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Transcripts from the Prime Ministers of Australia

Transcript 3018


Photo of Whitlam, Gough

Whitlam, Gough

Period of Service: 05/12/1972 to 11/11/1975

More information about Whitlam, Gough on The National Archive website.

Release Date: 21/09/1973

Release Type: Speech

Transcript ID: 3018

once already this week I have had occasion to draw attention
to the remarkable number of manufacturers' dinners I have been
eating, or will eat in the space of a fortnight five in all.
Manufacturers well know the way to my heart.
These eating engagements are, of course, also speaking
engagements. I am happy to speak to Australian manufacturers
because, quite frankly, I think we have a good story to tell.
I believe there is no section of the Australian business community
which shares greater common interests, more common ground with the
present Australian Government than Australia's manufacturing
industries. It is an historical fact that the strength of Australian
manufactures and the strength of the Australian Labor movement have
grown together. This has been no accident. It is of the essence
of the political and industrial development of this nation; and
this community of interest between Labor and industry was never
greater than at this time in our history when we have an Australian
Labor Government.
Let me from the first get down to the essentials of our
community of interest. They are essentials which transcend, I
believe, the criticisms you may have of my Government in detail
or for that matter, which I may have of you in detail. To mention
these great areas of agreement is at the same time to set the present
economic condition of Australia and the Australian Government's
plans for the economy in a true perspective. It is timely this week
to do so.
First, the Australian Government has an unqualified commitment
to genuine full employment. However acute our perception of the
social and economic evils of inflation may be, we are not prepared
to seek a solution through the weapon of massive unemployment.
In Australia, massive unemployment means empty or half-used factories.
It means, whenever that weapon has been tried in this nation,' our
loss, your bankruptcy, the retarding and sometimes even the enof
your careers as businessmen. There is no matter on which the people
we represent and the industries you represent should share so strong
a common view and a common determination. And that means that
whatever measures we take to deal with the day-to-day problems of
economic management, even when those problems have a high
international component, they will not be solved by us at least
by creating significant unemployment or closing your factories.

Secondly, we are committed to a national economy running
at the highest level of its capacity and real productivity.
We are a Government of growth. That means that the manufacturer
and the investor can plan with complete assurance on the maintenance
of the highest level of growth. We cannot be content with the two
or three per cent growth prevailing in the year before our election.
We need to sustain and, if possible, surpass the seven per cent
already achieved, not just through our efforts in the last nine
months but through your efforts and the efforts of your employees.
Thirdly, you need, as we need, a high level of real wages
and a high level of real purchasing power. Your prosperity and
our success depend alike on the ability of the consumers
overwhelmingly employees and their dependants to buy your goods
and pay into our revenues.
Fourthly, we have a vested interest in your achieving fair
profits. We need the growth which the investment of your profits
brings; and quite frankly we need healthy taxes from your healthy
profits. As to these last two matters wages and profits you may
recall that in my policy speech last November, I acknowledged that
our program of vast social reform could only work successfully
within a framework of strong, uninterrrupted growth. The expectation
of reasonable profits is as much a factor in achieving that growth
as is the reasonable anticipation on the part of employees that their
real standards will rise.
Fifthly, there is the overwhelming importance to the wellbeing
of all Australians of our social program itself, our social
goals, our social priorities. It's true that by the simplest
accounting, our program involves an increased allocation of the
national resources to the public sector. The whole thrust of our
program is towards public initiatives, initiatives that in modern
societies are either taken by governments, or not taken by anybody
at all. But it should be left there. It is an absurdly oversimplified
proposition to suggest that any increase in public
activity, public initiative, any widening of the public sector is
automatically and inevitably at the expense of the private sector.
For example, this year, in our Budget, we gave education top
priority. It constitutes the fastest growing component of the
Budget. We will provide $ 843 million for education in 1973/ 74, an
increase of $ 404 million or 92 per cent on last year. But
governments do not manufacture the equipment, make the bricks,
erect the buildings, install the fittings which compose a school.
When governments spend on these items they provide new investment
opportunities for the private investor, new scope for the private
manufacturer. And the same opportunities apply in our proposals
in the cities, in hospitals, in transport, in housing. When
governments take initiatives where none existed before, it is
private enter prise, private manufacturing which share in the first
fruits of such initiatives.

And to those five great imperatives, these goals, these
objectives in which we share common interests I shall add a
sixth a thoroughly political one. You have a vested interest
in continuing prosperity of South Australia. So have I. I cannot
survive politically, my Government cannot survive, without
prosperity in this State a State which sends seven Labor of her
eleven members to the House of Representatives.
I won't go through the list of specific benefits which-accrue
to South Australia under the Budget and other arrangements made with
the South Australian Government during the year. I may say that
total paym~ nts to the South Australian Government in 1973/ 74 are
estimated at $ 385 million. That represents $ 320 per head compared
with an average payment to all States of $ 270 per head. The benefits
of increased. consumption in this State are benefits which you, as the
State's manufacturers, can share.
These are the things you can bank on, literally bank on,
invest on, plan on, with assurance, with surety, with confidence.
You can bank on-full employment; you can bank on an expanding
economy, you can bank on higher consuming power, you can bank on
the continuance of splendid profits; you can bank on growing
opportunities of the private sector to benefit from the growing
initiatives of government. These are sure and certain things.
Any prudent investor should be able to see these certainties and
seize the opportunities.
Quite frankly, I can only express contempt for the behaviour
of the Stock Exchange last week. The stock market apparently
suddenly discovered inflation. The Government cannot be responsible
for the masochism of the stock market, or be concerned about its
self-inflicted wounds.
I took the trouble to glance at the business pages of the
Advertiser this week. What do I find?
" John Martin Peak Profit and Pay-Out Surprise hoist in
dividend rate by Hills industries Hunter Douglas dividend
up after profit upsurge... . Orlit exceeds expectations earns
15.3 per cent.... . Earnings peak for food group."
This I am asked to believe is the picture of an economy
bludgeoned to its knees by the onslaughts of the socialists in
Canberra! It is a nonsense; and I ask you, as the solid
manufacturers of South Australia, people with a-stake in the
prosperity of your State, of your nation, as well as your own
business, not to have a bar of this masochism, this schizophrenia,
this psychological sabotage. It is in this context the context
of a strong, an expanding economy that I put some of our specific
problems and the Government's handling of those problems.

We have acknowledged from the day we took office that
inflation was the major problem of economic management. On the
December, the first report I made to the nation, I said
" In particular, my Government will spare no effort to restore
genuine full employment to this country. Yet we must do this
while continuing a battle to contain inflation. We are under no
illusions about the difficulty of this double task". That was
less than three weeks after the election. So inflation is not
something the Government has just discovered, just started to worry
about. It is just a statement of fact to say that most of the
additional price increases which have occurred in Australia since
we took office have been the result of the international transmission
to this country of inflationary pressures being experienced in
practically every developed country where a free or mixed economy
operates. But we immediately began to take action to curtail these
international pressures. We appreciated the value of the currency
by 7 per cent in December; we didn't go down when the United States
dollar went down and we revalued again by a further 5 per cent
in September. Those actions generated great criticisms. Where is
the foretold disaster?
Then, of course, we cut tariffs by 25 per cent in July.
Let me say this: the 25 per cent tariff cut is not going to
produce the 45,000 to 50,000 which " Industry News", the organ of
your associated Chambers of Manufactures, told us to expect.
The Government set aside $ 25 million for special assistance
to industries and persons who might be victimized by our decision.
The latest figures I have two months after the decision is that
one Australian factory not in South Australia has sought
assistance. The total number of employees claiming special
unemployment benefits provided for tariff cut victims is some
throughout Australia. There were 13 in South Australia.
Three still remain to be placed in new jobs. Catastrophe!
Disaster' Doom.
I do not want it to be thought for a minute that I am cavalier
about these matters, particularly as they may affect manufacturers
in South Australia. I very well know the vulnerability of South
Australia's great industries to changes in demand in your eastern
markets. No policy decision of any government. I lead will result
in the dislocation of South Australian industry. I give you that
unequivocal reassurance. As I told the people in a national
broadcast on the 22nd July; " This Government did not restore full
employment in this country merely to take it away again, even from
a section of the workers."
We are, nonetheless, striving for more efficient, more
competitive Australian industry, throughout Australia. It is
not enough to say that because an industry exists in a particular
place, it has a divine right to that existence in that particular
place for all time. To achieve our aims of a more competitive,
more efficient industry, we have instituted a whole range of measuresthe
tariff review, removal of restrictive practices, new manpower
policies, the establishment of the Industries Assistance Commission.
It is clear that if we are to combat inflation even moderately
better than most comparable countries we shall have to cut away
some of the industrial fat. It is, of course, going to be a massive
task to balance these objectives with our equally determined effort
to minimise hardship to both employers and employees. The Government
is equal to that task.

I want to introduceapare political note not a party
political note. But it is a matter which I think concerns all
Australians. The politics of Australia have for many years been
conducted in a atmosphere of virtual permanent electioneering.
This is not only because of the frequency of our elections, though,
of course, that is a factor. Since the two Houses of the national
parliament were thrown out of alignment in 1963, there have been
national elections virtually every e-ighteen months. In thirteen
years that I have been either deputy or Leader of the Labor Party
I have fought eight national campaigns. But there is more to i~ t
than that. For many years past ( we might date it from the death
of Harold Holt) there has been a deep element of instability and
unpredictability in our national political life. We have had five
Prime Ministers in seven years. As a consequence, we have lived
psychologically always on the verge of imminent political change.
This has not been good for Australia; it has not made for good
economic or political management. I want to put this very
seriously and frankly to you. It may be that the next elections
will involve an election for both Houses. There must be a
Senate election not much later than April or May next year.
But the timing of an election involving the I-ouse of Representatives
is a matter for our judgement. It is giving away no secrets, it
is a simple statement of political fact that I shall recommend a
dissolution of the House of Representatives at the time of maximum
advantage to the Government. Therefore, the simple poli-tical fact
of life in Australia is that the present Government is going to
be around for a considerable timi-e not less than two years.
Now two years is a long time in the life of a nation such as ours
and certainly a long time in business planning. it is unreal for
business to take the attitude that: the Government could be
sabotaged or undermined without far greater datmage to business
itself than to the Government. The Government itself in its broad
objectives and I believe in the specific measures it takes to
achieve those broad objectives is, an eminently predic-table government.
Wise business, prudent business, sensible manufacturers will
acknowledge that it is better to live'. with and plan with and
co-operate with a basically predictable government, one which will
be the government of Australia for a considerable time to come,
than to sulk in desperate futility in resentment against the
judgement of the people last December about how and by whom they
would be governed for at least tho ensuing three years.

Transcript 3018