PRIME MINISTER
PARTIAL TRANSCRIPT OF NEWS CONFERENCE, PARLIAMENT HOUSE, 7
SEPTEMBER 1989
E 0 PROOF ONLY
JOURNALIST: Prime minister, have you been advised of the
New Zealand Government's decision on the frigates?
PM: Yes, I have. The Prime Minister of New Zealand, Mr
Geoffrey Palmer, was kind enough to ring me earlier this
morning and to announce that, by a good majority, the New
Zealand Caucus had agreed to the proposal. That is that New
Zealand will agree, on the basis of the discussions they had
here last week, to purchase two frigates with the option of
a further two.
JOURNALIST: Do you think that serves relationship,
given the United States mix to it?
PM: Well, I think it's a very positive decision for the
relationship. I'd made the statement that if it hadn't been
that way, it would inevitably have had some adverse
implication. But I do want to make this point, that I
believe that the Government of New Zealand has made its
decision on this issue on what it sees as the merits. I
mean, I don't think it's been a question of saying ' well
won't Australia be annoyed if we don't make the decision'.
I believe that the Government of Mr Palmer has examined this
very closely and has made the decision that it's in the best
interests of New Zealand and I welcome it in those terms.
JOURNALIST: Prime Minister, when do you expect domestic air
services to return to normal? This weekend, next week?
PM: To normal? No possibility of them returning to normal
this week. There's never been any suggestion by anyone that
they would return to normal this week, but what I am
confident of is this, that there must be an increasing
understanding now on the part of the Federation of Pilots of
the determination of the employers in the airline industry
and of the Government. May I say of the trade union
movement that the outrageous claims and approaches and
tactics of the Federation are not going to succeed. I
believe that this is having an increasing impact amongst
former employees and that increasingly more of those pilots
will sign up with Australian and Ansett and that that will
mean that in the near future I can't put the precise day
PM ( cont) upon it, but I hope it will be certainly by the
beginning of next week that some aircraft of the airlines
will be operating in their own right. Now I hope that the
pilots will understand, and I want to say this in as a
constructive way as I can, I hope they understand it.
Those are the facts, those facts are not going to change.
The Government and the airlines and, may I say the ACTU, are
committed to that position. I think it's relevant to that
question that's been asked that I should address the
development of yesterday where there has been this so-called
offer by the Federation through its President, Mr McCarthy.
Now that has been properly categorised right throughout the
media and by the airlines themselves as a sham. Mr Strong,
I think, summed it up very well. There's never been before,
I think, in industrial relations history the position where,
in a dispute, an offer to return to strike is regarded as an
offer. No-one can take that seriously. But I do want to
take this opportunity, in the context of your question, to
address one thing that was said by Mr McCarthy in his letter
to Ansett in which he made the outrageous claim, and total
misrepresentation, that it was Ansett and the Government
who, way before, had planned the shutdown of the industry.
I mean, it's a manifest lie on its face, but I just had a
little bit of work done to establish where, the
responsibility lies and I would like to share with you that
information. The Federation of Air Pilots has been putting
out a publication, it's called Deadline ' 89. Fascinating
document as you will come to see. it's been being issued at
least since February, why, its issue number one was
February. I just give you a few quotes from some of the
issues of Deadline ' 89 so that we can see precisely who has
been planning the shutdown of the industry and how
meticulously they have been planning it. February ' 89,
Deadline ' 89 ' Deadline ' 89 will be issued regularly and
cover many of the questions that you . will have in the months
to come addressing topics such as the actions companies may
take in the case of prolonged industrial action, legal
implications, Press reaction, how the strike will be
organised, progress reports on negotiations of the company,
historical information,. financial management and other
issues that will provide a full dossier for you to refer to
during the year'. This is February and that ended on that
page with a resolution that the Federation informs the
Government and all companies of its intent to restore pilot
salaries by 1989 using every means available. Gets better.
April Deadline ' 89. ' At some stage in one's working life
the potential to face a non-income period ( NIP) exists.'
well, that has its connotations, I suppose. ' Now may be the
appropriate time for the more prudent pilot to review both
long and short term financial arrangements. By careful
planning beforehand, the full impact of such a NIP can be
dramatically reduced'. And on the same page, ' Be prepared
to adjust your lifestyle in the period leading up to and
during the NIP, eg, eating at home is cheaper than eating
out'. Then we have, ' Establish other employment
opportunities. Many people have acquired a taxi drivers'
licence-, many may decide this is an excellent opportunity to
have a complete break from the house and go fishing, work on
PM ( cont) the car, start a lawn mowing business'. Great
stuff. Concluding with this observation from Mr Terry
O'Connell, Executive Director, ' A major reason for the
stopworks being called was to inform you of the major battle
ahead should the existing system not become flexible or
pragmatic enough to remedy your real salary slippage.
Should it reach that stage, then it will be a real battle as
we will be fighting the Government, the arbitration system,
the companies and all the vested interests. Pilots, by
being united, have done it before and we can do it again.'
I mean, the audacity of the Pilots' Federation in this sham
offer they made yesterday, to say in the light of all the
evidence, that the planning was by the Government and Ansett
to close down the airline industry. It can be seen for what
it is, yet another instalment of the incapacity of the
Federation to face up to either the realities or the truth.
JOURNALIST: Mr Hawke, what does the dispute say about
people's right to strike in Australia, to withdraw their
labour, without being hit with massive fines or the sack?
PM: It says this. That we have by the historical
understanding of the Australian community, established a
system within which the employers and trade union movement
of this country are able to discuss, negotiate, conciliate
and have arbitration for the resolution of their industrial
disputes. And within that the right to strike has
manifestly existed if you know anything about the statistics
and the history of Australia. what we have in this case is
a situation where a particular organisation, which is an
organisation registered under the system, they have chosen
to be in that system, which as they have said, they have
used to their very great benefit. That is the history.
They have been in the system, used it. They made a decision
that they want to be out of that system. The Federation
said, we're out. Now the facts are simply there, if they
decide to go out then by their decision they expose
themselves to the law which is available, not only to their
employers, but to others who may be affected by their
decision. But of course you see in this situation they have
ceased their employment relationship.
JOURNALIST: Are there any circumstances at all in which you
or any of your ministers would negotiate with the pilots
Federation? PM: The Federation is not relevant now. The Federation is
not relevant now and not relevant for the obvious reasons.
They have withdrawn from the system and as late as yesterday
say, we will not operate in the system. Will not operate in
the system. Now they have said that is their position. And
the next point of course is that there is no employment
relationship. They don't speak for the employees of the
airlines because there are no employees except those that
are signing up now. And let me say, if there is one thing
that those signing up are saying is, have nothing to do with
, the Federation.
JOURNALIST: How many have signed up?
PM: Yes, I could have guessed that it would come from you.
Look, Mr Jull as the agent of the pilots in the Parliament
yesterday tried that one. You think there is one thing that
the pilots would like to know. Well two things. The pilots
would like to know how many of their former colleagues have
signed up and what the contents of the contract are. The
pilots' agent in the Parliament tried that one yesterday.
Now I wasn't through their agent in the Parliament going to
give them the information they would dearly like to have.
Nor am I going to give them the information via you.
JOURNALIST: Prime Minister, yesterday you said or raised
the possibility or said that the question of recompense for
employees, non-pilot employees of the airlines could be on
the agenda. You spoke that they were in a unique position,
unlike for example workers in the tourism industry. Could
you elaborate just what you meant by that?
PM: Yes. Some people have some difficulty in
understanding, it's perfectly clear. The dispute is in the
airline industry. It is the dispute in the airline industry
which is threatening not merely to break the wages system
but via that to wreck the Australian economy. So it doesn't
seem to me that it requires a considerable degree of
understanding or intelligence to understand therefore the
uniqueness of the airline industry. There is no dispute
elsewhere which is threatening to wreck the Australian
economy. It is in the airline industry. Therefore one's
attention has to be given to what course of action is
necessary to ensure that the wages system and the Australian
economy is not wrecked. Now I think that's a relatively
easy concept to understand, it having been put. Now
therefore what is the situation with-which we're confronted?
It is this; that as a result of the dispute by a small and
privileged group within the airline industry we are faced
with that threat, the threat of a collapse of the wages
system and the destruction of the Australian economy. Now
the rest of the employees in that industry have firstly, at
all times abided by the system, restrained their claims and
have been an essential and integral part of the support of
the system and they within their industry, in respect of
their two employers or basically two employers Ansett and
Australian in respect of their employment they are running
the risk in their industry. But because of the action by
these other people, the pilots, that they will be
disadvantaged and would have the capacity in those
circumstances if they were disadvantaged, to take some
action which would in the industry where the dispute
threatening the economy exists, could produce the
catastrophic result. Now as far as other industries are
concerned let it be quite clear, I and the Government
acknowledge, I acknowledge, that they are being hurt,
particularly in the tourism industry. The dispute is not
there, the dispute is not in the tourism industry
. threatening the economy and in that industry there is no
complic-ation in regard to the dispute as to the stand-down
PM ( cont) procedure been used and it is being used.
Employers in the tourism industry are standing down their
employees and that action of stand-down does not in any way
impinge on the dispute. The possible stand-down of
employees directly working with pilots in that industry has
potential implications for the dispute. Now what I'm saying
is that in this situation the letter to the Government from
the two airlines asking for these matters to be taken into
account is, I am saying, properly on the table. I'm not
saying what the outcome will be but for the reasons that I'm
giving there is a relevance, it's appropriate for them to
put that there. It's not yet been considered by the
Cabinet, I haven't put it to Cabinet, but I have been open
and direct in saying there it is, it will be considered.
JOURNALIST: Is it Prime Minister the fact that if Cabinet
was to proceed down this path it would in fact create a
precedent and if there were further industries where there
were strike action outside the national wage guidelines
which threaten the wages system then the Government would
have to take follow-up action?
PM: I am not going to canvass the whole range of arguments
not because I'm afraid of canvassing the whole arguments
but it's not appropriate to do that before it may be
necessary to be considered by Cabinet. But I would make
this point; that the airlines are this position if
an employer was operating in a deregulated, non-government
regulated industry and is faced with this situation, what
that employer would be doing would be to make his decisions
as the market would allow him to to increase his prices to
the extent that he was still operating, to increase his
income and of course in the case of the airlines they are in
a regulated industry, both in respect of the prices that
they charge and also in terms of the cost to them which are
a matter for decision by the two auth6rities, the Federal
Airports Corporation and the Civil Aviation Corporation
which deal with landing charges and other affecting the
industry. They are in a regulated environment where they
don't have the freedom because the Government is regulating
both sides of their equation. In a free market situation
where an employer and another industry was not so regulated,
what he would do. I mean it's obvious, it's not a question
of argument, if he was still operating to any extent, he'd
whack up his prices, whack up his prices, and he'd be
totally free to do so. In this industry they don't have
that freedom. They are subject to Government regulation.
Now I'm not saying that that is the total answer to the
question but I say it is a relevant consideration in respect
of your question, is this precedent? Is this the same
situation as every other part of industry? Obviously on
that ground there are distinctions that can be taken into
account. Now having said that, I don't want to canvass the
issue any more because that's a matter which will be
considered by Cabinet at the appropriate time.
JOURNALIST: Today's job figures, unemployment down,
participation up. Is that another indication that there is
no indication of easing monetary policy?
PM: No, no, no. It's a confirmation when I say no, no,
no, I'm not ending my answer to the question of easing the
monetary policy but what I'm saying about indication is
that it is another element of what I've been saying for some
time that the signals are mixed. I mean you'* v e heard me say
this in the Parliament and elsewhere and if you'd been
sitting in the Caucus which you're not entitiled to you
would've heard me saying it there. The position with which
the Government is faced is that we are getting mixed
indications about what the impact of existing policy is.
There are a number of indications, particularly I would
suggest in the . housing industry, which suggests that the
impact is there and that there is the beginnings of a
slow-down in activity. Now there are others which suggest
that the economy is still growing at a fairly strong rate.
Now I guess in respect of these employment figures one can
say that very consistent with a still fairly strong
level of growth. we now have an unemployment rate which has
fallen to which is the lowest level since October
1981. we have a participation rate I might point out, at
63.4% which as far as I can ascertain is the highest
participation rate ever. So we've got to feed these figures
into the other indicators that are coming through. Let me
make this point however, that looking to the basic
foundation of the economy when you take into account the
massive investment that has been taking place and the growth
in the workforce, we are creating an economy which is
basically going to meet the essential core problem that we
have been facing. As you'll appreciate that problem has
been if you look at the statistics of last year we had a
7.7% increase in gross national expenditure and an increase
in production of about 3-1/ 2% and that gap, that 4% gap, is
filled by imports which we had a 25% increase in imports and
if you want the essence of the problem there it is, last
year, 7.7% increase in gross national expenditure, a 3-1/ 2%
increase, production, gap gap filled by imports,
increase in imports. Now what we're seeing with the massive
increase in investment and associated growth in employment
is the creation of an increasing capacity within Australia
to meet our own requirements and to expand our export
capacity. So it's in that sense where we take comfort and
pride, I might say, in the fact that now with these figures
we have created one million five hundred and forty six
thousand six hundred new jobs since we've been here. our
decision as to the point at which we relax monetary policy
Will be made, as I have said consistently, it will be made
at the earliest point which is consistent, responsibly, with
the conduct of macro-economic policy, we'll do it as soon as
we possibly can but not a day earlier.
ends