PRIME MINISTER'S WEEKLY BROADCAST
RELBUDGiET
SUNDAY 31 . AUGUST -1975
I WANT TO DISCUSS WITH YOU SOME ASPECTS OF THE
BUDGET WHICH THE PARLIAMENT HAS BEEN DEBATING DURING
THE PAST WEEK., YOU WILL REMEMBER THAT THE BUDGET MADE A
SWEEPING REFORM OF THE INCOME TAX SYSTEMx IT'S BEEN
PERFECTLY CLEAR FROM THIS WEEK'S DEBATE THAT THE OPPOSITION
HAS NO CREDIBLE ALTERNATIVE TO OUR ECONOMIC STRATEGY AND
CERTAINLY NOTHING TO COMPARE WITH OUR TAX REFORMS
MR FRASER'S PROPOSALS OFFER NOTHING WHATEVER TO THE PEOPLE
MOST IN NEEDx THE GREAT DIFFERENCE BETWEEN US IS THIS:
WE ARE REFORMING THE PERSONAL INCOME TAX SYSTEM TO GIVE
RELIEF TO THE MAJORITY OF TAXPAYERS AND MAKE THE SYSTEM FAIR
TO ALLx THE BEST THAT MR FRASER COULD PROPOSE IS SOME
TINKERING WITH THE EXISTING TAX SCALESx UNDER THE OLD SYSTEM
DEDUCTIONS FOR MEDICAL EXPENSES, EDUCATION, SUPERANNUATION
AND OTHER EXPENSES WERE WORTH MYCH MORE TO THE WEALTHY MAN
THAN TO PEOPLE ON LOWER INCOMESx THE WEALTHY MAN PAID LESS
FOR THE THINGS WE ALL NEEDx UNDER OUR NEW SYSTEM, NOT ONLY
WILL MOST PEOPLE HAVE MORE MONEY TO SPEND AFTER TAX IS
DEDUCTED; BUT EVERYONE'S DEDUCTIONS FOR EXPENSES WILL BE
WORTH EXACTLY THE SAME"
2,
HERE'S A FIGURE TO REMEMBER: OVER THE NEXT
TWO FINANCIAL YEARS THE AMOUNT COLLECTED IN PERSONAL
INCOME TAX WILL BE NEARLY ONE BILLION DOLLARS LESS
THAN IT WOULD HAVE BEEN UNDER THE OLD LIBERAL
SYSTEMX THAT'S A MASSIVE SAVING TO THE TAXPAYERX
AND DON'T FORGET THAT OUR TAX CUTS AREN'T SOME VAGUE
PROMISE: THEY ARE ALREADY IN OPERATIONA BECAUSE
THEY INVOLVE SUCH EXTENSIVE AND COMPLEX CHANGES IT
WON'T BE POSSIBLE TO GET THE EXTRA MONEY INTO YOUR
PAY PACKETS UNTIL THE BEGINNING OF THE NEW YEARX
BUT IN FACT YOUR TAX SAVINGS ACTUALLY STARTED TO
ACCRUE ON THE FIRST OF JULY LASTx ,/ 3
APART FROM ANYTHING ELSE, THE DEBATE THIS
WEEK HAS SHOWN JUST HOW JUDDLED AND EVASIVE ARE THE
OPPOSITION'S ECONOMIC POLICIES, BECAUSE-WE HAD TO
TACKLE INFLATION THERE WERE SOME THINGS IN THE BUDGET
THAT NONE OF US LIKE, WE ANNOUNCED HIGHER CHARGES ON
CIGARETTES, BEER, SPIRITS, PETROL AND RATES FOR POSTAGE
AND TELECOMMUNICATIONS, WE SAW THESE AS AN ESSENTIAL
PART OF OUR PLAN TO RAISE REVENUE AND REDUCE THE
BUDGET DEFICIT. AS SOON AS THESE CHANGES WERE ANNOUNCED
THEY WERE ATTACKED BY THE OPPOSITION. MR FRASER HIMSELF
ATTACKED THEM IN HIS SPEECH ON TUESDAY NIGHT. YET
WITHIN 24 HOURS MR LYNCH, THEIR DEPUTY LEADER, WAS
FORCED TO ADMIT THAT EVERY ONE OF THESE HIGHER CHARGES
WOULD BE SUPPORTED BY THE OPPOSITION, IN OTHER WORDS,
AS SOON AS THE OPPOSITION WERE FORCED TO DO THEIR SUMS,
THE MOMENT THEY HAD TO JUSTIFY AND EXPLAIN THEIR
POLICIES, THEY ADMITTED THAT OUR ECONOMIC MEASURES
WERE . SOUND AND JUSTIFIED. WE HAD THE EXTRAORDINARY
SPECTACLE OF THE OPPOSITION LEADER IN THE SENATE,
SENATOR WITHERS, ATTACKING THE NEW CHARGES AT THE VERY
MOMENT MR LYNCH WAS SUPPORTING THEM.
YOU'LL NOTICE THAT THE OPPOSITION ARE
ALWAYS TALKING ABOUT CUTTING GOVERNMENT TEXPENDITURE.
MR FRASER SAID HE WOULD SAVE $ 1000 MILLION IN EXPENDITURE
CUTS. YET HE AND HIS COLLEAGUES KEEP ON PROPOSING
MEASURES WHICH WOULD PUSH EXPENDITURE FURTHER AHEADMORE
FOR DEFENCE, MORE FOR THE SCHOOL, WITH THE HIGHEST
FEES, MORE FOR CADET CORPS, MORE FOR CERTAIN INDUSTRIES. 1
THEY NEVER SPELL OUT CLEARLY WHERE THEIR CUTS IN EXPENDITURE
WOULD COME FROM. MR FRASER GAVE A LIST OF SO-CALLED
SAVINGS IN HIS SPEECH THIS WEEK, IT SIMPLY DOESN'T
BEAR EXAMINATION. HE TALKED OF SUSPENDING OUR GROWTH
CENTRE PROGRAM, OF CUTTING BACK LOANS FOR NEW HOUSING,
OF SCRAPPING OUR LEGAL AID SERVICE, OF ABANDONING URANIUM
EXPLORATION, OF DISPOSING OF OUR GAS PIPELINES,
* THESE PROPOSALS WOULD BE DISASTROUS ENOUGH IN THEMSELVES,
BUT THEY STILL WOULDN'IT LEAD TO SIGNIFICANT ECONOMIES.
TRY AS HE MIGHT, MR ERASER COULDN'T MAKE HIS SAVINGS ADD
UP TO ANYTHING LIKE $ 1000 MILLION. MR LYNCH HAD TO
EXPLAIN LATER THAT MR FRASER WAS ONLY GIVING EXAMPLES
OF THE CUTS THE OPPOSITION WOULD MAKE. IN OTHER WORDS0,
MR FRASER IS HOLDING OUT ON US. IT DOESN'T TAKE MUCH
IMAGINATION TO SEE WHERE THE REAL CUTS WOULD COME FR . M
IF THE LIBERALS HAD THEIR WAY. THEY WOULD COME FROM
OUR PROGRAMS FOR THE CITIES, FOR REGIONAL DEVELOPMENT*
FOR BETTER PUBLIC TRANSPORT, FOR DECENT SCHOOLS, FOR
BETTER HEALTH SERVICES AND HOSPITALS, FOR ADEQUATE SOCIAL
SECURITY. THE PEOPLE WHO-WJOULD PAY FOR MR FRASER'S
ECONOMIC POLICIES ARE THE POOR, THE NEEDY, THE SICK,
THE CHILDREN, THE AGED, THE PEOPLE WHO LIVER IN NEWER
SUBURBS AND COUNTRY TOWNS.
.1
MR FRASER'S POLICIES WOULD MEAN A SAVAGE ATTACK -ON
THE LIVING STANDARDS OF THE VAST MAJORITY OF
AUSTRALIANS, IT IS EASY TO SEE MR FRASER'S DILEMMA.
WHILE HE APPROVES OF THE SIZE OF OUR DEFICIT AND
HAS SAID AS MUCH HE STILL ADVOCATES FURTHER
CUTS IN TAXES MAINLY TO BENEFIT THE WEALTHY AND
MORE EXPENDITURE ON SUCH THINGS AS THE SUPERPHOSPHATE
BOUNTY MAINLY TO BENEFIT WEALTHY FARMERS LIKE
MR FRASER HIMSELF, WELL, HE CAN'T HAVE IT BOTH
WAYS, THE SYDNEY MORNING HERALD NO FRIEND OF
THE GOVERNMENT SUMMED IT UP THIS WAY:
" IT WOULD SIMPLY NOT BE POSSIBLE TO STEP INTO
-GOVERNMENT AND IMMEDIATELY KNOCK A FURTHER $ 1000
' MILLION OFF GOVERNMENT SPENDING OVERNIGHT,,, UNTIL
THE NECESSARY SPENDING CUTS HAVE BEEN MADE MR FRASER
COULD NOT RESPONSIBLY INTRODUCE HIS TAX CUTS, FOR TO
DO SO WOULD BE TO RUN THE RISK OF EXPANDING THE DEFICIT,
AND MR FRASER RECOGNISES THAT THE DEFICIT MUST, IF
ANYTHING, BE REDUCED,"
64
IN OTHER WORDS, THE OPPOSITION'S REMEDIES
JUST DON'T MAKE SENSEx THEY IGNORE REALITIESx THEY
CONCEAL THEIR TRUE PURPOSESx OUR BUDGET IS THE ONLY
SERIOUS AND PRACTICAL WAY TO TACKLE INFLA'TION, ONLY BY
TACKLING INFLATION CAN WE REDUCE UNEMPLOYMENT. ONLY BY
TACKLING INFLATION CAN WE BOOST BUSINESS CONFIDENCE AND
GET INDUSTRIES TO INVEST IN MORE PLANT AND MORE JOBSA
THE FIGHT AGAINST INFLATION MUST COME FIRST, MR FRASER'S
ANSWER TO INFLATION IS TO PROMISE INDEXATION OF TAXESX
THAT IS, HE WANTS TO GEAR TAXES TO INFLATION,, THAT'S
NOT A REMEDY FOR INFLATION; IT'S A WAY OF SAYING THAT
INFLATION IS INEVITABLE, THAT WE SHOULD BUILD IT INTO THE
SYSTEM) THAT WON'T GIVE MUCH CONFIDENCE TO THE BUSINESS
COMMUNITYX IF I WERE A BUSINESSMAN I'D RATHER HAVE A
GOVERNMENT PREPARED TO TACKLE INFLATION THAN A GOVERNMENT
THAT SIMPLY ACCEPTS IT AND TRIES TO CONCEAL ITS EFFECTSA
IN THE LONG TERM THERE IS A CASE FOR TAX INDEXATION AND WE
CERTAINLY HAVEN T RULED IT OUT, BUT IT S A VERY POOR
SUBSTITUTE FOR GENUINE TAX REFORM, IT DOESN'T CHANGE
THE EXISTING TAX SCALES, IT DOESN'T GIVE TAX RELIEF TO
THOSE WHO NEED ITx
IT'S AN INTERESTING COINCIDENCE THAT OUR
TAX REFORMS THE GREAT AND ENDURING THEME OF OUR BUDGET*-
HAVE COME AT A TIME WHEN THE GOVERNMENT IS COMPLETIN G ITS
FIRST 1000 DAYS IN OFFICE,, THOS. E 1000 DAYS CERTAINLY
HAVEN'IT BEEN EASY, WE'VE HAD TO CONTEND ' WITH A WORLDWIDE
ECONOMIC RECESSION, WHEN UNEMPLOYMENT IN EVERY COMPARABLE
COUNTRY HAS REACHED ITS HIGHEST LEVEL SINCE THE DEPRESSIONX
WE'VE HAD TO CONTEND WITH A WORLDWIDE UPSUR GE OF INFLATIONx
WE'VE HAD TO CONTEND WITH WILFUL OBSTRUCTION OF OUR POLICIES
IN THE SENATE AND BY THE STATES. YET DESPITE ALL THIS WE
HAVE MANAGED TO HOLD OUR OWN,. THE RECESSION. IN AUSTRALIA
HAS BEEN MUCH LESS SEVERE THAN IT HAS BEEN IN OTHER
COUNTRIESx AND THROUGH ALL THIS WE HAVE BROUGHT INREFORMS
AND ACHIEVEMENTS OF LASTING BENEFIT TO ALL
AUSTRALIANS., WE HAVE WIDENED THE EDUCATIONAL HORIZONS OF
EM ERY AUSTRALIAN CHILD, WE HAVE FREE UNIVERSITIES, WE HAVE
INTRODUCED MEDIBANK AND THE LEGAL AID SERVICE, WE HAVE LAID
THE FOUNDATIONS FOR BETTER TRANSPORT AND HOUSING AND DECENT
CITIES, WE HAVE GIVEN A NEW DEAL TO LOCAL GOVERNMENT AND
BROUGHT NEW AND PERMANENT STANDARDS OF SOCIAL WELFARE AND
SECURITY. WE HAVE ABOLISHED CONSCRIPTION AND ENDED OUR
TRAGIC INVOLVEMENT IN VIETNAM,, WE HAVE REVITALIZED THE ARTSx
WE HAVE BROUGHT NEW HOPE TO THE ABORIGINES, THE MIGRANI'S
THE UNDERPRIVILEGED IN THE COMMUNITY>, AND NOW, WITH OUR
LATEST BUDGET, WE HAVE BROU GHT RADICAL REFORM TO THE
TAXATION SYSTEM x THOSE 1000 DAYS HAVE BEEN STRENUOUS AND
DIFFICULT AND SOMETIMES PAINFUL BUT LOOKING BACK, THEY'IVE
BEEN WELL WORTH ITA