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Tuesday, 17 March 1987
Page: 789


Senator COLLARD (Leader of the National Party of Australia)(5.17) —Mr Deputy President--


Senator Robert Ray —Have you got shoes on?


Senator COLLARD —Yes. I am even marketing a line of thermal footwear. I see quite a future in it. As one who spent many years on the footplates of steam locomotives, I know the value of them and their ability to withstand hot and cold. I am quite sure that if I accepted the offer of Senator Richardson opposite to talk about my version of what happened yesterday, the day before or whatever, I would have a far bigger gallery than I have now. Unfortunately, contrary to what the members of the Government might think, there are more urgent things out there exercising the minds of the people of Australia. Not the least of those is interest rates.

Senator Richardson found it very hard to work out why we are discussing the motion put down by the Leader of the Opposition in the Senate (Senator Chaney). We all know the history of the document that Senator Ryan quite rightly quoted from. It was an honest document and an honest assessment by one of the senior public servants-I think he is even a First Assistant Secretary-in the Administration. What we are on about is why this Government has said that this document does not represent its particular judgment when, as late as last week, I believe there was a conference which used this document as a basis for discussion.

It is quite easy and quite right for people out in the community to get very emotional about tax, which raises its head all the time, because every week in their pay they see the tax going out. When a government spends big it also taxes big. This is a government of all sorts of records-it is the biggest spending government in peace time history and thus it is the biggest taxing government in peace time history. The Prime Minister (Mr Hawke) particularly, the Treasurer (Mr Keating) and the Minister for Housing and Construction (Mr West) to a lesser extent, almost since they got into power in 1983, have said that in a couple of months time interest rates would come down. I will not give all those quotes again. As alluded to by Senator Richardson, I gave them in a previous debate. They are there on the record. What have we now? We have the Government once again saying that interest rates are going to come down shortly. As I have said, tax is an emotional issue out there. But if this economy is to get going again and if the business and farming communities that are really the engine-room of this society are to have the ability to invest, to manufacture more and to create more employment, things such as interest rates and inflation have to be addressed first. The incomes of most people in rural industry are so low that they are not paying tax anyway, but they are sure getting beaten around the head by the interest rates.


Senator Button —What would you do, Senator? Would you lower interest rates?


Senator COLLARD —It is in Senator Button's hands. He is part of the Government that has blown out the Budget deficit. He is part of the Government that has propped up the dollar with high interest rates. We therefore see the tragedy facing business men and women, and farmers who quite legitimately sat down a few years ago and budgeted with their accountants. They have worked hard; they have great expertise, but through no reasons other than high interest rates they are not only walking off their farms but also being carried off them.

In this incident a senior public servant gave an honest assessment of how he saw the situation so far as interest rates are concerned. No doubt what he said will turn out to be the truth. It is quite indicative of this Government that it tried to put this man down. It is almost going back to the Middle Ages, when the messenger was shot. Anybody who brings bad news is done away with. If we go into the traditions of this chamber and of the other place, we know that the position of Speaker was never a popular one because he always had to be the person to give the bad news to the King, thus his longevity was quite often in question. So we had the traditional spectre of people having to drag the incumbent to the Chair when he was first elected. We have a similar situation here of the messenger being shot. A senior public servant is doing his job, giving an honest assessment, and is being denigrated in this chamber for doing so. If we are going to keep shooting the messengers-and there will be many more messages of bad news if this Government keeps going down the track it is going down-we will have what could almost be described as a munitions led recovery.

As I have said, between December 1984 and February 1987 prime business rates have risen from 13.5 per cent to 18.5 per cent, an increase of 5 per cent. Small overdraft interest rates have risen from 14.5 per cent to 20.5 per cent, an increase of 6 per cent. How can one possibly budget for interest rate increases of that magnitude? For comparison let us look at the prime interest rates of other countries. From December 1984 to February 1987 prime interest rates in the United States of America went from 11.8 per cent down to 7.5 per cent, a change of minus 4.3 per cent. The prime rate for Japan-another of our major trading partners-went from 5.5 per cent down to 3.8 per cent, a change of minus 1.7 per cent. The rate in France for the same period went from 12 per cent down to 9.5 per cent, a change of minus 2.5 per cent. In Canada it went from 12.5 per cent down to 9.3 per cent, a change of minus 3.2 per cent. That is a selection of our major trading partners who have experienced a downward trend in their prime interest rates. No wonder we are being out-manoeuvred, out-pointed, out-sold and out-everything else in international trade when our farmers and businessmen have to compete with increases of the magnitude of 5 to 6 per cent or against the decreases of our trading partners.

Most people these days are into Bankcard. The last time I took part in this debate I think I mentioned the many people who are just getting over their Christmas spending-spending on presents for families and friends and on the extra food they bought to entertain relatives. A lot of that money came from Bankcard. Now that the repayments are due those people are finding out what sorts of repayments they are having to make. The interest rates for Bankcard over a similar period, from December 1984 to February 1987, have risen from 18 per cent to 22.5 per cent, an increase of 4.5 per cent. So not only are the business people and the farmers, even though they are the engine-room of society, being denied every opportunity to lead this country out of the recession in which it finds itself, but also the ordinary men and women of Australia are being hurt.

Housing loan interest rates have already been mentioned. The great Australian dream of owning a house has become the great Australian nightmare. The state of the industry is reflected in the drop in the number of housing starts, which is on the record. But what is probably worse, what is the big tragedy, is the number of repossessions going on.


The DEPUTY PRESIDENT —Order! Senator Collard, I have been allowing you some latitude, but you should bring your remarks back to the subject of the motion.


Senator COLLARD —I rather suspect that I mentioned housing loan interest rates. I recall that this whole document is really about interest rates, and particularly housing interest rates. Yet this Government says that the document put down by this senior public servant does not reflect the judgment of the Government. So we see that the great Australian dream has become the great Australian nightmare. As I have already indicated, the worst thing is the repossessions. People have scrimped and saved, forgone having a family, put together a deposit and decided that they could meet the repayments, only to find that they cannot now do that. Houses are being repossessed and sold on a down market and all that saving has gone down the tube. From March 1983, when this Government came to power, to September 1986 average home loan repayments have increased by various amounts in various States. In New South Wales over that period it increased by $206 per month. In Victoria it increased by $204; in Queensland by $199; in Western Australia by $97; in South Australia by $207; in Tasmania by $175; and in the Australian Capital Territory by $177-an average increased repayment of $169 per month. No wonder a man of the calibre of Dr Hawkins saw fit to put down on paper his concerns and where he saw interest rates going. No wonder this Government is trying to duck every possibility of having this subject aired before one of the Senate's standing committees.

As I indicated by way of response earlier, the whole matter has been brought about by Government ineptitude in handling the economy, Government expenditure and the propping up of the Australian dollar. I, and indeed my colleagues on this side, believe that this subject should be referred to a standing committee so that it can be well and truly aired, then all of those who are interested will have the chance to put forward their points of view. I support the motion.

Question resolved in the affirmative.