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Gulf war; the economy; recession; interest rates; ABC Gulf coverage

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Leader of the Opposition *


SUBJECTS $ Gulf war; the economy; recession; interest rates; ABC Gulf coverage.


Dr Hewson, does the Coalition continue to fully support the Government's stand on the Gulf.


Yes we do. We've been consulted appropriately all the way

through and we remain totally behind the government.


Even now that the ground war has been launched.


Yes. We see it as a situation where Saddam Hussein had again every opportunity to respond and to leave Kuwait and as he's chosen not to do that, not to meet what were very fair deadlines, there is unfortunately no alternative but to push ahead with the

ground war and we remain, totally behind the government on that as well.


Do you think more time should have been given to consider the Soviet proposal.


No. I don't think so myself. I think that it's a fairly simple choice for Saddam Hussein and that is complete and unconditional withdrawal from Kuwait - very easy decision for him to make and he obviously made it - so in that sense he left the Americans and

the United Nations' forces no alternative but to proceed.



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


- » Hews on:

No at this stage w e 're quite happy with the commitment that has been made and, you know, we don't have a lot of information on the way the ground war is going. But we've always kept the view that each stage of the process should be subject to a separate decision and we've left it open as to whether in fact there

should be any change in the nature of our commitment. We don't start with a disposition either way, but we'd like to look at any request or any situation as it emerges and that was our position from the beginning, it's still our position. But at this stage on what we know, we believe it's the appropriate response that the government's made. And undoubtedly as the days go on we will get more information on the way the ground war is going.


Do you think Australians.are getting enough information on what the three war ships are actually doing.


We believe so. We've been'keeping pressure on the Prime Minister and the government, if you like, to keep telling people where they are and what they're doing and I think in general that's been the case. He's made himself available fairly well on a press conference basis, and both the relevant Ministers have done

that as well, so, you know, you have to always have an eye to the sort of intelligence restrictions that should apply and you don't want to put their lives at risk in any sense, but within those bounds I think the government has said all they can in relation

to the location of the ships.


Do you know where they are at the moment.


Yes we do. In terms of our most recent briefing but I wouldn't want to be telling you what I know. I'd rather they release the information as appropriate. We do maintain an approach to the government where we get as regular a briefing as we can at the

similar level, I believe, to what the government gets so in that sense we keep our eye on what people are being told. And if

there is a significant shift in the nature of the commitment then we'd call on the Prime Minister to inform people when he can about that and initially I would try to do that on a private

basis to encourage him to make a statement. At this stage I've got nothing to cause me to say any more than I've said. /3


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On economic matters, the dwindling tax receipts, how worried should the government be.


Well, this disappearing surplus of Mr Keating's stands really as another monument to his dishonesty and misrepresentation and his lousy economic management because we've been saying since the last Budget that the surplus number wouldn't be achieved, that he'd used artificially favourable forecasts, that he'd obviously

judged the economy not to be going into recession when clearly it was. And so the outcome of that has really been that the

recession impacted pretty hard on the surplus, but also the government itself has made a number of decisions through the year which have increased expenditure or reduced tax receipts. I think principally they tried to force an artificial sale of the

Pipeline without doing due process. Indeed, I think they were breaching existing contractural arrangements in order to put in a fictious number in the Budget, that sort of thing. Well, you know, it's overall a response to the recession and it's

incompetent economic management.




We did. We said that if they maintain the interest rate policy they've been maintaining that a recession was an almost

inevitable result of that policy and so far they've yet to face that reality. You still see Mr Keating trying to create the illusion that things will be better, we're on the way out,

sustainable recovery will come the latter part of this year. There's nothing in the system at the present time that will bring us a sustainable recovery and as we keep warning, we're in a period of rolling recession. Some numbers will look better for a while, but others will look worse.

And I'm very apprehensive about the impact of the rural crisis which has yet to flow through and, of course, a slowdown in the world economy which has yet to hit our export markets and our export prices. So we've got at least through the middle of next

year before we can look to any sustainable recovery from this recession and it ought to be a great sense of urgency right now, that this March 12 statement really does bring about a

significant shift in policy.

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■ » Unfortunately all we're seeing is posturing between the Prime Minister and the Treasurer and Button and Mr Kerin and others and all the options that they're floating are unfortunately nowhere near what needs to be done to turn this country around. We have to make more change in order to boost our exports and boost our production than at any time we've achieved in the whole post­ war period. And I don't see any willingness or capacity on the part of the government to bring about to bring about that sort

of change.




Well, I think the big issue there is that they are eroding public sector savings at a time where we deperately need national savings. They are increasing debt, or looking like they'll increase debt as the surplus will undoubtedly disappear, if not this year, next year, and they'll go into deficit. There is a public sector, I believe, financial crisis emerging because not only is the Commonwealth in a situation where it's run down it's

surplus, but a lot of the States are seeing their revenue bases eroded, their expenditure has jumped dramatically and in those circumstances, I mean, the real issue, do you go into more debt and you fail to produce the necessary savings the current account deficit stays higher longer than it should and ultimately, of

course, interest rates bear the brunt of that and, you know, that's why there's such an urgency for the government to put in place other policies apart from interest rate policies.


Mr Keating argues that ... budget surplus .,.

Hewson: .

Look he built a budget surplus on the basis of an unsustainable economy. He overheated the economy, and you know, created a speculative boom. That gave a great boost to government coffers in terms of increased revenue, it saw the labour market overheat

in terms of the number of jobs he was creating and, of course, the end-point of that was the unsustainable surplus. He used to boast that he would always get the surplus right, it was the one forecast you could always be sure he'd bring in on track, and even that one now has biten the dust and I think in those

circumstances he should come clean with a full and frank

exposition of where the economy's headed, we're a long way from seeing the bottom of this recession in my view.

Thank you.

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Dr Hews on, can I ask you one final private question. Do you

agree with the Prime Minister that the ABC's coverage of the Gulf war as been biased.


Well, we thought the news coverage of the ABC was very good and I think, you know, it was a constant source of good information to everybody.

We were a bit concerned about some of the documentary or current affairs-style programs where quite often the guests that appeared were not identified as having particular links or particular positions and that can mislead people as to whether they're

getting a clearcut view of the situation.

I unfortunately, personally, don't get to see a lot of television but my staff and others who've seen it suggest that that was the case. That quite often you get somebody in who may have a

particular Iraqi link and it's not declared. That can lead people to draw the wrong conclusion from that presentation so I think, you know, there's always the need for balance in these things and if there was any scope for improvement it would be in

that area, whereas I personally, did see the news coverage and I thought it was very fair and high quality.


So was the Prime Minister's attack, was that just ABC bashing.


Look, I'm not sure the motivation or the occasion that he chose to make that attack. As I say I think it's always important in these very sensitive areas to be sure.that you are identifying the source of the information so that accusations about bias can't be m ade. In those circumstances, where I was happy with the news service, but I think that some of the current affairs programs came across as presenting, you know, an unbalanced view.


Would a Coalition then support the idea of an independent watch­ dog for the ABC.

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Look, we haven't gone that far in looking at it. I think that there are a number of watch-dogs on the ABC already, public opinion being perhaps the best one, but, you know, we haven't formally considered any specific new organisation that monitors you guys. I think where we have problems, or have had problems

in the past, we've just simply drawn it to the attention of

people as a misrepresentation of what we said, or whatever. in general people at the Commission then professionally respond to that well informed criticism.

Thank y o u . '

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