PM Transcripts

Transcripts from the Prime Ministers of Australia

Transcript 9865


Photo of Keating, Paul

Keating, Paul

Period of Service: 20/12/1991 to 11/03/1996

More information about Keating, Paul on The National Archive website.

Release Date: 04/12/1995

Release Type: Speech

Transcript ID: 9865

I/ i
Well thank you, Monique ( Aho], Simon ( Crean], my colleague, Derek Volker,
distinguished guests, ladies and gentlemen.
Well we appreciate very much you coming together. But, more particularly,
for giving us support over the course of the last year in doing what, I think, is
a new thing for Australia. That is, a partnership between the Government
and business in focussing on the labour market and particularly on the long
term unemployed.
One of the things, I think, we have always believed well we like to believe
certainly it is one of our characteristics, is that sense of fairness and
egalitarianism which I know you all share and I think most Australians share.
And there was no way that we can continue to lay claim to those qualities if a
large proportion of the workforce were denied opportunities to take their
place in society and to enjoy the things the-rest of us have been able to enjoy
and to share in the opportunities and the bounty of Australia.
And the difficulties of unemployment and longterm unemployment have been
pretty obvious for quite a long time and even in the 1 980s where we had
spectacular rates of employment growth, we could never get unemployment
below about 6 1/ 2 per cent because we could never get down into the people
who had already lost their place in the labour market. And I think we always
need to keep a sort of mind's eye picture of the labour market of people
coming into the pool, perhaps staying there a few weeks or a few months,
and then going out to employment. And the fact that some people in the pool
are there a very long time and they drift to the bottom of that labour market
and when we get strong employment, there is not enough pulling power from
the employment to tug the new entrants along and to pull them out of
longterm unemployment.
So you find we have this pattern of those who join the labour market are the
school leavers, women moving into the labour market often rejoining it, or

for the first time migrants. * Aiid so even in an economy which is growing as
strongly as this one has where we have had employment growth of around 3
1/ 2 per cent to 4 per cent it is taking up the new entrants and it is taking
down unemployment. But it is not necessarily getting to the longterm
unemployed and for all the reasons that Monique mentioned a few moments
ago, people lose their self esteem, they lose their sense of importance and
their sense of self worth and, after a while, they are psychologically not really
prepared to apply for jobs or even were they lucky to snare one are they in
the right sort of shape to make a contribution to hang onto one.
So the challenge has been for us to deal with the longterm unemployed as
well as the raw demands of employment. Now I am very happy with the rate
of growth we have been getting in employment growth. We had the largest
fall in unemployment in the last 12 months we have ever had. But even so,
8 1/ 2 per cent unemployment is too high and you can see that even with the
economy growing somewhere between 6 per cent and 4 per cent in the last
few years, in fact we have had 17 quarters of consecutive growth. This is the
longest growth phase in Australia since the war. We have never had 17
consecutive quarters of growth since the Second World War and yet we have
still got unemployment with an eight in front of it.
Now our target is to get to unemployment of 5 per cent by the turn of the
century, which means as we continue with employment growth and we get
towards that 6 1/ 2 per cent we had in the late 80s this time with Working
Nation in place we ought to be able to go down further through the
arrangements we have in place with you and people like you, in the Area
Consultative Committees, and with employers across the country to focus on
the longterm unemployed so that we can actually get down to that group that
we weren't able to get to in the 1980s.
Now since Working Nation was introduced, we have had a 25 per cent fall in
longterm unemployed. And, I think, even after the end of the 80s with that
huge period of employment growth, we only reduced longterm unemployment
by something like 8 per cent or 9 per cent. So this is a huge improvement
and it couples in with what we are trying to do in education and training
generally. This morning I was out at the Canterbury-Bankstown Leagues Club, talking to
the Southern Sydney and South West Area Consultative Committees, and I
was making the point there about education and how education and training
are the bridges to better opportunities for everybody. It allows people to
crack through the barriers economic, social, however they perceive them
and find the opportunities for themselves.
Now a decade ago, only three young people in ten completed secondary
school. This year it is eight in ten and a decade ago we were putting 40 per
cent of young people through university and we are still putting 40 per cent
through, which has meant with a massive increase in participation and
completion rates in secondary school we have had a huge addition to the

stock of tertiary places. We" -have 66ne from 325,000 university places in
1985 to over 600,000 this year.
So we have got that 40 per cent coming through. But, of course, in a much
fairer sample because so many more young people are completing Years 11
and 12 and going on. But we also had the problem of that other 60 per cent
cascading into very little training and in a country that wants to be
technological clever and innovative there is no way you can talk about a
clever country for a start, if only three in ten young people completed
secondary school, and even if we get to eight in ten as we are now, if we
can't get a higher proportion of them trained, we are not going to make the
grade in terms of their expectations and opportunities and our own for the
country. So we are doing two things. We are building a tertiary education system of
quality and we have had a big revolution in tertiary education and we are still
working our way through that. We have now expanded it. We have now got
to continue to lift the quality on that so we don't get lower common
denominator effects and now out into vocational education in the One Nation
statement of 1992, we put together the Australian National Training Authority,
which for the first time is putting together a national TAFE system, with
national accreditation. Now this was a big effort.
Joan Kimer is with us today. She was Premier then and I owe her a great
debt in supporting that initiative and we brought the other States to it. Wayne
Goss was ANTA is now based in Brisbane and he was, if you like, one of
the founding Premiers in it and the impact of it has been, I think, already
rather profound. And we are going to build a national vocational education
system and with it appropriate certification so that the standing of somebody
with a certificate from TAFE or ANTA across the country will be able to find
recognition as they find for a tertiary degree.
Now all of this, of course, fits the story of training and in Working Nation we
focussed on the longterm unemployed through this novel thing of a Job
Compact, where we say after you have been unemployed 12 months or more
we will give you a Case Manager, who then manages you and that person will
manage around 30 people and get to know you, your educational
attainments, your work experience, your aptitude, your family situation and
has the option of giving you a job subsidy and getting that person placed into
a job. But the essence of the Compact is they must take the job.
Now through that device we have had a lot of success in bringing longterm
unemployment down and that, in part, also means bringing the business
community into the picture. Because it can't be done only by the
Government, it can't be done by the CES. We are also trying to develop a
private training market and Joan is chairing ESRA, which Simon and I
developed to create a market for employment services so it is not just, again,
the monolith of the CES. But we have also got other private providers of
employment services out there, just as we are going to have private providers

of training. It won't just be the AN1AITAFE monolith, but private training
providers. And just out at Canterbury-Bankstown this morning, a representative of a
construction firm was saying how they have set up their own training unit and
they are putting about 170 people a year through it. And we are supporting
that, financially, and we are supporting those sorts of activities financially
around the country to see a private training market emerge as well.
The other important thing, I think, we are doing is we are starting to try and
encourage young people in Years 11 and 12 to get some out of school work
experience and start to focus their career into TAFE and giving them TAFE
accreditation while in Years 11 and 12, through the Youth Training Initiative
of Working Nation.
So, in other words, instead of them finding at the end of Year 12 when they
have left school and all of a sudden they can't find a job and are not sure
what they do next and they are not quite prepared for the next step, we start
getting them thinking about what they might do and getting them prepared
and getting them focussed and streamed in Years 11 and 12.
In Working Nation we thought it was important to declare that we wouldn't let
any young people under 15 years of age slip through the system. We were
regarding 15 to 19 years as a period of vocational preparation. We don't
expect young people to be away from school, or away from structured training
and, if they are, we try and pick them up through the labour market
programs, or get them back into accredited training. At least they should
have the opportunity that, to 19 years of age, they can then come and say I
have had education to a certain level, or training to a certain level, or
post-secondary training of some quality and they can prepare themselves
better for entry into the labour market.
So this is a very great change and it all, I think, underlines this question
about what sort of society we want to be. Now as you know there would be
no place for Working Nation or One Nation in the Contract with America.
There is no way our friends in the Republican Party, there, would have a bar
of it because they say if you are out of work, bad luck. Bad luck, do your best
and get moving.
But what that attitude and state of mind does is, I think, damn a lot of people
to longterm unemployment. Their children grow up in the environment of
their parents being longterm unemployed and it produces a sub-culture which
is not only dispiriting and completely dismal for them, but starts then to erode
the whole egalitarian ethos of the country and the social cohesion we have
always had.
Employment in Australia has always been the way you got your hand on
some of the national cake. And if you are not employed or you can't get a
job, then those opportunities are denied to you. And we say that a target of
per cent unemployment is achievable. It means we have got to grow the

economy a bit faster than Wewouldini the traditional structure. But with an
Accord we can grow the economy faster than we would say in Western
Europe or North America.
I mean you hear a few of my opponents talking about labour market reform,
which is just code for cutting wages on the bottom end of the labour market.
You look at America which has got an army of working poor on very low rates
of pay, exceptionally low rates of pay, and yet the American speed limit is 2
1/ 2 per cent GOP growth. It has not made the American labour market more
flexible. Or if it were to be more flexible, America could grow faster than 2 1/ 2
per cent. But it never does.
Yet we have been averaging around 4 per cent and we did this mostly
through the 1980s and any country that is growing at 4 per cent a year is
creating a lot of wealth and this economy of ours is $ 500 billion of GOP, 4 per
cent of that is $ 20 billion. So there is $ 20 billion of new value every year is
being created and it helps Humpty Dumpty to stay together if there is
billion out there of new real wealth being created.
Now there are bigger and smaller Humpty Dumpties all around the country
we all know that. There are a couple of big Humpty Dumpties in this city. But
the fact of the matter is we have got to have that sort of creation to get the
economy moving.
Now I think it is worth pondering, we had the National Accounts out last week,
and after 17 quarters of growth, we are now in our fifth year of consecutive
growth and growing. For instance, in the year to September last year at 6 per
cent, growing this year at 3.5 per cent. But, basically, around 4 per cent to
per cent you can say, on average, in these last three or four years. The
Non-Farm GOP Deflator, the broadest measure of inflation. The one that is
not messed up by weightings in the CPI basket, the broadest measure was
2.8 per cent in last week's National Accounts for the quarter. So after 17
quarters of growth and running at that speed and strength, we have still got
inflation at 2.8 per cent in the broad, which is a mighty achievement.
Now there was a time, of course, when if you said things like 2.8 per cent, or
2 1/ 2 per cent inflation we have been running between 1 1/ 2 per cent and
2 1/ 2 per cent really for the last three to four years. People are now getting a
bit blase about it. They shouldn't. Inflation is a scourge. It slows your
economic growth, it pulls peoples' assets down, it wrecks their savings, it
gives them big mortgages. But the reason we can run the economy faster is
the Accord we have with the unions and, essentially, it is that essential
undertaking: growth and employment growth for sensible wage outcomes.
The unions say give us growth and employment growth and we will give you
sensible wage outcomes. Now we are getting, now, quite strong growth in
real wages. But we are still protecting the inflation rate with good productivity
growth coming from the enterprise bargaining system. So we have got a
good strong economy on our hands. We have got good profits, good
investment numbers around.

There is no reason why these strong employment rates can't stay up and if
they stay up we have got to pull the longterm unemployed into it. We just
can't take the new entrants the school leavers, women joining the workforce,
or rejoining it, or migrants and just let the longterm unemployed people
languish in the longterm pool of unemployment.
So that is why your Area Consultative Committees matter. That is why the
link to business matters because if we can't get you interested and to know
that you do end up as this chap this morning was telling us about his
construction company that is getting a good class of trained people coming
from longterm unemployed people. He is training them himself and then he
knows that he has got tremendous loyalty from them in the firm and they are
going on.
Now I know in these sorts of ventures people say oh well, you know, there is
a bit altruism required here. But it is not altruism. There is a bit of
good-spiritedness about it. There is a bit of compassion about it. But there is
also a lot of efficiency about it and good sense because, obviously, we will
never make the sort of growth rates we can and enjoy the sort of incomes we
expect if a large part of the country's resources are either under employed, or
unemployed. So we are doing something for all of us if we get the longterm unemployed
back to work and we are doing something particularly for them and we are
making our society more cohesive.
Now the other day, my Tory opponents jumped all over me for talking about
the rates of deaths in California amongst young people. And I read this
chilling statistic in, I think it was, Time magazine saying that in California
more young people die of gun shot wounds than die of car accidents and that
is pretty frightening. The main reason for t hat is because under these crazy
American laws, they let people carry guns around. But it is also part of the
social malaise of unemployment and disillusionment and rejection. It is all
out there and we don't want to see any of that cancer coming into the
Australian society. I mean some of that malaise has been there with the
longterm unemployed and as a society we have got to get in and do
something about it.
Now Working Nation is the most valiant attempt ever been made in this
country to deal with it and, as far as we know, while other countries similar
countries are into labour market programs, none of them have quite got the
innovation of Working Nation, we don't think, and we think we are a real show
of building on that 25 per cent reduction in longterm unemployment since it
was introduced and getting that down and making a very big difference into
the way Australia functions and the fact that people can share in it.
Now the Government has taken a very big interest in regional Australia
because now in some of the regions they are growing much faster than the
capital cities. A lot of the employment opportunities are in some of the
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regions. We are trying to get regional leadership, we are trying to give
regions focus and, at the same time, we are trying, in that, to get a focus on
Iongterm unemployment which is prone to be more difficult in the regions than
in the cities. And we are very pleased that so many of you are from the
regions of Australia and you have seen yourself committed and interested
enough to be in it with us, to do something about it. Because the whole thing
about One Nation is that we think of ourselves as one nation when we are all
pulling together and it is not just programs for the capital cities, but for the
provincial cities and the towns and the regions around the country as well.
So I would like to take this opportunity of thanking you for your interest in
work and training and I think we all know that when we give these people
training and work experience, even with a job subsidy, when the job subsidy
finishes the retention rates we are getting are so encouraging that people are
staying in the jobs and going on.
So we may well be able to fill those jobs which the labour market is requiring
us to fill with employment growth. The main thing is we fill them by taking a
good share of the longterm unemployed up into them as well. So we have
some real fairness operating in the system and we have the sort of country
that we have always believed Australia should be.
Anyway thank you very much for coming along today. Simon and I are
delighted with the progress of it. Simon has done a great job with Working
Nation, as Minister. He has got a great Secretary in Derek Volker and a
great team in DEET. We are absolutely delighted with it and pleased as
punch you can be involved with us.

Transcript 9865