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Thursday, 10 March 1977

Mr BRADFIELD (Barton) - I was sitting in the chamber when the third last speaker, the Leader of the Opposition (Mr E. G. Whitlam), was speaking and I thought I was experiencing a nightmare. He was predicting all the gloom in the world for the future of Australia. I think he was making his speech for a forthcoming election which he may have to contest. Perhaps he was making himself out to be something like that character who is known as the mild mannered reporter from the Daily Planet.

I want to tell the Australian people the truth about that speech and the speech of the Deputy Leader of the Opposition (Mr Uren), who spoke about the straw which will break the camel's back. He predicted gloom and jealousy for the private sector and mentioned the need to build up the public sector. He does not realise that taxes from the private sector support him and the public sector. I talk to the people of Australia tonight- hopefully, some of them are listening in their cars as they are driving home from work- to tell them that the future does not hold all the gloom which has been predicted by the previous 2 speakers from the Opposition benches.

There are 2 very important sections in the Speech of Her Majesty which was made here last Tuesday afternoon. One section has already been referred to by my colleague, the honourable member for Eden-Monaro (Mr Sainsbury). I shall mention these 2 small sections to honourable members. Her Majesty stated:

Australia has experienced economic difficulties in recent years; my Government has given first priority to restoring the economy and will use all the resources at its disposal to achieve this goal.

Later, in the speech, Her Majesty said:

My Government is not only taking action to restore the economy, it is also making social reforms which are of fundamental importance to the freedom and well-being of the Australian people.

This Government is concerned not only with business and the future of our economy but also with people. When we look at our record in the last 15 months and consider what has been achieved, we see that we have accomplished many things which honourable members on the Opposition benches could not achieve when in government. An example is an automatic adjustment of pensions. The Opposition had the opportunity to do this. We did it. In a few weeks' time the 1.5 million pensioners throughout Australia will receive a rise of 8.2 per cent in their pensions. Yet the Opposition is supposed to be the Party which cares for people like pensioners and people in need. Did the Labor Party take this action? It had the opportunity. In our first 15 months in government we have given automatic increases to pensioners. We have not stopped there. I ask: What about tax indexation and our generosity in that respect? This year tax indexation will give the people of Australia $ 1,100m discount in taxes. Honourable members opposite laugh when I talk about that. While they were in power they increased taxes at a far greater rate than had ever happened in Australia before. This Government is not stopping at tax indexation. As recently announced by the Prime Minister (Mr Malcolm Fraser) and the Treasurer (Mr Lynch), we are now firmly committed to look at tax reform. This is another advantage that the people of Australia will experience in the near future. I might add also that the Whitlam Government absolutely refused tax indexation. Its greed to obtain more money stopped it from making this decision. It needed the money to spend. It was not prepared to give anything back to the people of Australia.

We have achieved other things in the last IS months. The alteration in the distribution requirements of small private companies shows our sincerity towards small business. The fact that small private companies are now allowed to retain more of their profits for capital expansion has certainly alleviated some of the problems that built up during the previous 3 years before this Government came to power. I refer also to the investment allowance. The list is endless. The point is that we still have promises to fulfill which will give to the Australian people many more advantages. The Australian economy is not in the gloomy situation that it has been made out to be in by members of the Opposition.

I turn now to one other recent decision which the Government has made and which I feel will be of tremendous advantage to the Australian people. I refer to devaluation. The Opposition criticised it. I am brave enough to stand up and tell the Australian people about the advantages that they will receive from devaluation. Honourable members opposite have backed it both ways. Before we devalued they were predicting it. After we made that brave decision and devalued they were criticising us for it. The decision to devalue was made in order to give a very quick domestic advantage to the Australian local industry. In our decision to devalue we were concerned for the unemployed people of Australia. Devaluation was one of those measures that would give the greatest and the quickest boost to the domestic economy. I suggest that shortly people will see the result of devaluation. They will see the revitalisation of Australian industry. They will see more Australian goods from Australian industry produced and sold. Those industries in particular which have been experiencing great problems with imported goods over the last few years will gain relief.

I come now to the attitudes of some of the Australian people as to what they expect from the economy today. The Opposition continually says that unemployment is high, inflation is high and interest rates are high. If honourable members opposite and the Australian people look at the various components of the consumer price index they will see that we have arrested inflation. It is true that we have not brought it down to the level at which we want it to be but we have stopped it from spiralling upwards. Honourable members should look at a graph of the CPI. Let me run through some of the past performances of the CPI. Remember that when Labor came into office it was 3.6 per cent. Let us start off at December 1974 and see how this Government has arrested the growth in the CPI. The figures are as follows: 16.2 per cent; 16.7 per cent; 16.2 per cent; 16.7 per cent; 16.8 per cent; and now we have it down to 14.4 per cent. That includes the Medibank levy. There is some debate as to whether it should be included in the CPI. Without it the figure is 10.8 per cent. We do not intend to rest at 10.8 per cent, but it is rather like the tide. I do not know whether any honourable members have ever stood on a breakwater at the mouth of a river and watched the tide come in and go out. It flows in and it stops for 2 hours before it can flow out. That is exactly what we have done with the economy. We have stopped the trend and shortly we will turn the economy for the betterment of the people of Australia. I have here statistics from the Reserve Bank of Australia relating to the trend in interest rates since June 1972. we all know that interest rates came from an average level of about Vh per cent in that time.

Sitting suspended from 6 to 8 p.m.

Mr BRADFIELD - Before the suspension of the sitting I was about to make my point in regard to the movement of interest rates since this Government has been in power. When Labor came to power in 1972 we left an economy with interest rates running at about 7 1/2 per cent per annum, a rate that seems pie in the sky today. The average interest rate peaked at 11 'A per cent about 12 months ago and now the average interest rate charged by banks is down to about 10'A per cent. This is just another of the factors I was mentioning which indicate that we have levelled off the economy, and we must level the economy before we can achieve any decline in inflation in the way which is best for the country.

Let me come now to unemployment. The Leader of the Opposition in his smearing speech which was unfortunately aimed at the member for Macarthur (Mr Baume), spoke about unemployment. There have been some reports in the Press recently and some rumours floated by the Opposition about this Government's attitude to unemployment. The Government sympathises with all Australians who are genuinely out of work and it is concerned that there are not enough jobs available for them. It has shown this sympathy in the last 2 days by indicating that recipients of the unemployment benefit will have passed on to them the full 8.2 per cent rise in the consumer price index. However, we are against those people who are receiving the unemployment benefit fraudulently. We are not against the person who is genuinely unemployed but there are some unscrupulous people receiving the unemployment benefit which they do not deserve, thereby robbing Australian taxpayers of their money and robbing other people in genuine need to whom these funds rightly should be going. My colleague the honourable member for Eden-Monaro mentioned in his speech that last year Australia had a real rise in gross national product, a feat that was not accomplished in the preceding 2 years. Surely this is an indication that the economy is turning rather than an indication of the dreadful gloom mentioned by the Leader of the Opposition and the Deputy Leader of the Opposition.

In the short time I have left I want to talk about the present and the future, and in particular about an article in a recent report by the Australian Industries Development Association. This article went to many firms and businesses throughout Australia and asked them for their predictions. It posed the question: "Theoretically what would happen if you had a 10 per cent rise in productivity? How many more people could you employ?' Unfortunately, the answer is only 2 per cent. That leads me to another matter. Just what are the Australian people looking for? With what are they trying to compare the economy today? Subconsciously, when people say that the economy is crook, they are really comparing it with the boom of 1973. We do not want a boom like the boom of 1973 when things were out of control. There were too many job vacancies and the only people who were unemployed were those who were not able to work. We do not want a boom of that magnitude again because there can be only a recession afterwards. We are looking for something steadier than that. We are looking for a steady increase, something which we can sustain and which will not be followed by a recession. I also want to talk about changing demands. It will be realised that over the years in Australia demands change. There are many industries today that are in decline and there are many that are booming. When one looks at them one sees the different phases through which they have passed.

I have no doubt that back in 1937 or 1938, a manufacturer of ice chests would have thought that business was crook because refrigerators were coming in. I refer to the plastics industry which has developed in post-war years and to the items which are now manufactured of plastic but which were formerly manufactured of other products. Toys used to be made of tin, small items were made of bakelite and pieces of equipment were made of rubber. They are all made of plastic today. I do not have the slightest doubt that if one asked someone in the plastics industry about his business and about the economy, he would say that they were great. But if one asked the same question of a manufacturer who made something out of bakelite or tin or rubber, he would say that the economy is crook because we all tend to judge the economy from our own little backyard, those things that affect us. But that is not the indicator. What do we expect of the economy? We do not want a boom of 1973 again. There will always be some industries that are having hard times. I refer to someone in the marine industry who manufactures fibre glass boats. That has affected people who manufactured plywood boats previously. There is a continual change in demand, and irrespective of the state of the economy there will always be some particular industries that are declining.

The gloom predicted by the Opposition is not there. Unfortunately Australia will have unemployment for some time. That is not disgraceful. It is disgraceful for those poor people who want jobs, but when Australia is compared with West Germany, America and Canada which have booming industries it is found that those countries have a greater unemployment problem than Australia, This does not mean that we do not want to get industry moving or that we do not want to get jobs for the Australian people, but it is a fact of life that unemployment is unfortunately one of the parts of the modern everyday economy. Australia is not in the doldrums. The Australian economy has a future. We have rounded the corner and stopped the spiralling inflation rates. We have stopped increasing numbers of people from becoming unemployed and we have stopped interest rates from rising. We are at the point I mentioned before about the tide. The tide has been flowing out and it has to stop for a little while before it will flow the other way. It cannot go out and come straight back in again. We have Australia in the position at which we have stopped the tide flowing. Shortly we will be able to make it flow the other way.

I started my speech by referring to 2 parts of Her Majesty's Speech. A quotation of one of the opening paragraphs of her Speech will make a fitting conclusion to my remarks. She said:

Today the qualities of the Australian people, the character of Australian society and the resources of the Australian continent hold out a great promise and a great challenge.

Those words are very true, but unfortunately not all Australians realise how true they are. We do have a future. Australians have a future and a confidence under the guidance of the Fraser Liberal-National Country Party Government.

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