JAUTRAIA~ EMBARGO: 5: 00 PM
PRIME MINISTER A~. r
FOR MEDIA SU11DAY, 20 JULY ' 1; 9W0
ELECTORATE TALK
Federal Cabinet has been meeting in Canberra over the past
week making decisions that will lead to the framing of this
year's Budget.
There is still much to be done, but-the Budget that the
Treasurer will deliver in four weeks' time will consolidate
and strengthen the progress that we have made over the
past five years.
That progress has resulted from consistent policies that
have cast aside soft options and the so-called " easy solutions"
Our policies have consistently maintained downward pressure
on inflation, and have helped restore the profitability, the
competitiveness and vitality of Australian industries.
The Organisation for Economic Co-Operation and Development
has recently drawn attention to the fact that Australia's
growth prospects are twice as strong in 1980 as those for
the O. E. C. D. area as a whole.
What is particularly pleasing to the Government is that:
Australia has been able to maintain and improve its level of
economic activity at a time when there is a significant: downturn
in a number of major overseas economies.
This better growth rate reflects Australia' s sound economic
management, improved competitiveness and abundant resources,
including energy.
This potential would not, of course, be realised were i~ t not
for our tighter control over inflation.
Australia' s inflation rate this year is forecast by the 0. E. C. D.
to remain significantly below the average of the O. E. C. D. area.
Current developments in the Australian economy support our
faith in Australia's prospects.
The basis for this encouraging outlook can be seen in a revitalised
Australian capital market; in the high level of private capital
inflow; in the progress of our industries such as the great
rural industries which had earlier encountered severe setbacks.
For the first half of the past financial year the main source
of improving activity was exports. / 2
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It is most pleasing that recent figures show that the sources
of economic growth broadened in the second half of the
financial year.
Private consumption and private investment are showing
indications of solid growth.
The rise in investment, based on confidence in the future,
is expanding Australia's capacity to generate prosperity and
jobs in the years ahead.
A number of important domestic surveys confirm the strength
of Australia's prospects as forecast by the 0. E. C. D.
The survey in May of investment prospects by the Department
of Industry and Commerce shows that there is $ 29 billion of
investment projects committed or in a final feasibility stage.
This investment is beginning to be put in place.
A survey taken during April and May by the Bureau of Statistics
shows that expected investment expenditures for the current
financial year are about 40% higher than the expectations at
this time last year.
Even allowing for inflation, this rise is dynamic.
The Statistician's survey reflects the very large anticipated
investment in resource-based projects but also shows the
improvement taking place in a wide range of Australian industries.
This investment demonstrates a confidence that Australian
goods can be competitive both at home and abroad.
In the competitive trading world in which we live the present
encouraging outlook is due largely to the Government's
economic policies.
Sensible and firm economic management is a continuing requirement
if we are to keep this momentum going.
We have particular advantages in resources, in energy, and in
our geographic position in the fast-growing Asia-Pacific region
which gives us the potential to partially ride out the bleaker
conditions in the world economy.
More than 45% of our exports now go to Asian and Middle East
countries which in general are likely to do relatively well
in sustaining their growth rates in the years ahead.
The world is becoming increasingly dependent on reliable
energy supplies and in that we are better placed than most.
I must emphasise, however, that these forecasts depend very
much on the continuing success of our anti-inflationary strategy.
Warning signs are already here.
The rate of increase of wages has been accelerating in recent
months placing upward pressure on the Australian inflation rate.
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Claims for increased benefits such as a 35-hour week are
totally self-centred and irresponsible when the welfare of
the whole Australian community depends on retaining our
favourable position in the world; on keeping our recovery
on the move.
It is fair enough to ask what all this activity and development
means to the average Australian; what all this developiment
means to an Australian family wanting a decent education for
its children and a-secure-future for them.
The answer is straight-forward. A nation can* only consume
what it produces. A nation cannot consume what it does
not work for.
If we want improved standards of living, if we want improved
education, health and welfare programmes; all of these can only
be provided from the wealth earned by the people of our nation.
There is no particular value in development for its own sake.
Its merit lies in the jobs that it provides for Australians;
and in the opportunities that it makes available to
individuals and to our community to share in a high standard
of living as a result of sustained economic growth.
To this end, the Government is committed to responsiblE!,
disciplined economic management.
Our track record matches that commitment.
The Budget to be brought down next month will show all
Australians and those looking to Australia of our resolve
to build on the strong foundations established over the
last five years. 000---