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TRANSCRIPT OF PRESS CONFERENCE, BURSWOOD ISLAND RESORT,
PERTH 27 JANUARY 1989
E 0 E PROOF ONLY
JOURNALIST: Inaudible
PM* It is proceeding at a glacial pace, only one wicket
down, it was one for twenty nine when I left I spoke to
Allan Border last night and congratulated him and it would
be a fair understatement to say he was somewhat elated.
JOURNALIST: PM you predicted last night that interest rates
would fall by the end of the year. Would you elaborate on
that today, would you tell us do you mean housing rates?
PM: elaborate on it in the sense that I was asked
a simple question, did I think housing rates, interest rates
would fall this year. It's January. The answer is obvious,
housing rates included I believe, within the interest rate
structure will fall sometime this year. It was not
something that I profferred. I mean I was asked the
question. I think it's obvious to say that at some stage
this year they will fall, but the important point to make is
this. That this Government has the responsibility to
conduct overall economic policy in a way which is in -the
best interests of this country. The economic situation,
problem, if you like to put it that way, that we have at
this time and over recent months is not a weak economy but a
strong economy. one which is operating somewhat too
strongly in the light of our external account problem.
Therefore to ensure that we don't have an unsustainable
level of imports, we've had to tighten monetary policy for
that purpose. That policy that we have implemented will, we
believe, in the weeks ahead have the affect of somewhat
lowering the level of activity. That will occur in the
context of a lowering of the inflation rate. Now when those
things occur, as I believe they will, it's those sorts of
circumstances which will produce the environment within
which interest rates can fall. It would be quite improper
for me and I don't purport to do it, certainly not for
political reasons here where we have a State election just
to say to the people of Western Australia, ' yes interest
rates are going to fall'. I haven't come and said that, I
haven't offered that observation as some sort of election
bribe or bait but I honestly give that exposition as what I
believe will be the situation in Australia this year.
JOURNALIST: Is there a chance the rates might rise before
they fall?
PM: No I don't believe so. I think that the level of rates
now and the stance of monetary policy I believe it's
appropriate for the purposes I've just expressed.
JOURNALIST: Inaudible
PM: No, I simply say what I said before and it may be
useful to expound it here in the context of the
considerations of the State election. What is certain is
that the tax cuts for the lower and middle incomes will come
in from 1 July as promised. And may I just say there as I
said earlier today, these people in Australia, the people in
those categories have in my judgement responded
magnificently and responsibly to the requirements of the
national economic policy over the last two or three years
where the loss in our national income has demanded
restraint. I am very conscious of the contribution that has
been made and I've made the promise that as soon as we
believe that responsibly we could give relief by way of tax
cuts we would. That is why we have the stance of policy
that we have now, to ensure that we will, with
responsibility be able to bring the tax cuts in for those
people from 1 July. So lower and middle income earners,
here in Western Australia as in the rest of Australia, are
going to get that benefit. Now as far as the top rates
concerned, I don't give that unequivocal promise. We will
have to consider whether in the overall framework of policy
and in terms of equity considerations as well as economic
considerations it is more appropriate for those of us in the
highest rate to wait some time. We will have to, through
time, bring that top rate down. You cannot responsibly
maintain a gap between the or any significant gap
between the corporate rate of 39 cents in the dollar and the
top personal rate because if for any significant period of
time, you maintain a large gap there is unquestionably an
incentive to incorporate and to engage in tax minimisation
or avoidance schemes. So the judgement will be, and I
couldn't be more frank with the people of Australia on this,
the judgement will be, will you need to make some adjustment
at the same time on 1 July of the top rate and perhaps a
later one, or can you delay it for some time and bring in
the reductions later on. So those are the considerations, I
couldn't put them more directly and more frankly. So our
overwhelming responsibility and concern for is those lower
and middle income ranges and they will be adjusted, as
promised, from 1 July.
JOURNALIST: Can you put a figure on the maximum weekly
wage which will be given the tax cuts?
PM: No I can't responsibly do that at this stage. You've
got to understand that in these times when you talk about
lower and middle income figures you go quite a way up the
scale, you are talking over $ 30,000.
JOURNALIST: Mr Hawke is the decision to delay the top rate
reductions a unanimous position of Cabinet due to
Senator Walsh not come down at all?
PM: Now be fair to Senator Walsh. I think you may be
putting words in his mouth. I don't accept that of Senator
Walsh's position, in the light of all considerations, that
we will undertake, that there should be no reduction in the
top rate. If you want to characterise my Government's
approach to economic policy may I say in a moment by way of
contrast to our opponents it's this. That we have
demonstrated over our period of Government that when we come
to a consideration of economic issues, people may go in
there with some particular position. But there is an
enormous responsibility and sense of responsibility in that
Cabinet. They come in, they might have different prima
facie positions, but they listen to the arguments and to the
discussions and overwhelmingly we emerge from economic
debate in the ERC and in the Cabinet with a unified position
and that's one of the reasons why we've had such successful
economic policy making under my Government. I think it is
appropriate, without trying to make great political capital
out of it, but it is the fact. That if you look at
political and economic management in this country today,
it's that which distinguishes Labor from our conservative
opponents. They have an intrinsic incapacity to arrive at
relevant policy decisions. They are wracked in Opposition
by internal division and if you look at this State election
campaign we're in now, you have the position where at the
Federal level they are saying you shouldn't have tax cuts or
if you should do something about tax cuts what you should do
is to give tax deductions to those who are earning interest.
That's what they've said federally. Now what's happened
over here, Mr McKinnon has been faced with questions about
that and one's not sure whether he's in favour of tax cuts
or not, but you'd have to draw the conclusion that he'd a
very considerable doubts about whether he would support tax
cuts. But they have no doubts that they'd support tax cuts
0 for those earning interest, which is another example of the
way in which intrinsically the conservative parties in this
country are still the same as they always were on the
question of tax. For the conservative parties at a State
and Federal levels, tax has never been an instrument of
economics and equity. It's been a question of privilege for
the most advantaged in this country. It's what
characterised them in office. Remember this, that when they
walked out of Government in March of 1983 they walked out of
office with just about the most inefficient and inequitable
tax system in the history of this country. Top rate of
cents in the dollar, a great burden on the lower and middle
income people because they had a tax system which ensured
that those in this country with the greatest capacity to
make a contribution to the public revenue were given the
opportunity of avoiding that obligation. So everyone else
had to pay more. Now that's where they've been, that's
where they are now and the electors of Western Australia
should remember that on this fundamental issue of standards,
of welfare and of equity, that the Libs and the National
( PM cont): Party, tax is about propping up the privileged
and putting more burden on the lower and middle income
people. That's what distinguishes them from us.
JOURNALIST: Prime Minister, on the family allowance
raucous, will you act to ensure that no-one is suffering as
a result of the operating of payments system?
PM: Let me say this raucous that is referred to is more
properly described as an unmitigated beat-up by those who've
written it. There is no substance in it at all and in fact
the changes have meant a net cost to revenue to the
Government. I have been so assured.
JOURNALIST: Prime Minister, do you share the concerns of
some of your backbenchers about the Japanese
investing in property
PM: I do not make any racialist or nationalist
discrimination in any area of policy. So you asked the
question in regard to Japanese investment. The concept of
discrimination against any race in any area of policy is
anathema to me. Whether it be in immigration or investment,
anathema to me on moral grounds, but it's also anathema I
may say on economic grounds. If you wanted to think of
something which would be profoundly against the interests of
the Australian people it would be to say ' ho ho Mr Japan,
Mrs Japan, now we like having you as our major trading
partner, we do dearly want you to come and bring your most
modern technology to assist us in developing our
manufacturing and service industries, but Mr Mrs Japan
we're going to distinguish against you'. Now if you really
want to work out something that's against the interests of
this, and the future generations of Australians, that's it.
Now there may be a separate question as to whether in regard
to foreign investment as a whole, you want to have certain
capacities to monitor and that's why we have the Foreign
Investment Review Board. That's why, in regard to
residential acquisitions, we have previously bought in
limitations there. But that has been on general
macro-economic and investment grounds but while you have
this Government you will never have discrimination on the
basis of race or nationalism, in any area of our policies.
JOURNALIST: Do you need to look at the tightening of
guidelines PM: I don't believe at this stage it is necessary.
JOURNALIST: Mr Hawke, Peter Morris, Industrial Relations
Minister, spoke about wage breakout are you worried
about the possibility of a wages explosion and have you had
special meetings with your Cabinet Ministers on this
subject?
PM: special meeting, I mean I called a few of the
ministers in and the reason I did this is was because I was
going overseas. It's quite clear with the National wages
Conference coming up in early February, I wanted to put in
the minds of my relevant Ministers what I believed was the
appropriate sort of considerations which shape our policy.
I wasn't going to go overseas for a fortnight and leave them
unaware of my thinking on this matter and they wanted to
know exactly what I thought. -I made it clear what I thought
should happen and I of course won't go into the details -of
those discussions. It wasn't in any sense a secret meeting
it was just what a Prime Minister essentially should do
when he is going away for about a fortnight to pursue our
international interests. I wanted to make sure that the
increment of my thinking was on what was happening in the
economic and the wages sphere and I have done that.
Essentially, what it is about is what I've publicly
expressed. We've got to have a situation in the wages area
where the sorts of principles that have been enunciated are
in fact given effect to. What are those principles? They
are these. That we are about to engage in one of the most
exciting and important changes in wage fixation in this
country's history where wage increases will not simply be
judged in terms of the financial benefit to employees as
important and continually relevant to criterion that that
is, but for the first time in a considered and structured
way, wage movements are going to be related to the
restructuring of the awards in this country. It's
impossible to overstate in my judgement the importance of
this development because what we are going to have now is a
process whereby the awards of this country which represent
an historical mishmash of development in outdated
considerations, where, as you know in the metal trade, 360
classifications reflecting outdated process of destruction
are going to be swept aside and you are going to have
reduced classifications which will facilitate the use of
labour according to modern technologies and processes which
is going to relate it-to relevant training programs and
which is going to lead to more appropriate remuneration and
more satisfying jobs. Now that's nothing less than that's
what we're about so what I have been saying to my Ministers
and what I want to say to the trade union and to the
employers. Go into these wage processes now knowing that
there must be wage increases, but that they must be
associated with those objectives of award restructuring and
that the aggregate outcome must be consistent with
responsible economic policy. Now, that's what my
ministers, they share my views and so I know that in the
discussions which will start to occur with the trade unions
while I'm away, there may even also in that period be some
discussions with employers, that those principles will be
uppermost in what they do. It was nothing more or less than
that, that's what it was about. We must avoid, just to pick
up one part of your question Amanda, we must avoid a wages
explosion. I don't think it's going to happen, but it would
be the height of futility for the trade union and indeed for
the nation as a whole after the magnificent restraint that
has been exercised which has produced, let me remind you, a
rate of job creation four times higher than under our
6.
( PM cont): conservative predecessors, more than twice as
fast as the rest of the world. It would be the height of
futility to throw that away now and I believe that they will
have enough sense to see that that doesn't happen.
JOURNALIST: Inaudible
PM: well I see it as a reference to a shop steward's
meeting. I had the opportunity of talking with some leaders
of the trade union movement,-including leaders of the metal
Trades. I'm confident the sort of considerations that I've
talked about will be the ones that operate.
JOURNALIST: Inaudible
PM: No, but the other day when I was in Sydney, the metal
trades leaders were there, there was a general discussion
about the wages policy. You heard me in their presence
addressing this issue and congratulating them on the way
they'd approached in the past. There was no dissent from
the general propositions I was putting. I've been in the
trade union movement a fair while myself and I know you have
claims and you have outcomes.
JOURNALIST: And ambit claims?
PM: Well I don't want to say just ambit claims, but I
repeat you have claims and you have outcomes.
JOURNALIST: Inaudible
PM: Well I don't want to sound overly complacent or overly
proud, but I simply say that my six years as Prime Minister
leading this Labor Government has been characterised by a
responsible and intimate relationship with both business and
the trade union movement. In that respect we have a record
which is envied around the world. I don't know whether over
here you would have caught up with it, but the most
impressive, and I don't say that in any derogatory way,
because the gentleman in question wasn't here, he didn't
come to Western Australia, that's the only reason that : 1 say
it, but the Executive Director of the International Monetary
Fund, Mr Michael Camdessus, who was in Australia last year.
I had discussions with him and he had a press conference and
was talking at various meetings and so on and he made the
point that my Government's model of economic management
including the question of relationships with business and
the trade unions should serve as a model for the rest of' the
world. So I go to that in response to your question as to
whether I need to learn lessons from anyone. All I'm saying
is that what's been said about the way I conduct with my
Ministers, relations with business and with the trade union
movement has been put up as a model for the rest of the
world. So I don't think I have to learn lessons from
anyone. JOURNALIST: Do you think it's unwise for the WA Government
to get so closely involved with business people?
PM: I think in retrospect you could say that perhaps some
things that might have been done differently.
JOURNALIST: Such as?
PM: Well, in regard to your general question about the
relationship between Government and business here, but
having said that, and don't go getting excited, Hawke says
perhaps some things could have-been done differently
Let me make the point, in the end what Government is about
as far as the citizens under whom that Government operate
and for whom that Government is relevant, the important
thing is what is the impact of the relationships which
Government has with business and the trade union movement
upon the outcomes which affect their daily lives. I remind
you of this fact. That under Labor in this State you have
an outstanding economic achievement in terms of the
interests of the citizens of this State. Let me remind you
employment, unemployment, that's about the best employment
record in Australia, of any State, the best record in the
reduction of youth unemployment in regard to Government
charges in the last twelve months, zero, and consistently
below the rate of inflation, highest rate of economic
growth. Now all these sorts of things that have occurred in
this State, in the one and a quarter million jobs that have
been created and a few would have been in Government, about
158,000 of those occurred in this State,...... of its
population, an enormous achievement. So when you look at
all those things that this State Government has achieved,
that in part has been a function of its capacity to relate
to the business commmunity and the trade union movement. So
if you look at the totality of what this Government has been
about, it has a record and an outcome which is virtually
second to none in this country.
JOURNALIST: Prime minister, has this Government made
mistakes? PM: There is no Government, no Government anywhere in the
democratic world that hasn't made mistakes, even mine.
JOURNALIST: In this particular context?
PM: Wait a minute. I would think that Mr Dowding has by
his actions, I mean he's not a man whose said ' oh well a
mistake has been made', he's gone about ensuring that in
this area the proper processes in light of anything that's
emerged will now be followed and that's a credit to Mr
Dowding and to his Government
JOURNALIST: Inaudible
PM: Just a minute, I'm answering a question here, you want
to have a debate do you? Do you think it's reasonable that
I should finish answering this question? Now, what I'm
saying is that there have been steps taken to create a new
situation and I believe that they will be effective. while
still retaining the capacity of this Government to deal with
( PM cont): properly with the business community and the
trade unions. I don't think that one has to come unduly
critical, I mean has a new Premier faced up to the situation
and taken the appropriate steps. I get down to the point.,
let me say that as a Government has made mistakes, if you
want to get to the question in terms of any suggestion of:
finality or corruption, no suggestion in regard to Labor in
this State. There is only one side of politics in this
country where that occurs. Th-at is where you have a Liberal
National Party coalition, Queensland and now the emerging
scene in New South Wales.
JOURNALIST: I'm just wondering whether you thought the
critical of the Government, taxpayers money into the
Teachers Society bailout, which comes under Government
jurisdiction and also the $ 135m investment in the
Petrochemicals Plant which wasn't an objective sufficient. on
its own. It was done to extricate the original
guarantee Rothwells......
PM: what I have said on this issue, apart from a question
about it, I don't pretend from the position of my Government
to be able to be across all the details, considerations,
that were involved in the rescue of teachers credit union.
It is well known that there were valid considerations in
terms of equity that were involved in protecting interests
of small people that motivated the Government then. I
wasn't and can't be across all these details and
considerations that were involved there, but there were
certainly valid considerations involved and as far as the
Petro Chemical industry is concerned, it is quite clear that
there is a distinct possibility for State of the
establishment of a significant industry, both in terms of
output and this employment. So it would be wrong, all I can
say, it would be wrong to analyse those two considerations
in terms only of some suggestion of a relationship with the
business community that you mightn't like. There were
certain valid considerations in both cases. I think the
Premier, Mr Dowding, has been open about those issues and
the whole question of the relationship between Government
and business. He is proceeding along lines which are
appropriate and which are open and which overall, as I go
back to a previous answer I have given, are dominated by one
consideration and one consideration only. What's going tc) be
in the best interests of this State and let me say of
Premier Dowding, I've been around in Australian politics for
a long, long time now and I find it difficult to recall ai
Premier who in such a short time has imprinted such a
significant personal and responsible stamp of authority on
Government as is Peter Dowding.
JOURNALIST: Mr Hawke, Alan Bond said of Dowding, said he is
the same mould as leaders like Greiner, Bush, Thatcher. Do
you agree with that?
PM: It's not quite how I would have expressed it. Let me
say this, at least about Thatcher and Reagan because I don't
think anyone would be holding Mr Greiner up as a model at
the moment. But I have had my differences with Margaret
Thatcher and President Reagan but there are elements in
their leadership, which are to be admired. Indeed, in the
case of President Reagan, I say as I've said publicly in the
United States and here, I think that when the history books
are written President Reagan will go down as one of the
great Presidents of the United States.
JOURNALIST: What is your summation of Barry McKinnon?
PM: Well, as you know I'm one of the more charitable
characters in Australian politics and I don't know Mr
McKinnon very well. I think I've met him once, but I would
have to say, I think the fairest thing I can say is that
I would share the apparent judgement of the West Australian
people who know him much better. By a margin of two or
three to one, they prefer Peter Dowding as Premier and I
reckon they are right.
JOURNALIST: Mr Hawke, how will history judge Brian Burkes's
PM: That's a good question, I think you have to say this
about history. History has a changing perspective. I would
think if the historian were writing the book now it would be
a little bit jaundiced because the highlight, the focus
would be on aspects of the Premiership, about relationships
with business, which certainly at the moment are not heavily
coloured in Brian Burke's favour, but if you are going to do
a full assessment of Brian Burke's Premiership I think you
would emerge well because these sorts of achievements that I
have talked about, of the western Australian Labor
Government in the period since ' 83 mark it down as an
outstandingly successful Government in Perth of the
interests of the people of this State. Economic growth,
just about the best employment record, about the best record
in regard to Government services and charges, reduction of
youth unemployment. Now all those are the things which
determine on a day to day sense the welfare of the citizens
of Western Australia and Brian Burke was very much
associated with all of that.
JOURNALIST: comments on Brian Burke meaning that you
would still welcome him in Canberra working if he decided to
go there after his stint in Dublin?
PM: Well that's a real hypothetical one isn't it? A real
hypothetical one. I have made it clear that I think Brian
Burke had outstanding political attributes, but the question
you ask is quite hypothetical. it's not fair to him or to
anyone else to answer it I don't think.
JOURNALIST: Mr Hawke, have you discussed with Mr Dowding
the reports of funding requests for the Party from South
African Airways?
PM: South African Airways? No I've had no discussions with
him about that.
JOURNALIST: Inaudible
PM: I would think it was probably a slip. I can't imagine
seriously I think I saw a report, the Secretary of the
Party, Stephen Smith said that if any donation were to be
forthcoming it would be sent back. I think I saw that
report. Certainly it would be my position.
JOURNALIST: Mr Hawke, is Alan Bond a big financial backer
of Labor Party?
PM: I don't know whether he's a big financial
JOURNALIST: Has he made any campaign contributions
O PM: I don't know. I mean, there are people here you could
ask. Whether they'd answer you or not I don't know.
0 III
JOURNALIST: Do you expect to see Simon Crean in Federal
Parliament after the next election and if you do, and,
you're in a position
PM: That's a double hypothetical, that's a beauty. As far
as I know, what Simon Crean is saying is that he has at this
point no intention of making that move. There are
precedents for this, for people in that position to move.
Whether he will or not, Simon-will make the decision. He's
certainly an excellent President of the ACTU though we'd
miss him if he did make the move. But that's the answer so
therefore I've got no thinking in my mind of, if he were to
do it, what his role would be.
JOURNALIST: Mr Hawke, have you made any assessment of what
the likely outcome of the West Australian election will be?
PM: I've talked to people, I've seen research, I've seen
today's poll in the West Australian which has Labor winning,
I saw the Morgan poll on Wednesday which had Labor winning,
and I've done my own poll talking to people I meet in shops
and drivers and things like that. They seem to think
Labor's going to win. But I'm never complacent about
elections. I think the best way of saying it is it's going
to be a fairly tight election and I'm certain that Labor
deserves to win and I think it will.
JOURNALIST: Is it also true that your own Party polling is
still showing Labor behind?
PM: I don't go into any details of what our polling shows.
JOURNALIST: Including deny.
PM: I neither confirm nor deny appropriate policy at
certain times.
JOURNALIST: Mr Hawke it is a fact that it will be a close
* election fallout in WA Inc and the goings on here?
PM: I don't think there's any doubt that all the publicity
around that issue has been adverse to the Party. I've said
that.
JOURNALIST: what do you think of the argument that
interest rate rises we've had recently will cancel out the
tax cuts?
PM: Well, it's invalid because the calculation will in fact
show that in overall terms, taking into account movements in
the cost of living into which interest rates are factors I
mean, it's not as though you have calculations which
ignore interest rates. That's taken into cost of living
calculations and it's combination of movements in the cost
of living, wages and tax cuts will involve an improvement in
the standards of living and the people of Western Australia
can be certain of that.
JOURNALIST: Mr Hawke, an ALP poll indicates that the
independent and minor party candidates are attracting 12--15%
of votes in marginal seats.
PM: know more about ALP polling than I do. Is that
right?
JOURNALIST: That's what Mr Cameron is saying.
PM: I see.
JOURNALIST: Does that worry you Labor Party on Federal
indicators and also does it indicate a disatisfaction with
the two major parties in this State?
PM: No, I think if you look at politics around the western
world, not just in Australia, that you are seeing as a
feature of the western political scene in the most
recent period present, that you are seeing the emergence
of more minor parties. It's not just something that is
exclusive to Australia. In the end the Australian people
may move some of their votes away from the major parties but
under our system of voting there's got to be a final
allocation of preferences and I have no doubt that when the
people, either directly or indirectly by a vote for a minor
party, have to make a decision between Labor with its
magnificent achievements and the coalition, they'll come our
way. Let's be particular about this State. You've got a
Government, a Labor Government here in this State led by an
outstanding Premier which has produced just about the best
results on the economic and social front of any government
in Australia. You've got that on one hand and on the other
what have you got? You've got the Liberals and the National
Party. If there's one feature about the West Australian
political scene which stands out more than anything else,
it's the disarray, the disaffection, the bitterness, the
lack of correlation of policies between the Libs and the
National Party. They can't govern themselves, they can't
govern the State.
JOURNALIST: But Mr Hawke, the Labor Government could have
done a lot better if it hadn't put money into TCS, Rothwells
and Petrochemicals.
PM: I've answered all those questions and I've put it in
aggregate as achievements. And the aggregate of achievement
is that the record of Labor in this State is one of the
outstanding records of achievement of any government in
Australia over this period. whether you look at the issue
of employment, unemployment, prices, economic growth,
government charges, they stand out as the best in Australia.
You journalists sitting around here might want to say and
I'm not saying that critically you might want to write
your story about WA Inc and if I was in your position I'd
probably do some writing about it too. But don't delude.
yourselves that as far as Mr and Mrs voter are concerned
13
PM ( cont): that they disregard the question of achievement
in the areas of employment, unemployment, prices, housing
the lowest housing cost of any Australian state. Now all
these things are the achievements of Labor and when Mr and
Mrs and Miss Western Australia have to go into that ballot
box on 4 February they are going to be making a decision as
to whether a Labor government which has produced the best
result of any government in Australia is going to be or
whether you're going to put irr-the Libs and the National
Party who can't agree on anything, who detest one another
and who contradict one another on everything, who, as I say,
can't govern themselves but yet ask to govern the state.
And in the end that's the sharp, hard decision that the
electors of Western Australia have to take. I believe that
in their own self interest it's clear that those interests
will be significantly better served by voting for Labor.
ends