PM Transcripts

Transcripts from the Prime Ministers of Australia

Transcript 2533


Photo of McMahon, William

McMahon, William

Period of Service: 10/03/1971 to 05/12/1972

More information about McMahon, William on The National Archive website.

Release Date: 14/02/1972

Release Type: Media Release

Transcript ID: 2533

1I 6
~ KzK FOR PRESS: Pe N, 2 1/ 197 2
TF17) 1 7 LPPEM1ERS_' ON!! F-F2NN qL
S'tatemtent by the Prime D-in ste-, The Rt Hon. Willl)* a-. MCidon
In my opening stateme(-nt to the Conference ( copie-S of wh-ich
have been circulated) I outlined. the Coutmornwea2th's a., sessmezmc
of the economic sit-oation arid orosP,_ c-L and indlicatcd in boroad
terms the programme of action which the Government Ilad developedt
on the basis of its det'ailed review of the_. eCcomty. This review
Was, of course, consi ~ tent with our commitment tc keep the
economy under review but it was also undertakon, ! having in m~ ind
the opportunity today c Conference presented, to -take into
account the views of the Premiers on our assessm~ ent and oi.. our
programme. The proqramnxe I outlined to-, œ he Premiers this morniLno
was to increase unemployment-" benefits and associated short
term sickness and special benefit. for adult males -froin
per week -to $ 17 per week with commensurate increases
for juniors;
-to i4ncrease the amtount of the qr-r a nts T intro_' uceO last
Decermber for emplo) ent-cxeatinq activities in nonmetropolitan
areaas from $ 2 .25 mill ion per montCh to e. 4
million per morith a rate' of $ 48 million per yea~ c;
t~ o restore the special investment allowance on investment
in new manu,_ acturing-. plant and, equipment as from this day
in tef rm n vWhich it previd6usly existed.
to seek agreement to increases in the States' works and
housing and seni -, qovernment borrowing prognrammnes.
In discussion with the Treasurer and myself the Premiers
indicated that they welcomed the proposals, both for theirbeneficial
effect-oil the ecoainy and particularly on unemp'loyment_,
but also for their impact on the social hardship of some indivic~ uals
in the community.

Tiv rf. 2srudcc( OcVttttec shoal,' be art--
i d. o t Aie ir iicreascd amount couid re,'. U Li' -Z
allocated to o-genc'L a:. U cs ei I . h the Cono-~ a
nc: aethe,-inoithly ax, ounL. n oft I, c rmtr t. 14-o 4.5 o n, tu.
I. ifting the anrnual r,-, te cof t he grJa;. t to $ 54 illion. The increaced
-rants effectCive r hcbe(;:-ill 4ng of this month, wi 1 be isiuted
on the s~ u os'sas iinc~ er the existing arranmz-Mnts. hc
W" r.. 1 be subs ec to rcoy. e, L n June.
ThlIe P3: ri rr ; i. nan. T_ x rorusly7 veico0.. ne d th1ie C ommrnC . A1tI ; s
decu4sion to : soette r. c a in'veStTRncnt a-llosance and reecgnise-d
this irnitiai-ve as IL.~ yto provide~ a major bocst -to confidence
across a . ucumof Austrcalian1 iridascry. 7 r'rea~ urer is
maIKing a statemcient t-oday i~ n mtoro detail on thi! subject.
In P. y openii n, statement thi s morrrig i had sai. 1 tbal--A* 1n
the light of the Government's overall objectives, includ ncr
maintaining t-he momentum of economnic growth an' henc e of emp-loyrient
we believe there is a case ." or an increase both in the States, works
arid housing and! semi-governrient prograinxnes, anid I noted that an
in~ crease in the works and housing programme i. whIrich miglit be agreed
would involve the Commonwealth in taking up pa: rt of-" such an increas3
in the form of interest-free capital grant. Ifl reaching this view
whad noted that within the overall picture of rather stronger
growth in public sector expenditure this year than last year,
total public authority capital. expenditure is growing more Slowly
than current expenditure. Moreover, despite considerable spf: cial
assistance from the Common: weaith, rapidly escalating wage costs
had meant that in 1970-71 a number of intportanit State works had
had to be deferred. Similarly, the works activities of certain
of the State semi-governmental and local autriorities have also
had to be curtailed and the Prcmiers had indicated in discussion
that they welcomed some increase in this'area. Additionally,
of course, the loan raising programmes have been very successful
in this financial year to date.
After the fullest considtraton of the evidence and
arguments : produced by thc States full agreem~ ent has been reaichod
by the Loan Council on the amo~ nts of the increases of these
programmes. The amounts now agreed are
for the works and housing programmes an increase of
$ 32 million;
for the semi= governmental programme an increase of $, 0m~ lon.
It has been agreed that the works and housing programmes
of the' States for 1971-72 will be increased by $ 32 million,
bringing the total to $ 892 million. This increase is made up of
mili! lion on the same basi-s as the existing programme that
is, approximately one-quarter is -interest-free capital grant
and the remainder loan money with the ramaining $ 2 million
being entirely interest-free grant.
The additional $ 2 million interest-free capital grant has
been provided by the Commonwealth having regard to the continuing
costs in which the States will be involved in administering the

convarsion to mrcL) yj. C i v tc.-~ CC'& 2. clL
With thi3 ho ib > e~ cc ir
and hceu inq craTL in ruue~ y~ 2__
those costcs their-own res,; urces.
Viese I'msdloonl -f-nds wil~ l be ditrr: te . tween the
S tLe s i n limi c t: h t L. ex gpr o g7t , -iaV Dt a ils of the a,, iio u r! ts
. id 3str -own nr attached-tab2o Th--y willI ha~ ve
c1j . Y~ c 11A~ ~ r eM1) L( oVME and i I certainy1Y -ermi t
the carl-yirig ou-. ij.. OI c _ w io rtb wi1 1 1e IDI , b c w o rkJ s p r Cjec 4,
jar~~ u r. b~ ri ara as including hosp; i-tais, sjhoolfs anid
water supply. The Co'cnwa. his prepared to cgive an undertaking th~ at
the level of tnc' wrj c;-s b: ind h.,, us Lng anid the scii-qoverri..-it borro winq
prog.. ramne s it rreparzed to support for 1972-73 will not L'e
lesthan the -total of such programie in 1971-7 2 as decidod! at this
m.~ eeting. In agreeing to the Commonwealth proposa~ l to -incr2-ase
the borrowi-ng pro:-rarmmes, the Premiers have given their
assurance that the additional funds rwill, sC) far as is practicable
without loss of efficiency and ef-fectiveness, be untilised auic,: 1iy.
having in mind the desirability of procucinq-an early impact on
emnployment. In my opening statement I said that Premier5 -might also
wish to consid: er riot only their loan programm~ nes bt~ t also their
prospective revenue buadgets for-1971-72, and 1 assured t hem that
we would listen carefully -to anything that they might care to
put on this aspect. I did poirnt out, howeve) r that revisions
to elements of the formula determining the financ4* al assistance
grants to be paid to the States-in-1l07l-72 indicate that the
amount the States will . recqeive by way of ge neral revenue assistance
this financial year presently cald'ulated to increase 1) y the
order of $ 20 million.
In the event, we have today had a very frank disd'ijssion. of
this aspect of the States, finances.
All the Premiers indicated their budgetary position.
Followi. 7ng a very full discussion, a special general revenue
grant of $ 15 million will be made by the Commonwealth to the
_ ri 1971 This will De distributed between the States on the
S?. l9basis as the financial assistai~ ce jgrants.-( The figurec for
individual States are shown in the-attached Tabl~ e.
New South Wales cJearly has a much greater budgetary problem
in 1971/ 72 than any of th,-other States. The Commnonwealth has
therefore agreed to extend additional assistancc to that State in
ordE--r ; to enable it to avoid taking extreme nmeasures to improve its
budgetary position. A lcai of $ 17.5 million will be provid'sd hy the
Commonwealth to New South Wales this financial year on terms anm'.
condi tions similar to the loan made available to Victoria for t-he
same purpose at the cndI of 1969-70. The loan will be made on the
basis set out in the Attachmepnt.
CANBERRA 14 February 1972

. A. XwItiorn _ Fndry4s to S3ae A dC-at Febmarv lq' 72
PreDmirs' Confern) cej: r. Meeting MielitoC
we:-istoitu. ozs between States aire approximate oi: ly in some cases.
Warfts r
2 3 Ad-cvr~ tIce to
ileSot Additioriai Works and Housin
P rFaL13 raqs
LTc an
Tora-mI r 3S ntres -free Total
Ca-taE3T -rants
.50 5.80 2.86 3.. 12
2., 12
1 58
1' r,) I
3 22.70 2.37 1.18 1.27 0.. 37 10.13 8 .17
4.04 14.39 2.99 2.23
32.00 Additioinal Semi-Government
3. 31
3048 1 .9.7
0.45 0.31
1C. CO Additional Non-Netrop
Unem-D1o ieat
Wantts 253 2.25 0.68 0.84 0.* 62
? hie a : re to be distributed betseen the States in the sam'e proportions as
the fin rñ oPai assisance grants payable in 1971-72 but before making the & edections
fncm th~ osei Framts which are accompanying the transfer ofT pay-roll tax.
To be paid for the purpose of reducing the State's revenue budget deficit and
on the term sez out in an attached note0
Vic Ild.. Graad3.
TotalS5.8 ~ I~

( 1 1' 3. b
p e~ r. t
it o l po7-p .9 5 J n
ifIi;. atr , ou t~ h NeNc: South
ity ocl Te 0 dl psition in o er mcl.' u
not ior. 11( t j0 oaJfto " be mtade v; i" thout
ar-' Tc!* t die : euirflt htthe w'). ole oet Thll
I) e : repaid ' by 30 Jwia 1972.
Tphe loan_ OcarriCS intereu:: t at tho czhort;-terin
C o L ir% 1 ~ ltb bownJ r ate-o J. 5 5 re2-en t-o ffcr e d
in, the February 197-2 caslh loaon,
No interest is payable in. the finst year.
After interest is payable -annually
on -31 Decembher and 30 June each year on the
redAucing bualance of the loan.

Transcript 2533