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Transcripts from the Prime Ministers of Australia

Transcript 7985


Photo of Hawke, Robert

Hawke, Robert

Period of Service: 11/03/1983 to 20/12/1991

More information about Hawke, Robert on The National Archive website.

Release Date: 21/03/1990

Release Type: Interview

Transcript ID: 7985

JOURNALIST: Tracy Lois, Austereo News. Prime Minister
the Chamber of Commerce says today's national account
figures show we're heading for a recession and whichever
Party's in Government on Monday they'll have to move
immediately to bring down interest rates. Andrew Peacock
says if it's him he'll make an announcement on Sunday to
ensure the market moves on Monday. Will you be doing
more than just ringing Bernie?
PM: Well, let me refer to the national accounts and from
that into interest rates, the two issues which you
properly interlinked in your question. Of course, in the
national accounts we see the confirmation now of the
policies that Paul Keating and I, on behalf of the
Government have been talking about. The reason of course
why we had to have high interest rates was that in the
previous year you had that gap of between the eight
percent increase in consumption and the four percent
increase in production and that led to a massive increase
in imports which was unsustainable. And so we had to
have high interest rates to reduce that level of
activity. What the national accounts show now that that
gap has been eliminated, total spending grew by
percent over the year to the December quarter while
growth in production was 4.2 percent. So that gap has
been eliminated and what we're seeing is a situation in
which you've got now an increase in net exports. So what
weire seeing is not a move to recession, there's a
reduction in consumption which there had to be and our
activity is now being channelled into net exports which
is precisely what we need to have. And that of course
will1 enable us to move to a reduction in interest rates.
Let me make the point that my comment about the reduction
in interest rates is not simply my statement or the
statement of Paul Keating, although Paul Keating in his
release today with the national accounts has made for the
reasons I've put, the judgement that the fall of interest
rates will follow. But in a sense it's more important, I
think, to look at what's been said recently by people
within the banking industry and most particularly I'd
like to share with you the thoughts of the Reuters screen
last night. But just let me refer to a couple of the
observations from the banks recently and the Sunday Age

recently. They said economists broadly agree that the
conditions already exist or are forming for an easing of
rates. March the 15th, when the labour force statistics
came out, the Commonwealth Bank said the slowdown in
employment over the last two years provides further
evidence of the slowing in the economy which should allow
for some further easing of monetary policy in the near
future. Yesterday, the publication of the latest retail
trade figures, the Commonwealth Bank said the January
retail figures confirm the softer trend in consumer
demand which should prompt a further step easing in
monetary policy. And on the Reuters screen last night,
in the context of what had happened in Japan, traders
this is on the Reuters screen traders said credit
markets ended the day firmer in anticipation of a further
easing in monetary policy in the next few weeks assuming
the Hawke Labor Government is re-elected at Saturday's
federal election. The Reuters screen is right because
what they are saying, what they are saying is OK, Hawke
and Keating and the Labor Government have had the
policies, they've suffered some flak. We were prepared
to take the necessary hard decisions, but the national
accounts reveal that those decisions are working. There
is no need to fear a recession in any sense because we've
had 4.2 percent growth in GDP over the whole of 1989, but
the conditions have been filled, filled now for a
reduction in interest rates. I confirm what my Treasurer
said and that is that we'll be in touch with the
authorities within a week or so of being re-elected and
it is my judgement that, given the evidence of the easing
in the economy, that I see very good prospects for a
further easing in commercial rates and that expected fall
on top of the earlier fall in commercial rates should
feed through to mortgage rate reductions. Now I'll try
not to make the rest of my answers as long as that, but
you did get to national accounts and interest rates and I
needed to go to all the facts. Thank you.
JOURNALIST: Bob Bowden, SBS Television Prime Minister.
You ' ye stated during the campaign that the pace of reform
Australia can expect over the next few years will be
quickened if you are re-elected on Saturday. I wonder if
you'd explain how you expect to achieve that, given that
on some evidence the Government's appetite for reform
appears to have diminished and would you nominate the
areas you see as the highest priority as part of that
re-form process.
PM: Well I, when I answered that question earlier I made
the point, Bob, that in fact why I believe that there
would be an acceleration in the rate of reform was that
because we had, in fact, overcome the first hurdle. And
that was that it's very difficult, when you've had an
economy cosetted as this was for such a long period, and
remember the stastistic, for 30 of the 33 years for
of the 33 years before we came to Government
conservatives in power, no micro economic reform at all.
The easy assumptions of the lucky country, that it was

all going to fall into Australia's lap from a grateful
world that loved us for some peculiar reason, that we
didn't have to do anything. All the old attitudes would
remain. Now we in seven years have done more to turn
around those attitudes and institutions than has ever
happened before. Remember in this place in December I
issued the challenge to the conservatives, come up and
point out any period in all your 30 years when you came
within a bull's roar of our pace of economic reform
deafening silence because they haven't. Now what we've
done is had to tackle in these first years employers,
trade unions, State governments and other institutions in
this country who had been brought up in this atmosphere
of conservative apathy and gutlessness. And now we have
the situation where, in this last week, you can have
users and employers in the waterfront coming out and
applauding my Government for the reforms that it's
brought about on the waterfront and saying, faced with
the choice between our approaches which are going to
involve 3,000 of the older waterside workers going out,
thousand younger people being recruited, getting rid of
the concept of pool employment which we inherited from
the conservatives and having employer oriented
employment, bringing about very significant improvements
in productivity. On the, in the maritime industry, as a
result of what we've done Australian manning levels by
' 92 at the average of the OECD. Now what I'm saying is
that to get to this position where these changes have
taken place, reflected yesterday in the Metal Trades
Award, this country had gone on for decades, for
generations with an award, the centrally important award
in our manufacturing industry, still going on with 360
different classifications dating back to the beginning of
this century. As a result of what we've done, getting
the unions to face up to the challenge of change, getting
the employers to face up to the challenge of change,
that's gone. And instead of 360 ossified, irrelevant,
counterproductive classifications, now 14 classifications
which will facilitate training, retraining and the proper
application of modern processes. But to get there just
imagine the hurdles we had to overcome. So the point of
my answer to your very important question is we've got
over that. We've got now a receptive, cooperative trade
union movement. We've got a much more enlightened band
of employers, collectively and individually and
government, State governments also. So I believe that
bucause we got over that hurdle and seeing now the
example, for instance, of the waterfront, the maritime
industry, what's happened in the metal trades. I mean,
if you can reform the Metal Trades Award then you're
going to have a much easier road now to surge through
with reform and all the rest of the award structure. So
it's because the hard battle of changing attitudes has
been won that I think we're going to be able to continue.
You asked what were the most important areas. I think
transport generally will continue to be very important,
Bob, and I think with Ross Garnaut who referred not only
to transport, he also identified as a very important

area, power generation. Now, so these things need to be
looked at by the Industries Commission. We'll refer
these things to them, but I think we've now created the
environment, the attitudes for change, the preparedness
on the part of Australian workers and management to
understand that if we're going to meet the challenge of
the future, then they've got to be prepared to abandon
past practices and that's going to make it easier in the
JOURNALIST: Laurie Oakes, Nine Network, Prime Minister.
Why did you say yesterday it was reasonable to predict a
two percent fall in interest rates in a relatively short
time if you won the election? Why did you say that and
then back away from it and why did Paul Keating claim you
didn't say it.
PM: Well, I had to confess, I had to confess that I got
somewhat side-tracked by John Howard parenthesis. I had
seen the report where John Howard had referred to the
possibility of two percent reduction and I indicated
that, you know, that may seem reasonable but I wanted to
make it clear and it was pointed out to me that I may
have left that impression, I didn't want to leave it and
I shouldn't have got carried away by the John Howard
parenthesis. Because I have been very careful, right
throughout this campaign, to point out two basic things.
And that's what I've continued to do and what I've done
today. That is that if you're going to get reductions in
interest rates which can be sustained, then you have to
have the fundamentals of economic policy right. And
fortunately today what we've seen is the further
confirmation that those policies are right. We've
eliminated that great gap between consumption and
production and that means that the conditions are right
as has been said within the banking industry and the
Reuters screen and so on that don't knock the Reuters
screen, it's very important, very important and they've
said, they've said that the rates can come down. So
you've got to have the policies that are right. That's
the first thing and it's working. The second, I repeat,
and perhaps I should have been more astringent yesterday,
I don't walk away from that, that the decision will in
fact be made within the banking industry. What we will
do and do it with a great deal of vigour and do it early
on our re-election is to say to the central bank that it
i-s-the strong view of Government that all the evidence is
there now to justify a further reduction in rates.
JOURNALIST: Jim Middleton, ABC Television News. On page
three of your speech, you talk about fighting to realise
a vision for an Australia, an export oriented economy.
PM: Yes.
JOURNALIST: In line with that you recently gave $ 12
million to the Kodak Company. Now the Kodak Company has
announced a competition in which they are giving away $ 12

million, an intriguing similarity I think you will agree.
What does giving $ 12 million to Australian punters do for
an export oriented economy? Shouldn't you reconsider the
decision? PM: Well, good try, Jim, but the two things are not
connected as I'll point out to you and it's quite simple
to understand I give you the facts. Kodak's promotion
is purely related to its film retailing operations. The
bounty is solely related, solely related to Kodak's
manufacturing operations, both for the domestic and
export markets. And the terms of the bounty, the terms
of the bounty dictate that there be no cross subsidy from
Kodak's manufacturing operations to any of its retailing
or processing operations. Now Kodak's always run film
promotions in the past and will continue to do so no
doubt into the future, well after the bounty finishes.
And we have the situation where Commonwealth bounties go
to, and other types of assistance, go to hundreds of
Australian companies but that doesn't give us a right to
involve ourselves in any way in their promotional
activities. And we go back to the basis of the decision
in regard to Kodak. Very simple. We had there a company
which was the second largest exporter of elaborately
transformed manufactured goods and as a result of the
decision that we've taken, we will have a position where
they are going to see exports more than double on an
annual basis, from just under $ 100 million currently.
And we calculatedly made the decision that it we
weren't entirely happy with the decision and I said that
at the time, but we had to make up our minds whether we
were going to see the loss of this major export capacity
or not. We made the decision that we shouldn't lose it
and, as I say, in the terms of the bounty arrangement it
is clearly spelt out that there shall be no cross subsidy
from the manufacturing operations which are in question
to any of its retail processing operations.
JOURNALIST: Paul Lyneham from the 7.30 Report, Prime
Minister. This morning the Treasurer's Office told me
that the Commonwealth net debt overseas is $ 9.25 billion.
Yesterday in your interview where you didn't say interest
rates would go down by two percent, you also said,
talking of the $ 17 billion surplus you've accrued over
the last three years, the Budget surplus, you said ' we
have used that' and this is your own official transcript
' we have used that to pay off every cent of Commonwealth
Government overseas debt'. Isn' t that what would be
known in some quarters as a bit of a porky and secondly,
on what will likely be the key issue of the campaign, are
you concerned about the appearance of elitist enclaves of
rich white Anglo Saxons in Vaucluse and Toorak?
PM: I may say something about that last little bait you
threw out, I'll think about that one. But on the
question of debt the position is quite clear that on the
latest figures that I've seen that when you take into
account in regard to the Commonwealth Government its debt

and its assets we are net creditors to the tune of $ 4.4
billion. And I don't resile from that at all. That's
the position. If you put against our liabilities our
assets, in international terms we are creditors to the
tune of $ 4.4 billion. But as you go to the question of
debt,' let me, let me just expand briefly on that. We
have addressed this issue constructively throughout the
campaign which is the opposite of what's in fact been
done by our opponents. We have in place a coherent,
inter-related strategy to deal with the debt problem of
Australia. It's in three parts essentially. The first
is, and it's absolutely essential that you have it, we
have a wages policy which can ensure the continued growth
of a competitive Australian manufacturing industry and
the continued growth of services. We've had 54 percent
growth in manufactured exports in the last four years,
that sort of thing will continue. These latest national
accounts confirm the fact of the move to a stronger net
export position. Against that wages policy that we've
got to enable that outcome, our opponents have a position
where they will guarantee a wages explosion. Secondly in
regard to dealing with the debt problem, we have a
surplus $ 17 billion surplus you referred to, over the
last three years, and that's being used to pay off debt.
Against that you have the fiscal irresponsibility of our
opponents which would blow the surplus. And thirdly we
have a national savings plan statistics,
straightforward, when we came to office in superannuation
funds $ 17 billion, now $ 100 billion, calculated by the
end of this decade under our policies to grow to over
$ 600 billion. That will mean that we will be developing
the savings of Australia in a way which will reduce the
call by Australian enterprises on overseas capital.
Against that again, in superannuation, the Opposition
promises the smashing of the award based superannuation
system. So the facts are there in regard to our own
position and, generally speaking in regard to debt, we
have the policies to deal with it and our opponents have
not. Now about these enclaves in, I just caught the word
enclaves, in Vaucluse and Toorak, I just didn't quite
catch the way which you put it. Is it a serious
question? If it is, please repeat it.
JOURNALIST: something about an enclave
PM: Well I may be getting a question, I don't know, on
the question of the Multi-Function Polis but I will limit
myself to your concept of enclaves by saying this. That,
as you put it geographically, I inherited with my
colleagues in 1983, a Government, a country which was a
country of enclaves in terms of opportunity. And the
most glaring example and the most damning indictment of
the Conservatives in that respect was in the area of
education. There can be no more damning indictment of a
government than that it goes out of office after seven
years virtually leaving the retention rate in our
education system unchanged. That is the proportion of
kids staying on in school. It moved up from 34% to 36%.

They walked out of office with only one in three of our
kids staying on in school. That was the enclave of
Australia that I hated because you had imposed upon the
education map of Australia a pattern of enclaves. There
was no doubt whatsoever that the kids from the wealthy
suburbs were going on in the education system as they
should, they have every right to, but they had no more
right, no more right than the kids from the poor to the
middle class suburbs. But that was the pattern of
privilege, the pattern of enclaves as far as the
education map of this country was concerned and we have
changed that. In seven years not no change but now it is
nearly two in three of our kids and so that pattern of
education, the map of Australia has changed. Instead of
the enclaves of opportunity, now the kids are streaming
on in the education system from all the suburbs. So we
did inherit an Australia of enclaves in just about the
most important and fundamental sense you can talk about.
Because what is more fundamental than that basic building
block of the education of your kids, and it was an
Australia of privileged enclaves. Not any more after
seven years of Labor Government.
JOURNALIST: Dennis Grant, Prime Minister, from the Seven
Network. The clear winner in this election campaign so
far seems to be cynicism, but perhaps followed by apathy.
You raised this yourself in your speech when you urged
the cynics to think again because as you said the stakes
are high. I wonder if politicians are not alone at fault
here, that maybe we in the media have to cop some blame
as well. I think that is maybe because we take politics
in this country as a spectator sport rather than a
participation game. What can be done do you think by the
media and the politicians to reignite hope and perhaps
regain some confidence?
PM: I regard this as a very significant question. I
think the last part you mixed up another issue. You
mixed up, you were talking about cynicism and apathy in
the first part and then you brought in confidence. But
let me deal with the first part of the question where you
were talking about cynicism and apathy. I have had time
to read Laurie Oakes' article this morning in The
Bulletin and Laurie's thesis there basically is that
those who say that there is boredom in this campaign he
repudiates that and I must say that I tend to go along
wi-th the Oakes' interpretation rather than the more
general one of this being a boring campaign. I don't
reject the proposition that there is perhaps more
cynicism in the electorate about the major parties. I
accept that there is evidence to sustain that
proposition, although I don't think that the evidence of
a higher vote for the Democrats and the Greens generally,
is just to be ascribed to cynicism about the major
parties, Dennis. Because I am sure that if you look at
politics around the world one thing just strikes you
right between the eyes is that there has been a growth
everywhere of interest in environmental matters. So

people do want to give evidence of that being their major
concern and that is why I think you are going to have
more people voting for Democrats and the Greens than
before. But I don't walk away from the thrust of your
question that there probably is some more cynicism about
than there was before. I'm glad you gratuitously suggest
that it is not just the politicians' fault, that the
media has got some responsibility. I had a talk with one
editor and a journalist during this campaign when this
issue was raised. I asked them a question when they came
up and talked about cynicism. I said would you tell me
when you wrote in your paper an article about the hard,
unremitting work that politicians do. You talk about how
we misbehave ourselves in the House, and we do behave
rather poorly at times, myself included accepted, but how
many times, I asked them, have you written a story about
the work that politicians do in the committees, on both
sides I am not talking just about Government. Hard,
tough work they do in committees, either of their own
Government parties or of the opposition or joint
parliamentary committees. How often do you write about
that? How often do you write about the hard undramatic
and unrewarding work in the electorate of politicians?
And I know that politicians of both sides work bloody
hard out of their electoral offices, meeting the needs of
their representatives. Well I ask you today how many
articles have you written about that work that they do in
the parliamentary system, and they do out of the
electorates. There was a sort of sheepish grin of
acknowledgement nothing. Now if all you are going to
get in the media is the cheap shot and where the shot
should be put at it, ok of course it should be done. But
if all you are going to get about the parliamentary
system is the cheap shot and no exposition about the
tough unremitting work that goes on outside the actual
chamber of parliament and in the committee system, within
each house and between both houses and the hard work they
do in the electorate, I guess the electorate is going to
get a pretty cynical view of politicians. Now let me
finalise that by saying I accept that all of us in the
political arena have got room to lift our game, from the
Prime Minister through to lowliest back-bencher, we have
all got the capacity and the room to lift our game. But
I do think that you have very fairly gone to the point
that the media may have something of an obligation too to
show that a hell of a lot of hard work is done for which
pcriiticians get no credit at all.
JOURNALIST: David Barnett from The Bulletin, Prime
Minister. While you have been Prime Minister on the
foreign debt again the gross foreign debt has gone up
from $ 38 billion to $ 150 billion. Given that your
economic strategies remain basically the same, wages
policy which was just referred to, tight fiscal policy, a
tight money policy, one that's sustainable for very
long. Is there any reason to think that at the end of
three more years the foreign debt shouldn't be around

I V 9
$ 210 to $ 220 billion? If that is not a good figure, what
would your figure be?
PM: Well basically your figures aren't, I'm not avoiding
the thrust of your question, but you are using gross
figures and everyone who writes about this acknowledges
that it is the net figures that are appropriate and I
will give you the net figures. There has a been a
substantial move in the net figures, it has been from 23
to 118. They are the relevant figures and we are not in
argument about that though. Now let me explain what have
been three factors basically involved in the growth of
the debt. Firstly, of course, with the devaluation of
the Australian dollar which occurred early in our period
in office, by definition there was a revaluation of the
Australian debt and that had its impact upon raising the
figure firstly. Secondly, we had the very significant
decline in the terms of trade in ' 85/ 86 and that had its
impact. And thirdly, we have had the massive surge in
investment in recent years which has given us investment
0 as the highest proportion of gross domestic product in
our history. Those are the three factors which have been
involved in the lift in debt. It is very interesting to
notice David though that if you are talking about trends,
and certainly as a proportion of GDP, that virtually the
position has been stabilised since the middle of the
1980s. Debt as a proportion of GDP peaked in about
September of ' 86 at about 34% of GDP, it is now about
33%. What we have seen in the period in the latter part
of ' 80s is two conflicting elements which have operated
to keep the proportion of debt to GDP pretty stable.
Firstly, you've had, as far as the Commonwealth
Government is concerned, the running down of our debt and
that surplus of $ 17 billion that I have talked about and
the activity of the Government to turn around the net
public sector borrowing requirement which was turned
around by eight and a quarter percentage points. So you
have had that massive impact from what we can do directly
p tcoo mmruendiutcye. theB utp ubalsi cw e dheamvaen d beuepno n dtohien g rtehsaotu rycoeus ohfa vet healso
as I say had this massive surge in investment. Now that
investment that has been taking place and which is
reflected in the debt figures is not something which is
all bad. I mean if you look and let's take the most
conservative element of the access economic figure the
billion of investment which they identified which is
al-ready under construction or committed. They say that
that will be bringing in about $ 5 billion additional
foreign income in the years ahead. So as we have been
playing our part to reduce the demand on the community
savings, the business sector has been very significantly
increasing investment which is going to have its pay-off
in the years ahead. The other element that needs to be
taken into account David when you are thinking about this
is of course something which fortunately the Reserve Bank
went to in some detail in an article the other day and
this is something that Paul and I have talked about quite
a bit which hasn't been picked up so much and that is the

massive increase in Australian equity investment abroad.
When we came to office that figure stood at $ 7 billion.
That has now increased up to a point where it is now
nearly $ 50 billion. It is an increase of over
billion in Australian equity investment abroad. In other
words if that hadn't taken place David, the foreign debt
now wouldn't be 33%, it would be 22%. But because of the
encouragement that Australia has given, this Government,
that investment abroad has taken place and that is giving
Australian companies access to foreign markets and to
foreign technology which is going to be so vital to
Australia's future. It is earning us some $ 3 billion in
income as well. So I am not avoiding David the fact that
we need to be concerned about foreign debt but I am
saying that it's essentially been stabilised in the
latter part of the ' 80s. And if you look at the
components of it there are very positive elements for our
future. But the final point I make in terms of the
election is this. The Australian people have to ask
themselves which of the two parties have the policies to
deal with this issue and I have gone over this before so
just let me very quickly recap them. We have the
policies in terms of, one, a wages policy which will
continue to create a more competitive Australian
manufacturing and services sector which can increase the
range and breadth of our exports and reduce that profile
of exposure to commodity price fluctuations. Against
that the Opposition has no wages policy, they have a
certain prescription for a wages explosion. Secondly, in
regard to fiscal rectitude, we have done what they never
could do. Never once in all their years in office could
they get a surplus. We have, $ 17 billion and we will
keep the surplus intact, but they will dissipate the
surplus. And thirdly, we have got a massive national
savings program through superannuation, they will blow
it. Those are the questions that have to be asked when
you talk about the debt.
JOURNALIST: Bruce Juddery from Australian Business Mr
Hawke. I'm afraid it has got to be a double bunger.
PM: Bruce, I always expect at least a double bunger from
you, mate.
JOURNALIST: I'm being generous to you today.
PM-. Thank you, thank you.
JOURNALIST: On page seven of your speech, Prime
Minister, when you are indulging in product
differentiation with the Opposition, you make the point
that young people don't want more uranium mining, uranium
industry in Australia, and so on and so forth, they
shouldn't vote for the other lot. Am I not correct in
believing that the Labor Party has an enquiry into the
subject of uranium mining and enrichment and the jury is
still out. I am wondering what Mr Kerin, for instance,
who is strongly in favour of uranium mining, Senator

Button who also wants uranium enrichment here, they put
in submissions along those lines. Even Gerry Hand went
out of his way in his submission to say that the
Aborigines don't object to uranium mining. I am
wondering who you might turn of f with that particular
suggestion. The second bung. Is the MFP, Multi-Function
Polis, dead? And who do you blame if it is? Do you
blame Mr Peacock for wrecking the potential
bipartisanship with anybody who was going to put money
into investment for 20 years duration would require, or
do you blame Will Bailey of the ANZ Bank who was Chairman
of the national committee here, and who has deliberately
kept the wraps on the whole process of evaluation for the
last year, and refused to publish some of the more
interesting and imaginative proposals of his team because
he believes that they should belong to the rich companies
which have already invested in the Multi-Function Polis
Australia Research Limited.
PM: Thank you Bruce for those important questions. The
first one, yes there is an inquiry going on within the
ALP on uranium mining. But that is not the jury, I mean
that is in a committee. The decision will be made by the
Party and it is my assessment that for and I am
expressing my view that for a combination of economic
and other reasons that the Party will not be in favour of
any further mining. And I think on economic grounds it
is probably a very strong case for that quite apart from
other considerations. Now let me go to the second part
of your question. The Multi-Function Polis. Now you
asked really is the Multi-Function Polis dead. Well I
guess you would have to say that if the Coalition were to
win the election, as it stands now, the Multi-Function
Polis would be dead. Although one has to ask a question
even there, I guess, when you look at how the decision
was arrived at. Now let me remind you Bruce, what
happened in regard to the position of the Opposition on
this. Here we were going along through an election
campaign, Multi-Function Polis, no. No issue. The
position of the Opposition, quite clear. Let me quote
it. Here it was in the Sydney Morning Herald the week
before Andrew Peacock. This I quote, when
they were asked policy, his exact words, " the
proposal is unique for Australia and deserves extensive
consideration". Got it. That was the position of the
Opposition stated publicly in the Sydney Morning Herald
tt1M previous week. I repeat it. " The proposal is unique
for Australia and deserves extensive consideration"
What was the statement by the Minister involved, the
Shadow Minister involved, Mr Howard? Very clear. I
quote him, " I don't think we should bury the concept in a
sea of hostility before we know anything about it". Now
there you are. Last week. Not bad is it. Unique to
Australia, deserves extensive consideration, and the
Minister involved, the Shadow Minister involved,
shouldn't be buried in a sea of hostility before we know
something about it. Now something happened on the way to
the forum. What was it? There was Mr Peacock with his

travelling press crew, and I'm told, I wouldn't describe
these as leaks, I mean it's just these sort of
intercommunication channels that exist in these matters.
But I am told nary a word to those travelling with him on
the Thursday. But something happened. The faxes went
out on the Thursday. Thursday night. So much so that
Senator Stone was able to say on Thursday night it's
dead. He told us, and he told you then on the Friday,
that he didn't make up his mind until the Friday. Didn't
tell the travelling press with him, but shoved something
into the media boxes. Mr Howard wasn't consulted. Now I
go to these things just because your question is, is it
dead. Well it doesn't seem to me that the position of
the Opposition has really been thoroughly discussed.
Pretty hard to come to that conclusion isn't it. Where
was the discussion in their Shadow Cabinet? And how did
it happen? Did they get a bit of research shoved under
their nose and suggest well this might be something that
is worth throwing in? Mr Howard wasn't involved. So I
have got to say that if Mr Peacock were to win the
election, a totally hypothetical position as far as I am
concerned, and if he were to remain Leader of the Liberal
Party, which is also somewhat hypothetical, then you
couldn't even say in those circumstances that the MFP is
dead. Because there hasn't been this consultation, and
most importantly because the basis upon which he purports
to put his position is totally flawed. Let me examine
that aspect of it. He has said that he is against
enclaves, he's against enclaves. Well let me read to
you, December ' 87, and here is a statement of principles
agreed by the Commonwealth and State Governments. The
following principles should guide Australian
participation in the joint feasibility study of the
Multi-Function Polis. Principles for, let me read it,
develop the MFP as an entity which is not an enclave but
is linked with the remainder of the Australian economy
and provides a leading edge testbed and technology
transfer. So here he comes out and says, I am against
enclaves, when it is laid down, has been since December
' 87, that the concept of an enclave must be out.
Secondly, he says that he relies on the report. Well you
say that Will Bailey was keeping things under wraps.
Very interesting to note that September last year the
Opposition Leader provided with the opportunity to be
fully briefed, no keeping under the wraps, provided the
opportunity to be fully briefed, he declined to accept
that, and says that he reaches his position now. In
defiance of all that his Party has said before, in
defiance of what Mr Howard has said on his reading of
this document. Now, I bet my bottom dollar that he
hasn't read the whole lot of it, but let me go to what
the consultancy report says. To just destroy the basis
of his proposal. What it says is very It says it
should be said that this is not a final conclusion on
feasibility. Overall feasibility will be determined by
the Australian and Japanese Governments which will
receive a report from the Joint Steering Committee by the
of June 1990. They say, this report concludes that

the Multi-Function Polis is a compelling concept. This
is what he is relying on to throw it out. They are
saying it is a compelling concept. And then let me go to
what they say in regards to the economics of it. He is
quoted from economic statistics. What do they say about
the economic analysis. He says, " that analysis must be
regarded as a first attempt to understand the
Multi-Function Polis in terms of the Australian national
economy. Its conclusions are necessarily tentative and
heavily qualified". And yet he tries to out the
proposition on that basis. Finally, and let me just go
to the total hypocrisy of the Peacock position. I mean
you have already seen it is hypocritical because he
bases it on an objection to an enclave and from December
1987 that has been ruled out. He bases his position on a
report which provides him with no basis, but look at what
they had to say in their policy statement. Have a go at
us, page 19. Labor's foreign policy has too often been
driven by domestic political considerations. Now you
have a massive full-on insult to our major trading
partner by rejecting the MFP out of hand, because that is
not driven by domestic political considerations at all.
But in it page 20, what they say needs to be
done. We need to revitalise our economic relationship
with Japan to a new framework of co-operative trade
marketing research opportunity. I mean have you ever
seen such an opportunistic action by a leader of a
political party, I would like to know what it is. You
have four adventuristic, opportunistic, domestic,
political reasons thrown out the window, something which
your own Party has said is unique, unique opportunity for
Australia, should be thoroughly looked at, shouldn't be
sunk in a sea of hostility, and there you go and do this.
I think the facts speak overwhelmingly for themselves,
and I conclude my answer by saying this. No, the
Multi-Function Polis is not dead because fortunately
Mr Peacock will not be in a position, he has shown he is
not worthy to be Prime Minister of this country. He has
shown it before this week, but if ever an issue and its
handling showed that he was not fit to be Prime Minister
of this country, this has been it. The future of this
country depends absolutely on attracting to this country
the very best technology we can from overseas, from
Japan, from the United States, from Europe. Bringing
here and marrying in Australia the best technology that
we can with an increasingly well trained Australian
workforce. Not in an enclave, because we never would do
that. And any Leader who would jeopardise the capacity
of this country to attract such technology, is not
deserving of the support of this community. So we will
proceed with the analysis, with the feasibility study,
and if those reports show that the concept can be
proceeded with in a way which is consistent with
Australia's best interest, its sovereignity and its
integrity and its needs, then it will go ahead.
JOURNALIST: ( inaudible) a part of that saying a
passage had been included without your authorisation.

I'd like to know how a letter signed by the Prime
Minister comes to have something included without his
authorisation. Don't you insist on reading things in
their final form before signing them. And if you didn't
in this case, why not? What is the value of a Prime
Minister's signature on anything if, when there is a bit
of controversy he can turn around and say, I didn't say
that bit? And if something if published with your
signature, and you're responsible for that publication,
notwithstanding the letter from the person in the
Victorian Attorney-General's Office, shouldn't the buck
stop with you and with no-one else?
PM: I accept that the responsibility for that letter
going out in the end must stop with me. Of course I
can't deny that. But I must say that I regret very
deeply the fact that the person concerned, without my
authority, included that sentence. I don't know what
more I can do than that.
JOURNALIST: ( Milton Cockburn) Prime Minister, will you
match the Liberal Party's promise that they will hand
back each year the proceeds of bracket creep?
PM: Well I am in the position where I can match my
commitment, Milton, by looking at the record. And of
course the fact is, as has been demonstrated by
independent sources just within the last week, that under
the decisions that I, with my colleagues, have made in
Government, the Australian people have got back more by
the tax deductions that we have implemented than they
would have got simply by the application of bracket
creep. Putting that the other way, in seven years we
have more than given back bracket creep. But may I just
make this point quickly in regard to taxation and the
expectations of the community as to what sort of deal
they get out of us or the Opposition. Just let me remind
the Australian electorate at this late stage of the
campaign what is proposed in terms of the Coalition for
their taxation policy in their next term if they were
elected. They propose to adjust the taxation scheme by
bringing in what they are pleased to call a flatter
two-tiered system. What will that mean? What's the
revelation of their concept of equity in tax. Let me
tell you, and through you, let me tell the people of
Australia. Under their proposal, someone on $ 17,000 a
year annual income, would get the princely reduction of
a week. If you are on average weekly earnings of
about $ 28,000, you would get a reduction of $ 4.73 a week.
And if you were the Prime Minister, you would get a
reduction of $ 104 a week. Average weekly earnings
JOURNALIST: Mr Hawke, I said this to Mr Peacock
yesterday, so in fairness I should say it to you today.
My question was quite specific in regards to promise.
PM: Yes, I have done that. But I was getting a bonus
in, and I won't be as rude. I think you should do that.

It is perfectly even-handed. Perfectly even-handed. And
I am very naughty, I thought I had answered the question.
The answer is, of course, yes. Because I have done it
for seven years and I will do it for the next seven
years. More than do it for the next seven years. But I
was getting in a bonus, Milton, and saying that what they
are proposing in regard to their taxation policy was a
concept that it is fair taxation to give himself as Prime
Minister more than $ 100 a week tax reduction while he
gave the average bloke $ 4 a week. That doesn't fit with
mine. The answer to your question is yes.
BARTON: That's where we run out of time.
PM: Can we have one more?

Transcript 7985