Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Transcript of media conference Brisbane

Download PDFDownload PDF

t k%>

Leader of the Opposition

31 October 1991 REF: TRANSCR\0301.tmc



SUBJECTS: BOP, Housing starts, Interest rates, Industrial Commission.


Your reaction to the Balance of Payment figures today?

Hews on:

It just tells me that the recession isn't over. That we have deep seated structural problems in Australia and you can't tinker with those problems. We have to embrace major and dramatic change in Australia in order to fix the problem. And the

Government, unfortunately, has not faced that reality yet.


One of the major problems was the fact that imports are up 17 per cent, they haven't managed to kill off imports.


Well, we have become extremely import dependent in Australia and the timing of particular month's movements sometimes make it look better than it is and I guess that this month is reminding us that we are heavily import dependent and we have got a long way to go in order to turn that around. We have got to re-build

industries that have moved offshore in Australia in recent years. Go into any supermarket and see how many of the goods, any

department store, see how many of the goods are actually

imported. Even though we used to have viable industries in Australia.


The housing industry is showing signs of recovery - strong signs.

Parliament House, Canberra, A.C.T. 2600 Phone 277 4022


REF: TRANSCR\0301.tmc 2 .


No, the housing industry is showing mixed signs. I don't see any evidence that the housing industry is really picking up. There has certainly been some changes of ownership of existing

dwellings, but as one fellow from a major concrete company said to me the other day, we haven't shipped on more bag of cement, I don't know where they are doing all the building. And the fact is that there really isn't much of a pick-up. There should be,

in time, some pick-up, as interest rates come down and people have some confidence in that. But at this stage we haven't seen a lot, we have seen a little bit of activity, but clearly a long way to go in terms of there being a recovery, even in that

industry and that industry normally leads.


What then should the Federal Government do about interest rates and what do you think the Reserve Bank will do about it?


Well, I think that there will be a couple falls in interest rates over the next few months, I can't be specific about the timing but I think they will probably lower interest rates by one to two per cent in the next few months, through to the early part of next year. I think that is already in the pipeline. We don't try and pick the particular timing of those falls, but we are more concerned, actually, that the interest rates not only come

down but that they stay down and that will again only happen if you change policy in Australia.

If this economy picks up off this base, without addressing any of those structural problems, we will have a balance of payments problem or crisis down the track. We will have a massive

deterioration, further deterioration in our balance of payments, we will have re-kindling of inflation, we will back on the old boom/bust cycle that was a feature of this Government's period in office. It is time to deal with the structural problems and

as every day goes by and as every statistic comes, they really just have to grapple with that problem.


If interest rates do come down, won't that just increase imports?


Well, the risk is that if you just push interest rates down and they ultimately work, that you just move very quickly into a further balance of payments of problem. There is no doubt about that, that given our import dependency, if you try to force feed

the economy into recovery by a fair amount of stimulus from the Budget, as we have seen, and you push interest rates down too

REF: TRANSCR\0301.trnc 3.

fast, of course you risk that. So, what I am really saying is, I want interest rates to come down but in the context of a

package that starts to reduce our dependence on imports.


Do you think that there is too much euphoria from yesterday's decision, you know, yesterday's decision, ..(inaudible).., the CPI down and everything else, that we are really not out of the crisis that we have been in?


Well, I was amazed at today's media, sort of welcoming the

nirvana and the utopia and so on. Yesterday's decision is not in the best interest of workers of Australia or the Australian economy. We want genuine enterprise bargaining, we don't want the Government just going through the motions and talking about enterprise bargaining and then failing to put in place the

substance. So, yesterday was very much tinkering, it is not really going to change the nature of the industrial culture in Australia, it is not really about workers negotiating with their employers. It is about unions negotiating with the employers,

the Accord is still in place, the Government is still going to do deals, still the possibility of national wage rises. It is a bit of the Australian disease, you know, everything will be alright, we just have to sit around and things will get better -

and they won't unless we do something about it.

And yesterday is going to compound the problem.


Aren't you being a little bit unfair on people like Bill Kelty and Martin Ferguson, describing them as defacto Federal

Ministers, when in fact all they are trying to do is co-operate with the Federal Government to get the economy on its feet?


No, they try to run the Federal Government, don' they? I mean, they really start from a position where they have an effective veto power over most of what has got to be done. And the reason the Government didn't introduce a goods and services tax in 1985,

was Billy Kelty. It wasn't anybody else, the electorate was ready for it, the Government got rolled. The reason they didn't make a substantial improvement in competition in

telecommunications, was again the union influence. The reason they aren't doing much by way of improving our waterfront, no genuine reform on the waterfront at all, is basically the

Waterside Workers Federation. We can have the most efficient manufacturers in the world, we just can't get the goods past the Waterside Workers' Federation down on the waterfront.

REF: TRANSCR\0301.tmc 4.

So, sure the union movement has got a tremendous influence and you can be sure of one thing under us, they won't run us, they won't be part of our Government. We will talk to them, we will hear their case, but we won't do deals with them, they won't veto

policy, they won't set wages across the board. That has been visibly against the best interest of most Australians and I think importantly, visibly against the best interest of the rank and file. We are going to get to Government when the rank and file vote for us and they are going to vote decidedly against that

type of Government and that sort of deal doing approach to policy in Australia.