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Transcripts from the Prime Ministers of Australia

Transcript 4053

PRIME MINISTER'S INTERVIEW WITH PETER COSTIGAN, MELBOURNE HERALD, 12 FEBRUARY 1976

Photo of Fraser, Malcolm

Fraser, Malcolm

Period of Service: 11/11/1975 to 11/03/1983

More information about Fraser, Malcolm on The National Archive website.

Release Date: 12/02/1976

Release Type: Interview

Transcript ID: 4053

r/ 331
PRIME MINISTER' S INTERVIEW WITH PETER COSTIGAN, MELBOURNE HERALD,
.12 February 1976
JESTION: philosophic question. Leaving aside all the current
problems about the economy. What sort of Australia is it that
you would like to lead?
PRIME MINISTER: Well, there's maximum independence for individuals, maximum
opportunity for them to achieve what they want for themselves
and their families. Where governments create a climate for
this to take place, that encourages it. Where there' s maximum
devolution of authority to state and local government.
None of that is to imply an old fashioned laissez-faire
attitude because there are obviously many things governments
have to do. But if we go to government power in Australia
and other western democracies in recent years. I think people have
often forgotten the real place of the individual in society and that's
what it's all about. Governments are not there to serve governonents.
We're there to serve people. An Australia in which individual
men and women have maximum freedom to choose their own
lifestyle, what sort of work they want to do, the way they want
to work out their own futures. It is my view that is an
Australia which is going to be most productive and that also then
becomes the Australia which enables you to do most for the
people who.. are disadvantaged. In recent times, governments seem
to have taken more and more power into their own hands, more and
more control, into their own hands. They don't always ask if
there is any real public benefit from that. We have restricted
trade practices legislation and we need it. But the Ministers
at the moment are looking at that legislation to make sure
there is a public benefit from all the res-tricti-ons. Arnd the
rs-tricted trade prac-tices leaislation ou'Th-to
at as somnething Lo festrict people from oin thng z as
something that preserves the freedom of the average People or the
small business against the undue pressures that build up from
large organisations or from groups of organisations or from
monopolies and therefore should be something that preserves
the freedom of individuals and the freedom of businesses.
As long as you can do that, it would seem to me unnecessary to
have restrictions unless there is a real public benefit flowing
from them. And this is looking at restrictive trade legislation

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QUESTION: Do you think the average Australian still has the
incentive to go and do it on his own or to...
PRIME MINISTER: I think a great many do, but a number of people begin
to feel that the incentive has been destroyed, that taxes are
just taking too much. 1 know somebody who was Lunning a
hunting, camping fishing and shooting lodge in the Northern
Territory. They retired at the age of 42, because taxes just tookC
too much... and so he's gone to have a peaceful life where they'll
work a lot less. After a few years of that he might well get
tired of it because he's a relatively young man. But government W
destroyed his initiative his incentive to do things and that's
certainly damaging not only to him it's damaging to Australia.
QUESTION: This might not be a hypothetical question, but if if in fact
people are not working as hard as they used to, if in fact they
haven't got that incentive and if productivity is not increasing
as it should, how do you change these habits?
PRIME MINISTER: There needs to be inducements, people are going to work
harder, people are going to produce more. Obviously they either
feel that doing part of it at least for themselves and their
families and the benefits not all going to the governments for tax
gains and marginal tax scale, have got a significant impact
on things like this. When I was shadowing in the labour job in
Opposition, I met a lot of people on the factory floor, saying
" What is the point of working five days a week. The Government
just takes too much of the fifth day's pay." It wasn't that
they had any particular objection to workingT-was _ jsut that
thie government had established the circumstances in which, in terms of
the marginal return, they would get on their incomes wasn't
worthwhile.
? UESTION: You've already put a lid on the growth of the public service.
In the long term do you see any greater emphasis in switching away
from that very high percentage of Australians wqho are working
for Government?

PRIME MINISTER: If we can produce government services to people more
economically and efficiently, that should be our objective.
I can think in a number of areas where we can use voluntary agencies
to a greater extent than we have and perhaps especially in
the welfare area. The voluntary welfare organisations have a
number of advantages. They're independent, they've providad
independent criticisms of policies that are being pursued,
the delivery of policies whether certain objectives that you act
for have been achieved by the policies. They can often
dispense assistance much more economically than a governnlpent
bureaucracy. And they can often assess the need and see an emerging
need more quickly than a government bureaucracy. And I think
irl the past there might have been a tendency for governments
or departments to look upon the voluntary agencies as competitors.
SIn the last budget there was an attempt to cut down the grants
to them. I think they ought not to be looked upon as competitors.
They can play a very valuable role.
We have got a better educated community and that ought to be one
in which individuals and groups of people in their own communities
therefore are in a better position to make judgements about their
own future than may have been the case when education was restricted
* to a few and when it wasn't general and when more kids left
school at the age of 12 and 13 and 14. As people have become
better educated especially in the years since the way so too there
has been a centralisation of power especially in the last two
or three years. It seems to be saying that even though you are
better educated you must have less influence on the decisions
that affect your lives where government sought to be saying
the very opposite you are better educated community, you
ought to takirig -more resor'sibility for t-he deci iions tnhaz
affect yourselves and your own community. I would have thought
that's really what people want. They want to be responsible,
they want to make decisions that affect them and government
have got to establish these circumstances.
IJESTION: Leading onto the world scene. Do you see a -trend in the
rich countries and our sort of countries, to' conservatism?
Are people reacting against big government?

PRIME MINISTER: I Think in some areas there is a reaction ag. ainst
extremes of socialism ana the extravagance of government
expenditure but how far that rea. tion has gone I wouid
find it very difficult to judge. Cne of the great problems
in the western democracies our kind of country is that
people are basically independent. They want to do things
for themselves, they don't wart to he regimented. And it's
much harder to marshall such a people to a common cause, a common
objective, than it is in some other countries that there is
no need to name, where regimentation has happened more than
once in fairly recent history. But at the same time,
because of the indepenident nature of individuals and people
in a country like Australia, Britain or the United States,
it probably makes the leadership, the Government of those
countries of even greater importance in maintaining the morale
the resolution and the determination of the nation, especially
when there is some difficult decisions to be made. There
have been too many politicans going around offering the easy
way out suggesting more or suggesting that we have the resources
to pursue every wcrthwhile plan at one and the same time. T. ixd
the Governments aren't really elected to do the nice and
pleasant things all the time. They're elected to take the course
they believe to be right. In the nature of things a lot of
decisions are going to bze unpopular with a nui. iber of people
because resources are limited. That means governments have
to be able to say no.
UESTION: That's supposed to be politically unpopular? Do you think
it is possible with this more educated community that the public
will in fact recognise that?
' RIME MINISTER: In the short term it is politically unpopular. And it
might be politically unpopular in terms of the immediate reaction
you get from particular pressure groups, and therefore with
noises you get through the media. But I also believe it is
something the general community recognises as being responsible.
And therefore politically popular. Responsibility is what
people I believe want to see in government almost more than
anything else, especially when they've had a dose of great
irresponsibility.

UESTION: Switching to foreign policy and Australia's alliances.
I think you did refer to the ANZUS treaty as being the mos t
important aspect of Australia's foreign policy or words
to that effect?
? RIME MINISTER: Well Mr Peacock's used those words. The ANZUS alliance
is obviously of great importance to us, to New Zealand,.
and I believe also of significant importance to the United
States. But our foreign policy has got much more to it than
that. We'do need closer relationships with the countries
to our north and closer relations with Japa-n and we need
a better understanding with China. That is why it was a closest
priority to visit the ASEAN countries, Japan and China before
going, as one might have expected from a traditional Liberal
leader paying a visit to Washington and London. When the time
does come round for that I think those sorts of visits
can be much more useful, if I've got abetter perspective
of the way in which countries in our own region, the western
Pacific, and east Asia think about current events.
With Japan in particular there's need for greater strengthening
of our relations. We need to work for greater stability
of trade between the two countries. Their Prime Minister in
the message sent after the election said that they hoped the
Australia-Japanese Treaty could be concluded speedily. We've
already taken decisions as a government that will enable the
negotiations which were suspended last year, to begin again,
and I hope we can meet the wishes of Japan in relation to this.
We'd like to see a treaty concluded also. one of the things Mr
Anthony will be pursuing in Japan at the moment is not only
a need -for us or them to understand e a oina to be
r -l1ia h 1e -long-term suppliers but. the need to -make Sure there iLs
going to be greater long-term stability of trade both ways.
They want a reliable access to our markets as we want a
reliable access to their markets for the commodities we sell to them.
It's not only a question of coal and iron ore to the extent
that beef and primary products are sold in Japan. It's
much better to have a steady and continuing market to one
that's wide open one minute and can be chopped right off the next.
So there are a number of areas where we're hoping to achieve
stability in that relationship. This is important not only for

the whole region. Japan, the United States and Australia have
all got key rcles to play in the Pacitic region and the relationship
is one that's one part of it very much depends on what the
others do. There's a complementary nature to the economies
of the three countries.
QUESTION: What about Canada? A similar country which Australia doesn't
seem to every think about very much.
PRIME MINISTER: Canada's interest in our part of the world is to some extent
limited I think. There was a move some years ago to develop a
broader interest in the Pacific region but that move didn't seem
to carry forward with its original impetus. We'd welcome
a greater involvement by Canada in affairs in our part of the
world but they seem traditionally to be either preoccupied with
their southern relationship or to be tending towards Europe.
These are factors of geography I think. But Canada and Australia
have many characteristics in common.
UESTION: The provincial government, state government federal situation?
RIME MINISTER: Yes.
UESTION: The Indian Ocean. The Opposition. Leader has suggested that
your comments and the comments of your Ministers have been
stimulating the possibility of an expansion of a sort of arms
race in the Indian Ocean. How do you...?
PRIME MINISTER: This is one of the areas in which Mr Whitlam is talking
a great deal of nonsense. Russian sailing days are three times
the s~ iiiing days of the United States. Russia, with facilities
and in sailing days, has kept the pace up. Russia started to use
the Suez Canal for her military vessels. Clearly they want to
link up with the BlackSea-Mediterranean fleet with the
Pacific-Vladivostok fleet. And they can do it now. There needs
to be a balance. We'd like to see the balance at the lowest level
possible. But what I have said is that the-objectives that
some people have for a neutral zone seems somewhat remote.
Nobody really suggests that they can negotiate Russia out
of the Indian Ocean. In fact I would go so far as to way that that

would be a complete and absolute impossibility and China would
agree with me. And I also believe a number of the Littoral
states would agree wiith me, no matter whatpublic statements
might be made, no matter what official policies might be put.
Now it's quite possible for the states to have a particular
view which is a long-term objective but at the sa-me time to
recognise that it's not capable of achievement within the forseeable
future. Now that's a legitimate and proper position to take.
But having said all that, when Russian activity in the Indian
Ocean is so far ahead of the United States' activity it seems
somewhat unreal to adopt the sort of view that Mr WNhitlam
adopts that the United States should not develop pretty modest
facilities at Diego Garcia which are quite essential to
maintaining a balance. And even with that, it won't be
a balance because Russia will be ahead. And Diego Garcia
is not only important in relation to the Indian Ocean
activities. It could at some stage have a significant influence
on a resupply situation in Israel if war ever again emerged.
And if the criticial events in Portugal, the Azores became
unavailable there are alternative way through area supplythat's
a complicated and difficult and dependin4 upon the
circumstances dangerous operation. Diego Garcia
could also be significant in guaranteeing oil supplies out of
the Middle East to countries east of Diego Garcia andof course
Japan, is one of the mail oil users. We'd have a special
interest in that. -So, what we're saying or our policy is not
escalating what's occuring it's encouraging a realistic response
to what has already occurred. I've mentioned my views
about this particular matter, and before I went to Kuala Lumpur
and Singapore not one of the four leaders of the ASEAN countries
sucgestedJ thIat tlhis was an inappro-. priate v-iow, to ha-le. V-' n
fact whien the subject did come up with one their
views were pretty much identical with mine and none of the others
were concerned. I think they recognised that this was a realistic
view.
JESTION: I think I can guess who the one was.
The new American Ambassador after he was confirmed said he was
going to urge Australia to allow the U. S. to build an Omega base

here. This is the controversial, I suppose, communications
facility Have you made a decision about that?
PRIME MINISTER: Well it hasn't come before the Government, but this is
a navigational device, it's not of particular importance
in any military activity if of any importance it's a
navigational device and a number of countries around the world
are participating in. And I can't see why Australia shouldn't.
There've been very extensive inquiries concerning it.
UESTIO': Almost a personal question. You've comr. under attack in various
ways and you've been in politics many years. Specifically
when you're accused of things like changing your policy on
indexation, your accused of being ruthless etc. internally,
in the Party and so on. How do you personally feel about that?
Do you lie awake at night?
RIME MINISTER:... about accusations?
UESTION: Yes.
RIME MINISTER: All you can do at any one time as a Politican with all
the facts and knowledge available to you is try and make the
decision you believe to be right. If you've done that, that's
all you can do. If other people disagree with you well
you'd obviously sooner they'd agreed with you but if they
disagree that's their right. So often in this sort of thing,
people's judgement is colored by what they themselves want,
what they themselves expect. When we said we are prepared
to modify our view in relation to the Prices Justification Tribunal
when we had had conversations with the trade uin moveent,
employers, business concerning its future that was welcomed.
A good degree of flexibility, not being too rigid. When, for a
number of the same considerations we felt that our view about
wage indexation should to some extent be modified, because
maybe unexpected, it attracted predictable criticism from people
like Mr Hawke. But pecple took a different judgement of it.
Maybe it took them more by surprise. But I think they also took a
different judgement of it because this was a harddecision and
because it was a hard decision it tended to line other people

u-what side of the fence are you on in relation to it.
I got a very strong view that a majority of people out in the
streets, trade unionists, and others support the decision
that we took. They know very well that the continued escalation
of wages and salaried just can't go on and in the end when we
saw the extent of the CPI rise we felt we had to put some arguments
to the Commission because of the policies that we were invol~ ved
in and restraining our1 own expenditure we believed that here was
a great opportunity for the Arbitration Commission to break
the inflationary spiral. What the commission does is of immense
importance to the total Australian economy. And there are two
sets of arguments in relation to this one we didn't press
all that hard because of the earlier Medibank position but we'll
press it very hard in the future, that's the indirect tax
argument. If that's automatically to flow through to employees
it virtually means that if the Government had a policy of relieving
the income tax burden and relativey a great weight of tax was on
indirect taxes. I must take a hypothetical exaniple, that employees
would almost automatically be exempt from that sort of move
and that a government's budgetary position is much more heavily
circumscribed because of the present policy of the Commission
in relation to the inclusion of indirect taxes. But the real
thrust of our argument on this occasion was that a flow on of the
sic point four percent would lead in some industries to higher
unemployment because with higher prices they wouldn't be able
to sell as much of their product and for other industries that
would be able to sell their product with higher prices.
It would just be another move in the inflationary spiral.
And that the Price Justification Tribunal for industries that
are committed to go before it would be bound to take it
into accol-, nz a a si,-jni~ ican' -, cre ae
was going to do was make it harder to get jobs, make it
harder to control inflation and we believe that in the
interests of all Australians, employees, in particular, controlling
inflation and getting jobs available are the highest priorities.
There' s an argument that Mr Hawke uses which in other
circumstances would be valid, but in the present, one is not.
He says that it needs to be a consumption-led recovery and
therefore you need higher wages. Well there have been higher
wages solidly over the past two years. There've been a couple of tax

cuts which have hardly been tax cuts because of the progressive
tax scale but anyway some cha-nges to the tax scale which did put
some more money in the hands of consumers. But all they did was
save more dnd the Hawke argument is a false one because under
present circumstances too many people are concerned at what
inflation is going to do. Is their job going to be available
in three months or six months. Are prices just going to go
on going up and up and if people feel these things individuals
aren't going to spend more in a real sense and so the things
that stop them spending are the very same things that's
stopping bdsinesses investing. It all gets back to inflation.
And, with all that, this wasn't an easy decision to take.
We knew what would be said of us. It would have been much easier
to go down the other path. But if you like, with later knowledge
with later advice, we had to argue the cause that we did.
QUESTION: Just a couple of quick questions. You'll be standing up for
the first time as the elected Prime Minister. Do you
get any feeling about that excitement and how do you
see this first Parliament of your regime, if I might use the word?
PRIME MINISTER: I suppose there is some feeling of excitment. But
imore there is a sense of the enormity of the job that has to
be done and not from the nature of the job itself, but because
of the position that Australia is in at the moment. And we're
not going to be able to overcome the problems of Australia unless
there is a recognition by a majority of people in Australia
that the Government has to take some unpleasant decisions, that
there are some difficult things to be done. And that's basically
why w: iø were elected. That quite apart from the view
have uf Australia and the nura of A; straian -society.
There'll be some significant areas where we'll want our
policies introduced as soon as possible and as soon as there can
be appropriate consultations with the community secret ballot
legislation is part of that. And there's always a lot of dull,
routine andnecessary legislation through the Parliament. But
one of the problems of the last two or three . years is that
there's been a good deal of legislative indigestion and nothing
like enough attention paid to the plain and if you like, dull

11.
administration of the country. Sitting do,.-n behinidn a
desk and seeing that the ship of state is moving/ the right
direction. Passing bills do'esn't achieve that. It's a question of
administration, seeking that yourpublic service is working
properly, seeking that government services are getting
delivered in an efficient manner to the people that need thorn.
This is, I believe, one of the areas where the previous
Government fell down, greatly. And the public service was in part
hampered because there was so much legislation that theyuare
finding it increasingly difficult t o do the nornal jobs that the
service had to do. Some departments doubled in size in a
matter of a year br two. No organisationi can grow that quickly'
and do it efficeitnly and effectively.
JESWN: So, compared with recent experience, you don't expect this to be..
to spend that much time in Parliament, or at least,
that Parliament will be sitting shorter...
? RIME MINISTER: I think the Parliament might be sitting a long timequite
a long ti-me, but we would want a good debate on the address
in reply. We'd want a. good debate on foreign policy, of
Australia's place in the world. We'd want useful debates on what's
happening to Australia internally. We-' d want the Parliament
to become a more effective forum. Nojw all of this can be
encompassed by debates initiated by a Minister or by myself
in addition to the address in reply and its all a useful
part of the work of a member of Parliament. We'll want to
establish an expenditure committee in the fashion of the
House of Commons, which will work alongside the public accounts
comnit~. B.--hins iareij were/-HouSe -; Znatve
has been very much deficient, wher e I think governments have
always thought that an expenditure committee is going to be
a bit of a nuisance to departments it will be a nuisance
to governments let's just not bother about it.
I can remember 12 years ago originally advocating such a
committee in our own Party room under the then government of
the day and I've done it in Opposition. Well, there's
a chance now to achieve that. But there's an important watchdog

12.
rc. e for Parliament and especially in the present circumstances
with econiomy tha name of the game. They had a committee of the
Parliament oversighting the way in whicb departments drew
up their estimates and getting in underneath the figures
themselves to really learn how things are done. We'll make
the Parliament a mort effective instrument of control of the
public purse.
UESTION: I don't want to put words into your mouth, but is this one
way you're going to involve your great army of backbenchers? 0
PRIME MINISTER: That's one way, certainly. And a very important way.
We've had a party committee meeting oVer the last couple of
months. Cabinet considered its report two or three days ago.
That report will be debated in the party toom and it sets
out a framework of committees, structures for the party
room operation. And I think its a very good report. I hope
it gets the general support of the party. It is important
that members feel they have a role. But there's one other point
I'd like to make about this. There are some members ot
Parliament who'll always work no matter what the difficulties
might be, whether they're a private mzmber or whether they're
a Minister. There aie some others who don't work so hard.
You can't force a member of Parliament to work, you can't
hand feed him. You can encourage and for new members you can
guide. You can stimulate, help to create a climate in which
members of Parliament will want to work, and even if encouraging
it does sometimes make it uncomfortable for the Ministers of
the Government. But that's part of the role. But basically
the wish to work has to come from insidle the mind and heart
of the meLber himself. it's my hope and belief that the great
majority of our new members will be in that mould.

Transcript 4053