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Thursday, 28 May 1987
Page: 3504

Mr TUCKEY(1.45) —No doubt there is considerable cause to express a grievance on behalf of the Australian people today because the Prime Minister (Mr Hawke) has again created a situation where Australians are called to the polls at least six months ahead of the time that they might otherwise have been. It is typical of the Prime Minister that he consistently chooses to break his promises. It was I who coined the phrase in this Parliament that someone should put a use-by date on his promises. Consequently I have taken a close look at these and I have found that they all last less than three months. Of course the promise best remembered by most Australians is that there would be no capital gains tax.

It is time that this Prime Minister and his Government attempted to establish some credibility amongst the Australian people. It is not all that long ago that many Australians in business and in private activity with home loans and so on, took decisions to incur considerable debt because the Prime Minister and the Treasurer (Mr Keating) had promised that interest rates, which were then at about 14 per cent, were on the way down. Interest rates were falling, we were told. In my responsibilities as shadow spokesman for small business, I have encountered tragedies of people who believed our Prime Minister and our Treasurer, and contracted debt which they could properly service-either from their wages and salaries, or from the proposed business income-but whose calculations were blown out of the water by the massive increase in interest charges that have occurred since. These increases are hurting small business and are driving families to desperation. People have had to change all their spending plans. On a plane just recently I spoke to a public servant from Canberra, who told me that he and his wife were both working and that he could not define himself as `poor'. Yet he and his wife were now struggling to make ends meet because of the cost of living and the falling living standards created by this Government.

The Prime Minister tells us we must re-elect him because somebody must give us the medicine of hard times. I agree that Australia must have some medicine of hard times, but it is time Australia understood who gave us the sickness. This Government did have an inheritance. In its initial two years of administering this country it had extremely favourable economic circumstances and the breaking of the worst drought in history. I might add that the Prime Minister keeps telling us that our current situation is all the fault of those foreigners who have forced down the commodities; it is never his fault. Of course nothing is the Prime Minister's fault and nothing is the Treasurer's fault. One could go back as far as Bob Menzies-one could blame him. Currently the Prime Minister and the Treasurer are blaming the foreigners and they tell us that all the problems are caused by the foreigners. They never remember that Malcolm Fraser and other Prime Ministers had to battle with these sorts of problems; that Australia has had difficulties with its overseas trade on other occasions. There was a time when we were so desparately seeking markets for our wheat that we had to impose wheat quotas. We survived those times. The living standards of ordinary Australians did not fall. Pressure was placed on our farmers but ordinary Australians were looked after by the government of the day.

Now we are being told it is all somebody else's fault. The reality is simply that when the Government came to office it did not know how to govern. In common with the government of its predecessor, Mr Gough Whitlam, it thought that the right to govern was a right to distribute largesse. It did that by first confusing the Australian people claiming that it had to borrow money because it had inherited a deficit. For the information of those who are listening I emphasise it is time that everyone understood this-that a deficit is just money that governments spend in excess of the revenue that they gather. The incurring of a deficit by a government is very much like an ordinary person borrowing $100,000 and spending it. He has a lot of fun and looks pretty wealthy while he is spending but the fateful day comes when the finance company or the bank demands interest payments and repayment of the capital. We have seen people get themselves into those circumstances. That is what this incompetent Government did. It went out in its first two years of office and borrowed $17,000m. It then said to the Australian people: `Look how prosperous we have made you'. It gave us a debt-led recovery.

All of those wonderful economic figures that our Treasurer boasted about-and he is a master at manipulating figures to make them mean whatever he chooses in order to support his argument-were based on borrowed money. Now, of course, the bank is calling up the loans. The problem has not resulted from difficulties with our trade balance. That is a contributing factor but one that must always be anticipated. When we consider the cyclical nature of the world economic structure the clear message given to government is, when times are good start preparing, as does nature, for the hard times. We can go back in history as far as records have been kept and find that situation occurring-we get growth and then we get decline. The Government was experiencing magnificent growth, for which it took all the credit, but that growth was caused mainly by, of course, the breaking of the drought and the effects of President Reagan's economic policies in the United States of America. They were the things that were pushing the economy along in Australia but our government tried to add to its quota by injecting a big heap of borrowed money. It was very inadequate in its understanding of the operations of business. That is not surprising when we think of the credentials of the two gentlemen concerned. The Prime Minister could be considered the managing director of Australia and, I guess, the Treasurer could be considered to be our chief accountant. If we were to look at their credentials, under that business approach, we would be quite surprised. We would find that the Prime Minister's references would indicate that he has had managerial experience-he was at one time the manager of Bourke's store when it went broke-and he was, of course, the man who initiated and saw the failure of ACTU Solo and ACTU Travel.

The Prime Minister went to the Australian people this morning on television and said: `Trust Australia Incorporated to me because I will not let you down'. The reality, Madam Speaker, is that he has let us down already and that I do not trust him as the receiver and manager. We now need good policies that will give Australians an incentive to go back to work, not borrow money. Borrowed money is all that this government has delivered us. As it fed $24,000m worth of borrowed money into our economy Australians took the money and spent it, but the Keynesian theories that these gentlemen were applying were applied in the 1930s. These theories did not allow for the fact that one could bring goods from half way around the world on a jumbo jet in 36 hours or pay one's debts by pressing a computer button. Australians had money to spend and they spent it on imported goods because Australian industry was not ready for the sort of injection of capital that the Government gave us, and the money drifted off-shore.

Mr Cunningham —What about the international debt that the Government inherited?

Mr TUCKEY —If the interjector wants to suggest the money did not drift off shore, I remind him to look at the growth of Australia's international indebtedness. Let us talk about inheritance for a moment. The Government's international debt inheritance totalled $35,000m. The figure has now grown to $105,000m, an additional $70,000m. I heard the honourable member for Canning (Mr Gear) tell the House the other day that we had just had our first fall in international indebtedness-from $105,000m to $104,000m! We have a brand new situation in Australia. If our trade deficit drops below $1,000m a month it is a cause for celebration! The Treasurer gets up and says that he is very satisfied-we have only borrowed another $700m-$800m from the world. That is a disaster in anybody's language, but of course it is not as a big a disaster as is the $40,000 a minute we borrowed in one month in particular. We borrowed from the rest of the world each minute a sum equivalent to the value of one modest family home. This occurred under the administration of a Prime Minister who now goes before the people and says, in effect: `Elect me quickly because I know that things are getting worse'.

Yesterday we had the Treasurer reading us the national accounts. They were not those for the last three months. We had heard all of the earlier detail before but this great manipulator wanted to extend the figures over a period that would make them look good. The reality is that the last three months have been a disaster for the Government. None of the Treasurer's predictions have been come to pass and, of course, his mini-Budget will not change anything either. The Prime Minister has promised us no new taxes. He has just put $500m worth of taxes in--

Mr Cunningham —You won't be here.

Mr TUCKEY —I will be here unless Labor does a deal with Joh. I will still win. Labor will give in to Joh. I am not worried. Government supporters can count their fingers after the handshake. I will still be here. The Government can do any deals it likes. It has let Australia down. It has put us into massive debt and has created a situation in which, for ordinary Australian families, what one earns is no longer enough to survive on in the manner to which Australians had become accustomed under Liberal management year after year after year.

Madam SPEAKER —Order! The honourable members time has expired.