TRANSCRIPT OF JOINT NEWS CONFERENCE WITH THE HON KIM
BEAZLEY, MINISTER FOR TRANSPORT AND COMMUNICATIONS,
PARLIAMENT HOUSE 24 SEPTEMBER 1990
E OE PROOF ONLY
JOURNALIST: Prime Minister, I guess the question now is,
when will this happen and how will it happen?
PM: I want to say a few words about that and then I
think that Kim can take you perhaps in more detail to
that. Let me say this. As far as the Government is
concerned, we: want to now give effect to the authority
that's been given to us by the Party as quickly as
possible. That means as quickly as is consistent with
getting what will be very complex legislation into place.
Kim, you migh7. t like to add to that.
BEAZLEY: Yes, well we would want to try and get some
draft legislation up by the end of the year for
considerationk. Certainly we'd want to see this process
over if we could by about the middle of next year. We
will be working towards that end. But it's not easy
legislation t~ o draft and will not be easy legislation to
talk through the Senate and to negotiate the fine detail
of it. As fa~ r as the airlines are concerned I think that
we could do the best part of the work that needed to be
done on that this financial year. It might spill over
into the next: one.
JOURNALIST: Are you concerned about putting Qantas and
Australian on the market when the share market's so
depressed and the investment market is so depressed?
BEAZLEY: It's something that we'd have to think about
and we'd have to talk to the airlines about the
appropriate way of doing it. Of course other departments
have an influence on the course of action that we'd take
on those matters. But that's not something that would be
distant from our minds.
PM: Let me add there to what Kim has said that as far as
the airlines are concerned you'll appreciate that some of
the placement will obviously be overseas. In other words
you're not looking just at the capacity of the Australian
capital market to absorb what would be placed.
JOURNALIST: So when would the sell-off of the airlines
would you envisage?
PM: Well again I'd just make a comment about that and
Kim might like to expand on it. Obviously as far as we
are concerned we would like to do this as quickly as
possible. But we are not going to move precipitately in
a way which could minimise your chances of getting the
best possible return for the sale of your assets.
JOURNALIST: Are you inclined to do the Australian
Airlines sale in two parts rather than putting it all on
the market at: once?
BEAZLEY: I think that's something that we'd want to
consider after we've had a chance to take a pretty decent
look at what would be the most appropriate way of going
about it. I think there'd be distinct views I think in
the Government about whether or not you ' d want to do the
whole lot at once or in two parts. But certainly I think
we'd want to see the whole process at a conclusion mid to
late next year.
JOURNALIST: Senator Button suggested it could be
years before there is in fact a full network competitor
to Telecom arid suggest that on the Swedish model
there may never be.
BEAZLEY: Well the Swedish model has this flaw.
Basically the Swedish Telecom, Televerket, determines the
nature and Price of interconnect into its system. That
is not our proposal. I think that it would be a most
unwise competitor not to expand as rapidly as it possibly
could its involvement in the full network. One can't
tell how long; this particular period of regulation would
last. We would certainly see it going through a couple
of Parliament~ s. But from that point on, if you haven't
taken advantage of your position to build yourself a
customer base then you don't exactly know what's going to
happen to you. That's the first point I'd make. The
second point I'd make, building alternative networks is
getting easier and easier. You take a look at the sort
of costs, prices I was dealing with on fibre optic cable.
Transmission and cable Adelaide to Perth, just a bit over
million. When you're talking those sorts of numbers
and then contemplate also that in this decade we'll see a
massive expansion of sort of wild-spaced communication
around domestic nets, I think it's not going to be as
difficult for a competitor to operate as some people
thought. JOURNALIST: do you competitors to be up and running
and secondly you mentioned putting in legislation this
year. Would you expect it to be through this year
next year?
BEAZLEY: I really, with the best will in the world I
don't think we could get the legislation through this
year. It will be through next year and then immediately
you'd want the competitor going. You'd hope to have that
whole thing positioned, out of the way by the end of next
year. JOURNALIST: select the second carrier?
BEAZLEY: I think there are two alternatives really.
There's one of simply proceeding with a generalised
beauty contest between those who are interested in being
in it or there is the prospect of commencing with a
beauty contest, toning it down to two, and then competing
those two against each other in much the same way as we
did the frigates. That has the advantage probably of
increasing the Australian content in the initial owner
and it also gives the Government, if you do go through
that course, an opportunity to present a menu more
effectively to the competitors of the things it wants and
expects them.. So that's something that we'll have to bat
through with Cabinet. But we will have time to reach
conclusions on that.
JOURNALIST: Mr Hawke, what's your response to the ATEA
threats against the interconnect process?
PM: I've got; these things to say about it. I can
understand in the immediacy of the decision that's been
taken by the conference which disappoints the ATEA that
some rather belligerent statements might emanate from
that quarter. The second thing I say is that the ATEA
must understand that this Government will govern. We
will not be dictated to by one union. The third thing I
say is that 1: believe not only will the Government not be
dictated to but the trade union movement as a whole would
not tolerate a situation where the interests of all their
members would be disadvantaged by such industrial action.
Now the fact is that under the decision that's been
taken, as I've indicated and most importantly as the
Ministers indicated, there's a lot of discussion to take
place now. We want an environment and I hope the ATEA
will want an environment in which those discussions can
take place constructively. But in the end the position
is this. The overwhelming majority of Australian workers
operate in a competitive environment and there is no
reason why one union, the ATEA, shall say that uniquely
for them they will not operate in the competitive
environment and to pursue that position to the
disadvantage of all other workers and their dependents in
this country. I believe that with good will these things
can be resolved and will be resolved. I'm heartened by
the fact that this evening just in the last half an hour
that Mr Ian McLean has said well some deep breaths will
need to be taken and some consideration given to these
issues. JOURNALIST: Mr Hawke, have you seen the situation in
America when they deregulated the airlines over there?
Do you intend to put in any form of cushion to stop the
airlines from folding if the airlines are split up?
4
PM: Well the airlines folding, who folds and who
prospers will be a matter of the market. There is no
question but that the airline industry will be a growth
industry in this country. It will be a significant
growth industry. As far as Australian Airlines is
concerned, the decisions that have been taken today by
the Party will mean that Australian Airlines will have
had its capacity to prosper in that growing market
enhanced. I just may make this observation in passing
that I noticed that one disgruntled delegate made some
observation about my friend Sir Peter Abeles prospering
under the decision. Let me say this. If there is one
thing that is certain about the Australian airline
industry, if we had wanted to help Sir Peter Abeles, what
we would have done is to leave Australian Airlines in its
present condition. Australian Airlines is going to be a
much more effective competitor for Ansett as a result of
the decisions that have been taken today.
JOURNALIST: Will the fledgling privatised Australian
Airline be protected in the short term?
BEAZLEY: That airline is
PM: Fledgling? Some fledgling.
JOURNALIST: ( inaudible)
BEAZLEY: Well it's no fledgling.
JOURNALIST: Government backing.
PM: Let me make it quite clear. It didn't have
Government backing. The whole problem as far as
Australian Airlines was concerned is that they were
coming to government and saying this. Give us equity
injection or privatise. Now there is no way that as far
as this Government was concerned that we were going to
allocate scarce resources of f Budget to inject equity
into that airline. That would have meant the
privatisation of Australian Airlines by market takeover
by their competitors. Under this position now their
capital funding will be guaranteed.
JOURNALIST: The ACTU said last Friday that it still
wasn't convinced of the need for a second network. How
are you going to convince them now?
PM: If we're going to have a perspective of the ACT
position, just don't leave it that. The ACTU conducted
discussions amongst their affiliates and as we came to
the eve of the conference the ACTU didn't have a united
position. But very importantly the President of the ACTU
indicated two things. Firstly that he believed the
Government position would and should prevail and that
within that position that the ACTU would be co-operating
in discussions with the Government. Those are the facts.
JOURNALIST: head of f problems with the unions before
those problems are quite obvious to the community
PM: We've be in government for seven and a half years
and if there's one thing which characterises this
Government it:' s our capacity to and our willingness to
consult with the trade union movement. That's been a
feature of Australian life under this Government and it's
been to the benefit of the public as well as the members
of the trade union movement. We'll continue to do that.
But in the end on these issues, as I've said, the
Government will govern.
JOURNALIST: What should they watch for now? How
should we best watch the progress of these
PM: In regard to these particular enterprises?
JOURNALIST: Yes.
PM: Well again, let me make a couple of comments. I
mean Kim has been much more intimately concerned in
discussions with potential operators should add to
it. But quit~ e clearly on the experience of other
countries and on the expectation of the capacity for
growth in this country, there will be considerable
interest in investment in the Australian
telecommunications industry. We're not going to have any
problem about people wanting to now come in and operate
within this new competitive framework. As far as the
airlines are concerned I think you will have interest
from overseas airlines in getting a placement with Qantas
and with Aust~ ralian. So I don't anticipate any problem
there. The important thing is that for as far as
Australian consumers are concerned both in the area of
telecommunications and of airlines, that interest of
investors will work out in a way which will be to their
benefit. But: Kim you might like to
BEAZLEY: Yes I think obviously investors will want to
watch the content of the legislation. They'll probably
want to talk to Austel about the sorts of issues of
interconnection arrangements both technical and the cost
of interconnection. I think they will obviously want to
know a bit more about Aussat's financial circumstances.
They will want to in the case of the airlines know how
we're going 1: o place shares. I think particularly in the
case of Qantas there will be a very heavy placement
privately and probably not very much listed. Probably
there'll be a similar case in the case of Australian.
We'd be looking for big strategic owners standing in
those airlines with very substantial interests. In the
case of Australian, some foreign airlines but
particularly some Australian financial institutions and
also some Australian transport companies other than TNT.
So I think obviously we're going to talk these things
through with the airline management. We've done a bit of
that now. They have views about how they'd like that
done. We have our own views. Over the next couple of
months we will finalise them.
JOURNALIST: It does sound from that if the opportunities
for Australians to invest in Australian Airlines, Qantas
or the new telecommunications operator would be quite
limited.
PM: Let's take Australian first. Again Kim will want to
expand on this. But take Australian Airlines first. The
immediately sensible thing to do is to look at some
foreign airlines taking a placement because that is what
Australian has decided, with good sense I think, is in
their best interests. The reasons for that are fairly
obvious. Now to that extent, and taking into account
that we also want to give employees of Australian the
opportunity for involvement, I think it's right to say in
the first instance that that opportunity will be limited.
But then as we move to the total disposition of
Australian, the opportunity for public involvement will
increase. Although, as Kim says also, the most effective
operation of Australian would involve, I would think, a
fairly significant involvement of major transport
operators other than TNT. But within that total
framework there will be room I think for some public
listing. In regard to Qantas, there again, Qantas' best
interests are going to be served by the involvement into
Qantas of some other international operators and then
when you take account of the fact that you are only
exposing 49% there and you want some employee involvement
then it's quite true that the opportunities for general
public listing would be limited. In regard to
telecommunications, the obvious truth is that no
Australian interest has the capacity to establish the
competition, the network competition. Now that will
mean, as we have indicated therefore, that at the outset
there would be a major overseas involvement. The
position of the Government is that we would like to see
as much Australian involvement as is consistent with the
most immediate introduction of competition.
JOURNALIST: sale of the airline.
BEAZLEY: Well that's, I mean we've put around a series
of notional figures. Now we probably better be more
circumspect that we have to this point.
PM: Yes, exactly.
BEAZLEY: We are looking for a totality in various ways
of the sales, including all sorts of manoeuvres related
to the telecommunications that will end up with a package
over the But by no means that sort of area for the
airlines. But we expect substantial sums.
JOURNALIST: What's your minimum for Australian or
Qantas.
PM: Oh, come on. We want to get the maximum figure.
We're not going to jeopardise that by putting that sort
of figure on it.
BEAZLEY: you had a question.
JOURNALIST: better to sell off say the whole of
Australian Ai~ rlines. If you sell of f part of it
wouldn't you have to plough that money back into capital
expenditure whereas if you sell of the whole of
BEAZLEY: I think there's a lot in what you say in that,
yes. JOURNALIST: 100% then where does that money go to
then? Will i~ t go to infrastructure or paying off debt?
BEAZLEY: Wel. l that's again to be determined by the
Government. There are two alternatives but the one most
favoured is into retiring public debt interest then using
the savings in the
PM: Retiringj public debt
BEAZLEY: And then using the savings regard to
interest to form effectively a fund for infrastructure
development. PM: That's right.
JOURNALIST: Mr Beazley, have you taken any advice on the
constitutionality of a second Telecom network industry?
BEAZLEY: I know the constitutional position associated
with it, it's not a problem. The Government has the
capacity to dispose of post and telegraphs as it sees
fit. This comes into that category very clearly
established tinder that constitutional authority. It's
legislative issues that are of concern, not the
constitutional ones here.
JOURNALIST: Mr Hawke, Barry Jones made an interesting
speech, it was only agreed with the killing of sacred
COWS. He said there was a need for a new ideology by
Labor's leaders to attract a new generation of voters and
Party members. Do you take that seriously?
PM: I don'~ t think there's a need for a new ideology. I
always believe that it's a responsibility of Government
and its Leaders to get your message, your ideals out to
the people and particularly I think the younger
generations. But as I said in my speech today, the
fundamental ideology, if you like, and objective of the
Labor Party has been unchanged for nearly 100 years. I
see no need to change it. It's not, as I said, something
that needs a degree in political science to be
understood. It's very simple, the ideology of the
Australian Labor Party is to improve the lot of ordinary
Australians. That's your objective, it's not going to
change. What we're about is showing the flexibility in a
rapidly changing world to make sure that you have the
most appropriLate means of giving effect to that
ideological objective. To the extent that the Party has
made the decision that new means are necessary in these
areas to give effect to that objective, then we do have
the responsibility of explaining those facts to the
Australian electorate as a whole and we will. But not
only will we do that in terms of that obligation upon us,
we will have our task facilitated by the stark
distinction that there will be between the Australian
Labor Party, the Australian Government and the
ideological irrelevant mishmash of our Tory opponents.
JOURNALIST: Mr Hawke, you've had some tough things to
say in the past after the Conference about the
by the Left. What are your views on the Left's
PM: What was the last part.
JOURNALIST: inaudible
PM: Well, I want to say here what I've just said in an
earlier interview and that is that I think that the Left
in Australian politics and within the Australian Labor
Party has very significantly improved its contribution to
the conduct of our affairs over recent years. You will
have heard me say on a number of occasions that the
Parliamentary Party has been more cohesive in recent
years than it has been in living memory. The Left has
played a very responsible part in that process. Going
from the level of Cabinet Ministers, members of the
Ministry through to the Parliamentary Caucus. That's
been reflected out in the Party generally. On this
issue, I think, any objective observation of today's
events would lead you to the conclusion that there was
less heat and less bitterness on the part of the Left on
this than there has been in the past on other issues. As
I've said at the end of the Conference a number of
members of the Left came up to me and said, well done now
let's get on with it. I think that'll be the case. I
think the Left now will feel that, you know, they've
fought their fight. I think they'll play their part now
in ensuring -that these decisions work.
JOURNALIST: Mr Beazley, just clarification of an
earlier answer. When do you expect the sell-off process
to be underway of the airlines and the restructuring of
telecommunication of a competitor, in telecommunications
to begin?
BEAZLEY: On the airlines I'd expect us to be able to do
a substantial proportion of that in this financial year
and we'd certainly want to conclude it by the end of next
calendar year. In the case of telecommunications, much
depends on the passage of legislation through Parliament
because it is on that that the competitor knows his
' V 9
situation. I would hope to be able to achieve that in
the early part of next year and then complete the tender
process middle to the latter part of next calendar year.
PM: Anything else?
JOURNALIST: Mr Hawke are you still proposing to have an
October statement focussing on airlines and
telecommunications? PM: I would expect so.
JOURNALIST: What would be the content of that statement?
How much further would it go than today, for example?
PM: Well we'll be able to flesh out quite a bit by then,
as to the Government's thinking in more detail. It will
be a very significant statement. But that won't
necessarily be the last statement we'll make this year.
JOURNALIST: Will it include other things or just the
e?
PM: It won't necessarily be the last statement. It may
be possible to include other things that are relevant to
microeconomic reform in that October statement. If it's
not possible to do it then I would expect that before the
end of the year there will be another statement which
would go to other matters.
JOURNALIST: Will that be after the Special Premiers'
Conference? PM: I would expect, Nikki, that the first statement
covering the matters that have been dealt with today, to
be made before the Special Premiers' Conference. If I am
not able to have included in that all the things I want
to go to then that there would be another statement
before the end of the year and after the Special
Premiers' Conference. Thank you very much.
ends