stronger than it was then because it is less cloistered and more competitive and less protected. We are increasingly seen around the world as a nation of the future. Three great things have happened to give this nation of ours greater lustre internationally: the magnificent stand we took over East Timor, the huge success of the Sydney Olympic Games which radiated all that is great about Australia to the whole world and the impressive economic performance of this country which has led such magazines as the London Economist to predict that in calender year 2002 Australia will out preform any other industrialised nation.
But the other thing that has started to focus the minds of the Australian electorate on the choice and begun to incline more people back to us or towards it is a recognition that there is not clear alternative to the current Government. Mr Beazley has now been Leader of the Labor Party for five and a half years and I have no clearer picture now than I did in March of 1996 what he stands for or what he believes in. He keeps telling the Australian public that he';s had as much or more Ministerial experience as I';ve had. Well whether that is right in years or months matters not, it';s what you achieve in the years that you have political responsibility and what you achieve as the Leader of the Opposition. Leaders of the Opposition, and I';ve been there and I know a bit about it, I know how up and down it can be and how difficult it can be, but Leaders of the Opposition, my friends, have responsibilities to their nation as much as do Prime Minister';s. When I was Leader of the Opposition I took the view that if the Government of the day put up a good idea it ought to be supported in the national interest. And indeed many of the changes that were made that were beneficial to the Australian community in the years particularly of the Hawke Government were only achieved because of support from the Opposition in the Senate. We took the view that if it was good for Australia it ought to get a tick. This mob take the view that if we propose it it ought to get a cross. And that is fundamentally their approach irrespective of the merits of a proposition and you see it everywhere.
You see it in the contest of something that is very important at the present time and that is the tremendous battle that Philip Ruddock and the Government is having on this very difficult issue of illegal immigration. And I think Philip is doing a magnificent job, not only on behalf of the Government but also on behalf of the Australian people in an extraordinarily difficult situation. He';s trying to balance the humanity of this nation with our absolute right to control who comes here, it';s as simple as that and no nation can afford to surrender to that, and we have no intention of doing that. And we have tried to make it less attractive for people smugglers to send people here and one of the reasons why it is not as unattractive as it ought to be is that we haven';t been able to get legislation through the Senate because of the hostility of the Labor Party and others in the second chamber and they have blocked it. And I think what they have done in relation to that is this kneejerk Opposition against the national interest, this approach that if the Government proposes it then we';re against it. Now we were not like that when we were in Opposition and we are a party that believes that whether you are in Government or in Opposition you have an obligation to the people of Australia to behave in a responsible fashion.
But this week my friends, we have seen an extraordinary demonstration of the lack of cohesion, the lack of any clear sense of direction from the Australian Labor Party. We are a bare few months from a federal election and we still don';t know the priorities of Mr Beazley. There he was talking about roll back. There he was saying, I';m going to roll this tax back and then along comes an opinion poll. They put their finger in the air and went "oh, maybe rollback is not such a good idea" so they trot Bob McMullan out to try and rationalise it all and he says "oh no it is not rollback it';s health and education", and then thinking that might be a bit difficult they then send Simon Crean out and he says "no it';s not rollback, it';s not health and education", he says "it';s both". And I ask the rhetorical question : Who is going to tell Mr Beazley what to believe in next week? Is it going to be Carmen Lawrence, or Chris Schacht or Michael Lee or Simon Crean? The reality is that after five and a half years, the Australian public does not have a clear picture of what the alternative prime minister of this country really believes in.
Politics is about doing things that you believe in when you are in government and about propounding what you want to do when you are in opposition if you are fortunate enough to get into government. And when we were elected in 1996 people had a clear idea what I stood for. They may not all have agreed with it, and they certainly don';t all agree with it now, but they know where I stand on the fundamental issues that effect the Australian community. They have no idea where Mr Beazley stands, but as the weeks and indeed the months go by between now and the election, it will be necessary for him to articulate to the Australian people exactly what his priorities are. And of course much of the debate will be about taxation. That won';t be the only issue but it will be an important element in the debate.
As you know one of the things that has preoccupied so much of our time in the last few years has been the introduction of the new taxation system. And it is well to remind ourselves why we brought in the new taxation system. We certainly didn';t do it for our immediately political health. We didn';t do it for fun. We did it because we thought it was necessary in the long term interests of the Australian community, the Australian economy and Australian society.
Remember an undeniable fact about the Australian community. And that is we are a ageing population. Like all other western societies our population is slowly ageing. In those circumstances you need a revenue base that will provide an automatic growth in revenue to fund the services needed to look after an increasingly ageing population.
And that is one of the fundamental reasons why we reformed the Australian taxation system. Because in 1975 which is a generation ago the ailing direct tax system, the wholesale sale tax system was contributing about twenty five percent of our gross domestic product with the equivalent of about twenty five percent of the gross domestic product. By 1996 it had fallen to something like eighteen or nineteen percent and it was destined to continue on a declining and in those circumstances if we had not introduced a broad based tax, a goods and services tax that extended the tax base into the growing services area and the proceeds of which will grow automatically with the Australian economy. If we had not introduced that we would have been deemed to ever increasing levels of income tax in order to pay the increasing services required by an ageing population. And it remains the case now that he or she that argues for a reduction or a removal of the goods and services tax in reality is arguing for higher levels of income tax.
It is an inescapable result of applying our tax base to the ageing demographics of the Australian population and sometimes in this debate about taxation we lose sight of the fundamental long term reason why we brought in a new tax system. Not only of course has it provided us with a natural growth tax, a natural growth in revenue as the economy grows but of course the new taxation system has enabled us to cut personal taxes by $12 billion per year, to cut company tax to 36 cents in the dollar to 30 cents in the dollar and to effectively halve capital gains tax for individuals.
Now ladies and gentlemen there is a fundamental divide on the issue of taxation in Australia. Those who attack oppose and seek to rollback the goods and services tax are in effect arguing for income tax to carry a much greater burden in the future. Because there is no other result. If you have an ageing population and a demand for more services and you rollback the indirect tax base that grows naturally with the economy you are going to throw a greater burden on income tax. And that of course is why Mr Beazley said on the eve of the Aston by-election that he didn';t think Australians were paying too much income tax. Well can I tell you after twenty seven years in public life when a politician tells you he doesn';t think you';re paying too much tax in a particular area he is really saying you ought to pay a bit more. Because that';s what he';s really saying and I think all of you know that that is in the mind of somebody who says that.
Over the last year my friends we have invested very large amounts in an ongoing basis in many important areas of social and economic infrastructure. Earlier this year I announced a $3 billion programme called Backing Australia';s Ability which began the process of increasing investment in innovation in universities in technology and in science. And as the months go by we will be announcing different details and different aspects of that programme. That additional expenditure was necessary. We did need to put more resources into those areas. I am also very proud of the fact that in the five and a half years we';ve been in government we have resuscitated Australia';s health system. It may not be perfect. It may need improvement but compared with the health systems of the rest of the world it is infinitely superior. We';ve but $2.5 billion into reviving private health insurance, something that Labor reluctant dead of the night fertive sort of way. I think at a Ballarat meeting of the Shadow Cabinet the same day that Cathy Freeman won the 400 metres at the Sydney Olympic Games, guaranteed to get front page with the Shadow Cabinet announcement if you choose that date. The Labor Party has said oh well if we get back into office we';ll really hang on to the private health insurance rebate. I wouldn';t at all be certain about that.
But in addition over the next five years under the Australian Healthcare Agreements there is a 28 percent real increase in the money flowing from the federal to the state governments in relation to public hospital provision. Our health system is not perfect but the federal government has injected already massive additional amounts via the private health subsidy of about $2.5 billion a year and all the additional money that is flowing under the Australian Healthcare Agreements.
And in addition to that we have provided a guarantee of the long term fair trading treatment of the parents of Australia in relation to the choices they intend to make regarding the education of their children. It has always been a sacred principle of the Liberal Party since the introduction of direct assistance to independent schools in the 1960s by Sir Robert Menzies that Australian parents should have the right to choose the school which educates their children. We are a government that supports that choice. We are a government that supports high quality government education and under present funding arrangement 78 percent of money from all government sources goes to the 70 percent of children who are educated in government schools with only 22 percent from government sources going to the 30 percent that are educated in independent schools. And that gives the lie to the argument peddled by Labor that in someway our policies are designed to assist the wealthy within the Australian community. Indeed at this moment a bill to provide establishment grants for many low fee independent schools is likely to fail in the Senate because of the hostility of the Labor Party and others in that Chamber.
I have made it very clear that off the back of the ongoing increased investment that we have already made in areas like health and education. In the area for which Robert has responsibility, salinity and water quality, an additional $1 billion into the National Heritage Trust. The massive increased expenditure on defence which has given us the best blue print for the defence of this country in a generation. The $1.6 billion we';ve put into the Roads for Recovery programme, the great bulk of which is going to local roads in regional and rural Australia. Off the back of all of that investment in social and public infrastructure, it is our belief that if there is a surplus available, then the next bit of the cherry out of that surplus ought to be applied to further income tax relief. Because we believe in a society which is cohesive and prosperous. A society that is generous to its vulnerable but also a society that encourages people to aspire and to achieve. And governments should never lose sight of the fact that the wealth of a nation is built on the aspirations its people have to work hard and the incentives they have to aspire and the incentives they have to achieve.
The other issue that I';d like to briefly mention is that of industrial relations. It will not have escaped your notice and it certainly hasn';t escaped the notice of my friend the Premier that South Australia is the only state in Australia which is still in Liberal hands. And I ask all of you to contemplate the industrial scene in this nation if the Australian public wakes up - I won';t tell you which Sunday - the Australian public wakes up on a Sunday later this year and discovers not only does it have five state Labor governments but it also has a federal Labor government. Can I tell you the person who will be first out of bed that Sunday morning will be Sharan Burrows, the President of the ACTU. Because she will know that all her heavens have come at once. She will know that all of her opportunities have suddenly arrived in one stroke. And if we were to lose the next election I would grieve for a number of things in relation to policy and in relation to Australia. But the thing I would grieve about most is the certainty that federal Labor will combine with state Labor in five of out of six states to rollback the industrial relations reforms that have transformed the productivity of the Australian nation over the last five and a half years. The union boys and girls would be back in town. The union bosses would be back around the Cabinet table. Australian workplace agreements would go. The thugs would be back on the building sites not only in Western Australia but also in other parts of Australia. The Trade Practices Act protection for small business would be swept away and all of the productivity gains that the working men and women of Australia have enjoyed over the last five and a half years would begin to disappear. Because the supreme irony of all of this is that working people are better off under us than they were under Labor.
When we were in Opposition Labor boasted about cutting their real wages because when you ran an industrial relations policy that was anti-competitive - an industrial relations policy that didn';t encourage productivity - the only way you could control inflation was to cut real wages. Well we';ve found a better way of doing it. We';ve actually found that if you increase productivity you can pay people more as a firm without going broke. I mean it is a pretty simple proposition but it has taken a Liberal government to implement it and make it work. So all of that will be totally at risk and there will be no compromise on that. They will rollback our industrial relations reforms. The unions of Australia will force Kim Beazley to do what the unions of the United Kingdom did not force Tony Blair to do and that is to rollback the industrial relations reforms of his predecessor. Labor has pledged itself to do that. Labor will be forced to do that. Labor will co-operate federally with Labor in five states of Australia in order to achieve it. And of all the things that we might grieve about the impact of a Labor government it would be the rolling back of those industrial relations changes.
So we have ahead of us my friends a tremendous challenge. We have picked up. We are doing better now than we were a few months ago but we still have a long way to go. We don';t have a bit majority. We have a very tough fight ahead of us. In the process of reforming and changing the Australian economy we have inevitably trodden on some toes and offended some people. But deep down I believe that we can win this. I believe that we have recovered momentum. I believe that people are listening better. I believe the recovery of rural Australia will help us and I can only say that the millions of Australians who don';t live in the rural parts of Australia are ever so pleased that their fellow Australians in the bush are now enjoying better prices, a super competitive exchange rate, better seasons in many parts of Australia, not all. And at long last slightly better conditions and a brighter future.
But we have a huge fight. Here in South Australia our great challenge is to hold on to those three very marginal seats. We have magnificent members in Trish Worth and Christine Gallus and Trish Draper. But it will be tough. It will be very difficult and we';ll have to strain every sinew but the prize is great. To win again will give us the opportunity to entrench and consolidate the reforms and improvements of the last five and a half years and put it beyond the capacity of a Labor government elected years into the future to reverse those trends. It';s too soon. A Labor government elected in a few months time can roll things back. They can turn back the clock if we can win again we can put it beyond their capacity to do that. That';s a huge incentive. It';s a great prize. And I ask all of you to join me in working to achieve it.
Thank you.