E&OE………………………………………………………………………………
Well, thank you very much Mr President, ladies and gentlemen. It’s always a delight for me to address a gathering of the NFF personally and as leader of the Liberal Party and over the last two-and-a-half years as Prime Minister I have had a very close association with the National Farmers’ Federation. I have admired its contribution to many of the important economic debates in this country over probably 15 to 20 years. And, of course, in our first term in Government I worked very closely with the NFF in resolving what was undoubtedly the most difficult issue that came the Government’s way in that first term and that was the issue of native title. And although it has disappeared from sight virtually over the last few months, certainly from a national point of view, I know there are still some details to be resolved at a State level and that perhaps things are not proceeding at a State level in some areas as well as might have been hoped. I do want to take the opportunity of recording my appreciation to the Federation for the very constructive way in which it set about the final negotiations which led to what I saw then, and still do see, as an honourable settlement of an extremely difficult issue.
I only want to concentrate in my remarks today on a few areas but they are all important areas. The first and most important thing I want to say is to reaffirm the Government’s commitment to the sector of the Australian economy and the Australian community which you all represent. We don’t take the support of the farm sector for granted politically. Our two parties have very deep links with the farm sector and many of our representatives in Federal Parliament are or have been themselves farmers. But we realise in this era of detribalised political activity that nobody can take anybody’s support for granted. We also understand that the farm sector in Australia continues to face monumental challenges. You continue to operate in corrupted world markets, you continue to carry very heavy cost burdens and you continue to face, in common with your fellow Australians who live in isolated parts of our country, a loss of service and an erosion of the facilities to which you have been used over a period of time.
I am very happy to say that the broad economic conditions in which the country finds itself at the moment are better than at any time since I have been a Member of Federal Parliament. I entered Federal Parliament in 1974 halfway through the three year Whitlam period when the wheels were beginning to fall off the Australian economy, when our inflation rate was going through the roof. For the first time in a generation or more we were beginning to experience high unemployment, wages were running out of control, interest rates were beginning to climb, oil prices had been quadrupled and, generally speaking, the Australian economy was losing the benefits of that long uninterrupted boom that it experienced but for the interruption of the Korean war experienced from the late 1940s through until the early 1970s.
But over the last 25 years we have gone through a lot of difficult periods and the farm sector has suffered in many cases more than other sectors of the Australian community. And whilst I don’t claim for a moment that everybody in the community, let alone everybody in this room, is getting the benefit of it, the general economic climate in Australia at the moment is very strong. We do have very low inflation with no likelihood in the near future of it changing. We have much lower interest rates than we have had for a generation. We have quite high levels of business investment, we are enjoying economic growth which is even stronger than the more optimistic of us thought possible six or nine months ago, and we do appear to have weathered the Asian economic downturn far better than most people had predicted.
And one of the reasons that we have done that is that we have been able to diversify our exports better than we thought we might be able to do. And in turn that is due to the benefits of a flexible exchange rate and can I recall in that context that the National Farmers’ Federation was about the first major industry body in Australia to argue very strongly for a floating exchange rate. And when it wasn’t popular, when it wasn’t kosher to argue for a floating exchange rate in this country the National Farmers’ Federation was prepared to take up the cudgels for it. But the general economic conditions are strong. Now, that doesn’t, of course, flow through to everybody in the community.
The second issue I want to touch on very briefly, of course, is that very critical issue of taxation reform. As you all know it was the main issue of the last election campaign and despite the fear campaign that was run against it in a quite ferocious way, we won. We have a working majority in the House of Representatives. We don’t have a working majority in the Senate. And in order to get the legislation through we will need to get the support in addition to the 37 Senators we have until the 30th of June next year, we’ll need to get the support of the two Independent Senators in order to get it through in the form that we want. The Democrats have indicated that broadly speaking they support a GST but they are very strongly opposed to a GST on food. I note with approval your remarks, Mr President, once you start taking it off food you begin to erode the broad base of the tax and you begin to create pressures for it to be taken off in other areas.
Now, this is going to be a long battle. It will pass strange to many of our visitors that you can fight an election by telling the public before the election that you are going to change the tax system, you can provide all the detail under the sun, indeed, a level of detail never provided in Australian political history by an incumbent government before an election. You can win that election despite the incumbence of fighting the election on a tax platform that is subject to virulent vociferous attack but you can still have trouble getting your wishes passed into law. That’s the Australian democratic process and it’s the process that we have to live with because it’s the law and we have to work within that law. But I just want to make it clear to all of you that we intend to push very hard indeed to get the plan that the Australian people voted for the on the 3rd of October adopted.
Now, the benefits of that plan for the farm sector, for rural Australia, are quite enormous. The cost reductions total about $10.5 billion for businesses throughout the entire country. There’s about a $4.5 billion cost remit for our exporters and the great bulk of that goes to, or a very large slice of that of course goes to our primary producers. The reductions in fuel which amount to about, in cost terms, about $3.5 billion a year represent an absolute revolution in fuel costs as far as rural Australia are concerned. And they certainly represent the best proposal rural Australia has ever seen and has ever had within its grasp so far as tackling the problem of the high cost of fuel in such a very large country. And I can’t think of a more compelling reason if you wanted one reason alone why your organisation should continue to give, as I know you have in the past, the very strong support for this plan of ours.
We are very strongly committed to it. It is the greatest piece of unfinished economic business in Australia. We have de-regulated our financial system, we have floated the dollar, we have reduced tariffs, we have embarked upon micro-economic reform in other areas. But the one great standout is taxation. We are still running a 1930s taxation system and we put our bodies on the line politically at the election. As I said last night, we didn’t do it for fun, we didn’t do it for our health, we didn’t….I certainly can assure you we didn’t do it for cheap political thrills, we did it because we thought it was in the long-term interests of the society we represent in the long-term interests of the Australian community. And we are going to push very hard to get it through but it won’t be easy because those who hold the numbers in the Senate, or certainly a large proportion of them seem deaf to the verdict that was passed by the Australian people.
Another matter I want to acknowledge is the great concern in rural Australia about the disappearance of services. Some of those services, the loss of them, has been very painful and some of it is unavoidable and some is irreversible. But I nonetheless acknowledge that there are things that governments can do to prevent the loss of services in the future and to replace some of the services that have been removed in the past. And the reasoning behind the administrative changes I made affecting the bush after the election go very much to this issue of services. I have created the new portfolio of Transport and Regional Services which is now being handled by John Anderson, the Deputy Leader of the National Party. The emphasis in that portfolio is a holistic approach to use that terrible cliché towards services provided in rural and regional Australia. And John’s major, but not only, preoccupation will be to have a general responsibility in relation to them. Mark Vaile has responsibility for agriculture and related issues.
We are intending to make, and we have already announced a number of policy commitments that will bring about major improvements in a number of areas of particular concern to rural people. In the health area we are providing $50 million this financial year for rural GP retention grants. We are providing $30 million to establish another 600 Medicare easyclaim facilities and we are providing $42 million for 30 regional health service centres to be established in different parts of the country. We are going to provide $70 million for regional transaction centres which are going to be funded from the next tranche of the sale of Telstra. And these rural transaction centres will help fill the gaps in banking, postal, communications and Medicare services that have been left in a number of smaller rural communities. And there is a potential within them for additional services such as the Job Network, Centrelink and private health funds.
We have committed a further $250 million to the Natural Heritage Trust which touchs large parts of rural Australia from the sale of the next tranche of Telstra. We have committed $30 million towards the rehabilitation of the great Artesian basin, a vital resource providing essential water supplies for Australia’s farmers. And we have committed $20 million to a regional and rural floodplain management programme that will assist communities to prevent repeats of some of the recent tragedies.
I am as Prime Minister and all of my colleagues are very conscious of the concern within rural Australia about the presence of bank branches, the availability of postal services and in that context you’ll be aware of the statements that we have made about the retention of public ownership of Australia Post and the maintenance of postal service centres throughout Australia. And I am very happy to report that in the two-and-a-half years that we have been in Government we have actually turned around the process that was previously going on about the establishment of postal centres throughout the country. But it does remain a very legitimate area of concern. I can understand the feeling of rural Australia, that the very lifestyle to which people have legitimately become accustomed over generations is changing as a result of the loss of these services. And whilst I am not going to pretend that in each and every case we can stop a bank disappearing, we can reverse the withdrawal of a service. We do recognise your legitimate concern and we are setting about the implementations of policies that will respond to those concerns.
Can I just Mr Chairman touch on two other points. One of those relates to the waterfront. You will be aware that one of the most keenly fought political battles of the Government’s first term were the steps we took in March and April last year to support moves to improve and render more efficient the Australian waterfront. I want, in the context of that, to acknowledge with gratitude and to salute the contribution of the NFF, then under the leadership of Don McGauchie, for the contribution that it made to a vital crusade for the long term economic future of this country.
I think everybody in this room has known for a long time that we have an inefficient waterfront. And everybody in this room has known for a long time that you weren’t going to get a change in the waterfront culture unless the government of the day and others in the community steeled themselves and undertook a resolute course of reform. And that is what we endeavoured to do in the early part of last year. And the Patrick company and those acting in association with some of the interests I’ve mentioned earlier, the NFF and those related to the NFF, those people set about doing good work for Australia.
And whilst every element didn’t turn out as had been advised I think it is fair to say, and we’ve had some evidence in recent weeks, indeed in recent days, it’s fair to say that there have already been major productivity improvements in areas of the Australian waterfront. The Sydney waterfront still remains a problem and it underlines I think the challenge that still exists in that area and I think points the finger of responsibility, or the finger of blame at those who are responsible for the fact that Sydney is still lagging behind the pack. But the productivity improvements that have been achieved in other parts of the country are due to the action that was taken by Patricks, the action that was taken by the NFF, and the support that was given in the cause of a more efficient waterfront by the federal Government at that particular time. And I want to record my personal thanks to Peter Reith for the excellent job he did as the Minister responsible for that area at the time that action was taken.
The last issue I want to touch on very briefly is APEC. I have to say that I was disappointed that in the area of early voluntary sectoral liberalisation, because of the stand that was taken by the Japanese Government it wasn’t possible to achieve delivery on everything that had been agreed at the Vancouver meeting in 1997. We tried very hard both in bilateral discussions with the Japanese Foreign Minister when he came to Australia three weeks ago, and also during the various bilateral discussions we had, particularly via Tim Fischer and Alexander Downer in Kuala Lumpur last week. But the resolve of the Japanese Government to slow down a little on that process was such that no alternative outcome was likely.
Now I don’t want that to be seen as in any way signalling a serious set back to APEC. I don’t think it is. Given the nature of the downturn in the Asian economies over the last couple of years it was inevitable that there would be, as I said, a dropping back from top to third gear in the APEC car. And that is what happened. But other aspects of the APEC meeting were highly successful. There remains a very strong commitment amongst those countries to the Bogor goals of trade liberalisation amongst the developed countries by the year 2010, and amongst developing countries by the year 2020. I’m very pleased to say that Australia is certainly setting a good example in areas of trade liberalisation as I constantly remind countries whose agricultural sectors are more highly protected than ours are that we have, by the end of all sorts of measures, about the most efficient agricultural sector in the world. But it is cold comfort to Australian farmers who are knocked around by unfair world markets to be told that they have an inefficient sector when they’re not getting decent returns on their produce and they are encumbered by all sorts of unreasonable burdens and costs.
Mr Chairman, I don’t want to say anymore than that. I apologise for my late arrival but we had a rather extended meeting dealing with some of the finer details of the taxation legislation which I hope will be introduced by the Treasurer into Federal Parliament next week. But I do want to say again at the commencement of my second term as Prime Minister how much I value the association the Government has with the National Farmers’ Federation. How much I admire the contribution of rural men and women to our country. How important I regard the farm sector to the Australian way of life, and how much I want to work with you, how much my Ministers want to work with you in building a stronger Australia and maintaining the rural community as an integral part, not only of our economy, but an integral of the kind of country that we see Australia continuing to be into the next century. Thank you very much.
QUESTIONS AND ANSWERS
QUESTION:
Thanks Prime Minister. Brendan Stewart, Vice President of the National Farmers’ Federation. My question is in relation to bank branches and bank closures. The Treasurer’s reopened the possibility of allowing mergers amongst the four major trading banks. Given that one merger would almost certainly lead to possibly two and a further rapid closure of bank branches in rural and regional Australia, what benefit is there, I suppose, for rural Australians in further bank mergers, and what’s your attitude to those mergers.
PRIME MINISTER:
Well I don’t know that the Treasurer or anybody has reopened anything in relation to bank mergers. Our position on bank mergers is this: that we are not for all time against mergers of the existing banks. But we would not agree to any mergers taking place, any further mergers of the majors, in other words we’d maintain what’s called the four pillars policy, until we are satisfied that there were a greater level of competition than now exists. I have to say to you that I don’t believe that, although there have been a lot of improvements in the area of competition, I don’t believe that that greater level of competition has yet been achieved. Now I understand the feeling of people about mergers. I also understand that we live in a globalised economy and the arguments about having strong national flag carrying companies in all sorts of areas is a very strong one. But I can assure you that we are not going to likely demolish the four pillars policy but it would be a foolish government that said they could never contemplate the circumstances into the future where there might be a case for a change. But I certainly don’t see the conditions of greater competition as having yet being satisfied in order to meet the sort of criteria we had in mind when we enunciated our response to the Wallis Inquiry a couple of years ago.
QUESTION:
Prime Minister, can I just ask you a couple of things in relation to the APEC leaders’ summit. And let me say from a personal point of view, and also on behalf of this organisation that we would congratulate you on the way that you handled what was a very difficult and delicate summit. I think the fact that you handled it the way you did is going to be of great credit to Australia as a nation, perhaps not grandstanding in a way that some others did for domestic purposes but in fact looking after the interests of the country in the way you did will stand us all in much better stead in the future. But I think it’s the consequences for APEC of actually having to refer off some of the processes of further reform to the WTO rather than deal with it with an APEC that is probably of interest to us specifically. And secondly, as New Zealand will chair APEC in the next 12 months, what can we do both as a nation, and certainly from an organisational point of view like NFF, to support New Zealand to get agriculture back on the agenda in the way that we would like it to be?
PRIME MINISTER:
Well, we can do a number of things. I think you can obviously, through your fraternal associations and I imagine that you have them with the New Zealand farm organisations, make certain that the maximum case is put to the New Zealand Government as Chairman of next year’s meeting to ensure that that happens. Can I assure you that the present New Zealand Government and the present New Zealand Prime Minister is very committed to the sort of things that I outlined in relation to APEC in my speech. The problem at the meeting Don, frankly was, I have to choose my words carefully and I don’t want to put a too fine a point on it, there were some broader political considerations that meant that the Japanese felt unable to proceed as far as they wanted to proceed, had originally committed themselves to proceed. Now I say those things carefully because Japan is an important customer of Australia’s. As a Prime Minister I understand that you’ve always got to juggle the economic dictate and political realities. And we all do that and I don’t seek to sort of be too sanctimonious about it. On the other hand we have a very very deep interest in further progress on this front and the progress we’ve made has been slow and painful but we have made progress, particularly coming out of the Uruguay round. We’re pressing very hard for a further broadly-based trade round in the year 2000. I think we have to keep in the public eye in Australia the cause of trade liberalisation although it is fair to say that across the political spectrum there is a reasonable measure of agreement about the desirability of achieving the Bogor outcomes. But I would hope that in a year’s time there would have been some improvement in the economic climate in the Asian-Pacific region so that we will meet in a more positive climate than we met in Kuala Lumpur. I can report to you that there are some signs that the Thai economy, they’re only slight at this stage, and some signs that the Korean economy, both of which have undertaken very very severe adjustment measures, very stringent adjustment measures, there are signs that those two economies are improving, ever so slightly. The outlook in Indonesia is very difficult. I don’t need to tell you with all the coverage that’s in the newspapers and on your television screens each night. It is a very difficult and volatile political situation and of course the economic situation in Indonesia, although it has stabilised somewhat, is still quite difficult, and of course there’s been a very dramatic decline in living standards and millions of people in that country have been plunged into absolute poverty. Australia does stand in very good stead in the region because we have been seen to be, and have in fact been helpful and constructive. We’ve stuck to what we believe in but we haven’t publicly hectored people. We’ve given some practical help and that’s been appreciated. And we’ve also taken the measures domestically to keep our own economy in good health. And that’s quite widely respected and quite widely appreciated in the region and the best thing for me out of the APEC meeting was that I felt I was representing a country whose esteem had risen significantly over the last year or so in particular for the reasons that I’ve outlined. Now everybody in Australia is entitled to take credit for that. It’s not just the Government but it was a very rewarding feeling and experience and it does demonstrate that there are dividends from taking the right decisions domestically but also being willing to help the region. And that wouldn’t have been possible if I hadn’t have received understanding and help as Prime Minister from organisations that eschewed short term political point scoring such as saying: well charity begins at home, why do you help out countries that don’t have the same system of government as we have? The reason, as you all know, we help out those countries is that’s in our long term national interest to do so because they are potential markets for Australia and we have no vested interest in having other than strong and very forward looking markets.
QUESTION:
Mr Prime Minister, firstly congratulations on your re-election, and secondly congratulations on your establishment of the ministry of Transport and Regional Services. Sir, could you please advise us how you see this portfolio easing the pain being experienced in rural and regional Australia and also delivering the election promises you made to these areas.
PRIME MINISTER:
Well, I think the greatest advantage of John Anderson’s new portfolio is that for the first time you have a senior Minister, one of the leadership group of the Government, whose major responsibility is making certain that the overall level of services in rural and regional Australia is fair and reasonable and whose total responsibility, or major responsibility is the quality of the lifestyle of that sector of the Australian community. In the past this responsibility has been rather fragmented. Now we have it put under one roof. We have it in the hands of a senior minister and it hasn’t been done at the expense of the proper focus there ought to be on the agricultural sector. And in addition to that, if I can just digress for moment, we have achieved a rationalisation of the industry responsibility within the Government that hasn’t existed for at least twenty years, perhaps ever, by grouping responsibility for manufacturing industry and also the resource industry into the one portfolio. I think that is a far more intelligent grouping than we’ve had in the past. So by giving a senior minister the responsibilities for the care of the overall quality of service for regional and rural Australia you’ll not only get a speedier implementation of Government commitments but I think you’ll get on a day-to-day basis in Cabinet discussions, or week to week basis rather, you’ll get a more lively appreciation and a better and more co-ordinated feedback of the problems and the difficulties that are being faced. Now the pain that is being experienced of which you spoke in your question is the pain that comes from years of quite high interest rates, years of disappearing markets, years of the wind down of services, and years of being buffeted by corrupt world trading practices. Now no ministerial re-arrangement, no set of government promises, no amount of government dollars can cure all of those difficulties and I can’t promise you that we can reopen, or we’ll even try to reopen every closed bank branch, or every closed services. But we are trying in a more systematic way to reverse closures and retreats where they ought to occur. To stop where possible ones occurring in the future, and particularly in the area of information technology, making a very big fist of ensuring there are not IT haves and have nots within the Australian community. That is certainly something that we would very much want to avoid.
[ends]