PRIME MINISTER
MWASCRIPT OF NEWS CONFERECE, HYAI? W* mCYP ADBL& ZDE
24 JXANURY 1990
2-6 O3jr PROOF -ONLY
JOURNALIST: What do you say to mr xeating predicting an
early Kay election this morning? Is he right in doing
that? PH*. Be's got a fair chance in being right.
JOURNALIST: Only a fair chance?
PX: Ne's got a fair chance of being right. I mean I
love Adelaide and I'd love to use this occasion to make a
very important announcement and I an not going to.
JOURNALIST: H~ ave you made the decision?
PKE: Not yet.
JOLRNALIST: sentenced James Savage to death.* Will
the Government be doing anyting about that or do you
have any comment to make?
PNI You, I do have a coment to make. I notice that zY
friend and colleague Lionel Bowen# the Deputy Prim
Minister and Attorney General, ham issued a statement
which reflects the position of the Government and that is
that we deeply regret that the judge has rejected the
ecoidation of the Jury but as Lionel has said this
matter has still a long way to go through the American
legal system. We've provided $ 50,000 already to enable a
number of witnesses, to go to the United Stt. To
explain essentially the tragic ciroumetanoes of this
matter and talking about the tragic circumstances of this
man who has been found guilty and of course we don't
overlook the nature of the crime but you do have to
undrstndthat he was a young man up-acoead from his
natural environment,, from hi. parents, put into a
situation out of which developed this tragedy and we hope
that through the futher processes that are available
account will be taken at the appropriate level of the
American judicial system of those Wccitances. So that
justice can be properly qualified with mercy.
Porter: mr seatinrfvusNyfr neetode
that rule out AprilifvusMyfra 1cim o
PH: No, I make the decision.
Reporter: What about interest rates Uir Hawke* how moon
before they an coae down?
PR: As Paul ating said rightly-yestarday will
happen now is that the first stop has been taken and how
the banks vill mowe now in the area of other interest
rates including mortgage rates wiii be a matter for
decis ion by then and the pressures and the considerations
won't be identical for each of the banks ut we believe
that we have acted responsibly, there vas-same presure
upon us to ease monetary policy earlier than this but we
Were rat prepared to do that until we were confident that
there was a slowing down in the economy which we regarded
as necesary to meet the fundamental external challenges
confronting this country. We think this position has been
reached and now the conditions are in place for the
easing of monetary policy which has been undertaken now
when that will be reflected in mortgage rates will be a
matter for the banks.
Reporter: Will there be further adjuatmentass, this was
an initial adjustment, is there a program of adjustments
in mind now?
111: There is a program in mind,, but an Paul rightly
described it,, it van a limited initial move now that
carries its own implications.
Reporter: If there is an easing of mortgage rates, will
that be a trade off in any wage negotiations later this
yeSar. PM: No not a trade off, quite clearly in negotiations
that we will be having with the trade unions, and let so
also say with the employers,, when we talk about wage
negotians it is not just with trade, unions, we talk
with emloyers as well.* I think it is quite clear that
they should see the desirability of having an outcome
fzrl the wage negotiations which of itself will be
oopzsive to a further easing in monetary policy and
Wwloslywe would want to see that.
Reporter: reaction a 1.5% drop in the dollar?
PR: go not worried about that at all.* We the float of
the dollar and when you have changes in the price of
mey within our country then that create* a change in
-relativities that will obviously have mom reflection in
the exchange rate that was to be expected.
Reporters The polls are suggesting that Janine Haines may
be able to take Kin ton from the Labor Party, what are
You feelings an a. Does it concern you?
p31: no I want to see all my sitting members returned I
believe that Gordon Dilney nas done an ezoellent job of
representing the electors Of Kingston-I think that they
will appreciate that their interests will be better
served by having someone in the aovernment wbo can
directly represent then and I make those ObSSVtiofls
without making any personal detraction Of senator Haines.
I mean : E an not here to attack her. I an simply saying
that it makes sense. I would beleive for the electors Of
singston to ensure that they are Continued to be
represented by a person who has proven hi. capacity to
represent them effectively*
Reporter: Are you confident that Post election interest
rates will stay down?
. MI: Yes. * we have . not at any stage played with any element
of our economic policy, whether it in wages policy,
fiscal policy or monetary policy in electoral terms. * I
meon we have been in Government nov for nearly 7 years
and we are entitled to be judged on the consistency of
policy making and the results of it. There have been
times when electoral or political considerations would've
pushed us in the judgement of analysts in a
particular way but we didn't go that way because we
didn't think it would be responsible. We have therefore
in this case waited to ease monetary policy until we
believed it was appropriate in economic term to do it.
We've made that judgement and we think those conditions
will continue.
JOURNALIST?: Mr Hawks, to what extent has the reduction
or likely reduction in interest rates led you to believe
that May would be the best possible election date?
FN: It has had no connection. I've not made my decision
as to when the election will be. it always had to be by
abot mid May and am I've made it clear all the way along
as I did in response to a question just previously, we
make our economic decisions in termn of what the economic
interest of the nation demand and that's how we've acted.
There wert some who would have liked us on political
grounds to ease monetary policy earlier because their
argument way if you do it earlier then it'll be reflected
mowe qickly into mortgage rates and that would be good
polticlly But we made the judgement that it wasn't
appropriate in economic term to do it earlier. I think
that the Autralian electorate has shown over recent
years an increasing sophistication of judgement in these
matters. I don't think they would've taken kindly to a
decision by me and the Goenet to bring monetary
policy of f earlier than it was appropr iate to do so. I
think they will make the judgement that veve made the
right decision in economic to= m. I hope that taking all
those things into account we' 11 get the approval of the
electorate. I think we will.
JOUNIALST: t
mest likely Are you saying Mr Hawke,, that May seem the
date now?
PK: I haven't said that. YOU SemM to be w* aing to get
me to say it. I haven't said it. Z've said I haven't
mad. my mind up yet.
JOURMULST: A fair bet?
PSum yWoaulrl diet'csis iyoonu. r money you're betting with,, mate. You
im~ xALLM: But Ir Keating favours it wad he is Part of
the teamn.
PUt I an" e the decisions. I listen to what a numer of
my colleagues certainly including what Paul has to say.
-But in the and an in 1987, in the quietness of The Lodge
or my office in Parliament Nouse ii * mke the decision.
I'm not dictatorial in these matters. I like to hear the
views of my colleagues and I will take aboard the
thinking, of paul and other.. But in the end 1I'll make
the decision that I think's appropriate.
JOURNALSIT: mr Hawke, the domestic airfare price hike.
Imn't that a bit rough on the public considering we were
promised a better system after the polite disp: U?
PHE: Yes, but just get it exactly right because the ABC I
might may last night got it wrong. Hy sateIments and
you look up all the transcripts and you' 11 see it quite
precisely this is what I said and what 1I'll say again.
I said that after the airlines recoup the losses from the
dispute that was inflicted upon them by the pilots, after
they reoup the loeses we will have an airline fare
structure lover than it would otherwise have been because
ot the enormous pilot productivity increases that arise
out of what happened in 1989. Now they were my
sa ts and what in fact has happa is peisely in
line with that. The Independent Nf ares Tribual has
not agreed to the full amount that the airlines asked to
recoup their losses but it recognised that they had
suffered very significant loses. They've granted an
increase to help them meet those loss. But it is true
and indisputedly true what I said before i that as a
result of the enormous increase in pilot productivity
that nov exists with very,, very many less pilots being
eployed that from that factor alone airfare structure
will be lover than it otherwise would've been.
JOURNALIST: hike in July So do you expect there'll be aother price
when they review it again?
FU: I don't know, but all I
right, that you are going to
airfare structure than there
with the airlines employingi
of pilots. Now how long it~ know is that what I said is
have a basis for a lower
would otherwise have been
k significantly lesser number
till take for them to recoup
0
their losses, I can't sake that judgement,, I don'It
assess. But there is no argument with anyone in the
airline industry about the accuracy of what I've said on
this matter. Xr Hawke, the Morgan Gallup Poll puts Labor
slightly ahead today. Basing of monetary policy surely
Must give you some confidence going into an election
SO" e.
PM2 Well, I think you'll recall what I've said about
polls consistently. When we've been in front before I
haven't exhilerated about it or gloated and when I've
been behind I certainly haven't been despondent. If you
look at what I've had to say to political journalists
over the years, thereto one phrase that I've consistently
said to them in my charitable attempt to be educative in
these Matters. I've maid get your timescales, right. Then
when you're on a high, a real high, don't think that
that's necessarily normal. When you're down a bit, don't
think that thatVs normal. Be intelligent about Your
MSs n of the Australian electorate. They have
become more and more sophisticated I think during the
eighties. Its of course happy that we're in front. I
meon it would be silly for me to say otherwise. I'm
happy we're in front but I1m, rnot cooky about it. I
Understand that we've got a very significant job in front
of us to ecplain to the Australian electorate why the
sensible decision whenever I call the election would be
for them to return us.* Now I ' m not cokyo complacent
about that but I do believe we can win.
JOURNALIST: in your speech inside you talked about what
you term the inevitability of confrontation industrial
confrontation under a coalition governmet. Do YOU
then regret being what most people regarded as the prime
architect of confrontation in the pilots dispute?
IN: Of course you'-re totally wrong in yoaw premise.
Nast people don't regard as as being the prim architect
of conrotaion
JOUNAIT: assessment of what the obser vers were
saying at the time# Prime Minister.
PH: At the time. But some of thm were saying at the
time and they were wrong as they so often are. An I
say as in answer to your previous questions, it's good to
get your timescale here and remember see we're now in
January of 1990 remember that in February of lastea
the Pilots Federation produced their docmints in : hl: h
they said theme thing.: we are going to take on our
employers, the Government,~ the ACMr and the Arbitration
comission. We are not prepared, they said, to abide by
the guidelines. We're going to take then on. It that
means a prolonged NIP non incom period be prepared
for it, they said, because we are going to fight
everyone.* We're going to take the vwhole system 0Cm. They
6
were very, very keen to do that then, they vere canf ident
ina their view of history that they could take on the
Australian community and get a 30% wage increase. NOV
they were the people who took that position.
JOWUNLIST: exercise in conciliation,, wsTt it.
Ml: my friend, I'a not here an you so often want to do,
to have a debate. ' s here to answer a question so let
as finish. I said after they put that they woe going to
destroy the wage fixing system and have a 30% increase,
remember a 30% increase on a average wage of $ 60,000, the
increase that they wanted was maze than the average
income of ordinary Australians, I said as Prim Ninister
of this country that as far an I was -WnWifr Iteh ey
persisted with that position I would fight it. I would
not allow Australia to be destroyed by the pilots. So I
was not the initiator but 7. wasn the defender and quite
clearly ma 1' ve said before, these people picked the
fight, they were warned not to, they picked a fight,
they've lost. I regret the trouble they've caused to
everyone but the system has been an it sha'ldve beeo,
defended. JOURNALIT: Mr Keating has been saying consistently that
there would be no easing in monetary policy until there
were clear and unamiuu signs of a slow damn in the
economy. What are those signs as you now see them?
PHO2 Well let me give you the aggregates and then the
individual components. If you look at domestic demandl
the s ituaation you' 1ve had is this; going through the Masrch
quarter, the JUne quarter and the September quarter of
the national accounts, in the March quarter last year
there was a 3.7% growth in domestic demand. in the June
quarter they had dropped to 0.6% and in the September
quarter the the mast recent figures available -that
had dropped to a flat figure. Those aggrgtei~
have been concerned by the individual onen
regard to e~ loyment which has shown a significant
slawing down in growth and by housing and by the surveys
that have been down at business. When you add those
things together the national aggregates and the national
acounts which-show the movements from 0.* 6 down to
twro, take the individual components that I referred to
and put then all together, its Judgement of the Reserve
Bank and of the Government that the conditions have been
endst