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Transcript of press conference: Bomaderry: 4 March 1993



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PRIME MINISTER

TRANSCRIPT OF THE PRIME MINISTER, THE HON P J KEATING, MP PRESS CONFERENCE, BOMADERRY 4 MARCH 1993

E&OE PROOF COPY

J: ....18 months ago when you got in, when we needed a 10 per cent investment allowance?

PM: We did in One Nation. That's why we have got now a stock of applications on the One Nation of $130,000 million.

J: And what about the report from the local City Council? The GST is actually going to save the council $351, 000.

PM: Are you a member of the media are you?

J: Yes lam.

PM: Which organisation?

J: Australian journalist Association.

PM: No, the local newspaper.

J: Win TV, contractor. I am in a union.

PM: I really don't need to go through your ...... What did you say about Shoalhaven?

J: The local City Council put a report in. They called for a report on how it would affect the local council itself. They Caine out with a report the other night that claimed it would save them $351,000 in a year without taking the training levy off. If they took the training levy off they would save $651,000..

COMMONWEALTH PARLIAMENTARY LIBRARY MICAH

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Knott: That it is contrary to everything that came out from the local Government Association of NSW. Peter Woods and the local Government Association of NSW have come out with a report showing that the local council is worse off under GST. In fact, there were statements made by many of the regional Mayors wondering

how Max Atkins could be the Mayor of Shoalhaven and support GST. That has been reported widely in the media, as you would be well aware.

J: The Development Allowance Authority seems to suggest that there isn't that huge avalanche of projects ready to come on, with only a few signed up and registered?

PM: What the Treasurer has said is there is $130 billion of applications. Now the Authority is working its way through them. Yesterday when I was at Mackay Sugar, Mackay Sugar was saying they have got a $264 million proposal ready to go and they arc just waiting now for the Authority to approve it. There would be

many hundreds of applications now just waiting for approval.

J: So you haven't been fudging the figures from One Nation?

PM: No. I noticed that report in The Australian this morning. It didn't know what it was trying to say.

You said that there is $130 billion registered?

PM: No, there is $130 billion of applications.

J: Yeah, but you have often said registered.

PM: Let's not have a play on words. There is $130 billion of projects there which are with the Authority. Now what you call registered and what you don't call .. and what I have said on other times, even if a modest proportion of them goes, it is going to be a huge avalanche of investment.

J: Mr Keating, the point being made by the man managing the cake shop today was that he thought that your pay roll tax was immoral and without a ....

PM: It's not mine, it's the States'. The Commonwealth doesn't impose a payroll tax, it is the States. But the fact of the matter is you have got to have 60 employees before you even pay it. So, the key point for Australian small business is that 790,000 small businesses will carry the GST and have no payroll tax relief. None.

J: But he says that he could employ 2 or 3 extra people.

PM: Yes, but then when you ask him then about the impact of the 15 per cent GST on his business, across the board, that will put people off.

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1: Are you saying that you only expect a modest proportion of that $130 billion worth of projects to go ahead?

PM: Well I don't think people are going to apply for an investment allowance and not proceed with the projects. Obviously, a relatively I think, substantial proportion are.

J: What kind of proportion.

PM: Well it is very hard to say. But let's say that half did. You are talking about $65 thousand million. The One Nation package was $2 billion. This is $65 billion. It is huge, it is gigantic.

J: (inaudible)

PM: Well there is $130 billion of applications, some proportion of it is going to be applied, but as the Authority ticks them off companies can get going with them. We saw two done last week, and as 1 said yesterday, we had an example in Mackay, where I think most of you were, Mackay Sugar, where their new

refinery, $264 million is now an application. And they were saying to me yesterday can you get it ticked quickly, let's get going.

J: Mr Keating, Dr Hewson had trouble explaining the GST on cakes and pies, can you tell us how much sales tax there is on cakes, pies and candles?

PM: Well there is no sales tax on cakes and pies. None.

1: What about the bag they are sold in?

PM: Well they might be, but so what?

What about the candles?

PM: It is small.

Knotts: It is also in wholesale, not retail.

PM: That's right. It is at the wholesale price and once you mark it up you put the retailer's margin on. It is a much bigger impact at the retail level. The point is let's make this clear, this Government doesn't tax food, it taxes confectionary, it doesn't tax food. Dr Hewson is going to change the whole of the takeaway industry, the fast food industry, your cakes, your pies, your fast food, your chickens, your

Macdonalds are all going to be 15 per cent tax. It is a quarter of all food sales.

J: Mr Keating, if every business like that could employ an extra two or three people, that is going to go a long way to solving unemployment problems.

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PM: But how many places like that isn't? The one we went to today is a chain, but most of them are just individual businesses.

Knotts:80 per cent of our businesses are tourism industry. 357 million in the Shoalhaven each year, 80 per cent of those people arc not sales taxed. Most of the takeaways, most of the employment comes through those small businesscs. If you look from here down through to Ulladulla, down at Bawley Point, and ask the business people, the small business people who they are going to vote for, they are not going to vote for the GST, they are going to vote for the Labor Party.

J: Mr Keating, how important is this seat for you to win Government?

PM: Every scat is important in a National election. And this is one which has had a very fine margin and one where, I believe, that in this part of NSW a Federal Labor Government will_always be more interested in these areas beyond the capital cities then is the Coalition. And we have proven that with the Better Cities program, we

have proven that with our infrastructure programs. They don't believe there is any place for public provision of infrastructure. John Hewson says if a company can't provide it, you don't get it. That is his attitude.

J: Mr Keating, would you agree that Dr Hewson is showing a degree of bravery of holding these very public meetings? Do you plan to follow suit?

PM: Well, you just have a look at how many people are here. What are you talking about?

They are all Labor supporters.

PM: What do you think they were last night, they were all Liberal supporters. And can I just make this point to you, what he won't do is sit up and do a press conference every day. He won't do it. Let him show his bravery by answering the questions for the mass of the Australian people, not some tricked up thing in a hall.

J: You were challenging him to go and meet the people, he is doing that.

PM: What I am saying is that whenever you see Dr Hewson running along a beach, whenever you see him wearing a funny hat, you can bet one thing for sure — he is not answering questions about the GST and why he wants to impose a monster tax on Australians. That is the key issue. It is the job of political leaders in this country to explain their policies not run away from them, whatever the subterfuge

is, whatever the subterfuge may be, even if that includes evening meetings.

J: Why don't you go out and do meetings like that and meet people, and have them challenge your policies?

R

PM: I have now got five television cameras on me, everything I say here is going to go to a much larger audience then some hall meeting. I have done more hall meetings over my life time than I have had breakfast.

J: Don't you think that ... could get some public sympathy for the demonstration..

PM: Well you would have to have a very weak head to be in that wouldn't you? He is about to put a 15 per cent Goods and Services tax on you, change the way that Australians live forever, and we are suppose to have sympathy because he does a hall meeting.

J: Mr Keating, could we just get to local issues for a second or two? How concerned are you about the electrification of the rail system from Sydney down to Bomaderry? At the moment it is very ... and I know it comes down to State, but how can Federal help us?

PM: Well it is something I think Bob Brown had looked at and thought about. We are extending some electrification under the Better Cities program. NSW nominates, we provide the funds, they nominate the projects. So, NSW has not electrified this line at its own expense and it is not even nominating this as a project under the

Commonwealth Better Cities program.

J: (inaudible)

Knotts:That's what we intend to do and that's why you elect me.

Mr Keating, in this area you have the opportunity of creating several hundred jobs at the Navy Armaments Depot, the Government sat on the report for the past couple of years?

PM: ... there are a lot of defence issues that take time to materialise. We haven't made decisions about it.

1: How long before you make it?

PM: It is something we will probably look at in the current Parliament, I think.

J: Mr Keating are you saying that the Liberals deliberately stacked that hall with demonstrators last night and try and make it look ....?

PM: No, you are saying that, Nickii (Savva), not me. No, I am just saying this, that the Liberals had basically a Liberal Party hall meeting last night with their supporters.

J: Do you think he wins sympathy from having things thrown at him, and people shouting at him, and enduring this?

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PM: Well the thing is this, if you are in public life you have got to take what comes. I mean I am sitting here with all you preying types. I mean, am I complaining about it?

But today you were suggesting that people should let him be heard. Is that because you think he is winning ground?

PM: No, I don't want anyone to do other than to let him explain the inexplicable. To let him tell us that bad is good, that a tax slug is good for you. To let Dr Hewson have the floor to say how a monstrous tax like this on the way in which we live can possibly help us, and let him refute the irrefutable, that a GST will cost jobs. And that is what we want to hear from him, we don't need histrionics, we just want

facts, but the best fact he can give us is the Cole Committee report. Could you imagine a Labor Government with a tax report which is going to affect every person's life, every issue in their lives, every dollar they spend, us saying it is a secret we won't let you have it? That is what he is saying to you.

J: So once he has been heard in silence, Prime Minister, you would be happy to see a repetition of last night's events?

PM: The Liberal Party can do its own stuff, do what they like. What I want to sec from Dr Hewson is the Cole Committee Report. He says he wants to look Australians in the eye. Let him look them in the eye with the colour of his document. Let's see the secret report he has which is going to change the way in which Australians live, in the way in which the GST effects their lives. That is, what we want to see. That is, what he has, and at this stage of the game the media haven't got it from it. Ten days before a poll, he has still got the report.

J: You wouldn't be concerned if there were more rallies like last night?

PM: Let him go for his life.

(inaudible)

J: Will you hold a public rally before the election?

PM: 1 am holding one now, in a sense.

J: But you are not really facing the public out in

PM: These are members of the public, just turn around, there they are all around you.

J: They are all Labor party members.

PM: No, not necessarily, they are not.

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Knotts:The bottom line is what you are trying to say is that the media here should determine what the Prime Minister, and the same thing has happened locally here, where the media tries to determine how I run my campaign, or how the Prime Minister runs his.

PM: Peter, they don't determine how I run things and they know it. Now are there any other questions?

J: .. grass root supporters, is it sort of calling off the dogs to leave Hcwson alone?

PM: No, I am just saying Dr Hewson will look for every excuse not to explain his policies. Not to tell Australians why they should wear a 15 per cent tax on everything they do and everything they spend. He will look for every excuse to slip and slide off the stage. His first questioning, his first real questioning about

this came on the John Laws program a couple of days ago, and he was hopeless. He couldn't explain. On Willesee last night he got asked a simple question, on A Current Affair, whether a cake was taxed, and he wouldn't say, couldn't say whether it would be taxed. The fact is he doesn't know, or he won't say. Now the

fact of the matter is that he is the author of the policy, he is the one who should say how it applies. But the detail has been thought through by a specialist committee he set up and made much noise about in the setting of it up, that is the Cole Committee Report, Sir William Cole, a former Commonwealth Statistician,

Deputy Secretary to the Treasury and other tax specialists who produced a 40 chapter, large volume report on how a GST will apply. Give us the Report, Dr Hewson should give us the Report. Stop obsverscating and give us the Report.

J: Any reason why those people who were heckling last night, and others who might want to in future, should listen to you in particular, and shut up?

PM: Well I invite some, I invite all comers, I can absorb the counter culture no worries at all.

J: Mr Keating, is there a chance that while you are getting mileage out of the GST that people aren't hearing enough about Labor Party policies, about whether you arc offering a change or just more of the same?

PM: I did a major policy statement on the second day of the election campaign, that was a reduction in the company rate to 33 per cent, a further investment allowance. That, coupled with the depreciation under One Nation, building on the One Nation investment allowances, I mean it is all there, We did it right at the front.

Mr Keating when you say some proportion of the $130 billion will go ahead, that could be 2 per cent or 92 per cent?

PM: Well it is going to be, I think, a relatively large proportion.

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J: More then half?

PM: Well why would people apply, it has got time limits, it has got strict time limits.

J: So, more then half as a rule?

PM: Who can say. Even if, whatever proportion of it goes, it is so large, it is $130 billion.

J: But it could be 2 per cent?

PM: Well it is not going to be that is it? There is $800 million gone already or more. And there is $260 million yesterday waiting to be ticked.

J: Possibly a modest proportion, possibly a large proportion, what do you think the figure will end up as?

PM: Could you imagine the Liberal Party, could you imagine, Mr Robb and Dr Hewson, fitting with $130 billion of applications for investment, could you imagine the brouhaha, the advertisements, the carry-on from that? We have in Australian business $130 thousand million of applications.

J: (inaudible)

PM: And that is the best indication any of us have had of the likelihood of strong investment in this economy.

J: You say that if Dr Hewson is elected that that investment plunge will evaporate? That those investment applications will be withdrawn?

PM: Well he's certainly not going to reduce the company rate to 33, he is going to put the company rate up to 42.

(inaudible)

PM: Well I don`t know. Obviously people would have to re-do their sums if the company rate rises as it will under the Liberal Party. It is going to go from 39 per cent to 41 per cent.

J: (inaudible)

PM: I could hear the question the first time. That is, if the company rate is going to rise from 39 to 42 per cent, every company will have to reconsider its position. And the other thing is this is a 10 per cent investment allowance for projects over $50 million. So, I don't even know whether the Coalition would stick with the policy..

But what we are doing is saying this, that if they actually bring them forward, even

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further forward will give them another 10 per cent. So what we are saying is there is an avalanche of projects there, the charge that one needs to put into it to see it come down and be spent in the economy, earlier rather then latcr is a further investment allowance. We are the only people offering that and we arc offering it at a 33 per cent company tax rate.

J: Is your campaign against the GST damaged somewhat by Merle Mitchell this morning saying the GST isn't an issue now it is off food? And ... also refusing to endorse your party?

PM: She made a very, I thought, valued attempt to make clear that the Coalition's policies would be bad for the future and bad for her constituency. And it seemed without being totally partisan about it, coming out and say, she was really urging people not to vote for Coalition policy.

ENDS