Subjects: Taxation reform; Australian Labor Party; Governmental achievements;
E&EO…………………………………………………………………………………..
Thank you very much Kerry, to your wife; to Senator Helen Coonan and Alan Cadman. Alan and I do belong to the quarter century club that means that we’re both only twenty-five, not that we’ve been in parliament for only twenty-five years. But it’s great to be back to a Liberal Party function in the electorate of Macquarie. I sneak in and out of the electorate of Macquarie in a private capacity on a number of occasions. I have a few mates and relations in this part of the world that I’m very, very happy to visit whenever I can and it’s a delightful part of the world and it was a real privilege this morning to be able to join my twenty-four predecessors as Prime Minister of Australia in planting my tree and to remark upon the contribution that they made. I speak not of myself, I’ll leave that to my successor to talk about my contribution to Australian politics. But to reflect for a moment on the contribution of the twenty four people that have gone before me but most particularly in the lead up to the century of federation the incredible contribution of Sir Henry Parkes, a native of the Blue Mountains, son of the Blue Mountains, the contribution that he made not only to his state but also to the Commonwealth of Australia. Remarkable in the fact that he had an enormous impact on our country but of course by dent of history was never to become one of its twenty-five Prime Ministers.
Kerry was kind enough to talk about all of the things that have happened in politics since I was last here and he’s right – it has been a quite momentous three-year period. And today I want to focus for a few minutes in one of the most important things that we did during that three year period, something that of course is going to come finally to fruition on the 1st of July of this year and that is the great historic reform of Australia’s taxation system.
It is not realistic or possible for anybody in politics not to talk about taxation reform at the present time because it is the biggest reform and the most important economic reform that we’ve had since WWII. And can I say to you as supporters and friends of the Liberal Party and to the broader Australian public that it is perfectly natural that in the lead up to the 1st of July people will have questions, people will have doubts, people will inquire, people will want information and even our best supporters will go through a period of saying : “gee I hope it all goes well, I wonder perhaps, maybe, is this and that appropriate?” That is a perfectly natural thing.
I think one of the sort of things that I guess troubles people most in politics or about politics is sometimes there’s a tendency in the paraphernalia of it to sort of try and pretend that the obvious doesn’t exist or to ignore the obvious. Now it is perfectly natural that when you are leading up to a big reform like this there’s going to be a degree of apprehension and degree of concern, even a degree of criticism and it’s perfectly natural. If people weren’t interested in it, interested in it enough to be apprehensive it wouldn’t be worth doing. It really is as simple as that. And can I say to all of you that’s going to go on for the next few months.
But when the 1st of July dawns, that Saturday in the first day of July and the first Saturday in July and the great bulk of Australians in the days that follow discover a very simple thing - 80% of Australians tax reform will mean that the price of some things increases, the price of some things stay the same and the price of a third category of things falls and on top of that everybody will enjoy an income tax cut. And if you’re on a pension or a benefit it will be increased up front depending upon your circumstances in the order of 4%, in some cases with rent assistance higher. And then on top of that, particularly for self-funded retirees there’ll be other benefits as well. Now that in essence is how 80% of the Australian community will find taxation reform.
If you are in business there’ll be a new system to get used to; people are getting used to it now. If you are an exporter you will find that you have a bit more of a competitive edge because the GST will not be payable on your exports. If you pay provisional tax you’ll find after a while that provisional tax has been abolished. If you are a self-funded retiree one of the things you will enjoy is a thing called dividend imputation credits which means that you will get the full tax value off franked dividends.
But the point I really want to leave you with and no other point today is that it is a totally natural thing when you are embracing a big reform that people are going to have questions and doubts and concerns. If you didn’t the thing wouldn’t be worth doing. And we’ll embrace tax reform not because we’re sort of mad ideological warriors, not because it’s the next thing to do. Not because we have an obsession with changing things just for the sake of change. We have embraced taxation reform because we think it will make the Australian economy even stronger and better.
Because it will reduce, over time, the operating costs of business. If you live in the country areas of Australia, you will find that your fuel is cheaper. And for state governments it will do something that for decades, indeed for generations, state governments have asked for and that is to have access to a growth tax. I have been to a lot of Premiers’ Conferences. Can I tell you that they’re a bag of laughs most of the time. You know, they are an art form in nonsense if I could put it that way. You know you have the Premier arrives at the front door of Federal Parliament and says “I’m going to tell them.” And then he goes out and says “I told them that the heartless Commonwealth took no notice and I’m going to have to go back to Macquarie St and increase taxes, or reduce services or something.”
I mean there’s a lot of nonsense carried out of Premiers’ Conferences. But there is one thing I can tell you privately, all the Premiers of Australia are united about, whether they’re Labor Premiers like Mr Carr or Mr Beattie, or Liberal Premiers like Mr Court or Mr Olsen and that is that the GST is good for them. Because a lot of people don’t realise that every last dollar of the goods and services tax is going to go to the states. We’re not going to get a penny of it. Every last dollar is going to the states. And that means that as the years go by and it builds up, the revenue returns from it, develops, and the states get the benefit. And they have more resources to fund government schools and hospitals and police services and all the other things that are so important.
That is why I shall never forget Mr Carr’s contribution to the GST debate. He came down to the Conference that the Treasurer and I had with all the Premiers to get them to sign the agreement and he said “I want to tell you Prime Minister this is an outrageous attack on the living standards of average Australians, where do I sign the agreement?”. I’ve got to say the Queensland Premier was a little more subtle, but he grabbed the pen with equal vigour. Because they know a good thing - to vary an old slogan - and they’re going to stick to it, they’re going to stick to it because they know it is very, very good.
So, tax reform is a huge change. But the average person is going to find it really consists of what I described. The other thing I’d like to say about it is that it’s not something that is being imposed on the Australian community by stealth. It’s not being done in the dead of night. It’s not being done in defiance of commitments. I mean I once said we’re weren’t going to do it, but I came to the conclusion that it ought to be done. I didn’t try and do it until I’d gone back to the people again. I mean not like 1993 when Mr Keating opposed John Hewson’s goods and services tax, won the election on the basis of that opposition and then increased all the indirect taxes to balance his budget. Or rather to stop it being even more in deficit. Without it going back to the people. And without providing any compensation to people on the pension or on fixed incomes.
Yes, we did decide in 1997, not long after I came here that it was a good idea to put tax reform back on the agenda. And we put it back in earnest with a detailed plan before the 1998 election. And I went to that election and I said “yes we once had a position against it, we now believe it is good for the country. If you don’t like it, vote us out of office, if you don’t agree with us having changed our position, vote us out of office.” But the Australian public wanted us back. They voted us back into office. They voted us back knowing we that we would introduce taxation reform. They had it warts and all and we proceeded with no assistance at all from the Labor Party, but with good assistance from the Democrats with a number of changes we would have rather not made. But we had to make it to get it though and we got it through the Parliament. And now it is going to be introduced.
But let me for a moment just examine where our political opponents stand on this. I mean the Labor Party on taxation reform. Kerry talked about rights and responsibilities. On taxation reform the Labor Party is the classic illustration of the irresponsible citizen. They want the right to criticise it which they have in any democracy, the opportunity to score political points off a government that’s trying to do the right thing for the country. But they abandon any sense of responsibility about what they are going to do.
I mean I always thought in politics that how it operated was like this. One side proposed a policy, the other side either embraced that policy or disagreed with it and if it disagreed with it, it then turned around and said what it was going to do in place of it. Now that is how it is meant to work. I mean if you are going down the main street and you want to buy a car and you go to one car sale yard and they give you a good spin as to why you ought to buy that car and the bloke next door with the other car yard then comes along and starts criticising the model the first bloke is trying to sell you, you are naturally entitled to turn around and say, well what have you got to offer? Then he turns around and says I’m not trying to sell you a car, I’m just trying to critisise that one. You start to lose a bit of interest in him, he doesn’t have a lot of credibility, but that is what Mr Beazley is doing on tax. He hates the GST so much he is going to keep it if he wins the next election. But he is going to keep it.
I mean this is one of the, you know, one of the great secrets of Australian politics. I mean if somebody had arrived in this country six months ago and they’d have heard me and they’d have heard my opponent talking about taxation reform, they would have said, well this fellow Howard he’s in favour of tax reform, he’s in favour of the GST as part of tax reform and this fellow Beazley’s against it. So that means if Mr Beazley wins next time Australia won’t have a GST. Wrong. If Mr Beazley wins next time, Australia will have a GST. He’s not going to . . . he said he’s going to roll it back, whatever that means. And he can’t do that without increasing your income tax because he said that he’s going to roll it back but he’s not going to leave the States worse off.
I mean he went down to a meeting with all of his Labor mates. Mr Beazley went down to Burnie, and there Mr Bracks and Mr Bacon. And Mr Beattie told Mr Beazley in Burnie that he had to give a guarantee that if any of the roll-backs that he talks about took place, he doesn’t tell us where they are. I mean what he is really doing is that every time an interest group comes along and complains to him about the GST, he says we’ll look after that with a roll-back. They go away happy. I mean, you know you’ll be in terrible trouble if they all bump into each other at the same meeting because they’ll add it all up and they’ll work out that it’s pretty difficult. So you really do have a sharp distinction between the two sides of politics on this very important issue.
I mean, we are trying to do something we believe in and what we believe is for the good of the country. It’s not easy, it’s never easy undertaking big reforms like this and I know some people have concerns about it and they have questions about it, I understand that and we take those questions and those concerns very seriously. But we do have a goal and we have a commitment to that. And on the other side we have somebody who’s trying to luxuriate in the expediency of criticism without any idea of some alternative road map. And I think in the end that will be exposed for what it is, but ultimately that of course is for the Australian people to resolve.
We are not only interested of course in economic issues. I was asked a few weeks ago by a journalist who interviewed me on the occasion of the fourth anniversary of Kerry Bartlett’s victory in March of 1996 and the election of the Coalition Government. I was asked to nominate the three things that I was most proud of as far as the Government’s achievements were. And I said that in no particular order our achievements, in delivering the strongest economy this country has had for 30 years and particularly the way in which we were able to stare down the Asian economic downturn better than I expected. I don’t mind admitting three years ago I was apprehensive that the Asian economic downturn might have damaged us more than it has and we performed even better than I had hoped and believed we might.
And the other two things that I am very proud of what the Government was able to do are in the non-economic areas. And that is our national gun control legislation achieved in March of 1996. And let me say I know that didn’t please everybody, didn’t please some of our supporters and friends, but it was long term in the national interest. And every time I witness on television, I witness the appalling license with which guns are available in the United States, I am grateful as an Australian that I live in this country and that must be the reaction of so many Australian parents in particular, and lonely and vulnerable people within the community.
And the final thing that I put in the three things of which I’m most proud, of course was the role that Australia was able to discharge in relation to the people of East Timor. A role that saw our country do the right thing in our region, saw our country respond to the suffering of a group of people, saw our country undertake a very difficult operation and all credit to the men and women of the Australian Defence Force, so superbly led in that operation by General Cosgrove, but demonstrating the wonderful capacity and tradition of the men and women of our Defence Force. And when I visited them in Dili and elsewhere in December, there were many things that I remember of that day, but one of the most wonderful parts of the day was the obvious warmth they displayed towards the local people and the way in which that warmth was reciprocated. Not only were they great military representatives our country, but they were great humanitarian representatives of our country. And to walk into the military hospital there and to find one of our own Liberal MLC’s, Major Brian Persudy in the medical team was just a reminder of the diversity of the skills of the modern Australian Army and the humanitarian rapport that was established.
So Kerry, it has been a wonderful journey so far, it has been a great four years, we do have a very strong Parliamentary team. I do want to pay tribute to Kerry as your local representative. He has very strong and spontaneous support in this electorate and that doesn’t surprise me because he does represent his electorate in a very dedicated way. I said to journalists of local papers that interviewed me in Kerry’s office a short while ago. I said of him, that he lived with his constituents in the total sense of that expression. He worried on their behalf when they had problems and he celebrated with them when they had successes and had achievements. And that is the mark of a very good local representative.
This is a very diverse electorate. It has a fascinating cross-section of the Australian community. And I think you have probably got, you got most points of view on the political spectrum represented in Macquarie! I saw a number of them on display [inaudible] and a number from elsewhere! It’s one of those places that always attracts visitors and long may in the best tradition of that expression, long may that continue to be the case.
But Kerry, it has been an enormous privilege to have you as a colleague, to have you as somebody who is a very good conveyor of the common sense concerns of the Australian people when those concerns ought to be expressed to a Prime Minister.
A Prime Minister in the end is only as good as the advice he gets from his parliamentary colleagues. If you get bad advice and you have people who are unrepresentative of public opinion and if you have people in who are afraid to express their points of view, in the end you will lose contact. No matter how hard you try yourself to keep contact with the public, and I try very hard.
So Kerry, thank you very much for your support and your contribution. And to all of you can I say that I value the loyalty and support of the members of the Liberal Party that I have had over the last four years. We could not have travelled the journey we have, we could not have achieved what we have, we could not have reduced the unemployment the way we have, built the Australian economy, built the international respect of the Australian community, pioneered the reforms that we have without the sympathy and the understanding of the supporters of our party.
And can I just finish on this note. It is appropriate that for the second time as Prime Minister I’ve come to this same restaurant because on earlier occasion. Now that reminds me that there is something symbolic about that and that is, the first thing about it is that there is a consistency about our patterns and our attitude. And the other thing is that it is so symbolic and appropriate on the two occasions I come to this electorate we should do so in a small business establishment, because small businesses are so much the heart and soul of this electorate with its large number of small but vibrant communities, so much the heart and soul of the Liberal Party and so very important to the economic strength of the Australian economy.
Thank you.
[Ends]