E&OE...
Thank you very much Mr Trevor Carroll, the President of the Australian Industry Group, Mrs Heather Ridout, the Executive Director, my parliamentary colleagues, ladies and gentlemen. I've had the opportunity on numerous occasions since becoming Prime Minister, and previously, of addressing this gathering and its predecessors and I always enjoy the occasion and I take the opportunity on this occasion in 2007 in expressing my thanks and that of the Government for the excellent relationship that we have maintained with the leadership of the AI Group and your members in the development of public policy. I appreciated very much the reference to the development of the skills for the future package which was excellent example of how over a period of months in close consultation with many industry groups the Government was able to bring forth a number of policy changes which have made a practical impact on dealing with one of the continuing and quite chronic skills problems of the Australian economy, and that is the very large number of people in the workforce whose education qualifications have not reached year 12, and the extraordinary take up of the $3000-a- year vouchers is testament to the relevance of that particular initiative and I want to mark my gratitude to your group and your organisation for the advice that it injected into the discussions.
We do meet of course at a time when it's right to record again the great strength of the Australian economy. It is a wonderful human dividend of good economic times and good economic policy that we are now enjoying our lowest unemployment rate for almost 33 years. And some figures that came out last week reminded us that in the 12 months to either June of July of this year there was a fall of no less than 29 per cent in the level of the long term unemployed in Australia. And a long term unemployed person is somebody who's been out of work for more than a year. I can't help but reflect what a wonderful metaphor that particular figure is for the remarkable strength of the labour market in 2007. I am also encouraged to make the observation that it must have quite a lot to do with the greater willingness of small business in Australia to take on more staff without the fear of the old unfair dismissal laws.
Ladies and gentlemen I want to say a couple of things about the economic climate in which we operate. The strength of the Australia economy, the stability of our financial institutions, the prudent state of fiscal policy in Australia, the investment of past budget surpluses in the Future Fund and the credible commitment of the Government to maintaining strong budget surpluses into the future. All stand this country in particularly good stead at a time when there are some concerns on international financial markets. And they are a reminder of how important it is at any time in the economic experience of a country to maintain very strong economic fundamentals. And just as they prove their worth on earlier occasions, so they prove their worth at the present time.
The prudent way in which institutions are run and regulated in this country is something we tend to take for granted but we should remind ourselves on an occasion such as this of just how valuable that regulation and that administration really is and it's important as we look at some of the difficulties that are occurring in the United States to understand that pleasingly the incidents of what they call sub- prime loans here Australia is quite miniscule compared to what is the case in the United States.
In his remarks your president talked about the support within the business community for the Governments' approach to climate change and most particularly the introduction of an emissions trading system. It's fair to say that there has been a very big change in the attitude of the business community towards this issue over the last few years. When the Government put together the energy white paper, what, four to five years ago, there was near universal opposition in the resource sector of the Australian economy to the introduction of an emissions trading system.
But some years on that attitude has changed and the development, through the work of the task group chaired by Dr Shergold, the Secretary of my Department, the development jointly with the business community of a structure of the emissions trading system that I announced that the Government would adopt on the 3rd of June, was as good as an example of Government business cooperation on an important public policy issue that I have seen in the time that I've been Prime Minister. We brought together leaders of the resource companies and the secretaries of five of the Commonwealth Departments of state. And within a period of less than six months, what I regard as a world class trading system was put into a framework, an excellent document advocating its adoption was published and within a few weeks with very wide public support, the Government was able to embrace the recommendations of that report.
History I think in the future will record that along with the Campbell Report into the Australian financial system, released almost 30 years ago, the Emissions Trading Report could well have one of the most lasting impacts on the Australian economy because the adoption of an emissions trading system and its orderly and sensible and measured introduction will have a tremendous impact on the Australian economy and the target that we embrace in relation to the operation of the scheme will be amongst one of the most important economic decisions that this country will take during the next decade. And I agree very much with your president's exhortation to make sure that we get the settings right and we understand the implications of the target we embrace and that we do it in an orderly and not overhasty fashion.
The Government is moving to implement the emissions trading system. The scheme is being designed by a task group within my own Department. The Treasury has started the modelling work for targets and legislation will be introduced this week for the emissions trading reporting system. Our aim is to have the trading scheme commencing in 2011 and we're very keen to maximise incentives for abatement in the lead up to 2011. We don't want to disadvantage any firms for abatement measures already taken and we want to reward extra abatement before the trading commences.
I want to confirm tonight that compensation for firms adversely affected by the trading system will apply to those assets that were in existence on the 3rd of June 2007. That is a logical decision to announce but because there has been some ambiguity in the minds of some firms it is important that it be confirmed. And that date has logically been chosen to avoid windfall gains for investments made in full knowledge of an impending price on carbon. It is important that we get the details of the trading scheme right and my Department is preparing a discussion paper to be released in September, to be followed by some structured consultations. I invite the Australian Industry Group to be an enthusiastic participant in that consultative process.
I would now like ladies and gentlemen to direct a few remarks to an issue that will bulk very large in the forthcoming election campaign. No issue will be more keenly argued in that campaign than the fate of the Government's reforms to Australia's workplace system. No issue is more central in that campaign to the future of the Australian economy than whether or not those reforms survive. I have said on a number of occasions in the past that this country has had the wit and the genius if, I can put it that way, to embrace five great economic reforms over the last quarter of a century which have laid the groundwork, have been the foundations of our great economic prosperity at the present time. The deregulation of the financial system, tariff reform, taxation reform, strong fiscal consolidation including the privatisation of government business enterprises and importantly industrial relations reforms. And speaking very generally, if we are to maintain the prosperity that we now enjoy, it will be quite counter-productive, indeed, potentially fatal to maintaining that prosperity if we were to turn our backs on any of those major reforms. It would, of course, now be unthinkable to unravel the introduction of the GST; it would be unthinkable to turn back the clock on tariff reform. It would be unthinkable, difficult though I know, a high exchange rate is for some import competing industries, to go back to the days of a regulated and fixed, or a managed exchange rate. And in current economic circumstances it would be unthinkable to walk away from the strong Budget position we now have, and yet we face the real possibility that if there is a change of government, industrial relations reform will be dismantled.
Let us understand without any ambiguity and without any polite words, but there is a very clear choice. If the government changes, the industrial relations reforms of recent years will be dismantled. We will go back to the old days of forced collective bargaining; we will see a return of the nightmare of unfair dismissal laws for small business and we will see the re-imposition of a union monopoly over the bargaining process in this country. Australia will be the loser and Australia will be the poorer. But to put it in proper context, that if the Government is returned, then I confidently predict that the reforms that have been made over the last few years will never be dismantled. Because by the time of the next and subsequent elections, they will have become so much part of the economic and industrial fabric of this country, that will be quite impossible. But I can say with equal conviction that if the Government is defeated and the reforms are over-turned, I do not believe a future government of my persuasion will again be able to re-introduce those reforms.
I put it starkly because I believe that to be the clarity of the choice. Elections are about choices; elections are about change or the maintenance of progress. We have come a long way; I don't claim for a moment that I lead a perfect government; I don't claim for a moment that my Government is without blemish. But we have committed ourselves to a reform process. Today's prosperity is the product of a quarter of a century of economic reform and many people in this room have been part of that debate and part of that process and they have seen the achievements, they have helped shape those achievements and what is at stake in relation to one of those vital reforms is nothing short of a very, very crucial decision as to whether those reforms will be maintained.
I find it truly astonishing that a set of reforms that has help generate some 365,000 jobs in about 18 months, that has maintained a steady growth in real wages based on non-inflationary productivity gains and has created the lowest level of industrial disputes since a year before the outbreak of the Great War in 1914; I find it truly astonishing that anybody should argue with passion and conviction that those reforms should be rolled back. They have played a vital role in shaping the prosperity that we now have. Jettison those reforms, we send a signal to our own people and we send a signal to the rest of the world that this country has lost the stomach for reform and that this country has been fatigued by reform. I don't believe that that is an option that the Australian people will want to embrace.
Finally can I return to my opening remarks and to thank all of you for the cooperation with the Government over the last year, to wish your members well. I know that there are many challenges, despite the great prosperity of the Australian economy but the great energy and ingenuity that businessmen and women have brought to the growth of the Australian economy over the last decade or more is something that I very greatly admire. I wish you well and I look forward to a long and fruitful continuation of past associations in the years ahead. Thank you.