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Tuesday, 31 March 1987
Page: 1774


Mr HURFORD (Minister for Community Services and Minister Assisting the Treasurer)(3.48) —This so-called matter of public importance is just another in the long list of irresponsible actions of this divided and crumbling coalition Opposition with which we are all inflicted in Australia at present. Opposition members play on two separate themes. One is a public theme and the other is a private theme. In private, when they are being responsible, when they are talking, for instance, to senior business leaders or academics, they admit that Australia has had a very difficult situation thrust upon it by the world market. The admit that the prices of so many of our exports-wheat, coal and iron ore-have collapsed. They admit that well over $6 billion, getting closer to $9 billion now, has been written off our export income. The day Opposition members come in here and admit this publicly instead of just being good fellows out in the private sector when they are talking to their senior business friends and their academics, or admit to the people generally that these are difficult times and that this amount has been written off our export income, that will be the day that they become credible and that will be the day that the country will start listening to them as having some responsible policies with which to address this problem. That responsible mood, however, does not come out in public. It comes from some of the Opposition front benchers all too rarely and only in private. In their heart of hearts some of them will even admit that thank goodness a cohesive, united Australian Labor Party is leading this country at present with its grave problems instead of the divided rabble opposite who could not possibly address the very serious problems this country has.

More often Opposition members are in their public mood. They are playing to the gallery. They are being irresponsible populists. The so-called matter of public importance today is another in the long line of pathetic matters of public importance which the Opposition has put up purporting to criticise our Government's economic policy. As usual, the Opposition does not put forward any viable policy as an alternative because it has not faced the basic fact that we have had over $6 billion written off our exports. Opposition members are not being truthful in addressing these problems. They do not seek to engage in any constructive debate about the causes and effects of interest rates or the role they play in the overall economic mix. They just seek to be irresponsible populists, trying to gain another vote here, another vote there-and to hell with the truth.

The day Opposition members become credible is the day the Australian people will start listening to them. But once again, all we have are a few cheap tears from the honourable member for Mackellar (Mr Carlton) about interest rates. He talks about a loss of disposable income because of high interest rates. He berates the Prime Minister (Mr Hawke) for being honest about the need to reduce the standard of living. I repeat: The day he comes into this House and recognises that such a reduction is necessary in the dire times we are facing is the day people will start listening to him.

The Opposition has opposed every national wage increase that has been granted since this Government was first elected. When it was in government, it opposed national wage increases as well. What are these crocodile tears about living standards? Is there any better way to indicate that Opposition members shed only crocodile tears when they talk about living standards than by recognising how they behave when it comes to national wage cases? The honourable member for Mackellar has the gall to come into this House again today and talk about the income of households. He would slash the disposable income of households by not giving householders any increases in wages and salaries.

The Opposition has also pledged to abolish the Prices Surveillance Authority. What right does the Opposition have to talk about prices when it would do that? It would eliminate the measures this Government has implemented to restrain prices. In other words, it would hold down wages and let prices rise out of control. Honourable members should remember that the Prices Surveillance Authority works with the Trade Practices Commission to seek to ensure that there is real competition and that the market-place is operating properly in order to bring the lowest possible prices to the people. We should remember that it involves itself in greater work only where there is monopoly or oligopoly power in the market-place. That valuable work would be crushed by this Opposition in its elimination of the Prices Surveillance Authority. The Opposition's view of equity is no equity whatsoever. The complete disregard the Opposition has for the welfare of ordinary Australian families is manifest in the sorts of policies it is putting forward. I repeat: The discredited Opposition sheds mere crocodile tears for the disposal income of ordinary Australians.

It goes further. The Opposition is set to dismember the Australian caring society. It would dismantle many of the important programs and reforms that this Government has introduced in my portfolio of community services. It would do the same in the social security area. These programs are there to protect people in need, such as the frail aged, the disabled and families in crisis. Yet the Opposition has a $16.2 billion credibility gap. It would slash government spending and be proud of it. The Leader of the Opposition (Mr Howard) is proud to say that he is the most conservative leader of the conservative parties of all time. What is the real truth behind what he is saying? Opposition members are afraid to come out and put it to the Australian people, but the real truth is that the programs of the caring Australian society will be slashed by the Opposition in the Ramboish set of policies it would bring in.


Mr Carlton —He's choking because he doesn't normally tell lies.


Mr DEPUTY SPEAKER (Mr Leo McLeay) —Order! The honourable member for Mackellar will withdraw that remark.


Mr Carlton —Mr Deputy Speaker, it was a private remark to my friend.


Mr DEPUTY SPEAKER —No, it was in the form of an interjection which was heard by the Chair. The Chair has brought your attention to this on a number of occasions. The honourable member will withdraw the remark.


Mr Carlton —I withdraw, but it was flattering to the Minister.


Mr HURFORD —I believe the honourable member, but thousands would not. I will now address the interest rate problem, which, of course, is an outcome of the facts I have put before the House concerning the great reduction in the export income of this country. It has been necessary to maintain a firm monetary policy while adjusting to the changing circumstances in the foreign exchange and financial markets. This policy has had the effect of maintaining interest rates at levels higher than they might otherwise have been. Let me state again, as I have stated before in this House, that no government wants interest rates to be one scrap higher than they need to be for responsible policies. Of course we do not want interest rates to be high. The present high interest rates are very much the result of the wiping away of over $6 billion of our export income.

Any policy other than that which we are pursuing would be totally opportunistic and irresponsible. A less firm approach to monetary policy would put downward pressure on the exchange rate and thereby would add to inflationary pressures. Such a policy would completely ignore the medium to long term recovery of the Australian economy. It would risk a cycle of exchange rate depreciation and inflation which would add up to economic instability. That is what we are being asked to do by this Opposition. But that is what the Government firmly will not do. We will continue to act responsibly. Such a cycle of economic instability would occur under the Opposition's policies. It could not reduce interest rates in the situation that is faced by Australia now any more than it is possible for us to do so other than in the slow, secure and steady way in which we are doing it and will continue to do in it the forthcoming year.

After a short time of the Opposition's irresponsible policies the need for a tight monetary policy would be far greater than it is at present. Interest rates would rise through the roof. We have had experience of that under the Opposition. This is not just rhetoric. We know that it would happen again. I remind the House that interest rates reached far greater heights in the time of the Fraser Government and that those policies were supported by the same people who are now lecturing us in this irresponsible way. Investment would decline under the Opposition's irresponsible policies. The balance of payments adjustments which are currently under way would be rudely halted. The process of economic adjustment and recovery which has now commenced as a result of the policies of this Government would be thrown out of the window.

By contrast, our Government's policy is aimed at a sustainable reduction in interest rates, not at some half-baked, premature reduction, which the Opposition would implement. The Opposition has no credible alternatives to the comprehensive and effective economic strategy the Government has put into place and will continue to put into place. We have a viable policy. We have a viable policy for a sustained reduction of interest rates-not a temporary reduction. I repeat: No government wants interest rates to be one scrap higher than they need to be.

As stated by the Treasurer (Mr Keating) in the 1986-87 Budget, the Government has taken some of the adjustment burden off monetary policy. The Government tightened fiscal policy in the 1986-87 Budget and has recently reaffirmed its commitment to fiscal restraint with the announcement of a May expenditure statement and with a repetition of that objective by the Prime Minister in Question Time yesterday. The Government has also announced that it will be taking a hard line with the States at the Premiers Conference and the Loan Council meeting to ensure that restraint in expenditure and borrowings occurs at all levels of government.

Through the Government's prices and incomes policy, we have been able to secure wage moderation, thanks to a responsible attitude on the part of our trade union movement. There have been other matters of public importance and urgency debates in this House about the terrible effect that would result if we were to be inflicted in this country with the market labour policies of the Opposition. There would not be, resulting from that, the prices and incomes restraint from which this country has benefited and will benefit due to the close relationship between our Government and the trade union movement. The national wage case decision of March 1987 continues this moderation.

The current account deficit is now improving. The policies about which I have spoken will enable sustainable reductions in interest rates and long term growth in the Australian economy will result. The Opposition, by contrast, has no answers to Australia's current economic challenges. I do not ask the House necessarily to rely on what I have said. I turn to some of the most recent writings in the very respected British periodical, the Economist. The Economist published a survey on Australia on 7 March. It made some telling comments about the disarray of the Opposition, but it had some very pertinent things to say about the Government. It described the Opposition as being in `a sorry state' and went on to say:

First, it has lost credibility. It, after all, had seven years in Government from 1975 to 1983, with three big mandates, yet did damn all, other than pave the way for the current mess . . . Many of the things it wanted but failed, to do-such as floating the currency and deregulating the financial markets-have been done by Labor. And it will be seen as dishonest if it tries to exploit the voters' economic hardship without at the same time explaining that its own policies would either be irresponsible or offer much the same degree of pain.

I am sorry that I do not have time to read further quotations. However, that should be compared with what the Economist had to say about the responsibility of the Labor Government. We do not have to rely only on the Economist. There are further recent examples of what others have had to say about the Australian economy. I refer to today's report by the United States Conference Board in New York which, once again, shows that the Australian economy, under responsible policies, is on the mend.


Mr DEPUTY SPEAKER (Mr Leo McLeay) —Order! The honourable member's time has expired.