EMBARGO: 9.30 P. m. E. S. T.
lj) AUSI* Rt ALIA~ g
FOR PRESS 9 JULY 1977
ADDRESS TO W. A. LIBERAL COUNCIL PERTH
It is very good to be in Perth again and a great pleasure to
address this Council.
You have all undoubtedly had a very interesting week watching the
A. L. P. Conference go through its routines. Bob Hawke, having
been unable to get a safe Labor seat, announced that if he
was not given leadership of the Labor Parliamentary Party, he
would not go into Parliament. It seems that even two hats
are not big enough for him. But he had to admit he had not been
inundated with offers of support from Labor Parliamentarians.
It has become obvious that Mr Hawke and Mr Whitlam. hold one
another in the highest regard. Having led the A. L. P. to its
greatest defeat in Australia's history in 1975, Mr Hawke and
Mr Whitlam conceded that they were still the two best campaigners
the could produce. Mr Hawke's obviously aiming to prove
his loyalty to the present Leader of the Opposition
Yesterday he said that Mr Whitlam was " a greater man than he was".
But he could not stop himself from adding " for the time being".
There is no doubt about it the A. L. P. is as strongly behind
its leader as it ever had been.
There were some remarkable changes at the Conference.
Five weeks ago, following his resounding two vote confirmation
as Labor leader, Mr Whitlam had said that there was nothing
wrong with the policies Labor had pursued in Government;
it was obvious to use one of his own phrases that he would do
it all again.
In Perth, however, Mr Whitlam made an astonishing change. He
said that Labor would have to behave in an economically responsible
fashion. Mr Hayd~ n said that Mr Whitlam's speech was drafted
on the road to Damascus. It is more likely that it was written
on the road away from breakfast with two Iraki gentlemen.
It is unfortunate the changes Mr Whitlam had undergone thus
far have been short lived, and they have left Australia
short changed. The Labor Shadow Treasurer, Mr Hurford,, said
Labor had to face econiomic reality. Labor could no longer
afford to finance its social programme through inflation and
Labor accepted tax indexation. People sat with baited
breath and wondered whether a new, economically responsible
Labor Party was about to be unveiled. The new image was
shattered, however, once Mr Hurford said that the A. L. P. vuould
raise indirect taxes substantially and spend an extra
$ 800 million on social programmes if they were in power.
But that was not surprising. We have heard Labor commitments
to restraint before. The A. L. P. is replaying the promises of
the past. Before 1972 they briefly assumed the cloak of
responsibility they would not spend too much money, they
would eliminate unemployment, they would be stable and sensible.
That was Mr Whitlam's promise. What he delivered was the
most irresponsible and outrageous government Australia
has ever seen. In the Labor Budget of 1975 the so-called
responsible budget Mr Hayden said: " We have exercised the utmet
restraint in government spending". In that year spending
increased by 23% so much for restraint. Once the charades
were over, it was clear that the A. L. P. had not changed.
They are still the party of economic irresponsibility and
inflation, the party of massive government. The party that graver
damaged business, whose inflation harmed the poor most of all.
The Australian people know this -they have seen Labor in action
between 1972-1975. They won't be deceived again.
We have spent the last 18 months working to overcome the damage
the Labor Party did to Australia. We stopped the rapid
expansion of Government spending; we have controlled the money
supply; and we have pressed for wage and salary restraint.
To encourage initiative, reward enterprise, reduce the pressure
for higher money earnings, we have cut taxes substantially.
The tax cuts amount to around $ 1,000 million in revenue
foregone. This year, the total will be around $ 800 million.
We also took specific action to promote business investment.
The results have been encouraging. Inflation came down
substantially in 1976, and has come down further this year,
despite those gloomy forecasts-following devaluation.
Growth has been resumed, after no progress in 1974 and 1975.
And practically all this growth was accounted for by the recovery
of the private sector. Company profits are well up about
for 1976. Business confidence has improved, and company
investment is up. This will improve further as the benefits
of devaluation flow through.
wihshould assist a wider range of companies to raise
overseas capital.,.. But the battle against inflation is not over,
andweare using all the arms of government policy to continue
progress. Unemployment is still a major problem and we have adopted a
number of innovation schemes which have had a considerable
degree of success. These schemes include: the Community Youth
Support Scheme which has helped 15,000 young people to acquire
basic new skills; an expanded " NEAT" scheme which has trained
18,000 people, three quarters of whom have found employment at
the end of their service under the scheme; the most successful
special youth employment training programme, which aids
adolescents who have been unemployed for a lengthy period of
time 70% of whom are getting jobs as a result of training
they receive under the programme.
Assistance is also given for apprentice training, and for those
forced to relocate themselves and their families to gain
employment. But as the unemployment figures show, these
schemes cannot by themselves resolve the unemployment problems
we inherited from Labor. One fact must be faced up to
that because of the wages explosion which Labor fostered in two
years there was a 53% increase in wages in manufacturing industry,
unskilled and semi-skilled workers are relatively more highly
paid than at any other time in Australia's history. This has
meant that even though company profits are increasing, employers
still tend to be reluctant to take on unskilled workers and are
buying labor-saving machines. This is a factor that has
not been adequately realised in Australia. But it does make
it difficult to reduce unemployment as quickly as we all would
wish. Unless union leaders take a responsible attitude towards wage
increases, workers will find themselves priced out of employment,
and the success we have had in reducing inflation and promoting
economic recovery will not be translated as quickly as we would
hope into reduced unemployment.
Your own state has taken the lead in economic recovery. The
reasons for this are not hard to find: the sharp rise in development
of export-based industries which has begun, and which is likely
to increase in the near future; and the very able leadership
of the Western Australian Government under Sir Charles Court,
which has consistently and successfully promoted Western
Australia's interests. As Sir Charles recently pointed out
Western Australia is in the happy position of looking forward
to the prospects of major new developments over the next 7 years,
as large in real terms as those that occurred over the last 17 years.
The largest and most ambitious project is the development of the
North West Shelf gas deposits. This $ 2-3 billion project will
greatly supplement our energy supplies, and significantly
boost our export earnings. Moreover, the establishment of a
project of this magnitude in the Dampier area will act as a
catalyst for other development. The substantial supply of
natural gas should enable establishment of gas-consuIming industries
along the length of the pipeline to Perth. It will assist
development in thq.-Pilbara, and it will fulfil an important
energy need in Perth as supplies from the the Perth Basin
are reduced.
The Commonwealth wants this, and other large scale projects
to proceed as quickly as possible. And we have been doing all
that we can to promote the North West Shelf development.
We have assisted the partners in the project by providing
rulings and clarification on the application of tax laws,
foreign investment rules, and a number of other matters.
Sir Charles and I are in close and continuous contact on this
issue to ensure that there is no undue delay.
But for Australia to realise the benefits of such projects
unwarranted industrial disputes must be avoided. So far this
year, there has been a marked improvement overall in industrial
relations the one glaring exception is our major export-based
mineral projects. The current Mt Newman dispute and other
stoppages and bans in the Pilbara have been most disruptive.
Over 50,000 man days and $ 2.2 million in wages have been lost
already in the Mt. Newman dispute. There is an average of more
than one strike a week in the Pilbara. 20 ships are tied up at
this moment at Port Hedland and more are expected each day.
As a result of disputes such as these, major iron ore contracts
have been entered withBrazilY which might have come to Australia.
As Mr Hawke found out when he went to Japan, strikes and bans
in the Pilbara have severely threatened the prospect of further
investment and of further jobs. Mr Hawke went to the Pilbara
presumably to stop the strikes continuing. And what happened?
The position deteriorated further. The dispute between the
Seamans Union and the Utah company in Queensland is also
a most serious matter, and could have grave repercussions for
the new ore industry in this state, and for the coal industry of
New South Wales. The Utah dispute has led to the suspension of
the 250 million dollar development at Norwich Park.. The
same could happen to other major export-based developments.
The Whitlam Government brought investment in this country to a
halt. We acted to revitalise investment plans and to get a
large -number-of major projects on the move. And we were
successful. Three billion dollars worth of major new projects
should get underway this year. And what does Labor do? What
do the trade unions do? The very projects which promise to give*
great impetus to our economic recovery, and provide jobs for
thousands of workers are jeopardised by the very unions who
are supposed to represent the best interests of those workers.
These disputes have gone on so long, with so little sign of reason
or commonsense being displayed, that we are entitled to ask
whether the union leaders involved are trying to sabotage the
prosperity of this country. I have called for a report from
Mr Street and Mr Nixon on these disputes, and I may have to
consider calling together-the Premiers of New South Wales, Queensland
and Western Australia to discuss this whole question. It is
essential that reason and commonsense prevail, and that
these stoppages be brought quickly to an end so that these vital
projects can proceed.
When I was in Europe, the subject they always raised first in their
discussions with me was uranium. This was understandable given
Europe's need for energy. This need is one of the matters that
we are going to have to consider very carefully in deciding the
issue of uranium mining and export. Another factor will be the
importance of delaying the turn to the fast breeder reactor and
the plutonium economy in which large quantities of plutonium
would be produced and recycled. If sources of uranium are restricted
the production of nuclear power for peaceful purposes will come
much closer to the edge of military technology.
The Labor Party's new policy on uranium would if implemented
not only deny essential power to the homes and factories of
Europe and Japan, it would hasten the move to the
plutonium economy, and have the incidental effect of increasing
the capacity of some countries to produce nuclear weapons.
The Government is yet to make its own decision in the light of the
two Fox Enquiry Reports. But it must be faced that a decision
to ban outright uranium production in this country would not
advance the well-being of mankind.
In my discussions in Europe, I pointed out that the European
Community wanted a secure access to uranium. And that reliability*
of trade was a two-way business. I believe that they are coming
to accept this. For a number of years now, Europe has been
excluding Australian agricultural products from her markets,
and disrupting our traditional markets in third countries by
subsidising exports of her food surpluses. For many years,
the European Economic Community tried to make these policies
respectable by saying that such policies applied to agriculture
alone. Now, these policies have been applied to Japanese
manufactured goods and steel from Japan, South Africa.
They tried to apply them to Australian steel. The Chairman of
the Commission told me that Australia was an unfair trader
in steel and demanded arbitrary cuts in our exports of
There was no way I would voluntarily agree to such cuts.
This morning there were news reports from Brussels that the
request had been withdrawn. And these reports are confirmed
by the cables I have received over the last few days. The
E. E. C. is only in favour of free trade and general lowering of
tariffs in things she produces better than other people.
For those items which Europe produces less well, she plainly
stands prepared to erect absolute and impenetrable trade
barriers. When Australian industries have been in difficulty, we have still
allowed access to our markets. In recent years tariffs have
gone down about 30%, market penetration of imports
has increased. Contrast that with the European approach,
the Europeans are in fact great protectionists.
After much discussion with the E. E. C. we agreed that there will
be major bilateral discussions between the Community and
Australia. I hope that these discussions will point the way to
solutions to some of the trade problems that have created
difficulties for some Australian industries. These are possibly
the most critical international trade discussions in Australia's
history, and the Government will be appointing a special trade
negotiator to conduct them.
While we are discussing the international trade, I should make
some reference to our trade policies with respect to ASEAN.
There has been some criticism of our policies. To put it
mildly, these are not well based on the facts. The facts are:
Between 1970/ 71 and 197S/ 76, ASEAN's exports to Australia increased
from $ 87 million to $ 317 million, a growth rate twice as
fast as that of total Australian imports; these imports
continued to grow by over $ 120 million through the last two
years of difficult domestic economic conditions; since
1971/ 72, our imports of textiles, clothing and footwear
from ASEAN countries have increased four and a half times;
and the rapid expansion of imports of ASEAN textiles and clothing
has continued, even though some general import restraints
were introduced on these items in 1974/ 75.
Our own textile, clothing and footwear industries have been long
established in Australia and they are substantial employers,
particularly in some relatively small towns in country areas.
These have been subjected to a very rapid change. It is not
reasonable given the degree of unemployment in Australian industry
to subject them to a greater rate of change. We can properly claJ
that given our size, Australia has dealt more fairly in allowing 16
ASEAN access to our markets than have the United States, Japan,
Canada or Europe. In 1975 our imports, per head, of textile
apparel, and footwear were $ 2.18 compared with the United
States, $ 0.63; Japan, $ 0.25; E. E. C. $ 0.37; and Canada, $ 0.41.
A similar situation applies to imports of manufactured goods from
ASEAN. I believe that the ASEAN countries understand the
position and I am looking forward to discussions with them so
that we can go through the situation in detail.
Mr Chairman, thank you for your invitation to address this meeti*
Your state is making great progress under Sir Charles Court's
leadership. And the very able team of Western Australian
Senators and M. P.' s are making a major contribution to the
Commonwe'alth's efforts. Reg Withers is an invaluable member
of Cabinetzand Senate leader; and Senator Fred Chaney has made
an outstanding contribution both as Senate Whip, Chairman
of Backbenchers Committees, and as one of the leading members
of various Federal Party Committees.
The .3vernment is making solid progress but it will take time
and your wholehearted support for us to achieve our goal
of full economic recovery. 0000o0000