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RT HON. B.M.SNEDDENQ.C..M.R 74/180 21/11/74

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THE MINISTRY

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The Prime Minister's announcement ends the weeks of un­ certainty about the future of Mr Crean which have con­ tributed to the decline in confidence in t h e .Government's economic performance. ·

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However, changing the man does not change the economic :

situation.

The present economic: situation isv the result of mismariager . ment and wrong decisions for which,,the -brime Minister ..pre-.. . . . dominantly and the whole of the Labor Cabinet .bear the. . ... . b l a m e . .

The change that is required is a change of policy.

The Opposition has consistently set out the correct policies to be followed, most recently in the 10-point economic strategy set out in my statement to the House of Representatives on Tuesday n i g h t .

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They includes

$1000 million cut in personal income taxes; Guts,in some indirect taxes aimed at directly reducing some prices; a reduction in the Government spending increase announced in the Budget from 33° / ° to 25%; the easing of monetary policy; a statement setting out the future course of monetary policy; abolition of the variable deposit require-? ment and an end to the prohibition on short-term capital flows; a flexible exchange rate with the development of a foreign exchange market; investment incentives to restore business investment in new plant and equipment; a complete review of the activities of the various Govern­ ment bodies regulating business; and restoration of the authority of the Arbitration Commission and a more re­

sponsible approach to wage claims generally across the whole labour m a r k e t .

Mr Crean's dismissal as Treasurer represents a further pressure on the crumbling structure of the Labor Government.

His replacement by Dr Cairns cannot be expected to lead to any immediate improvement in economic management for a number of reasons.

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Dr Cairris is recognised to be the author of the September Budget, which has already been thoroughly repudiated by the Prime Minister himself. Dr Cairns s.tates that the present level of unemployment is trivial arid is on the record .

as believing reductions in personal income taxation to be both n a i v e'and1 inflationary:. . : .,· : · . . . .

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While there has been a switch of. p e r s o n n e l t h e r e can- bej.r. no confidence thatAustralia will see an end .to t h e : con­ tradictions and mismanagement of economic policy which have produced today's unemployment and inflation.

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A further aspect is the unprecedented way in which this Ministerial change is to be carried out. ; . .n . .

Because of his clumsy hsmdling, the Prime Minister h a s ... . ■ been obliged to accept an i.interregnum of several weeks . . . : during which there will be, for practical purposes, no Treasurer. ··â– .;■ ■ · . · · . ' · · · . . : ■ . · ■ . . ; v ■·â– ,.

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