CHECK AGAINST DELIVERY EMBARGOED UNTIL DELIVERY
SPEECH BY THE PRIM4E MINISTER
AAP 50th ANNIVERSARY DINNER SYDNEY 29 MAY 1985
Distinguished guests, ladies and gentlemen
It gives me great pleasure to be here tonight to join
with you in celebrating AAP's 50th anniversary.
Many people in the community, with the exception, of
course, of those here tonight, know of AAP only from the
letters at the end of a story appearing in a newspaper.
It has been said that AAP, whoever he or she is, must be
the hardest working Journalist around.
The joke may be a familiar one to this audience but it
serves to underscore the pervasiveness of AAP. Since
its beginnings in 1935 AAP has developed into the
leading disseminator of news and information in this
country.
But AAP's stature goes beyond the domestic scene. it
plays an important role in communicating Australian
developments and attitudes to the rest of the world.
In part AAP's success is a reflection of the quality and
level of service AAP has striven to provide. It has, in
the fifty years of its life, remained true to the pledge
of AAP's founders.
A pledge to provide the Australian public with " the most
accurate and most searching information of all world
activities and thought without any tendency toward the
exercise of political partisanship or bias".
AAP's growth is also attributable to its adaptability.
It has been over the fifty years of its existence, at
the forefront of technological innovation.
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The pen and the telegram of yesteryear have been
replaced by sophisticated computer and microwave
systems. The introduction of the domestic
communications satellite system to this country later
this year will present further opportunities for
expansion. I understand that, true to its traditions,
AAP is ready to grasp this new opportunity.
As technology has changed, AAP has expanded the range of
services it provides to the community and opened new
markets for information services. The financial and
business communities and even Prime Ministers are
particularly well provided for with AAP's specially
tailored services.
Many of these services spring from advances in
technology. This underscores the philosophy, clearly
understood by all politicians, as well as A. AP, that all
the information in the world is of little use if it
can't-be communicated to the people who matter.
This is the basis of the special role the media play in
our society. The media is the link between those with
the information and those to whom it needs to be
communicated.
This is a heavy responsibility and not one to be abused
either by the media itself or by those who use it. In
this regard, the kind of advertising which is currently
being run by the Queensland Government on the Grant's
Commission Report reflects very badly on that
Government. The Queensland Government's advertising is obviously
intended as a pre-match tactical manoeuvre leading up to
the Premiers' Conference to condition the electorate to
believe that Queensland is about to become some sort of
victim of Canberra.
The advertising is inaccurate. It is misleading. It is
a cheap shot by the Queensland Government because they
are trying to portray the authoritative recommendation
of a non-partisan, quasi-judicial body as some kind of
political vendetta. It is cheap and it is an insult to
the members of the Grants Commission as well as to the
intelligence of the Queensland public.
The Grant's Commission finding about the payments which
should be made to Queensland is not some figure
confected by the Federal Government, plucked out of the
air to punish Queensland becuase its Government is a
different colour to ours. The Grant's Commission's
Report is a result of exhaustive research and inquiry.
It is based on the long experience of the commission
members.
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And in case anyone might then suggest that the
Commission has been stacked, let me just remind the
Queensland Government about the makeup of the
Commission the fact is that every member of the
Commission was appointed by the Fraser Government.
The Queensland Government's own advertising standards
highlight the importance of the media getting its facts
right. In the early days it was enough for newspapers and
there were only newspapers then to report the facts
and nothing else.
Indeed, it would not be far wrong to say that a
journalist would have been considered somewhat
impertinent to have offered an opinion on these facts.
But this is clearly no longer the case. Your public
expects a great deal more of you now. The public still
demands a high standard of propriety and fair and
accurate coverage of events. They now also not only
expect the news, but also expect analysis of it and
expect it very quickly.
Governments are sometimes accused of being too sensitive
to critical reporting or analysis of decisions. My
Government welcomes informed commentary and constructive
criticism. But, like the public at large, we believe commentary
should be well informed and well based. Analysis based
on prejudice, poor research or a gross misunderstanding
of the facts contributes neither to good Government or
to the well being of the public.
AAP plays a crucial role in ensuring that the media are
in a position to provide this sort of service.
Societies such as Australia rely on fair and
professional * media. The public needs the service
because people need to know as completely as possible
what is going on. And Governments need the media to get
their message, their policies across to the people.
Both these roles are vital.
Good Government demands that the electorate knows what
the Government is dioing and why it is doing it.
New technology is making an important contribution to
that process. The launch of AUSSAT satellites
represents a further major step in improving
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communications for all Australians.
AUSSAT's network of satellite earth stations around
Australia will enable it to provide fast and economical
access to its services to all areas of Australia.
This, along; with the other benefits of the satellite
system, will ensure that all Australians will be better
informed than ever before on all aspects of the news
and particularly, I hope, the Government's policies.
The core of our approach to Government has been our
drive for a wealthier, more secure Australia, with high
economic growth, low inflation and reduced unemployment.
Only with such conditions can progress be made towards a
more just and equitable society.
Our approach has been based on a consistent, integrated
package of fiscal and monetary policies underpinned by
our prices and incomes policy defined in the Accord.
These policies have been remarkable not only for their
success, but for the consistency with which they have
been applied since we came to office.
We have gone to great lengths to ensure these policies
have been clearly enunciated and understood. We began
this process just over two years ago with the National
Economic Summit. The Economic Planning Advisory Council
which emerged out of the Economic Summit has a very
broad base of representation, as does the Advisory
Committee on Prices and Incomes.
It has been our particular concern to ensure that those
most affected by decisions of the Government have been
given sufficient information to make proper assessments
of the policy options available to the Government. In
this we have appreciated the co-operation and goodwill
of the media and of the press in particular to ensure
that the facts are quickly disseminated.
But words are not enough. Governments are judged
ultimately on their record.. Judged by that yard stick,
we can claim a remarkable track record of achievement:
Australians rate of inflation has fallen markedly
economic growth has been strong and a firm basis
exists for balanced growth with the private sector
playing an increasingly important role
unemployment has fallen to
industrial disputation has fallen to very low
levels.
our achievements have been facilitated by the framework
of the Accord which provides clear lines of
communication between the parties to the agreement. it
plays an important role in communicating information and
points of view, ensuring that there is a proper
appreciation of policy options available to Government.
At the same time the Government, as custodian and
representative of the interests of the community at
large accepts the responsibility to take the final
decisions, with the national interest being the
paramount consideration.
The recent depreciation of the dollar has thrown up a
new challenge to the Accord. This challenge is to
maximise the benefits to output and employment which a
substantial real depreciation could bring, while
ensuring that inflation is kept to the minimum.
The right wages outcome is essential. It must involve a
lesser real wage level during the adjustment period than
would otherwise have applied.
The options available to the Government include
adjusting either through the planned national
productivity case or discounting.
As for any productivity increase, it is our view that
the questions of the size, timing and phasing of any
such increase should be deferred until the scope of the
depreciation and the extent of its effect on the economy
becomes apparent.
The depreciation had little impact on the March quarter,
and it will have little more on the June quarter. The
real effects * on the consumer price index will flow
through over a longer period. ' Against this background
it is the Government's view that the wage indexation
case should proceed as normal in September under present
Principles.
A major focus of our policies has been to put in place
the conditions neclessary for sustained growth.
The outlook for economic growth in coming years depends
on achieving balanced growth with a strong private
sector.
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An essential ingredient in the medium-term health of the
economy is striking the right balance between claims on
resources by the public and private sectors.
There has been a tendency towards an increasing share of
resources being claimed by Governments. This
development partly reflects the severity of the last
recession and the fiscal stimulus required to provide a
kick-start to the recovery. It also reflects a longer
term trend throughout most of the post-war period under
both Conservative and Labor Governments.
It is a simple fact that the larger the net claim on
real resources by the public sector, the higher is the
call on savings. But in circumstances where there is a
pick up in private sector demand, higher pressures in
financial markets are likely to put real pressure on
interest rates.
An increasing supplement to domestic savings from world
financial markets would also be required; this would be
directly reflected in a still larger current account
deficit. Such developments would impact adversely on the outlook
for sustainable strong economic growth. Mly Government
is determined to avoid such developments.
Fiscal policy objectives have been clearly stated in the
fiscal Trilogy. The May Statement is the first step in
the achievement of these objectives and I believe it has
demonstrated our continuing commitment to responsible
fiscal management and will have an ongoing impact on the
deficit in future years.
Indeed the Australian Labor Government will fulfill its
commitment to achieve a substantial reduction in the
1985-86 deficit.
However, it should be obvious to all that restraint in
public spending is not the sole responsibility of the
Commonwealth. To be effective, it needs to extend to
all levels of government, without exception.
The efforts by the Government to date in achieving some
hardwon reductions in government spending in the May
Statement could be unwound if other levels of Government
were simply to expand their activities without regard
for the future neods of the economy as a whole.
That would be unfortunate for all of us.
The community as a whole, not just the Commonwealth
Government, has an important stake in the goal of
balanced sustained economic growth. For none is this
perhaps more important than it is for the States.
At tomorrow's Premier's Conference we shall be calling
on the States to make their contribution to achieving a
significant and lasting reduction in the relative size
of the claim of the public sector on the economy.
Without their co-operation in containing the growth of
the public sector, the prospect of securing a sustained
national economic recovery would suffer a major setback.
While some specific purpose grants to the States have
already been decided, the bulk of Comonwealth/ State
financial payments will be settled at the Premiers'
Conference and Loan Council.
A major concern is the size of the total pool of grants
to be shared:
in other words what increase in state funding over
K 1984/ 85 is appropriate?
A number of factors influence the Commonwealth's
position in this crucial area. These include, in
addition to the Government's firm and non-negotiable
fiscal objectives:
the fact that during 1983/ 84 the States were able
to significantly increase expenditures in real
terms whilst at the same time reducing their
aggregate deficits
S and again in 1984/ 85 have budgeted for a
significant increase in expenditures;
the fact that, with the rapid growth in outlays in
recent years, assisted by the very strong growth in
Commonwealth payments to the States, particularly
over the last three years, the States' share of the
. national resources in recent years has been at an
all-time high;
that economic recovery has benefitted the States,
in particular has led to an expansion in their
revenue bases in line with the general pickup in
economic activity.
The current tax sharing arrangements have been
criticised in numerous quarters as an inappropriate
basis for revenue sharing.
It is clear that a share of the previous year's
Commonwealth tax collections does not necessarily
correspond to the appropriate level of funding of the
States in the current year, especially in times of
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strong economic growth.
In particular, there is no justification in the
current economic circumstances for the very large
increase in state tax sharing payments that would
have resulted from a continuation of the current
arrangements. Conversely, the Commonwealth has, in the past, had
to resort to providing special revenue assistance
to top-up tax sharing payments because of problems
with the current arrangements.
In this context, the Commonwealth has examined a range
of alternatives in developing the position which will
be put to the States tomorrow.
I do not propose to go into details at this stage.
Suffice to say that the Commonwealth expects the States
also to adopt a disciplined approach to expenditure
restraint. At the Federal level we have delivered
substantially already.
The Government is determined to continue progress in
reducing the public sector borrowing requirement ( PSBR)
there is every prospect that in 1984/ 85 the PSBR
will come in at around 7% of GDP ( compared to 8% in
1983/ 84).
our aim in 1985/ 86 is to reduce the PSBR further.
This will require firm control on both budget related
and other borrowing programs at all levels of
Government.
A key agenda item for the Premiers' Conference, and for
that matter the Budget outcome, is the renegotiation of
the arrangements whereby the Commonwealth's general
revenue assistance is shared between the States.
There has been bipartisan support for the Commonwealth's
support of the principle of fiscal equalisation.
That is, the distribution of Commonwealth funding should
be such as to allow each State to provide government
services at standards not appreciably different than
those of other States, without having to impose taxes
and charges at levels appreciably different from the
levels imposed by he other States.
The Commonwealth firmly supports this principle.
Such an approach is natural for a society which is
concerned with fairness and equity. It gives the States
and the communities that they represent a " fair go".
The recent Report of the Grants Commission indicates
that a substantial realignment of the shares of some
States is required esscntially to make up for the
unduly favourable treatment received by one or two
States under the previous arrangements. In fairness to
other Australians we intend to ensure that the
Commission's recommendations this time are properly
implemented. In saying this, however, we will be concerned to ensure
that any adjustments required to meet the objective of
fiscal equalisation do not impose an unreasonable short
term burden on individual States.
Ladies and Gentlemen, the theme of much of this talk has
been communication and the clarity of the message. it
is crucial that the economic and fiscal considerations
behind our actions be conveyed and understood by all
Australians if the best outcome is to be achieved. That
outcome would see the achievement of the conditions
necessary for sustained economic growth at rates
sufficient to restore prosperity to all Australians.
What is done at this Premiers' Conference will have a
major bearing on that objective. For our part we will
be looking for the full co-operation and involvement of
the States with the National task.
I do not believe any Government, Federal or State, would
want to be a party to any decisions at that Conference
which were not in the best interests of all Australians.
Certainly, for the Federal Government's'part as I said
last weekend in Tasmania we will not allow the
interest of any State to be trampled on. Wle will not
allow the welfare of the people of any State or region
or section to be disadvantaged.
The economic welfare of Australia as a whole is at
stake. The result we seek is one I am sure all
Australians will welcome.
Thank you.