TRANSCRIPT OF THE PRIME MINISTER THE HON P J KEATING, MP
AND SA PREMIER JOHN BANNON,
DOORSTOP, JANUARY 30 1992
E& OE PROOF ONLY
PM: Well the Premier and I have had a meeting this
morning about the forthcoming economic
statement of the Federal Government. We have
also had a chance to speak to the business
community and one of the Social Security
organisations in SA we'd like to do things
which would encourage a faster recovery in
Australia, but at the same time are good for
the structure of the place. W listen to views
put to us by the business community about a
range of things, about how they see the
economy, about what things the Government might
do and also we discussed some of the
infrastructure questions. And we've decided to
come and just look at the interface between
water, road and rail which exists here and
that's the main point of the visit.
J: What do you think of Mr Bannon's shopping list
Mr Keating?
PM: Well it's extensive, I would think ill of him
if it wasn't, but I think we will have to sift
our way through those things. But the common
theme, I think, the Premier and I are on common
theme about strengthening the infrastructure of
Australia. We do have real problems now in
the micro-economy that is. There is a hint to
how much Budgetary and monetary policy can
change Australia. If there are physical
problems they have to be overcome, and that's
why we are considering some of these subjects.
J: Mr Keating, a lot of the Premier's suggestions
are those things based on micro-economic
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reform, things like the transport how well
do you receive them?
PM: Well I think in this sense that this is the
period when we need the states concentrating on
the things which they do mostly and that is
transport and a lot of the infrastructure
questions which are not directly Commonwealth
issues but because of the national economy and
because of our financial arrangements with the
States they've become a matter of co-operative
issues between us. So I welcome the fact that
the Premier is focussing on these problems.
J: So a good chance of some money coming that way?
PM: Well, we like to treat all of the States fairly
and equitably and do things which have a theme
to them, which improve the productive focus of
the country and therefore, obviously, some of
these things will fit into that picture.
J: Dr Hewson says a real increase in wages will
cost more jobs.
PM: Well I thought that was a very shabby comment
from Dr Hewson. He has oppossed every wage
increase in the last ten years and when this
Government has got inflation down to our
lowest level in a quarter of a century, and he
is walking around with a consumption tax which
is going to add 15% to prices, you've got to
have a lot of front and a lot of hide to be
talking about inflation when you are walking
around with the inflation detonator in your
hands. A consumption tax, and if Dr Hewson's
consumption tax were to go into place
Australia's inflation would go back to double
digits and we would be back where we started
twenty years ago and not where we are now. Yet
he has got the hide to address the Government
about low inflation and, worse than that, the
hide to say to Australians who actually made
the sacrifice and now, because inflation is
low, have higher real wages, to say that he
should take it off them.
J: He also says that an increase in real wages
means an increase in unemployment and
you're buying votes
PM: Yes, I mean that is the sort of inane comment
he makes that a real wage increase which comes
by way of the fact that the underlying level of
inflation is low, therefore making any nominal
wage increase of more real value, of greater
real value, that that success is described by
him as the Government buying votes or creating
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unemployment when he is walking around with
something which is going to add f ive or six
percentage points to the price system from a
per cent tax on all goods and services. I mean.
it is an amazinag comment from somebody who
must have a hide as thick as an elephant.
J: Isn,' t George Campbell right from the ACTU and
the metal workers saying the jobs are the
priority, you really ought'nt to be offering a
real wage rise in the current circumstances
should you?
PM: You have got to understand some technical
competence in this debate is required, even by
the ABC. We are not offering a real wage rise.
But: if wages come out this year at where
the Government expected earlier inflation to be
but: inflations coming out at obviously
there is a real wage increase in there. So
what do we say to people, well you've made the
sacrifice, we're wearing the recession, we're
wearing unemployment but the good side for you,
the up side, Dr Hewson wants to take it away.
Its like the comment he made about business,
the Premier and I have been keen to meet the
business community to speak to them and to pick
up their views. Not all our views, of course,
are views which we accept or that we can
contemplate, but some are he said we shouldn't
be meeting them. He said that's business
looking for a handout, that I shouldn't be down
here talking to them, that's his view. I mean
its this sort of strident view that the only
thiLng that you do is inflict people with some
pain, stick a new tax on them, don't meet with
them or talk to them, oppose any increase for
workers while at the same time saying that
their bread, their milk, their clothing, their
housing, their dry cleaning, their taxi fares
all carry a 15% tax.
J: Has Bob Hawke told you that he will be leaving
Parliament sooner rather than later, not going
to the end of the term?
PM: No he hasn't but we're not here for
J: Mr Bannon, now you keep this
infrastructure project for almost a year now,
have you finally got through to Mr Keating?
Bannon: I t~ hink that there is a general acceptance that
providing projects deliver long-term value to
our economy, now is a good time to look
seriously at doing them. I guess anyone can
say well perhaps we could have started earlier
or the conditions might have beepi better a
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while back I really don't think that is the
point. The point is that there are projects
which have been identified, they have been
refined, they are ready to go and providing
they can deliver that long-term value, and they
are not just making work, they have got a f air
chance of acceptance I think.
J: Mr Keating, what has happened to make you
change you mind on these infrastructure
projects, they didn't get a very warm reception
when they were officially floated?
PM: In the 1980s we were cutting Government
spending because we had a hugh current account
problem and one of the things which suffered
was public investment, but if private
investment is down in a recession it does
fol~ low that this is the appropriate time to
lif* t public investment somewhat. So, you know,
it's not a matter of any religious conversion
on my part, its simply a matter of being, you
know, wise to the current circumstances but it
is, I repeat, the point is it was true that
when we needed to lift public savings and cut
the size of the public sector a lot of
Government capital work suffered.
J: Mr Bannon have you won any commitments from the
Federal Government today?
BANNON: Wel~ l only in so far as I think we have had a
very good hearing following our submission and
the! bu ' siness people and others who have been
abl~ e to speak to the Prime minister, I think,
have had in turn a very good reception. The
fact that the Prime Minister is personally
inspecting some of the areas where we propose
things to happen is also very positive but I
wouldn't expect him to be announcing here and
now that, yes, he agrees. So obviously he's
got: to then consider it in the national context
and as part of the statement. But this is as
much as I think would be reasonable f or any of
us to ask at this stage of consideration.
J: Mr Bannon you say that South Australia is a
special case, how has the Prime Minister
responded to some of the special considerations
that you have outlined?
BANNON: Wel. l you can ask him. But the f act that we
have been able to put before him, the
su bmissions are there in detail, they obviously
don't get considered in a day. They need to be
tak en back, assessed. He may have further
quiestions or qudries. We'll respond to -those
in the course of the preparation of the
statement.
J: long term commitment from the Federal
Government?
PM: Well it's one of the issues the Premier
addressed us on. I think it has had the
character of a national project to this time
and I think it will keep that character.
Arrangements between us, as the Premier said
eloquently a moment ago, has got to be
considered in the context of the statement in
our financial capacity and across the States.
J: Do you think SA is a special case?
PM: We SA has got some unique difficulties that the
more populist States don't have. I've always
recognised that and as we drove over here we
came past the submarine project which the
Premier pointed out some pertinent features
about. That is here by virtue of the fact that
this Labor Government in Canberra recognises
the fact that SA does have particular
circumstances and difficulties which in part
the submarine project itself, in its time, was
designed to address. Now of course
difficulties remain and that's why we are now
examining other things.
J: What sort of long-term inflation rate is the
Government looking for?
PM: Well we're not here to give you long-term
inflation rates
ends