F76/ 16
EMBARGOED AGAINST DELIVERY
EXPECTED AROUND 7 p. m.
PRIME MINISTER
FOR PRESS FEBRUARY 2, 1976
TEXT OF SPEECH GIVEN BY THE PRIME MINISTER AT A CIVIC RECEPTION IN SYDNEY
it is appropriate, in this group of people concerned with politics and
administration at the state and local level, to discuss what tie Federal
Government has been doing since the election.
Our broad goals have already been stated. They are to get Australia moving
towards prosperity again to control inflation and reduce unemployment.
We are aiming at an Australia where people have the maximum opportunity to
choose, work for, and achieve the life they want for themselves and not
the sort of life that politicians and officials want for themr; where there
is the broadest possible distribution of power and people are able to influence
the decisions which affect their lives, where as few people as possible are
in real need or are disadvantaged, and where those in need are provided with
effective and personal assistance. These are the goals of the Liberal and
National Country Parties.
In Opposition, we developed a wide range of policies designed to give effect
to these goals. The Australian people showed by their vote at the election
that they preferred a Government committed to these goals and policies.
But goals must be achieved and policies must be implemented this is where
Government differs from Opposition. It has a new and important dimension.
The ideals which attract support and which motivate political parties must
be translated into reality.
The first essential step in ensuring that policies become reality is to
establish sound administrative practices. At this point policies and
administration become inseparable. The best policies in the world can
fail or produce consequences directly opposite to those intended
if the administrative means of achieving them are not properly researched,
or if there are no effective means of coordinating policy objectives.
The administration, the decision making machinery must be capable or
achieving the objects that are intended-On the other hand, th1e best
administration cannot properly supply the policies to be implemented.
A Government will be ineffective if it neglects either political goals
or administrative means.
To neglect administration, to ignore the way that things are done or the
dif ficulties involved in partic ular ways * of doing things is ' to be an
inadequate Government. It means falling into a process of instant decisionmaking
which is unmindful of the consequences of decisions where off the
cuff decisions are taken and not related to one another, or to the fact
that administrative choices often prejudice achievement of policies. / 2
-2-
Much of the work of the first few weeks of Government has been establishing
the administrative structures and procedures on which the success or
failure of the. Government will depend. Since the Liberal National Country
Party Government was elected, we have concentrated on the major task of
devising effective forms of decision-making, improving the administrative
structures with which to implement policies and ensur that the policies
we have initiated are properly implemented.
Cabinet Government has been re-established, and improved by the institution of
a system of Cabinet Committees which will be able to examine policies and
actions thoroughly and expeditiously.
The Administrative Review Committee has been established tinder Sir Henry Bland's
Chairmanship to review Government expenditure and advise how waste and
duplication within and between Government Departments and between Commonwealth
and State Governments can be eliminated.
The Economic Committee of Cabinet has been reviewing the activities of
Departments. Extensive discussions have taken place with unions, business and community
groups.
We are moving very shortly to discuss with Premiers the introduction of major
reforms in Federal-Stateñ relations. Australia cannot be administered well
governed well-if all power is centralised in Canberra. This is the trend
we have been heading in. The vital information necessary for efficient
decisions is often most available at local or state levels. We believe that
in longer term the effective and efficient Government of Australia depends
on an appropriate decentralisation of power to state and local governent.
Excessive centralisation betrays an attitude of mind that all wisdom resides
in a few. This is not only insulting. It is also untrue. We have seen
the consequences of excessive centralisation the unleashing of inflation
and unemployment as the Federal Goviernment has taken more and more resources
to itself.
Effective decisions can only be taken if there is a willingness to consult
with all sections of the community. This is why we very early had discussions
with the trade unions. This is why, in the light of those discussions, we
agreed to consider modifying our earlier stand on the Prices Justification
Tribunal. Dogmatism must inevitably lead to bad Government. Measures
which seem appropriate at one stage can indeed sometimes must be
superseded by new knowledge, new events. The crucial thing is not to lose
sight of the fundamental objectives. Flexibility in pursuit of the nations
interests must never be allowed to degenerate into expediency.
, A Government must be able to take hard decisions in a: ion' s i4nterests
even if m~ sreans u'ouart. Tnhz fact is that Ln che economi area
Australia has run out of soft options. Either we are serious as a people
in wanting-to control rising prices and reduce unemployment or we are not.
If we are serious we cannot keep deferring tough decisions andhoping the
problem will go away. It will not go away. We have obligations to-all those
people being harmed, and to all those people whose jobs would be imperilled.
We will fail in our responsibilities if we are not prepared to show restraint as
a community now. / 3
-3-
A 6.4% increase in wages and salaries would increase unemployment and inflation,
and undermine the confidence necessary for economic recovery. This large
increase would quickly lead to price rises. These in turn would lead to
further wage claims. The vicious cycle has to be broken. The Argument
that economic recovery must be led by consumer spending and that this spending
will take place only after an increase in wages and salaries is mistaken.
Consumer spending is important to economic recovery but consumers will only
spend if they have confidence in the economy. The former Government tried to
stimulate consumer spending.. In conditions of low confidence, it only resulted
in increased saving people now save 17% of their earnings compared with the
long term average of 10%. Confidence will be undermined by the consequences
of large wage increases. The key to economic recovery is reducing inflation.
Only in. this way will consumers spend more and business invest more. only in
this way will we have jobs for all who want to work.
For too long politicians, at all levels, have taken the easy way out. There
are no easy options left.
Those who suggest that the Australian people will not be prepared-to accept
these hard but necessary decisions do Australians a grave disservice.
When people are convinced that their over-riding common interest requires a
tough course, I know they will support it.
R( ALU IS(
PRIME MINISTER
CORRECTIONS HAVE BEEN MADE TO THE PRIME MINISTER'S SYDNEY
TOWN HALL SPEECH AS FOLLOWS:
Page 3
A 6.4 percent increase in wages and salaries would increase
unemployment and inflation, and undermine the confidence necessary
for economic recovery. This large increase would quickly lead
to price rises. These in turn would lead to further wage claims.
The vicious cycle has to be broken. The argument that
economic recovery must be led by consumer spending has some
validity. What we do question is the naive view that a money
increase in wages will result in increased consumer pending
at this time. Consumer spending is important to economic
recovery but consumers will only spend if they have confidence in
the economy. The former Government tried to stimulate consumer
spending. In conditions of low confidence, it only resulted
in increased saving people now save 17 percent of their earnings
compared with the long term average of 10 percent. Confidence
will be undermined by the consequences of large wage increases.
The key to economic recovery is reducing inflation. Only in
this way will we have jobs for all who want to work.
For too long politicians, at all levels, have taken the easy
way out. There are no easy options left.
Those who suggest that the Australian people will not be prepared
to accept these hard but necessary decisions do Australians
a grave disservice. When people are convinced that their
over-riding comrmon : interest requires a tough course, I know they
will support it.