PRIME MINISTER
EMBARGOED UNTIL 10.30 A. M. CHE: CK AGAINST DELIVERY
ADDRESS BY THE PRIME MINJtSTER
ALP VICTORIAN COUNTRY CONFERENCE
WARRAGUL, VICTORIA -25 AUGUST 1984
I want to make three preliminary points.
First, I am very pleased to be here even if I am 12 months
late. I regret that last year Budget deliberations
prevented me from coming at the last moment. I hope that
when I've finished speaking not too many of you will wish
the same thing had happened this year.
Second,* I am very pleased to be in Barry Cunningham's
territory. Barry is a very good friend and, more
importantly, an outstanding Federal Labor member.
Third, I want to pay tribute to Fred van Buren. This is the
ninth Victorian Country Conference that Fred has organised.
It is also his last. Fred will shortly be taking a seat in
the Legislative Council. On your behalf I want to thank
Fred for his work over these years as Secretary of t he Rural
Policy Committee and, in particular, in organising th6se
Conferences. Today I want to re-affirm in the clearest terms the
commitment of this Federal Labor Government to country
people a commitment I submit which should be by now beyond
doubt. But I want to speak first about economic policy and, in
particular, the Budget we brought down on Tuesday.
I remind you briefly of the economic crisis we inherited a
mere 18 months ago:
double digit inflation at levels more than twice
our trading partners;
record interest rates;
a disastrous wages explosion in 1981 and 1982;
a cessation of economic growth altogether;
a prospective Budget deficit of $ 9.6 billion; and
an explosion of unemployment in the last year of
the previous Government of a quarter of a million
people.
That was the economic crisis we inherited. Now compare that
with the situation today and the economic outlook set out in
last Tuesday's Budget papers.
First, inflation. In the Budget papers consumer prices are
forecast to rise by a little over 5 per cent this financial
year. That is half the inflation rate we inherited.
Interest rates have fallen significantly during our period
in government. The restraint we have exercised in this
year's Budget should make possible further reductions.
The momentum of economic growth is now very healthy
according to the Budget forecasts, about 4 per cent this
financial year for the economy as a whole.
Wage moderation is now the order of the day. The Prices and
Incomes Accord is ensuring that.
Finally, jobs are growing and unemployment is coming down.
Indeed, the Budget forecasts suggest that by June next year
we will have created over 400,000 new jobs since the
Economic Summit in April last year.
The economic policies of the Federal Labor Government have
been an outstanding success. All Australians, whether
living in the city or in the country, will benefit.
Last Tuesday's Budget will build on the excellent progress
we have already made. The strategy of the Budget will
ensure that economic recovery continues, inflation is
further reduced and job prospects are further improved.
The cuts in personal income tax that we announced are a
crucial part of the Budget strategy. The tax cuts will play
a very important role in stimulating consumer demand over
the next 12 months. Retail sales have been one of the few
weak spots in the economy and the tax cuts will stimulate
this area of activity.
In addition the tax cuts will make even more certain
continued income restraint and to that extent underpin the
Prices and Incomes Accord. For the majority of workers, the
tax cut will increase take home pay by roughly the same
amount as an $ 11 per week pay increase. C
Our tax cuts are good for the economy and we make no
apology for them.
The Federal Opposition's position on tax cuts is crystal
clear. If the Opposition had remained in power there would
have been no tax cuts at all this year.
Mr Howard has made that abundantly clear on several
occasions. On 19 March this year he put it this way:
" I think if the Government is faced with a choice
between giving a tax cut of say $ 1 billion and having a
deficit that is a billion lower than it might otherwise
be, I think it ought to choose the latter."
Mr Howard has repeated those sentiments several times,
including at the launching of the Coalition's economic
policy on 12 April.
Mr Peacock has made great play of the fact that the tax
scales have not been indexed.
The Opposition, of course, themselves abandoned tax
indexation when in government. ( As well, their notorious tax
cuts of 1977 lasted a mere 5 months.)
In fact the tax cuts in the Budget are very much more
generous than would have occurred through tax indexation.
The full year cost of the tax cuts is $ 2.1 billion, compared
with $ 1.2 billion as the full year cost of tax indexation.
The Budget has not only set the scene for continued strong
economic recovery. It has also done a great deal directly
to improve the position of the unemployed and other
disadvantaged groups.
The package of social security increases contained in the
Budget will cost $ 430 million this year and $ 683 million in
a full year. It will make a significant contribution to
easing the plight of those in need.
The standard rate of pensions and benefits, for example,
will be increased by $ 2.50 a week above indexation and the
married rate by $ 2.10 for each partner. In contrast there
were no general increases in pensions along these lines in
the seven long years of our predecessors' rule.
During those seven years the single unemployment benefit
fell by 19 per cent in real terms. With the measures
announced in the Budget it will have increased by 13 per
cent between March 1983 and 3une 1985.
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The Budget also contains increased payments for child
support and education allowances available to low income
families and additional rent assistance for needy
pensioners. In the past two years we have substantially
increased our support for public housing.
With this Budget we have made a substantial further step
towards providing adequately for Australians in need.
With this Budget we have also laid the basis for further
progress in creating new jobs and in reducing unemploymentwhich
is the greatest single cause of poverty in this
country. It is a Budget for growth, for recovery and for a better
future for all Australians.
Against that background I turn now to the situation of
country people. When we speak of country people we are
talking, of course, not only of farmers and others directly
engaged in our rural industries. We are talking of all the
people who live in country Australia.
I mention now just a few of the measures taken by this
Government to assist country people.
Spending on road programs of particular importance to
country people will be a total of $ 1,245 million this
financial year. This takes the increase in road funding to
46 per cent over the past two years.
Since coming to office the Government has allocated a total
of $ 20 million to the Country Town Water Supply component of
the Community Employment Program. The Community Employment
Program as a whole is also benefitting country people. For
example, the country regions of Victoria have already
attracted $ 29 million in CEP funding, involving over 2,000
new jobs.
The Government has committed a total of $ 218 million to
Commonwealth office construction of which $ 155 million is
committed specifically for regional areas.
The Government has removed the annual borrowing limits on
smaller local government authorities.
The introduction of the domestic satellite for Australia
will mean improved communications for many people in the
remote areas of the country.
Appreciating the need to keep transport costs down in
country areas, we are maintaining the fuel subsidy on
freight at 1.2 c/ litre.
In the Budget we increased by 25 per cent the basic zone
rebates for taxpayers in remote areas of Australia.
And I could go on. This Government's commitment to country
people has been demonstrated in the clearest terms.
Many country people, of course, have a vital stake in our
rural industries. Last Tuesday's Budget again demonstrated
the Federal Labor Government's support for these
industries. For example:
$ 26 million for wool promotion this financial year;
an increase in the allocation to the National Soil
Conservation Program from $ 1 mil~ lion to $ 4 million;
$ 27 million to fund rural research, an increase of
million; and
the decision to index the rebate on diesel fuel
A used off road.
This Government regards the money we are putting into our
rural industries as an investment in their future and the
future of all Australians. A strong and vigorous rural
sector means more growth, more exports and more jobs for all
Australians.
Rural industries are Australia's largest single export
earner 47 per cent of total exports last financial year.
So the strength of the rural sector affects the living
standards of all Australians.
We all have a vested interest in the prosperity of our rural
industries. Government backing for those industries makes
good economic sense.
I believe both the rural community and the Government are
very fortunate in having John Kerin as Minister for Primary
Industry. Mr Kerin is a respected member of the Cabinet, a
tireless Minister and an outstandinig advocate for the rural
community. There is one thing that is more important than anything else
to our primary producers sound, effective, competent
economic management. Without that, all the specific
assistance measures to rural industry will come to nought.
They won't work.
As I have shown, on this score effective economic
management the Federal Labor Government has an outstanding
record. Country people, of course, will continue -to benefit just as
much as city people.
The Labor Party's credentials as far as country people a're
concerned are excellent. All of you delegates here know
this to be the case. I ask only that You spread the message
far and wide.
We can go into the next Federal election and the next
Victorian election confidently putting our case to country
people. We have the policies and the programs to meet their needs.
Our record is an outstanding one.
I believe that whenever those two elections are held, Labor
will receive the strong support of country people throughout
Victoria and throughout Australia.