PRIME MINISTER&
FOR PRESS 9 OCTOBER 1977
ELECTORATE TALK
Australia today is back on the road to economic health.
The three years that devastated our country and almost brought
us to our knees -are behind us.
We are pulling out of the mess that went a long way to destroying
city and country, and harming millions.
Australia is back in the race largely because of one ' simple factthe
government recognised that above all else, inflation had
to be beaten. Until that happened, we knew there would be no
proper recovery, no prospect of expanding opportunities for
jobs, no sustained security and not much hope.
We are beating inflation. We have not yet finished the job but
our record so far in reducing inflation is unmatched in the
western world.
Let's look at facts. Inflation as measured by what is
technically called the implicit price deflator was reduced to
just over a 9 percent annual rate through the year to last June.
That is 7 percentage points better than it was through the previous
year. Looked at another way, over the same period and on the
same basis, the percentage reduction in Australia's inflation
was better than that of practically,: all the seven major OECD
countries. Those countries are: Japan, Germany, the United States,
Britain, France, Italy and Canada. In fact, Australia's
performance was matched only by that of Canada.
Inflation of course is commonly measured by an index of consumer
price. We are doing much better with this index too. In the
first half of this year, inflation as measured by the consumer
price index, was also running at an annual rate of around 9 percent.
This is lower than the average increase recorded by our major
trading partners and a far cry from the 17, 18 and 19 percent
levels under Labor. So whichever way you look at it, Australia
is getting on top of inflation.
Australia' s current inflation rate figures are not Liberal Party
figures, not political but figures produced by the OECD and by
Australia's independent statistician. What do they mean for
Australia? / 2
First, they mean. that our economic strategy a strategy consistently
applied from day one has been the right strategy for Australia
at this time. They mean we are doing the job the community asked
us to do. They mean that we will continue with our policies.
that keep bearing down on inflation. There is no way having
worked so hard and having come this far that we will slacken
in our efforts-to beat inflation. But above all, the reduction
in Australia's rate of inflation means we are ridding the
community of a real and tangible social evil.
Make no mistake about the deadliness of inflation.. Inflation
harms every Australian. It-harms every family, every business,
every farm, every school.. It hits hard and direct at the young,
the old and the defenceless. It is for that reason and for
that reason alone that-my government pledged to beat infaltion.
As we continue with this fight, it is becoming increasingly clear
that key ingredients in the national economy are responding positive]
to our policies. The signs are emerging. There has been a solid
and steady recovery in production. In the last financial year,
production increased by 3. 5 percent. Just two years earlierin
the middle of the Labor experiment production actually
decreased by 0.2 percent. There has been a very good recovery
in company profits. That recovery will continue through this
year.. Consuimers~ too are gaining confidence and are willing to
spend more of their incomes.
In simple terms, in the first quarter of 1977 Australian consumers
were saving 12.5 percent of their pay cheque, while in the last
quarter of 1974, they were saving more than.. 19 percent of their mone,,
What all this means is that Australia is back firmly on the road
to recovery..
We-all know, however, that not everything is as it should be or as
the government wants. Unemployment, although slightly improving
over the last couple of months, remains too high. The Government
knows this. That is why-we have developed a number of programmes
that either have helped or are currently helping more than 100,000
young men and women. We have removed all financial restrictions
on the various training programmes and employment assistance
programmes. No-one will be denied training opportunities because
of lack of finance. These however, are essentially short term
measures, short term assistance for the unemployed.
It is only when inflation is further reduced, and when production an
profits further improve that business and industry will seek to
increase its workforce. For a long term and sustained reduction
in unemployment, there is no alternative but to keep the battle
against inflation-at full pitch.
We must never forget what happened to jobs, to business, to farmers,
to migrants, to fixed income earners when Labor refused to face
reality, when Labor refused to accept what inflation was doing to
Australia. We must never forget what happened to Australia.
We could never survive that kind of experiment again.