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Transcript - 23616

Address to the 2014 Economic and Social Outlook Conference Dinner

Photo of Abbott, Tony

Abbott, Tony

Period of Service: 18/09/2013 to 15/09/2015

More information about Abbott, Tony on The National Archive website.

Release Date: 03/07/2014

Release Type: Speech

Transcript ID: 23616

Location: Melbourne

Tonight, I want to address the question: “whether a reforming prime minister can succeed any more in this country given the decisive shift in the system and culture against reform?”

It’s an important question.

It’s the question Paul Kelly posed in his column yesterday.

It’s a question many of you may have pondered – especially over the past few weeks.

It can only be answered with a decisive “yes”.

“Yes” because business as usual is not an option for a country that’s living beyond its means.

“Yes” because the Australian people will never be content to wallow in mediocrity.

And “yes” because, for the past ten months, a reforming government has been in place and is already making a difference.

The age of reform has not ended in Australia.

It has only been interrupted and is now beginning again.  Strongly.  Purposefully.  And I believe effectively.

Before the election, the Coalition made a contract with the Australian people: to stop the boats, repeal the carbon tax, build the roads of the 21st century; and get the budget back under control.

A lot else has happened since the election but the boats are no longer coming, an infrastructure boom unmatched in our history is shortly to begin, the budget is now projected to be in balance, and the carbon tax is likely to be gone within a week.

This government is arguing for difficult but necessary reforms – not justifying incompetence or trying to excuse negligence.

This government has a clear plan to address the big issues facing our country – not just the hope of survival from one day to the next.

This, surely, is massive change for the better in less than a year.

I don’t underestimate the challenges ahead.

The only time reform has looked easy was under Bob Hawke and Paul Keating, because the only real opposition they had was internal.

But I don’t underestimate the Australian people either.

You know that no country has ever taxed or subsidised its way to prosperity.

You know that no government can give what it can’t raise.

You know that there is a limit to taxation because there is a limit to your trust in government.

And you know that profitable private businesses are at the heart of the strong economy needed for a strong and stable society.

Wishing that there was an alternative will not create one.

Eventually – if not at the first attempt or even the second – this budget will pass, because no one has put up a credible alternative.

The challenge – for those who understand the importance of change – is not to lament its difficulty, but to work harder to bring it about.

The bad news is that we have indeed had six years of economic drift – lost years.

The good news is that even the Labor Party will eventually realise that you can’t block the government’s Economic Action Strategy without one of your own.

The better news is that while Labor and the Greens are in denial, the government is getting on with doing what’s right and needed.

As your conference theme, “Pathways to growth: the reform imperative”, implies: economic growth is not given; it is earned by continual decisions to stay competitive.

Australia has now experienced 23 uninterrupted years of economic growth; it is a record unparalleled in our history and currently has few equals in the world.

It’s the result of a quarter century of political courage and economic reform.

The reforms of 1983 to 2007 to the financial system and competition policy, and in trade, tax, workplace relations and federal-state relations, resulted in an Australia that was competitive, innovative and productive.

But reform is again imperative.

This government inherited a debt and deficit disaster and a booby-trapped budget with unsustainable and undeliverable spending promised beyond the current forward estimates.

The demographic pressures on tax revenues and on health and welfare spending; and the need to lower business costs and lift productivity to help our businesses become more competitive – all demand that we resume long-term structural reform.

As you have heard today, the government is repairing the budget; rolling out the NBN sooner and at less cost to taxpayers; making the welfare system simpler and more sustainable; and exploring ways to make child care more affordable and accessible.

As you know, we’ve concluded free trade negotiations with Korea and Japan and hope to do so with China.

We’re well on the way to one-stop shop environmental approvals for big projects and have already given the go-ahead for $500 billion in new investment.

There’s to be more reform of the welfare system based on the work of Patrick McClure and Andrew Forrest.

Next year, there’ll be white papers on tax reform and on reform of the federation.

And there’ll be a Productivity Commission report on how workplace changes might improve productivity.

None of this should come as any surprise.

Addressing this conference in 2012, I said that our policy would “be directed towards lower and simpler tax; fairer and more effective administration; better and more efficient services; and, above all else, towards a stronger and more prosperous economy.”

An essential part of our Economic Action Strategy is record investment in infrastructure.

We need it to address the end of the investment phase of the resources boom.

We need it to improve our country’s long-term competitiveness and productivity.

And we need it if there is, indeed, to be an infrastructure prime minister!

Investments in infrastructure are investments in the productive capacity of Australia and Australians.

Little boosts confidence more than seeing cranes in the sky and bulldozers on the ground – because it shows that investors have faith in the future.

As you all know, there is a big difference between investing in an asset and putting day to day expenses on the credit card.

So this year’s budget shifts spending from short term consumption to long term investment.

All too often, at every level, governments have been thinking short term, not long-term.

It’s why, in my own city, road congestion costs some $5 billion a year and why a plane trip from Sydney to Melbourne can take longer than it did 50-odd years ago.

It’s why dams haven’t been built and the construction of new base load power stations is mostly put into the too hard basket.

Then there’s the syndrome known as BANANA – build absolutely nothing anywhere near anyone – that has been a further handbrake on building the infrastructure Australia needs.

Traffic jams plague our big cities.

Freight waits – and waits – on inefficient road and rail connections, especially inland.

Almost 70 per cent of businesses are frustrated with our country’s infrastructure, telling an Australian Industry Group survey that infrastructure was in their top three priorities.

So, in our first Budget, the government has committed a record $50 billion to the infrastructure of the 21st century.

We are already moving on major projects right across Australia.

There’s the East West Link – stages 1 and 2 – that’s by far the most important piece of infrastructure for Melbourne and Victoria because it will provide a new, safe route between Geelong and the Mornington Peninsula.

For more than 50 years governments have talked about a second airport for Sydney.

The talk is over.

We’ve taken the final decision that Badgerys Creek will be the site of Sydney’s second major airport – or, as I prefer, Western Sydney’s first airport.

By 2060, the new airport has the potential to drive an increase in Australian gross domestic product of almost $24 billion and generate 60,000 new jobs.

And heeding past lessons, it will be a case of roads first, airport second: the roads will be built before the first plane has landed.

To get Western Sydney moving again, the budget included a $2.9 billion western Sydney infrastructure plan for major road projects over the next 10 years.

Then there’s WestConnex linking the west with the CBD, the airport and Port Botany.

NorthConnex will make it possible to travel from Newcastle, through Sydney, to Canberra and on to Melbourne without encountering a single set of traffic lights.

The duplication of the Pacific Highway means that, within a few years, there will be just two sets of traffic lights – at most – between Melbourne and Brisbane.

We’re improving the Gateway Motorway in Brisbane, upgrading the North-South Road Corridor in Adelaide and the Midland Highway in Tasmania and funding the long awaited Perth Freight Link.

We’re upgrading the Bruce Highway, building the Toowoomba range crossing, and improving roads in the Northern Territory.

To help the states, there’s the $5 billion Asset Recycling Initiative incentivising them to sell existing assets and to reinvest the sale proceeds into new infrastructure.

Shifting government investment out of existing assets and into new ones adds to economic activity.

It gives reassurance to the taxpayers who paid for assets in the first place that their investment is being preserved and their legacy built upon.

Every state and territory has signed the National Partnership Agreement on Asset Recycling – because it will help to build the infrastructure they need – including, it should be said, public transport infrastructure.

Over the next two years, the Commonwealth will work with the states and territories – on a first come, first served basis – to determine the specific assets to be sold and the additional infrastructure to be built.

Where there are risks that might impede private sector funding, this government has shown that it’s prepared to manage them using mechanisms like concessional loans.

And because Australia will need foreign investment if we are to achieve more infrastructure goals, business delegations have been looking at these prospects during my recent visits to Canada and the United States.

The global infrastructure gap – the difference between infrastructure needs and infrastructure spending – is now about US$1 trillion a year.

Governments can’t finance the world’s infrastructure needs on their own – as we have found in Australia and seen elsewhere.

The private sector must do more.

This is a priority for the G20 this year – and, as president, Australia wants member countries to get the settings right for business to invest in infrastructure.

That means deciding priorities and sticking to them; and it means giving businesses the information they need to make investment decisions.

It also means simpler, speedier and more predictable decision-making processes.

These changes will give business confidence to invest for the long term.

They will also help our G20 goal: to boost the world’s collective GDP by more than two per cent above current projections over the next five years.

In 1949, during the last months of his prime ministership, Ben Chifley put the case to the nation for the Snowy Mountains Scheme that was ultimately delivered by his successor, Sir Robert Menzies.

It was, he said, “…a plan for the whole nation, belonging to no one state, nor to any group or section … This is a plan for the nation – and it needs the nation to back it.”

Provided the numbers stack up, we should back big plans for our nation.

We are not a mean or petty people and we will not be a mediocre nation.

We will set no limits to what we can achieve.

We will remain a beacon of hope and optimism, freedom and prosperity in a troubled world.

We owe it to ourselves; we owe it to the people who depend on us, and the people who look up to us, not to let them down.

It was again Ben Chifley who said just over 60 years ago “if… a thing is worth fighting for, no matter what the penalty is, I will fight for the right, and truth and justice will prevail”.

The new Government is embarked on a great and necessary task.

All of us are gathered here tonight in the cause of a better Australia.

And I tell you this: we will not fail.

[ends]

Transcript - 23616