PRES S OFFICE TRANSCRIPT 23 JUNE 1978 7(/ 7
INTERVIEW ON SIDE STEPS OF
PARLIAMENT HOUSE
_ gJESTION: The Premiers seem to be in a state of shock. Do you
care to comment on that?
PRIME MINISTER: I don't think the Premiers are in a state of
shock at al_. I believe they expected very much what the
Commonwealth offered yesterday. Overall the funds increased
by marginally over 5 percent and you know the day has got
to stop when governments believe that they can go on spending
year after year after year a larger proportion of the products
of Australia. Governments overseas have tried that and it's
perpetuated the situation in which inflation has been too high
and unemployment has remained too high. My Government has no
intention whatever of pursuing that path. We've made very
considerable progress in overcoming inflation and considerable
progress in getting interest rates down and we intend to
continue with that policy that will achieve success in both
those directions. because by doing that, we will be doing more
to help businesses, small businesses, farmers, people throughout
this country than any other single act of Government.
QUESTION: unless you are dramatically successful, Prime Minister, with the
inflation rate, the five percent increase will in fact add up
to a decrease in real terms. Is it necessary to be that harsh
with the Premiers?
PRIME MINISTER: It's not harsh at all. Five percent increase
in money terms if there is any improvement in productivity
should be able to maintain the same levels of activity. Now
Premiers over the last two years have reduced taxes, they've
done that, and at the same time, maintained . levels of
programs. They've been able to exercise their own choices.
I don't quarrel with the choices they've made. We believe
taxes have been too high but we need to understand also the
state and local government employment has gone up by four
percent in the 12 months to March; Commonwealth employment
by 0.8 percent and we've had reductions in the two previous
years, so when you look to see what restraint state governments
have exercised up to this point, you've only got to look at
their employment state government employment and local
government employment and if there's a four percent increase
in the 12 months to March, it is perfectly clear that-* there
has been no restraint whatsoever.
QUESTION: Don Dunstan, Prime Minister, has indicated that your
economic moves may increase unemployment to ten percent.
PRIME MINISTER: I think that's nonsense, He's a Labor Premier,
he's perfectly entitled to think whatever he likes.
What will really get this country moving, what will really
establish the circumstances in which there will be jobs for
those who want to work, is a revival in the private sector,
in investment, confidence in this country from people in Australia
and from overseas; to maintain the confidence that
we are re-establishing, have to make sure that inflation
continues to come down, we have to make sure that Government
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PRIME MINISTER: ( continued)
expenditure remains under tight control. That will make
this country a favoured nation for investment, from our own
people and from people overseas. You know its very easy
on government account, to spend some hundreds of millions of
dollars more and think you are thereby employing more people.
but if in the same process you alter the perceptions of this
economy, by people in Australia and by people overseas; if
they think as a consequence that inflation will run out,
that interest rates will start to rise, you'll find you'll
lose very much more than that in investment and therefore
for every Government job you might get, you could lose three
jobs in the private sector. Now my Government hasn't got the
slightest intention of embarking on that path and I believe
that what happened yesterday is right for Australia. I have
not the slightest doubt of that and in their hearts I suspect
a number of the Premiers also know it.
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