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Wednesday, 6 June 1984
Page: 2612

Senator CHANEY —My question is addressed to the Minister representing the Treasurer. I refer to the same leading article in the Australian Financial Review which the Minister quoted with approval. Does the Minister also agree with the proposition in that leading article, that the Government appears to have resigned itself to a continued high rate of unemployment? That is not the exact quote. The article says:

Like the Government, the ACTU also appears to have resigned itself to a continued high rate of unemployment . . .

Is the Government resigned to that? I also ask the Minister whether he agrees with that leading article's proposition that:

. . . the crucial issue has yet to be settled. This is the Government's ability to deliver on the reality of an incomes policy which will persuade the unions to allow the economy to recover unimpeded by premature wage claims.

I ask the Minister whether he agrees with the definition that premature wage claims are:

. . . any claims which go outside the discipline of the prices and incomes accord before there is a substantial drop in the rate of unemployment.

I ask the Minister for the record and for the sake of future debate whether he agrees with those propositions in the same leading article.

Senator WALSH —It would be remarkable if it were done by any party other than the present Opposition for a party which presided over the biggest increase in unemployment which has been recorded in Australia since 1930 to be castigating some other government on the matter of unemployment.

Senator Chaney —Mr President, I rise on a point of order. We are not supposed to debate questions and anyone who could describe my question as castigating the present Government is incapable of listening. I put a number of propositions from a leading article which had been quoted with approval by the Minister and asked him whether he agreed with those propositions. He responded by talking about castigation of the Government. I did not castigate the Government. I asked for a definition of the Government's view on those important questions.

The PRESIDENT —Order! There is no point of order.

Senator WALSH —The Government has not accepted that there will be permanently high unemployment. Indeed, the Government's strategy, its long term objective, at all times has been to maintain an economic growth rate sufficient progressively to reduce unemployment, but it cannot be wiped out overnight. Likewise, we have always recognised that the success of the incomes policy was an important determinant, probably the crucial determinant, of whether that long term objective could be achieved. There is no evidence at this stage to support the fond hope of the Opposition that the incomes policy will not hold. Indeed, the incomes policy has the strong support of the Australian Council of Trade Unions, including support for the acceptance of the Medicare factor in the consumer price index being passed on in wage indexation, the effect of which is that when the next wage indexation decision is made there will be a negligible increase in wages because of the negligible increase in the CPI in the six-month period preceding that. In some instances individual unions have attempted to break the accord. All of those attempts have been strongly resisted by the Government, in most cases with the support of the ACTU.

Senator Chaney asked whether the incomes policy meant that the only wage increases permitted would be those strictly in accord with indexation. That is the general policy; it is not and never has been a rigid policy. It has always allowed for the correction of some anomalies. The most important comment that can be made on this matter is that the discredited Treasurer in the Fraser Government and now Deputy Leader of the Opposition, Mr Howard, admits that the greatest weakness of the Fraser Government was its lack of an incomes policy. That necessity for an effective incomes policy was something which apparently the Liberal Party did not learn in government, and one would hope that Mr Howard 's admission is an indication that it is learning in Opposition.