TRANSCRIPT OF INTERVIEW WITH MATT PEACOCK, AM PROGRAM,
6 NOVEMBER 1990
E OE PROOF ONLY
PEACOCK: Mr Hawke, you've told your ministers to lift their
game. Does that apply to you too?
PM: Yes I'm a Minister.
PEACOCK: And what aren't you doing right at the moment?
PM: Well I think we're all discharging our portfolio
responsibilities diligently and relevantly. But I think all
of us, and that includes myself, have to do more to get out
and explain, not just what each of us are doing in our
portfolios but overall the Government's message. I don't
mean by that, Matt, that the problems we've got politically
are just problems of communication. Obviously the community
is hurting al: the moment as a result of policies that we
believe we've-had to apply to save Australia from longer
term damage. It's a mixture of communication and
reassurance that these policies are going to produce in the
medium term the outcome that we all need.
PEACOCK: Ye; well that's the point of course isn't it. I
mean, people like Senator Button can hardly be told they're
not communicating. You appear to be carpeting him about
every couple of weeks for saying how bad he thinks things
are. PM: Well if you think that that's a fair statement of
what's been happening you're entitled to that opinion. It's
a totally erroneous misrepresentation of what's been
occurring. PEACOCK: There is concern in the Ministry, isn't there,
about how bad. things could get?
PM: There's concern not only in the Ministry but in the
Party generally that put it this way they understand,
there has been no questioning about the need to slow things
down because there was a clear appreciation that the high
level of activity and the associated high level of imports
was not sustainable. So they accept that the policy of
slow-down was necessary. Where the real concern is, Mattand
I understand it is were the brakes kept on too long as
it's going into a deeper hole of activity than was intended
and a recoverable one? There are concerns about those
things. PEACOCK: Can I introduce a couple of other items. I mean,
let's be pessimistic for a minute. If the shooting starts
in the Middle East and if the GATT trade talks break down
we're really very vulnerable in Australia, aren't we?
PM: Well the whole world is vulnerable in the case of those
two circumstances. If you take the case of the Middle East
and what can happen with that. Certainly it is the case
that if you ( lot an escalation of oil prices that would
increase inflation and it would have a detrimental effect on
a lot of our trading partners which could feed back to us.
In direct terms Australia being a nett exporter of energy
that could, in that respect, you know, in our external
accounts, have a slight nett advantage. But overall the
world must be worse off in those circumstances and so would
we. In regard to GATT, well all I can say there, Matt, is
that I don't think anyone however critical they are of the
Government on other matters have any word of criticism about
the Australian Government's activities in the GATT round.
We are the leaders of the Cairns Group. We are the group
which is trying to bring sense between the Americans and
particularly the Europeans and to put pressure on the
Europeans to put an offer on to the table in regard to
agricultural trade. Neal Blewett is there at this very
moment again fulfilling that role. So whatever criticisms
there may in other areas there can be none there. But
you're right in saying if that breaks down, and I'm not
saying that it's going to, but if it were to break down then
the total world economic context would be far worse.
PEACOCK: You'd then share the view of Minister Willis that
our current circumstances, even at present, might get worse.
That unemployment will probably get greater than the budget
predictions PM: Because of the ongoing Gulf crisis it looks as though
the price of oil could, on average for the year, be somewhat
higher than the US$ 23 upon which the budget was predicated.
To the extent: that that's true there could be a higher price
outcome, somewhat higher price outcome, than was expected
and there could, as Ralph Willis said, be a slightly higher
unemployment outcome.
PEACOCK: So do you think it's possible, do you think it's
even likely, that the economic situation at present is going
to get worse. I mean, there is a recession at least in some
sectors of the economy. What's your advice to the people
now? PM: Our view is that we are approaching the bottoming of
the turn-down. Let me say on this word recession, I mean
people just seem to be having some fun about that. The
position is very simple in regard to what I've been saying
about that. In economic terms, in the language of
economics, the technical definition of a recession is two
successive quarters of turn-down. All I've said is that in
those terms that criteria hasn't been reached. But I
haven't, and I don't now Matt, try to hide behind that. I
mean, that's merely the economists technical definition of a
recession, wh~ en you've had two recorded sessions of negative
economic growth. Now having said that that's the economists
technical definition I'm not trying to say that the economy
is not in turn-down and that people are not hurting. I've
publicly acknowledged that. Now our belief is that as we go
into the second half of the financial year, that is first
half of calendar 91, that activity will have bottomed and we
will be on the way up again. I have no reason to have any
other view to that.
PEACOCK: OK but how do you expect, for example, say the
farmers to like you more
PM: I don't expect the farmers to like me more when things
are happening to them the way they are. I can do nothing
whatsoever about the prices that they are receiving for
their wool and their wheat and the only thing I can do about
that is to do what this Government has done better than any
government before it and that is to take an active
international role in all the relevant fora and in all our
bilateral contacts to try and tell the rest of the world
that they must have a freeing up of international
agricultural trade. We're at the forefront. Australia is
the leader of that fight. Now I can't do anything more than
we are on that ground. In regard to the particular problems
of the wool industry, the answer to those problems are
partly with Government but overwhelmingly they are with the
industry itse-lf in terms of the numbers of sheep. Now we
can't do anyt~ hing more. In regard to the area of interest
rates, then i~ n this year there have been five successive
reductions of interest rates and we can't do anything more
in that area.
PEACOCK: You can do more though on micro-economic reform
can't you, with a recession or what looks like it and the
possibility of it getting worse, is that an opportunity to
move much faster, to make more drastic reforms in some of
these critica-l areas because obviously things like
telecommunica~ tions don't attract the headlines for, say, the
farming community?
PM: I'll be making a major statement on micro-economic
reform in regard to telecommunications and transport policy,
particularly aviation, later this week which will be yet
another instalment in the most massive program of microeconomic
reform that any government's ever done in this
country. There's no-one in the business community or, may I
say, in the farmers organisations, they do not question the
fact that we have done more in the area of micro-economic
reform than has ever been done or even contemplated by any
government before us.
PEACOCK: What about things like annual leave loadings
though, Prime Minister? Is that a rort, a luxury we can't
afford? PM: If we're going to be talking about rorts and luxuries
that people can't afford I would think that the attention of
commentators ought to be directed towards the business
community as much as towards workers. The fact is that the
workers of this country, the organised workers of this
country, have made more sacrifices in the period of this
Government than ever before. You've had between 10 and 11%
real reduction of award wages which have been compensated by
improvements in the social wage. But as fas as their wages
conditions are concerned, the organised workers of this
country have exercised more restraint in this period which
has resulted in a massive shift from wages to profits. So
they've done that, they've done that, to enable that
increase in profits to be reflected in an increase in
investment. PEACOCK: And what are the rorts that the business community
should give up?
PM: Well if you look overall at what's happened to
executive remuneration, that has moved much more, executive
remuneration has moved very, very, very much more than has
the remuneration of wage and salary earners.
PEACOCK: Prime Minister, I can't let you go without a tip
for the Cup.
PM: Yes well the three I've chosen, Matt, are The Phantom,
Flying Luskin and Ali Boy but I think that the Cup this year
is such that anyone of about 15 could win. In the last
seven years, apart from last year, I've picked and backed
the winner every time. I don't have the same degree of
confidence. But you've got to make a pick so there are my
three, The Phantom, Flying Luskin and Ali Boy.
PEACOCK: Mr Hawke, thanks for joining us.
PM: Thanks very much Matt.
ends