PRIME MINISTER
FOR PRESSF76/ 58
MARCH 26, 1976
EXTRACT FROM TRANSCRIPT OF RADI[ O INTERVIEW WITH STEVE RAYMOND OF 2UE
1% M~ r. F r ; 13e, 1! ttc ck -en * a3 0ra I Mo t or s
Hlolden in Par Iii-, e~ ycste-rday. va,-that' a conisidered
-statement or did YOU just happen to blowr your cool' 7
P. M. No. It was thoroughly considered and discussed with the
Minister for Employment and IAdustrial flelations. ' I don't
think it w-as a savagye atakeither. It was just stating
the facts, becauso there haO been a Cfull be~ nch decision
of the Arbitration Comimission hours before, arnd the company
just went against the full bench decision. Nor wre sometimes
critic ise some tradeo unions for n t abiding by decisions
of the Arbitration Commiss-ion, by seeking more or doing
some thing differently and if a gronIt corporation i~ s going
to break the rules set Jown by the Commission, I think it
deserves similar criticism,
QUESTION: There have been some dire threats made overnight about
possible drastic cutbacks on future purchases from Hloldnn
by the Govcrnmont3
P M.
QUESTION:
P. M.
QUESTION:
P N. Well I don't think those threats ivero made by the Government.
They ce'rtainly haven't been made by myself, because if
we have contracts WO hoeei them. But I dlid see some
speculation in the neirspapelri about types, of action.
Would you contemplate action along these lines?'
I prefer that this matter be settfled industrially, by
an acceptance that the rules, of the Arbitration Commission
be abided. 1 by-and I ' czlbevery disappointed if General
Motors floldon kno'.! in( 7 the,( Govornmctnt ' s vididn7 t pay
groater attention tlhe wora. E of the Arb~ tration Commission.
You know, wre used to have a very healthy cnj.') rt in motor
cars and in Jioldens in particul. ar. Now becauzi of inflation
adsomice changed trading circunstanices, they-fii9-themnselves
priced out of export markets which 9' think has been running
fo.-the wrhole industry at 60 or 70 thousand units, Under
those circumstances there is a. responsibility I bel eVe
not only to the company-arnd its sha; reholders but also to
the country in which the corporation happeiiE; to be,. operating.
That needs to be more widely recognised,
Infl ation and lmnemDlov-mcnt, arco thef c~ ce
faLcing, us aft the znc. utc-! d~ i'ng de-, at ion irz~ analt
by the former n 1, ooe n: cei nlvo -Leso probl~ oems, C 0u 1
I ash you t-o clear the air sir at for . n n ~ t~ n
are you for indexat ion now or would you t1 . ihc : Oose
scrapped? Wlthere have been many misunderstiindi ngsq about whiat.
indexation means.* The common view, a 1 s an
it is the viewr that wrage index) ati on and thc guide izies
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laid down by the Commission meant that every quarter
whatever was in the Consumer Price Index would flow
through into increased wages. The first principle laid
down. by the Arbitration Commission makes it plain that
that is not so, and that it is open to tle parties to
argue not for a percentage increase but for a flat rate
increase or even for no increase The Commission states
that the CPI will be applied unless the parties before
the Commission argue otherwise. It wasn't meant to be
automatic.
QUESTION: But wasn't that the inference you gave leading up to
the election with the knowledge that the CPI was predicted
to turn out at least around
P. M. We said that we wrould support the wage indexation agreement,
but we also have a responsibility to try and establish full
employment and overcome inflation. We are not going to
establish full employment again and we are not going to
overcome inflation unless there is restraint, not only
by corporations but also restraint by wage earners and
trade unions, Many people are coming to realise the
constant-round of wage and price increases really isn't
making anyone better off. After the last 6.4% increase
a large number of companies immediately said " Well, wr
are going to the prices tribunal to get higher prices".
We are sitting on a merry go round and we have to get
off the merry go round,
QUESTION: I am . not an economist but someone who is respected as
much as Professor Matthows says that ta: indexation will
only work if it is fully implemented in the next budget
either all or nothing at allo Could you explain your
strategy in introducing it in stages?
P. M. Well, our strategy is to go as far as we can in the next
budget. But there is a cost the total cost last year
I think would have boon ,1,200 million. If indexation
had been implemented in the last budgec on top of all
the other expenditure by the Commonwealti. Government then
instead of approaching .5,000 million, the oficit would
have been over 06,000 million. There is obviously a
limit to the extent that that process can go orl, So
what we have said is that the extent to which wo can
implement tax indexation in the next budget will depend
on the success wo have in restraining Government expenditure.
Now what we have done so far can be regarded as an initial
step towards cutting out extravagance, but I have made no
bones about the fact that there are going to be harder
decisions ahead of us in our efforts to restrain the
unreasonable growth of Government expondituroo Upon the
success of that will depend upon the extent to which we
can and will introduce tax indexation. W0 certainly will
make a starto
QUESTION: Mr. Fraser, is it true you are considering major amendments
to the Conciliation and Arbitration Act?
r
7
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PM. Some amejdments are being considered,-yes certainly. The
M'inister . or Employment and Industrial Relations will
announce these at the appropriate time but it was in
our policy to introduce secret ballots for the election of
all elected officials of industrial organizations and
that includes employer organisations not just trade unions.
There are some other amendments that vo vill also want to
make.
QUESTION: Along what lines?
P. M Well some of the amendments wi ll be along the lines of
amendments mooted by the previous Labor Government but
which were never introduced, giving the Minister power
to appeal against the decision of single commissioners
to the full bench, eCog, where they felt that was
necessary in the public interest. Those matters will
be unfolded at the proper time by Mr. Street,
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