PRESS CONFEMM~ E 25 OCTO! 3MP 1984 G. LMDS2ONE
PM1: Ladies axnd Gentlemen,-the ctatistics that have come out
today are absolute proof positive of the success of my
Government's policy7 in fighting infl~ ation and unemrployment
first. in combination, I think they are the best the country's
had for a decade. lIn regard to inflation, the' annual. rate nlow
of 6.1f on the basia of the 1.30, for the September quarter is
the lowest inflation rate for more than a decade. At the same
as tie have got the lowest inflation rate for more than decade
we have the employment vaca~ ncy statistics from the Commxonwcal-th
Employmenit Service which shows 2.1t more vacancies this Septeraber
than in the previoua September, that if; now five quarters
a row with substantial increasea in vacancies. So outstanding
succeso 6n the inflation front and on the employment front. Now
the people of Australia know the 7 gruell~ ing years through which
~ they went on the basis of the Opposition's fight inflation first-
' they did not fight inflation, wie had record inflation and we had
record unemployment. Now the Opposition ise seeking to go to
the people again now with a return of a. policy which must
restore unemployment and certainly send. inflation through
the roof. N~ ow the people have a clear choice. The statistical
evidence is there, we are winning the fight against inflation.,
we are winning the fight against unemployment.
JOURNALIST: Prime. M~ ini ster, do yuepcthtrntoonltinue
through to ne:,. t year? yuepc h rn oc
PM: Yes I do. ' And that is bacaiise the statistics that have
emerged reflect the applicatb-n of fundamental economic policies
calculated to produce these resulits. They are based on an
Accord between Government and the trade union movement. It is
* quite clear now that if you look at the underlying inflation
rate thure has been a fundamental change achieved. We are now
down to the level of the average of the OECD countries. The last
6 months we are now below the United States and the United 1 ingdom
which is very significant in competitive terms and this will. mean
that the budget. forecast which wais for an inflation rate of 5.25t
year on year 46 will core in below that and the award.
wages assumption of about 3t through the year will be easily
matched I believe. go w-hen yvu nave got those underlying
factore operating, yaa wie can e~ zuect a continuing successful
assault oni inflation. We are dounm with the rest of tho world
and below significvn t pt of it. We are performing better 7-,
2.
in employmant creation because of there fundamental factors
operating, the Accord betwoen Government and unions, good0
co-op. arative relationz with the busi~ ness community. Yes,
th's sucressf-u1 economic picture will further develop through
NOS.
JOURNALIST: * Prime Minister, could I ask you abo'. it an aspect of
the Accord. The-wage guidelines, I think, are to be reviewed next
year. Do you see any need for a change in those guidelines. In
particular, do you see any case for a more flexibld syste m whiLch
would allow wcges, wage rises to be different between different
industries in special circurtitancea?
PM: I think basically the guidelines have worked well and
certainly that is the position that is agreed between the trade
unions and ourselves and I think to a very large extent the
business community welcomes the substantial wage stability*
and price reductiont-Anflation reduction, which is associated,
has been associated with the application of the guidelines.
Now always any system should be periodically looked at, and it
may be that as there is a gradual rcstructuring of industry
through time~, on the basis of our consultall. ion with the trade
unions and with indusntry itself, that the: -e may be some need to
perhaps adapt marginally the guidelines so that you avoid
unnecessary rigidities which would prevent sensible restructuzing.
But that could be on the agenda of discuss; ions in the EPAq and
the Manufacturing Advisory Council over the longer term. So in
the day to aay operation of basic economic: policy I think the
guidelines are working well. I mean the evidence iB there that
they are.
JOURNALIST: Prime M4inister, based on today's figures*, does3 that
affect the. immediacy of your plans for tax. reform.
PM: That ha~ s got nothing to do with tax reform.
JOURNALIST:. Prime Minister, the secondary boycot. decision
in the Se-neate last. Democrat Senator Jack Evans said the
Government was secretly pleased about this. Is that right
and are you going-to strengthen the..
in the way the Democrats want.
PM: I don't know about Senator Evans capacity to know the
public or the private happiness or unhappiness of the Government.
I would think that Senator Evans ha23 got enough to concentrate
on with the problems ift his own party. But just let me
say this that tie put legislation up in good faith. We have
always said, and we put it to the people before the last electl _ on,
it was more appropriate to have pro~ vision of that sort in the
conciliation and arbitration act and so we had a dual package
taking 45D and E out of the Trade Pr7actices Act and having
legislation, amending legislation, in the 47 and A Act. NOW'
we will just have to consider that position next year when we
come back and we will have further discussions with everyone
concerned. JOURNAL IST: Back on the wage indexation gui. delines, Prime M4inister,
you mention the possibility of the prospect of removing unnecessary
rigidities..
3.
PM: No, no, I, not of removing unnecessary rigidities, I said
that as we moved down the path of gradual restructuring of
Australian industry you could get a situation emerging, Paul,
of some rigidities, which
JOURNALIST' I was wondering what sort of
PM: Well I think it is. too early to say but if you could see
that you were wanting to build up certain aspects of industry
and it was appropriate in terms of getting a mobility of labour
into that new industry, I am simply speaking hypothetically now,
ir that situation there may be some need for some slight modification
of the guidelines to meet that sort of situation.
JOURNALIST: ( inaudible, relates to previous question)
PM: Yes, I do.
JOURNALIST: Would you expect this matter to be looked at
in the next few months?
PM: Oh I think it is the sort of thing, Michelle which just
emerges naturally in the processes of discussions with EPAC and
other ' relevant bodies where, this Government as it. is, is looking
to the future. We have from day one if office, we haven't just
haven't been trying to turn the immediate economic situation
around, we have been addressing our minds to what has to happen
to Australian industry in the future to maximise the use of our
resources. So these sorts of discussions are going on all the
time and it is not a question of saying well we need to look at
it-next year, discussions relevant to this have been already
going on and I would expect no problems from either employers,
trade unions or any governments if w'e saw that to optimise
economic development in a particular direction, you needed
perhaps some modification of the guidelines, I think everyone
would say that makes sense.
JOURNALIST: Prime Minister, based on-those figures can you
see, in the short or
PM: Well, let me say this, you would understand that in
Seconomic theory and practice on of the important factors in
determining the movements in interests is not just the level
of inflation but inflationary expectations. Then in other
words, if business and government had the view that inflation
is going to be increasing then naturally the price of money
is affec'ted accordingly,.. and interest rates tend to go up
to cover that expectation. Now with the clear evidence now
the fall in inflationary rate has happened and that the
expectation should be further movements in that direction.
I would expect this to be a downward factor on interest rates.
JOURNALIST: Prime Minister could I ask you a couple of questions
about the situation in the Philippines. / 4
PM: Well sure you can in a moment. I jus. wonder are there
any others in the
JOUR'ALIST: Prime Minister I just i. ianted ask you
our more favourable inZlationary ponition compared to the
United States and the UK now, how would you expect that to
he reflected in the balance of payments statistics which are
due out later?
PM: Generally speaking what one expects when you have a more
competitive position reflected in your relative inflation rate,
It has this beneficial effect on balance of paymLents. One,
it makes your local product, manufactured in Australia, more
competitive against the imported product. So it has that
beneficial effect on lowering the level'of imports, it tends
to work that way. And makes your enports more competitive
so that you will be able to be in a better export position.
So both on the impoi= tand export side of your balance of trade
and the balance of trade component of your balance of payments,
it is a plus.
JOURNAXLIST: Prine Minister in your speech in Bunbury this morving
you talked about rest2ructilrin g induoitzy -the need Eft and
9 0 ndd to-consider the development of new producta. What new
products do you have in y~ ur mi~ nd.
Well just let mne take Cho oxiample of Bundaberg. I weo
talking to Brian Courtice there and his family bas had almost it
canutry of experience in the sugar:: Indusitry. He wan pointing out
to me the exceptional fertility of the aoil In the area anCA given
the change in the total market structure for sugar where 60% 81 our
product now hao':, got to be expor'ted lie is saying that it uould maka
a lot of sense for you to be lookinq in that area to increase
horticultural production and further divernification in the
vegetable area. Novi" Iese are not new products. These are new
production patterns and that seemed to-me-to make a lot of mense
as far as Bundaberg is concerned. and it fits in with the sort; of
planning that my Government has been doing for the future in our*
relations with tho Asian region. We recognise that that is the.
most dynamic region of the world. The standards of living are
rising rapidly in the western Pacific countries and in China.
And so they will have t'he capacity to expand their range of
consumption, their pattern of consumption, and it just seems to me
that Brian very sensibly pointing out to bow thor'e may need to
be somo restructuring and redirection of industry in his area.
N~ ow thatfs one aspect of it. Blut when you talk about newy pr'oductu
I believe that with the impetus Vie're trying to give in managerment
investment companies in the venture capital area that Australa
should show a capacity in new areas of teclinology to adapt its
productive processes and enterprisev to-new products in that sort
of area. I mean one of the example. I suggest is the developnent
which came out of CSIRO and which is now going to be set up in
Adelaide deVeloping these larger chipa which seems to me from the
evidence made available to me to. ofter opportunities of developing
an industry in that area. Now I don'twant* to exaggerate 11ow
gig that would be. But I just give that at; an example. We have
shown as Australlans a great deal of inventiveness over time. The
problem has been not so muchl a lack of inven~ tiveness but translating
that inventiveness in an applied way to get the benefit of the
actual manufacturing, here in Australia. Now I think we can do theac
things. JOURNALIST: Mr Hawke, ( manufacturing and metal trades)
Well the heavy engineering industry has been before us and
we have referred the heavy engineering indmstry to the IAC, in two
sections for an immediate report within three months as towThat
short term measures are desirable to agsist thin section of industry
and then the lorar term tuelve wonth:; report as to what l'onger term
measures are necessary. We waill wait for the report from the IAC
and vie w-4ll make the decisions that are necesseary to try and give
stimuluD to that section of the industry. And to the antent that
we do that we would hope that this aroa tiould also benofit from it.
JOURNALISTi Prime Minister you said earlier this month there'd need
to be a fall in unemployment before workers achieved productivity
increases. Would you comment on Mr Dolan's. statement yesterday that
the ACTU will press ahead with its productivity claims without
necessarily waiting for unemployment to drop. Would the Government
support such a claim?
No, we've made it clear all along to the ACTU that the
Government will consider its position in regard to that case in the
light of all tho evidence available to it at the time. And there
is an agreement between us all that the more you're gatting
unemployment down, the more jobs that have been created,'. then the
better then it that environment for. a consideration of some
improvoment in real standards. We've made it quite clear and the
ACTU understands our position on that.
JOURNALIST: Prime Minister are you satisied that justice
has been done in the Philippinrs in relation to the
assassination of Benigno Aginino?
PM: Well,: I guess in one sense it is too early to say. You
have now got the majority and minority findings of the
commission and we will be watching very closely what happens
as a next step. I must say that I haven't yet had the opportunity
of having a communication with my Foreign Minister or my own
Department on this, but I would expect either later today or
when I get to Sydney tomorrow to have more detailed informaticn
so that I will personally be in a better position to analyse it
and come to some conclusion. But just generally I want to the
point that Australia has a very keen inte: est in development
in the Philippines, there is a long historical association. We
have an aid program there and we will be watching very, very
closely the developments in that country. It's just a little
too early for me to say definitively anything in answer to your
question. As soon as I feel that I am I will be more than happy
to speak further with you.
JOURNALIST: Will Australia be trying to use its influence with
the Philippines in order to try and bring about justice there?
PM: Yes.
JOURNALIST: In what sort of way?
PM: Well, there are a number of ways I think that Mr Hayden
showed very effectively earlier in this year how he was
prepared to talk to the President and to talk to other people
directly and show that Australia doesn't really have passing
interest but is prepared to push a point of view about what
should happen, particularly in respect of Father Gore. So we
will not ostentatiously, but I believe and effectively make
our position known, both by ourselves and I think in association
with other nations which share our views on the matter.
JOURNALIST: When you use the Australian aid, when you use
the aid which Australia gives to the Philippines in order to
exert influence on President Marcos
PM: Well as you know Mr Hayden has directed his attention to
this matter and has asked Cabinet direct attention to it. We
have looked at it and we have maintained the aid programs in the
forms that are operating now. Now if My Hayden believes on a
further review that we will need to look again at that, then
then the Cabinet will. But there has nothing been put before
it at this time.
JOURNALIST: Prime Minister, can this state which you might
regard as conservative, the Queensland Premier, his wife and
others who support them, claim you are making rather deliberate
socialistic attacks on the family unit. For instance, taking
their security blanket, the Union Jack, off the family bed,
removing the Queen's photograph off the family wall, encouraging
the kids to leave school early to join the dole queue. How
will you reassure a conservative electorate.
PMs I would have thought the conservative electorate might
have just, and I hope to have the opportunity on television
tonight, of looking at how the kid3 of the families of thic
area are upset by me and my Government. I don't think you
could get a much warmer reception that we got. Look what
matters to the families of Australia are these things. ARe
they as they start their family going to have a home in
which to have the family. NOw just quickly on that, when we
came into office at the beginning of the year the housing
industry was just about destroyed. We have under the First
Home Owners Scheme in the public housing system we have
got the housing industry working now at full bore. There's
more homes being built than under the previous government
operating at 140,000 dwelling commenements a year. So if
you are talking family homes for families, jobs for kids
of families, last year of the previous government an increase
in unemployment of a quarter of a million, under my Government
since last April, April of ' 83 260,000 new jobs created,
unemployment down and the unemployment rate for kids down.
Education, we have now created a situation in Australia where
certain assured funding, both in the public and the private
sector in primary and secondary education provided for the
next eight years, welcomed by both the public, the state
and the private sector and that's created an entirely new
situation. Health, when we came into office 2 million
Australians, they don't exist floating around in space,
they are members of families. Two million Australians
not covered for medical and health care. Now under our
Government, universal coverage. No family in Australia,
no family, need worry about the spectre of sickness which
haunted so many of them before. So there you have it. If
you are talking about families, the real things that matter,
they talk about flags and things like that, the things that
matter, homes, jobs, education, health, and you compare our
record with the Liberals and the National Party.
JOURNALIST: Prime Minister, you spoke yesterday of the
prospect of the Governments and the unions agreeing to
discount : bearing in mind that there's already talk of a trade
off between productivity against wage rises and superannuation
bearing in mind also the traditional dislike of the unions
for indirect taxes, what can the Government offer the unions as
a trade off apart from reductions in personal income tax.
Well today is not the time to develop the position. in regard
to tax. Today is clearly the day which shows that our general.
economic policies are working in the areas of employment and
inflation. And I simply make the point that they are working with
spectacular success because we believe in the process of effective
consultation with the unions, with the business community and the
Government. We will apply exactly the same processes of
consultation to the area of developing tax policies and on the
evidence the outstanding successes we've had in general economic
policy as a result of consultations will also be reflected in our
approach to the tax area. f ( ret* t A f V: s