Subjects: Millennium forum, Australian politics; state elections; Australian economy; tax system; dairy deregulation; laziness of Opposition; forthcoming election; changes to BAS
E&OE................................
Thank you Michael, to State Opposition Leader Kerry Chikarovski, my parliamentary colleagues, ladies and gentlemen. First my I again express my gratitude to you Michael, and through you to all of the supporters of the millennium forum which have, collectively, done so much to restore the sinews of war, if I can put it that way, of the New South Wales division of the Liberal Party, and therefore struck a very important blow in presenting one side of the political debate in Australia.
I have addressed this millennium forum now on a number of occasions, and I've always endeavoured, when I've addressed it, to speak to you in a very direct way and to frankly analyse the political and economic scene as I see it. And today will be no exception. It's fair of me to say to you that right at the moment the Government faces, in political terms, the most difficult period it has faced since its re-election in 1998, and some would argue since its election in March of 1996. I say that quite directly because it is true, and my 27 years in parliament have left me, I hope, with some understanding of the political challenges and the political realities of life.
There has developed, over the last month a widespread perception amongst political commentators, based almost overwhelmingly on the results of two state elections in Western Australia and Queensland, that a change of Government at a federal level is well night inevitable and something that can be taken as a matter of course. Now I recognise that that is a perception that is being put around, I also recognise that as with all perceptions it is always based in some part in reality. And it is my responsibility as the Prime Minister and as the ultimate custodian of the political fortunes of the Liberal Party throughout Australia, and as somebody who is accountable in that position to those who belong to and support the Liberal Party, to face the reality of the present situation. But also in the process of facing that reality, to seek to remind those who I meet and address of some of the constants that always exist in Australian politics. And one of the constants of Australian politics, particularly in the era in which we now operate, is its extraordinary volatility. Australian politics now is greatly more volatile than what it was 20 or 30 years ago. I have often said to people that when I first joined the Liberal Party, and was taught a little bit about campaigning by my good friend John Carrick, who's here today, that you could operate on what I called the 40-40-20 rule. And that's not something you borrow from the financial community, it was something I learnt in my early political days. 40% voted Labor, 40% voted Liberal, and the 20% were in the middle. Now I think its fair to say that we live in 30-30-40 rule, we live in a different political dispensation. And it is more volatile, people are less rusted on, they are less committed to the party of their fathers and mothers. They are less likely, if they're living in one particularly suburb to vote one way or another. So much of what used to be predictable and constant about Australian politics 20 or 30 years ago has now changed.
Now that of course represents an enormous challenge, but it also represents, and presents great opportunities for us. And it's very important to bear in mind that just as there is a negative perception about the Government at present, that that is the product of the volatile circumstances in which we live, just as that has come rather suddenly, it is something that in the right circumstances can also change very significantly.
There were two very big reversals for the Liberal Party in Western Australia and in Queensland. And we have to be frank about that. I believe that in each case they were due overwhelmingly to state political factors, but that doesn't blind me to the fact that there are a number of areas on the federal scene that people are concerned about. I believe that there is a widespread recognition in the community, that this Government inherited a very challenging economic environment in 1996, that we worked very hard to reduce the budget deficit, that we got strongly into surplus, that the Government led this country through the Asian economic downturn, and contrary to the predictions of so many, we were able to stare that economic downturn down and emerge stronger and better than just about anybody expected. There is also a widespread view in the community that this Government has had the courage to tackle long term economic reform. For a generation people have known on both sides of politics that this country needed a new tax system. This Government has delivered it. For generations people have known that we've needed to change our industrial relations system, and this Government has delivered it. We would have liked to have delivered more but the Senate stopped us amending such things as the Unfair Dismissal Laws which are such a burden for small business. This Government has given Australia its lowest levels of interest rates for 30 years, the lowest levels of inflation for a generation. And has also presided over the generation of more than three-quarters of a million jobs. And we still have the lowest unemployment rates for many years. We inherited unemployment rates much higher than obtained today, and because of the strong growth that we've presided over we are able to look back over a four year period in which we have generated hundreds of thousands of additional jobs.
This country is now seen around the world as being a secure, stable, modern, sophisticated, tolerant, caring society. As Prime Minister I have the opportunity to talk to world leaders about their attitude towards our country. And I can report to you, particularly from the experience I had at the APEC leaders meeting in Brunei, held just after the Olympic Games, that the perception of this country is, built largely upon three things. Its economic strength, the moral and political leadership it displayed over East Timor, and the remarkable success of the Olympic Games. But those three things mean that Australia has rarely been more warmly regarded around the world than it is at the present time. Now I'm no so conceited as to suggest that all of those things are the singular product of what the Government has done. But I'm not going to be reluctant in saying that we have made a mighty contribution. And if as a measurement of the worth and the quality of a Government is what it does to a nation's sense of esteem and self respect, then there is a great deal that we can look back with with enormous pride over the last four years.
But despite that, because of the volatility in which we live, because of the clear sense of alienation that some within the community feel, a sense of being left behind, of left out, of not sharing the national prosperity, we face a very big political challenge for the remainder of the year. There's been a lot of debate in recent weeks about the rise of One Nation, there's been a lot of debate about rural and regional alienation. And it does exist, I've always thought that the attraction of minor parties has been essentially an expression, particularly in rural Australia, of a sense of dispossession and of having been left out. And the stronger you are generically speaking, the stronger the Australian economy is nationally, the greater sense that you're missing out on something is felt by those people who are not sharing that national wealth. And there is an obligation on us to understand it, there's an obligation on us not to be insensitive to people who are affected by and left behind by economic change. It's of no comfort to an impoverished bankrupt dairy farmer to turn on his television set, if he's still got one, and be told by somebody, from all the security of an academic view on business or economics, that globalisation if good for you. You have to do better than that, we all have to do better than that. And the great responsibility of Governments is to do their level best to explain the overall benefits of economic change and reform and also to recognise that there are victims of change and reform and that those victims have to identified and helped. The answer is to identify and help them, not to turn your back on change and reform. The reality is that in a globalised economy you can't turn your back on change and reform. It's going to happen anyway, and it's a question of whether you manage it in an intelligent fashion, in a sympathetic and compassionate fashion, or whether you pretend that you can stop it and stand by as it imposes itself in a far more indiscriminate ad-hoc fashion.
Part of the political challenge we face is understanding the impact of economic change, and helping people to adjust to it. It is clearly not to turn our faces against change. It is easy when you are a minor party to peddle false notions, it is easy to appeal to prejudices, it is easy to identify and point to scape-goats, it's very easy to say that if only you said no to change, everything would be in order.
Let me give you one example of the point I make, there has been a lot of discussion in the media about deregulation of the dairy industry. The reality is that the deregulation plan that was developed by the Federal Government, in consultation by with the State Governments, was requested by of the Federal Government by the dairy industry itself. And the reason it was requested of the Federal Government by the dairy industry was that the dairy producers of Victoria had decided that they were literally going to smash through the regulated dairy industries in New South Wales and Queensland. And as a first year student of constitutional law will know, and I'm sure that most people in business and Government in Australia would know, that one of the corner stones of the federation is the absolute guarantee of free trade and commerce between the states. In other words, if the Victorian dairy farmers had have decided that they were going to sell through the regulated systems of the other states, there was no legal way in which that could be prevented. To put it another way, deregulation was going to happen whether the dairy industry of Queensland or New South Wales wanted it or not. And that is why the dairy industry all around Australia came to us and said deregulation is going to happen, we don't want it to be chaotic, we want you to put in place a transition plan, we want you to put in place a support scheme funded by a consumer levy over a period of years so that you can support those people who by restructuring can stay in the industry and provide some financial assistance to those people who will be forced out of the industry.
Now that is the reality of what has obtained in relation to the dairy industry, yet minor parties, One Nation and others come along and say well the answer is to stop deregulation. The answer to that answer is that deregulation was going to occur whether the dairy farmers in New South Wales or Queensland wanted it, not because of what the federal government had decided but because of what their fellow dairy producers in Victoria had followed.
Now I've spent a moment or two detailing that particular example as an illustration of the sort of challenge intelligent contributors to the political scene in Australia have over the months and indeed the years ahead. It's not easy, but equally the way out is not to abandon those things that are based on commonsense or to abandon those things which are based on a sense of economic responsibility and economic thought.
In the end political contests do involve a choice. Kerry was right when she said that in the end the next election was going to be based on a choice between us and a choice between the Australian Labor Party. There'll only be one government after the next federal election, it's either a Labor government led by Mr Beazley or a Coalition government led by me. And as we go through the months ahead our responsibility as Liberals is to try and sharpen that choice. To remind the Australian electorate that it will be a choice between what we have achieved and delivered with all our faults and mistakes and what the alternative offers. We'll have an obligation to remind the Australian people that the last time Mr Beazley was a senior minister in five years his government ran up $80-90 billion of federal government debt. And that we've now paid off $50 billion of that $80-90 billion despite the strenuous opposition of the Labor Party at almost every turn. It will be our responsibility to remind the Australian people that the last time Labor was in office interest rates were 17%, farmers were paying bill rates of 19% and 20%. It will be our obligation to remind them that unemployment reached 11.2% when Mr Beazley was the minister for employment. It will be our obligation to remind the Australian people that if a Labor government is elected all of the industrial relation reforms of recent years will be wound back. The power of the trade union movement which now attracts the loyalty of only 25% of the Australian workforce will once again be restored to the centre stage so far as the government of Australia is concerned.
So in the end my friends politics is about choice. It's about defining what the alternatives are and that will be our responsibility and our commitment in the months between now and when the election is held. I have been asked on a number of occasions over the last few weeks in the numerous interviews I've done what my response on this or that issue is going to be. And I can't for a variety of reasons detail what all of those may be, but let me make one or two things very clear in general terms, all governments need to have a degree of flexibility. Any prime minister who pretends that he never gets messages from the electorate is doomed to early defeat and that is not a prospect that encourages me one bit. I think that this government I lead has done very fine things for Australia and I've every intention of doing everything I can to ensure that it is re-elected. But in responding to the messages that the electorate sends me and sends the members of my government, it's my responsibility to face reality and to tell the truth. There are some things I can't change - no prime minister of Australia can reverse the effect on rural communities of the longterm decline in commodity prices. Anybody who stands up and says that you can stop the process of globalisation is not telling the truth. Any prime minister who believes that you can ignore completely the sentiment of financial markets in the shaping of domestic economic policies is deluding himself.
And I want to make it very clear that in the flexible responses that the government will inevitably provide, the way in which we respond to the expressions of concern, we do not intend to abandon in any way our commitment for responsible economic policy. I have intention of seeing the Budget of this country go back into deficit. I have no intention of squandering the economic gains that this country has made over the last four or five years. But I do have every intention of listening to proper expressions of concern about the detailed implementation of some of our policy changes. The Treasurer will probably in the next day or so, be announcing our detailed response to the concerns that have been expressed to us about the Business Activity Statement and some of the other documents that are involved in compliance with the goods and services tax. What he will announce will be the result of a long process of consultation with representatives of the business community. I acknowledge that there were some mistakes made in relation to that form. It was, particularly the IAS, needlessly complicated and we've taken that message on board and we're doing something about it and it's my confident expectation that what the Treasurer announces within the next little while will in fact meet the very legitimate concerns that have been expressed to us.
I'm very conscious of the pain and sense of dislocation felt by many people in our rural communities. That is why we introduced in the last Budget a programme worth $500 million over a number of years to put more doctors back into rural areas. It's why we decided at the end of last year to spend $1.6 billion on national road funding to go to local government. It is why we're opening in rural areas regional transaction centres to bring some basic services back to rural communities. And it is why we're so committed because low interest rates are so important to farmers and small businesses in regional communities, it is why we remain very strongly committed to those economic policies that are likely to maintain and deliver low interest rates.
I've endeavoured today my friends, to paint the scene as I see it. We had a great win in 1996, we took a bold policy to the 1998 election and were re-elected and against all expectations we've implemented that policy in a remarkably smooth and effective fashion. And now on the eve of the fifth anniversary of our election, we do face a very significant political challenge. But the first solution to, or the first way of effectively responding to a challenge is to recognise that it exists, to remind people of the context in which it has occurred, to remind people of the extraordinary capacity of the electorate to change its mind very rapidly. And I venture to suggest if we'd had this months and five weeks ago it wouldn't have been against the background of the political commentary that has occurred over the past couple of weeks and that drives home my friends the opportunities of that very volatility of the Australian electorate presents to us. I have no doubt that if we can effectively present the choice that I outlined a few moments ago that we'll win the next election but I do not underestimate the challenge that lies in front of us. We are living with an electorate which is less rusted on in its political beliefs and that volatility is something that all of us have to understand.
I'm very grateful for the support that all of you have provided. It's very important because the strength that the grassroots of a political organisation provides to its parliamentary leadership is enormously important. We have achieved together an enormous amount over the last five years. There isn't any serious commentator in political affairs in Australia who doesn't acknowledge the very good job that the government has done in strengthening the Australian economy and the contribution it has made in so many areas of Australian life. I have a very strong Cabinet, the reshuffle carried out before Christmas has promoted a number of people and achieved a number of portfolio changes that have given the Cabinet a sharper focus. And in doing that I want to acknowledge the contribution that the three retiring ministers, John Moore, Jocelyn Newman and John Herron have made to the government over the last five years.
Yes it is true that we are under attack at the present time, it is true that we are being very heavily criticised, but it is also true that when the mist of that criticism clears there is that stark choice of which I spoke. We face a policy lazy opposition that seeks to surf into office on the basis of a combination of populist sentiment and the inevitable criticism that any government that has been in power for a number of years attracts. That is not a recipe for building a stronger Australia. In the end political parties do good things for their country if they believe in certain principles and they have certain policies. Our political opponents are the most policy bereft opposition I have seen in the twenty-seven years that I have been in government. The Hayden opposition between 1977 and 1982 had more policy guts and more policy commitment than the present opposition has displayed. And for that reason and for many others we owe it to ourselves to ensure that we inject as much energy and enthusiasm and commitment as we can into the campaign that lies in front of us. I feel a great sense of responsibility to make certain that that choice is effectively communicated. I will do that, my colleagues will do it, we will need your help, we will need your advocacy in the workplace and we will need your financial help, we will need your understanding as supporters of the party. If we can do that I have no doubt that we will be successful and we can be given the opportunity of working again after the next election for the good of the Australian people.
Thank you.
[Ends]