YOUNG LIBERALS' CONVENTION
SURFERS' PARADISE, OLD.
Speech by the Prime Minister, the Rt. Hon William McMahon CHMP
11 February,_ 1972
Mr. President, Ladies and Gentlemen,
I want to talk to you today about three thingsfirst
the economy second the role the Government has to playand
third the Liberal Party.
I realise you have dealt with these subjects in
one form or another during your Convention. However, I want to
give you the Government' s view because we are immediately concerned
with decision-making on these matters of direct concern to us all.
This is election year. And a year where we have
inherited problems from the past, many of them not directly within
our control, and also commu~ on to most industrialised countries
throughout the world. They are our problems, however, and we are
at grips with them. They are well-known to you all. There is inflation.
It continues to threaten us and, so far as it is in the Government's
power to do so, our measures to contain it must be constantly under
review and flexible in their application.
There is unemployment, which is the cause of
considerable public anxiety, though by world standards the level
is low, and it is by no means chronic.
No matter what a Government does its efforts will be
aborted unless there is confidence on the part of the public,
business and industry, and, I emphasise, the Trade Union movement.
I am well aware that there is some lack of confidence, we in the
Government are as sensitive to this as we are to the root causes
inflation and unemployment. We are doing everything in our power to correct this
and what we are doing is dictated entirely by the national interest
In other words, we are not looking at it from the point of view that
this is aA election year. We are not looking at it from the point
of view that there might be some very favourable signs and some that
are unfavourable. We are looking at it in order to ensure that
immediate and the long-term public interests receive paramount
concern. There are, with all this, a number of encouraging signs.
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In the long-term, of course, our prospects are
excellent. Even the Jeremiahs concede that. Our international
situation is very sound both in terms of trade and financial
resources. And we are showing strength and steady growth on the
domestic front. But it is the immediate problems that are commanding
public attention in Australia today, as you so well know. We have
to make sure that growth continues while we apply remedies to our
immediate problems. We must not throw the baby out with the bathwater.
This, therefore, is a time for carefully-considered
decisions, taking both the immediate and long-term situations into
account. There is absolutely no cause and no need to press the
panic button now. That, briefly, is the position in Australia today.
Now about the Government's role. We are tackling
the causes of inflation at every point we can. Inflation I want to
assure you, has been largely caused directly and indirectly by
excessive wage claims and wage rises in Australia. It is no good
putting blinkers on about this problem.
If you don't get a lift in productivity when you get
wage increases, then you are bound to got inflation no matter what
action the Government night take, and we haven't been getting a lift
sufficient to cushion the impact of those wage rises. On top of
that, industrial disputes and lawlessness, and political strikes, are
making the problem a great deal worse. But I can illustrate this
in a few sentences. The total man days lost was 2,877,000 compared
to 2,283,000 last year. To give another example of what disputes are
costing the wage earner himself, the total loss in wages for the
first eleven months of 1971 was $ 43 million, compared with $ 29 million
for the corresponding period of the previous year.
Look at the trouble in the Post Office, look at the
trouble we now have with the S. E. C. in Victoria. Having said this,
I think you are entitled to ask: What is the Government doing about
it? What can the Government do? And what sort of leadership is it
providing. most people don't rea~ lise and I want to stress this to
Young Liberals that one of the impediments we have is that, under
our own constitution, the Government is very limited constitutionally
in the action it can take.
Nevertheless, time and time again, we have sounded
the warning thiat excessive wage increases must be resisted by
Governments, by wage-fixing tribunals and Private employers and
that the Arbitration Court must take into account the national
interest and ability to pay. We have intervened in the national wage
cases and will continue to do so. This is a positive contribution to
the task of getting all the facts, the most important facts, on a
national scale before the Arbitration Commission. And we are
determined that a $ tate of full employment will be achieved and
maintained. ./ 3
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The Government undertook at Budget time last year
to keep the economy constantly under review, to be flexible and act
promptly in response to trends and movements. This we have done.
We made a review in October/ November. In December we decided to
review the economy again in January. This we have done and Cabinet
has discussed the results fully in recent days.
We have made and announced various decisions, as you
know, particularly on monetary matters, as a result of which interest
rates on Government Bonds have been substantially reduced, and, of
course, the maximum overdraft rate his also been reduced.
There are now some indications that some interest
rates in the private sector are starting to fall. Just two other
examples of action we have taken
We made a special interest free capital grant of
million to the States for the building of primary
and secondary Schools and
We limited the -migrant inflow during the period when
school-leavers would be coming on to the labour
market. In recent months we have also intervened in other
significant cases before the Conciliation and Arbitration Commission,
with some effect, as in the annual leave case. These interventions
included the carpDenters, bank officers and the Victorian Electricity
Commission cases. Much of this has largely escaped public notice but
I believe these actions show decisiveness and leadership on our part.
We have always insisted that the Arbitration system must be preserved.
Generally it has served us well since Federation. If it is
weakened or destroyed by pressure tactics from anyone, then both the
boss and the working man will really be in trouble. We insist that
industrial disputes must be settled by Conciliation and arbitration.
You will understand that I cannot go into details of
our latest review as I am to meet the State Premiers next week and
we will takre a number of decisions which will. be important for the
future. But I want to say this. The Government has acted
deliberately, and I believe sensibly, to demonstrate flexibility in
its management of the economy. It will continue to do so.
My Governm1ent is concerned to see that a State of
full employment is maintained. I am confident that the immediate
pressures can be eased off if there is a concerted community effort
to face up squarely to the problems of the day. The employment
position, no matter what the underlying trends are, can be seriously
compromised by prolonged and unnecessary industrial stoppages, of
the kind which is being experienced in Victoria and which is
forcing employers to stand down a large part of the work force. The
current level of registered unemployment in Australia is 1.6 per
cen~ t of the labour force, after adjusting for normal seasonal
influences.
This is a little higher than the average level of
1.4 per cent achieved over the last fifteen years but it is still
very low by world standards. Australians have come to expect very
high rates of employment and my Government is determined that this
expectation will be fulfilled. There is no reason at all why anyone
should join the " disaster lobby" and become crepe-hangers and
mourners about something that hasn't happened.
We are determined to continue to give leadership
in economic management. And are confident that the inherent
strength of the economy will show itself increasingly as the year
goes by. We will continue to take prompt action to anticipate and
deal with specific conditions as trends develop.
There is good news today as well as bad. The bad
news must not be swept under the carpet. It must not be concealed.
But neither should the good news. When the number of days lost by
strikes goes down, when productivity -goes up then let the story
be told. When wool goes up as it has. When the stock market liftsas
it has when companies show better trading and increased profits
as many are then let that story be told too. This is the way to
sustain confidence, encourage develop ment, create more employment
and take us forward to better days.
Despite all the difficulties we have had in the past
year the Government has made a great deal of progress on a wide
front. Time doesn't permit me to give you a list of many of the
things we've done, but I leave with you a paper which records in somie
detail our decisions and achievements from March of last year to date.
There are pages of it.
And in the first month of this year we have already
announced An important decision on bond and interest rates.
A new deal for our aboriginal citizens.
A major re-organisation of the Army and other
defence developments.
A decision to make Australian pensions payable
overseas. A decision to make Government papers and Cabinet
records available sooner to the public.
And there's more to come.
Now about the Liberal Party. First of all your
Conference. I am delighted to hear from those who have been here
throughout the Convention that you have really been getting down
to things.
You have:-demonstrated in the most vigorous way your
loyalty to the Party, your concern for the future of Australia,
your interest in the well-being of the Australian people and your
determination to help us win the election. I congratulate you and
I thank you. For my part let me assure you the Parliamentary
Party is in good shape and so is the Government. We are a good
team pulling well together and we are going to win the next
election. I have had talks with the Liberal Party's Federal
Policy Committee in Canberra this week, and I think you'll find
we'll have a first-class, forward looking, refreshing election
policy for the Electorate. A number of Party Committees have been
busy for several months overhauling all aspects of Party pclicy and
they've done a good job. I am sure that relations between the
Parliamentary Party and the Liberal Party Organisation have never
been better. One can look at an election two ways. You can
mention the risk of losing, to prod the faint hearts into action,
or you can make up your mind you are going to win and get that
message across loud and clear. That's the way I prefer to do it.
In the months -that remain before the Poll we have
to make a concerted effort to strip the mask off the Lebor Policy
and its pretensions, so that our policies can be judged on their
merits against theirs. We can best do this by putting our whole
effort into our own performance as a Party and a partner in
Government. Don't believe the rubbish you hear ." that we've been
on the Government Benches a long time and that's good enough reason
for a change." It's good enough reason to stay. The record of
achievement during our 22 years of office has-been remarkably good
and the Australian people like the way we do it. But again, don't
be complacent. We mustn't take it easy. There's too much that's
new going on all around the world and yesterday's iiet isn't always
the best for tomorrow. I belive Liberalism has its greatest opportunities
-ahead of it in this decade of the seventies.
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