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Tuesday, 23 October 1984
Page: 2244

Senator CHANEY (Leader of the Opposition)(8.30) —I always enjoy listening to the Leader of the Government in the Senate (Senator Button). I believe that he has a very great contribution to make both to this place and to Australia. However, this is the first time I have heard him make a speech that sounded desperate. I find it strange in circumstances in which the Government is ahead in the polls and the Government has chosen to close the Parliament down to hear him making a speech in the spirit in which he just has done. I think it is worth remembering that the Government, in conjunction with the Australian Democrats, has just chosen to close down the Parliament by preventing any further prolonged debate on matters before us, including the appropriation Bills.

I pose a very simple question to the Leader of the Government in the Senate: If things are as good as he is saying, why is it that we are having an early election? If everything is going as perfectly as this Government indicates, if all of the indicators show that we are on a path to sustained recovery, why is it that even though the Prime Minister (Mr Hawke) promised us there would be no early elections under a government led by him we find that about 18 months after the Prime Minister and Senator Button were elected to government we are rushing to an election? If the Government is as optimistic as Senator Button would have us believe-I certainly detected a hint of desperation in his words-why is it that we are having this early election? He asked us to take on trust. He said that what this country needs is trust. I think it is a great shame that the Government does not trust itself to allow its policies to be tested, to allow its policies to run through and for the Australian people to have a chance to judge the Government on the results of those policies. Instead we have a rush to an election after a year and a half. I think that is a question mark hanging over this Government.

In most of the things the Leader of the Government in the Senate has had to say in this place there has been a very strong streak of responsibility. I believe, for example, that in his answers to questions on unemployment he has generally been extremely careful not to gild the lily. I think he has always shown caution about a situation which I believe requires caution. He has shown concern about a situation which requires concern. However, he seems to have thrown those characteristics away in the last couple of weeks. I do not know whether it is the absence of Senator Walsh which has led Senator Button to don Senator Walsh's mantle. However, I would like to go through some of the points Senator Button raised in the debate this evening. I say first that his Opposition is delighted that there is less unemployment now than there was 18 months ago.

Senator Cook —That is the first time you have said it.

Senator CHANEY —Every Australian is pleased there has been a degree of economic growth and recovery and a lessening of unemployment. I do not listen to the babbling of Senator Cook. Senator Cook, as the Trades and Labour Council agent in Western Australia, did as much as anyone I know to damage economic activities in Australia. I will ignore the babbling of Senator Cook and get back to the more serious points made by the Leader of the Government in the Senate. A series of optimistic points were made by Senator Button. I put the general question over all of them: If things are so good why this early election? The first statistics that Senator Button chose to mention was that employment has grown and unemployment has been below 9 per cent for three months. It is true that unemployment has been below 9 per cent, but I would have thought it was worth noting that the most recently published Australian Bureau of Statistics figures show that full time employment in Australia has declined by, I think, 18,900 jobs in the last three months. If we look at those statistics it can be seen that full time employment in Australia has not improved over the last three months, it has declined. It is true that that is partially cancelled out by an increase in part time employment over the same period. Senator Button says that was a creditable performance. I suggest to Senator Button that it is a cause for concern that we have reached the sort of wavering position we have.

We have been told by Senator Button that inflation is down 4 per cent. Of course, we welcome the fact that inflation is lower. However, Senator Button might have conceded a little more honestly that the fall in inflation was substantially contributed to by the Fraser wage pause. Senator Button immediately went on to say: 'And look at the reduction in interest rates'. I say very simply to Senator Button: The fact of the matter is that under his Government real interest rates have not declined, they have increased. I would have thought that a Minister concerned with investment and with economic recovery would be a little more concerned in talking about nominal interest rates in the way he has, about reminding the Senate that we have a continuing and serious problem in the fact that real interest rates have increased under his Government. That is a significant factor which will affect both his portfolio responsibilities and the whole prospect of economic recovery.

Senator Button also said that the deficit has been reduced. He spoke the factual truth-the deficit has been reduced by $1.3 billion, in a year when the Government got a one-off wave of new revenue. The Government had a 10 per cent real increase in revenue available to it, totalling $9,000m, and a reduction in the deficit of $1.3 billion followed. What does that tell us? It tells us that this Government has locked itself into continuing high expenditure. It has given away the opportunity to reduce the deficit in a substantial way to buy itself votes in the early election it has called. We sit here and listen to the moralising Leader of the Government in the Senate telling us half truths. He is using statistics in a way which is obviously misleading. The Leader of the Government has told us that we can see the economic recovery by looking at the recovery in the housing sector. What sector has had more public money pumped into it? Of course it is a good thing that houses are being built, but those houses are being built because this Government has pumped very large amounts of taxpayers' money into the housing sector.

Senator Button —That is right.

Senator CHANEY —The Leader of the Government says: 'Yes, that is right'. I can only say to him that when we look at the decline in activity in so many other sectors and the decline in employment in agriculture and services to agriculture , in fishing and hunting and in mining and manufacturing, and when we look at the decline shown in the statistics produced by the Parliamentary Library, we have to be concerned that the signs of recovery are to be found only in those areas where we have a substantial public subsidy. The Leader of the Government talked also about retail sales being satisfactory. I can only say to him that senior retail industry spokesmen have been far less benign in their comments over recent weeks. The increases referred to are not real increases. The very calling of this election has caused alarm in the retail sector. There is no reason for the Leader of the Government to be as complacent as he was in the speech he made just a few minutes ago.

The Leader of the Government in the Senate has often made much of the improvements in industrial relations. Of course he pooh-poohs our references to the last Labor Administration, but he refers to our Administration. He and people such as Senator Cook love to refer to the Fraser Administration but they become very upset when we remind the Australian people that six million man-days were lost in 1974 under the brilliant industrial relations management of a Labor government. I agree with Senator Button that it is a very good thing that there has been a reduction in industrial disputation in this country. I welcome it and let me say that I believe that the Government has kept the trade unions to the accord better than I predicted and better than I expected. I agree with that but I say to him: Do not be too smug about it. We have a very worrying statistic for July and I suggest that the Minister should resume his caution-the caution he has customarily shown when talking about unemployment and the long term problems we have with respect to it.

We had the Minister placing great weight on the fact that we have had community discussion and consultation on a wide range of issues. The fact of the matter is that the general Australian public has never been more locked out of the processes of consultation. What we have is this Government establishing a selective consultation process which involves large business and large unions. The Australian Council of Social Service is the wild card in that pack and it made clear what it thought of the processes. The fact of the matter is that the previous Government sat down and over a lengthy period each year saw interest group after interest group, organisation after organisation, and those interest groups and organisations have been closed out by a government that wants to make cosy deals with the trade union movement and cosy deals with big business.

Quite frankly, the results of which the Minister is so proud in fact flowed from the recovery which came from the breaking of the drought, from the Fraser wage pause and from the continuing growth in the United States economy. These factors have gone away and this has brought on the early election which this Government has so unnecessarily called. We then had the most extraordinary part of Senator Button's speech. He dealt with the taxation policies which have been introduced by the Liberal and National Parties as a prelude to this election. We have declared our hand on taxation. We have conceded that the offering of tax cuts is a matter which has to be approached with enormous caution, given the lock-in of expenditure which the Government is handing to us. That is a matter which cannot be escaped or avoided; we have not sought to escape or avoid it. We have given a very clear indication of the way that we will shape the taxation system. The Government has told us and the Australian people absolutely nothing.

Senator Cook —A very vague indication.

Senator CHANEY —Columnist after columnist and observer after observer have put the lie to people like Senator Cook. Senator Cook has a big mouth. He is very good at bullying people through the trade union movement. His record is well known in Western Australia. He has no contribution to make to this debate.

Senator Cook —It is a record I am proud of. It is one you will never have.

Senator CHANEY —If Senator Cook reads the economic commentators around Australia today he will find them saying time and time again that the Opposition has come out with a policy which is far more specific and definite that the policy put out by the Government. Senator Button tonight claimed that the economic improvement in Australia was because of his Government's economic management.

Senator Peter Baume —Senator Cook's record has no standing around here.

Senator Cook —Shut up, Baume.

Senator Lajovic —You are a parasite.

Senator Cook —You are an old fascist.

Senator Lajovic —You are a young fascist.

Senator Townley —Mr Deputy President, I raise a point of order. Senator Cook was just heard to say the word 'fascist' in relation to one of my colleagues. I take exception to that-

Senator Grimes —And Senator Lajovic also.

Senator Townley —and I would like the word withdrawn.

The DEPUTY PRESIDENT —I did not hear the remark. If Senator Cook made it he should withdraw.

Senator Cook —I withdraw, Mr Deputy President.

Senator Grimes —Mr Deputy President, if we are to carry on with this nonsense, I ask Senator Lajovic to withdraw the same comment.

The DEPUTY PRESIDENT —If Senator Lajovic made it, he should withdraw it.

Senator Lajovic —I withdraw.

Senator CHANEY —The Leader of the Government talked about unemployment, inflation and interest rates. I have already commented sufficiently on those points. He made the comment that the wage pause had been dreamed up by the Fraser Government to get off the hook of shocking unemployment. It is clearly understood in the Australian community that we did face a very severe economic recession in 1982. It is a fact that the international recession caught up with Australia, that the growth which we had had with respect to our industries cut out because there was no longer a market for the products of those industries. The fact is that we handed the Hawke Government a great benefit in the wage pause which was introduced by the Fraser Government.

Senator Grimes —Rubbish!

Senator CHANEY —All of the scoffing that might come from the Government benches does not deny that fact. At least some Ministers, including the Minister for Finance, Mr Dawkins, have been honest enough to admit that the Government took office at the most fortuitous time in terms of the economic cycle. That is a matter which now ought to be beyond debate.

Senator Peter Rae —Sir John Moore also made that point.

Senator CHANEY —My colleague Senator Rae said that Sir John Moore also made that point. But the fact is that again we have had this desperate attempt by the Leader of the Government to suggest that the improvements which have occurred are improvements which will continue. I again put the question: If the Government is so certain that that is so, why does it not run its full term so that the people of Australia can judge not on the Government's rhetoric but on the basis of the actual results it attains? Senator Button again placed great weight on moderation in wage growth when Australian Bureau of Statistics figures clearly show that whilst there may have been a moderation in the growth of award wage rates there certainly has not been a moderation in the wages actually being paid. The fact of the matter is that, while Mr Keating tries to explain that in terms of the growth of overtime, anyone who is in business will say that there has been a wage growth which outstrips the indexed wage increases which were permitted by the Australian Conciliation and Arbitration Commission.

Senator Cook —Are you getting some help?

Senator CHANEY —Yes, I am getting some help. I would be very happy to have help from Senator Dame Margaret Guilfoyle and none from Senator Cook. She was simply drawing my attention to one of the inaccuracies in the speech made by Senator Button. He was claiming as an initiative of the present Government the fact that companies were to be allowed to deal with their taxation arrangements on the basis of the group profits. I made the point, by way of interjection, that that was an initiative of the Fraser Government, not of the Labor Government. It was an initiative that in fact was postponed for a full Budget period by the Hawke Government and introduced in this Budget.

Senator Grimes —When did you introduce it?

Senator CHANEY —It was announced as part of the 1982 Budget and the Labor Government chose not to continue it after the election.

Senator Grimes —This is deplorable.

Senator CHANEY —We have all learned that no credence can be placed on anything that is said by the senator from Launceston. I would simply say to him that that was a matter that was introduced by the Fraser Government, announced as part of the 1982 Budget, discontinued by the Hawke Government in 1983, and resurrected as part of its Budget in 1984. The fact is that that, like the new depreciation provisions, which Senator Button acknowledged as a Fraser Government initiative, was brought forward by us.

The Leader of the Government in the Senate, towards the end of his speech, talked about our vague and uncertain tax policy. I can only say how sad and sorry it is that a Leader of the Government who, day after day, comes into this place and refuses to acknowledge that this Government has no policy on taxation except to say that it will have a public inquiry, can accuse us of vagueness. The Opposition has been quite clear about its tax policy. There is to be no capital gains tax. We are to repeal the tax on lump sum superannuation. We are to introduce measures that will do away with some of the injustices and inequities in the present tax system. We will give to pay as you earn taxpayers who have children the same benefits with respect to splitting their incomes as are available to people who are self-employed. We will hand out a totally new concession to those in two-income families who are forced to go to the expense of having their children in paid-for child care. These changes will improve the equity of the tax system. No equivalent policy is available from the Government. The only policy put forward by the Government is that it will have an inquiry. I reject with contempt the views put forward by the Leader of the Government in the Senate and by other Government spokesmen that in some way we are being more vague than they.

Senator Button finished with a plea for serious economic management for Australia. I think that is a proper plea for a Minister to make. I think Australia has significant and continuing difficulties, not least in employment. But for Senator Button to suggest that the course which has been set by this Government is a guarantee of good economic management and continued improvement is to ignore the facts and reality. On a number of occasions in this place I have quoted the views of Syntec, a magazine which is said to be close to Treasury, an economic commentator which is widely respected and which in the early days of this Government had many good things to say about it. I have referred to the fact that in both the September and October editions of that magazine Syntec made it clear that it believes the Government is not on a sustainable course; that if it is returned to government it will need to take action early in the New Year if it is to avoid the great difficulties which it has set for itself with the recent Budget.

I reject what has been said by the Leader of the Government. The fact is that honest, professional economic management of this country would never have permitted that additional $9,000m to be dissipated on additional expenditure. It would have required a substantial and responsible reduction of the deficit.

In the time that remains to me in this debate, I would like to turn to some other points that go to the future of this country. We have a very interesting few months ahead of us. The big question for Australia is: Are we at the peak of the post-drought recovery or are we at the bottom of a long period of economic growth? That is the significant question that must be asked. Senator Button's speech really assumed that we could take it for granted that we were at the bottom of an economic slope that would stretch away and rise in front of us. I think there are enough worries about now for us all to be concerned that we may in fact be at the peak of the post-drought recovery. If we are to take seriously the point that was made by Senator Button about the problems of youth unemployment and the long term problems of unemployment for Australia generally, and I believe we must take it seriously, we have to be anxious to ensure that we are at the bottom of a long period of economic growth and not at the peak of a post-drought recovery.

The fact of the matter is that if we look at what has been said by Syntec, if we look at what has been said recently by Citicorp Australia Ltd, and if we look at what has been said by the Westpac Banking Corporation about the accord-all these authorities have been quoted in this place-we find that serious questions have been raised about the current policies of the Government. We have a situation in which full time employment is declining, retail trade is just bumping along, and very serious question marks are being raised about our exports. Senator Sir John Carrick in a very good speech in this place just a few days ago pointed out the enormous difficulties we face in our export industry. The wrong decisions made now, including many of the decisions already taken by this Government, will damage Australia's recovery by forcing up interest rates, by making labour too expensive to employ, by further increasing the tax burden and, in summary, by making us uncompetitive internationally.

There is a very high degree of satisfaction about. Many people have felt the benefit of the post-drought recovery. I ask again: Why is it that we are having this early election? I can only say that I believe it is because some wrong decisions have already been made and because some wrong decisions are in the pipeline. The simplest demonstration of the way in which this Government has gone fundamentally wrong is the record level of government spending that has been achieved. We have a Government which in a period of recovery has pushed government expenditure to record limits. I put the very simple question: If we need record government expenditure in a period of recovery, what will this Government have to do when the economic cycle turns? If the Government has to spend at record levels now, if it has to break new records of expenditure when things are so good, what will happen when the 29 per cent decline in rural incomes, which is predicted by the Bureau of Agricultural Economics, occurs? What will happen when our exporters face the declining prices outlined by Senator Sir John Carrick in his excellent speech the other day, quoting the Department of Trade, not some political source? The simple fact is that this Government will be forced to push up government expenditure more and more. That is what gives piquancy to this debate about tax. How can this Government claim to be one that will relieve the tax burden on the Australian people when in good times it has to push up government expenditure to record levels? As I said a few minutes ago, the Government got $9,000m extra cash from the taxpayers. Provisional tax went up by, I think, 47 per cent in one year, and the Government could use only $1.3 billion of that $9 billion to reduce the deficit. The Government is simply in the position where it will have to raise extra revenue next year, so it will have to go for new and/or higher taxes.

The Opposition wants a continued recovery for Australia. I have sufficient respect for Senator Button-indeed, I have a great deal of respect for him-to know that he would want the same positive results for Australia as are wanted by the Opposition. However, a continued recovery is dependent upon a series of interrelated policies. We will have to have some government restraint with respect to expenditure. I have already said that this Government has pushed up expenditure to record levels, and I said in an earlier debate in this place today that government administration will cost over 16 per cent more under this Labor Government than it cost last year. That will be $724m extra going not into benefits for people but into employing people to administer the benefits that are flowing. The cost of government administration under Labor is growing far faster than the cost of government generally. We have to achieve restraint. This is not a popular cry but it is absolutely necessary. Can we really afford to spend $740m extra on the administration this year when the Minister for Social Security, Senator Grimes, has to impose an assets test on pensioners to save perhaps $15m this year and $50m in a full year? Can we afford over two years of Labor to have something like a 10 per cent increase in the size of the Public Service? Can we afford the sorts of promises which are held out by the Minister for Science and Technology (Mr Barry Jones) that we will have new programs and new taxes if the Labor Government is returned after this election?

If we are to have economic recovery we will have to have an end to unnecessary government obstruction. We will have to have an end to the picking as to which investments will be allowed to go ahead. We will have to have an end to the situation in which Senator Cook, a Western Australian, can sit here and allow his Government to say that Roxby Downs can proceed to mine its uranium but uranium at Yeelirrie in Western Australia cannot be touched. We will have to have an end to the situation in which people who have invested in the mines at Honeymoon and Beverley are told that their investments have been quarantined because the Government is going to pick which people are going to be allowed to proceed with their investments.

If we are going to have a growth in employment which is sustainable, if we are going to have a reduction in unemployment among the young, quite clearly there is going to have to be an easing of the rigid wage fixing policies which would rather see workers dismissed than have them agree to terms and conditions which would permit their survival. Everybody in this place knows that during the recession employers were simply prevented by the rigidity of our wage fixing system from entering into arrangements which would have allowed employment to continue. If they had done so they would have been in breach of some award.

I have only a few minutes left in which to speak in this debate. In a sense I have not been able to touch on what I think matters most about what is going wrong with this country under Labor. I have touched mainly on economic matters because they were the matters on which the Leader of the Government chose to concentrate. But, in fact, I think one can see the more important deficiencies in what is happening to Australia when one looks at the approach which is being adopted by the Government in the fields of health, education and welfare. It is my view that if we are to maintain the sorts of standards which Australia needs in those areas we have to maintain the personal and individual standards of excellence that can be achieved in his country but which can be killed by unnecessary bureaucratic interference and overbearing of private effort. The Government has stepped back from its obvious desire to put greater pressure on the private school system, the system which I believe has contributed to the whole educational system by providing parents with freedom of choice and a competitive element. The Government backed off from the decisions that were taken at the Australian Labour Party biannual conference. But the Government has left remnants of that anti-pluralist attitude in place in its restrictions on the opening up of new private schools.

In the health field I suppose the most significant long term damaging thing that this Government is doing is its attempt to destroy the doctor-patient relationship and to turn doctors, through bulk billing, into public servants. As far as I am concerned an important element in maintaining excellence in health services is the continuation of the private contractual relationship between doctor and patient.

Senator Grimes —The gypsy principle-that is what it is.

Senator CHANEY —The fact of the matter is that the Minister for Social Security, who is at the table, disparages his own profession which, unlike my profession of the law, has in the past traditionally made services readily available for all Australian people. He disparages his profession by suggesting that the profession needs to be socialised to achieve the appropriate results. In all of these areas this Government has encouraged the Australian people to turn away from self-reliance, self-respect and self-help. It believes that one can, simply by raising more and more taxes and turning more and more people into government employees, improve the quality of our society. On behalf of the Opposition, I reject that concept absolutely.