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Liberal party breakfast

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Mr. Chairman, Sir Charles Court, Ian Warner, Ian Viner, Noel Crichton-Brown, ladies and gentlemen.

I am very glad to have the chance to be with you for the first few moments this morning, because this forthcoming election is obviously a very important one indeed. The polls over the last few days have not been entirely flattering and I made the point yesterday that if we were to believe those polls and if an . election had been held on the date of those polls there would be a Labor Government in power in Canberra at the present

time. ' .

I think in Western Australia, perhaps more than almost any other part of the Commonwealth, you would understand precisely what that means. The degree of interference, the kinds of policies that would be pursued, would frustrate enormously the hopes and

amibitions of all people in Western Australia and very much stand in the way of Sir Charles Court and his Government in promoting the State as vigorously as it has been.

A few days ago, and Sir Charles was making the point last night, the contracts for the North West Shelf were signed: the largest project ever undertaken by Australia; the largest contracts ever undertaken or signed by a State Government; a major enterprise. But it was held back for years - over the Labor years 1972 to 1975. We have been working with the State Government to. establish a

stable environment where projects of that kind can go ahead with confidence in the future of Australia, knowing that there is going to be stability in Government., and knowing that there is going to

be stability in policies. . Without that, of course, without that kind of confidence, then the major resources are just not going to be permitted to admit to ventures of that nature.

Business has a major role in Australia and in the development of Australia, in investment, in developing new goods and services, in finding new markets here and exploring markets overseas, and through its own profitability providing jobs for Australians. It

is worth noting I think that over the last year, more jobs were created through this process than at any time over the last ten years: over 200,000 new jobs. It is also worth noting that teenage employment grew last year more than it has at any time for

15 years. (Inaudible - talking over tape) . · · Obviously Governments need to co-operate with business, to support a stable environment, to have a sensible economy, to have inflation under control, to have inflation less than that of major trading partners, and (inaudible), so that our businesses can do better and sell more. Over the last five years our ability to compete has been restored. Investment prospects are now moving forward very strongly. Confidence in Australia, confidence from overseas,

confidence from people who are prepared to back this country with their dollars, is higher I think than it has been for many many years

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Profits are up, I am told, and capital (inaudible) are up. There are a number of things Governments have to do to help in achieving this: a stable environment, inflation under control. But then there is the investment allowance, depreciation allowance, export incentives and support, and better write-offs for exploration and development which are important for a great mining industry. Now how much of that would remain under a

Socialist government in this administration. They have already said that the investment allowance will be tapered off, and if you look at the words closely it is clear that they have said that that investment allowance would be taken off retrospectively, because a Socialist Government, a Labor Government, would want

to get $250 million out of knocking off the investment allowance in the first year, from the nature of it. That means businesses > large and small, would not be getting the allowance for equipment they have already committed themselves to and possibly have already got in operation. It would be knocked off


Against that kind of background, what would happen to export incentives and all the other kinds of support for industry; if they were knocked off retrospectively as the insatiable demands of a Socialist goverment required more and more funds

to meet its expenditure commitments.

It is ironic I think that a few days ago in Perth the Labor Party initiated what they called a small business policy. They said they would do something that we have already done - provide better access to the Development Bank - but they did not say at

that particular launch, that they were going to strike a dagger into the heart of many small businesses by removing the investment allowance itself.

I think it is very necessary, in the light of those polls over recent days, to ask ourselves what the consequences of a Labor government would be. What would be the outlook for competitiveness, what would inflation be under Labor. It approached 20 per cent before; and under the policies that they have enunciated it would have approach or go to 20% again. The increased

expenditure plans are massive but it is not only that; it is the whole approach to Government.

Mr. Hawke has made it plain that they have a hands-off approach to union negotiations. They would be putting unions above the law and I do not know how anyone can accept the view that if Mr. Hawke has a position of influence there will be responsibility in union affairs, because once before he was President of the ACTU

and President of the Labor Party, and there was a Labor Government, and what happened under those circumstances?

I know there have been a few strikes, days off, and strikes over the last 18 months - and far too much. But when Mr. Hawke was in those positions there was all-time record that has never been exceeded in any other time in the history of Australia, and in addition, award wages went up nearly 40% in one year alone. You all know what that does' to competitiveness, what that does to profitability, what that does to the capacity to employ. The

sort of hands-off policy that Mr. Hawke has enunciated is the policy that he was applying when he was in a position of influence. That approach to wages and union affairs, coupled with the spending policies of the Labor Party, would certainly send inflation in Australia through the roof and the competitiveness, the better

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position that we have from that of many other countries would be lost very quickly. There would be a loss of competitiveness, a loss of sales, a loss of jobs, a loss of investment, and it would be-a disastrous situation once again.

But there is another test also you can put on the attitudes of a Socialist government. What is their attitude to profits, what is their attitude to incentives for business which is the lifeblood of this country. They never understand that if people

are to be better off and to have higher standards, if they do want governments to do more for the disadvantaged, for the people who need help, you have got to build up _the productive assets of this nation.

You all understand that very well. But the Socialists seem to believe that you can batter the productive assets of a country like milked cow, and that people will go on producing, people will go on crating, no matter how difficult, or how impossible governments might make it. Well of course, it does become

impossible for you.

But a Socialist government has promised us much"higher taxation: tax on higher profits, resource tax, a capital gains tax, a wealth tax on industry and on all Australian.families. In spite of the election pledge to reduce taxes, they have also promised to restructure the tax scales to collect more revenue and it is arch-hypocrisy, it is fraudulent in the extreme to take the view that

they are a party of low taxes. They always have been a party of high taxation, of high expenditure and Mr. Willis said a while ago that if they did not win this particular election, by 1983 the policies of lower government expenditure and lower taxation would have been so embedded in the Australian community that

they would have very great difficulty in re-educating people to bigger government and the much higher taxes which Labor government would inevitably require.

I hope people take note of these things that have been said over the last year or so, not just the softer and more soothing words that might have been heard in a particular policy speech. I can put that sort of thing another way around. My Government will not impose a new profits tax... It will not impose a capital gains tax. It will not impose a wealth tax. It will not re-introduce death duties. We will not restructure the

tax scales to collect more tax. We will further assist small firms as we have over recent years,.and we will maintain the investment allowance. We are not going to put a tax on gold. .

The Labor Party cannot give a positive to any one of those things, because they are all in their book for higher taxation. We have not only got that. We have got their attitude to regulations, and again they have promises to extend the power of regulating bodies. I think a lot. of you are sometimes concerned at the power regulating bodies already have. Some of the powers, and the

exercise of those powers, gives my Government some cause for concern and we have been looking to see whether there are ways and means of reducing the impact of regulations on industry. Our opponents have made it perfectly plain that they would want to extend the power of regulating bodies and of Commonwealth

regulatory bodies.

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There is another test about the attitude to overseas investors, and to overseas business. Again, there is a promise of increased Government regulation. But one of the interesting things that they want to do is to establish a special spying bureau within the Foreign Investment Review Board, to especially spy on all multinational companies, to give the. information to Australian

trade unions, to international trade unions and to the United Nations.

Now, how many companies from overseas are going to invest in Australia, by themselves or in partnership with Australian firms if a Government is so naive and stupid as to establish that kind of body to frighten off and to deter investment in this country.

This is all their own work; it has been stated and it has been said time and time again by the Australian Labor Party. Therefore, we need to understand that if there were a Socialist government, if it did happen that those polls happened to be

accurate, which I do not believe they are - but you cannot ignore the polls when they come out, as they have done over recent days - you need to stand back and think what would the impact

of a Socialist government be. It would be disastrous for Australia, and distastrous for Western Australia.

We have negotiated with the State of Western Australia a complex set of agreements on all matters relating offshore. These are things the States used to do, then there were challenges to that and arguments· to that. The High Court gave jurisdiction and power to the Commonwealth. It would have been possible, and . Governments have, tried to exert total Commonwealth control over influence - "tell the States they've got nothing more to do in that area". That, of course, would include enormous areas of great importance to Western Australia.

We took an entirely different approach. We said the States to have a legitimate interest;· they do have legitimate functions. The interests and concerns of the States do not stop at low water mark. They do extend out and if there is power in the hands of the Commonwealth, it clearly needs to be sensibly shared and

the State allowed to do those things which the State can do best.

So we have got a complex set of arrangements (inaudible) the law, to protect the interests of the States. The Labor Party oppose those arrangements bitterly and vigorously, because it is within their policy - If they had the change to extend their power absolutely. They resented very much that we had tied the hands of the Commonwealth by law and by agreement with the States in a way which preserved the State1s capacity to get on with its own business without - I think Sir Charles sometimes indicates - without the Commonwealth's sticky fingers getting involved

in the business.

And that is the way that it ought to be. But over five years, Australian business had turned around. I hope all of you can remeber back to five years ago, and the gloom and the despair, the destruction, that had been brought to this economy. (Inaudible)

are good, but I think the outlook is better. There is an essential need for a continuation of sane and stable policies. There is benefit for everyone in this. On the kind of tests that you would want to put on the credibility of a Government, its capacity

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to advance Australia, the Labor Party fail on every one. They have failed in inflation, they have inflation in encouragement to industry, they have failed in the attitudes of militant unions, they fail in their attitude to investors overseas, and they fail in their attitude to profits and to

regulations against business. That is the most important single failure of the Labor Party - their failure to have any policy at all to control inflation, because if you do not control inflation as you would know, ultimately there is not much else you can do. It saps and destroys the heart of business,

(inaudible) and discourage people, and it destroys the wealth and the creative talents of the people.

I would ask you to think very carefully over the next couple of weeks, and if you do believe that my Government had done a reasonable job, as I believe it has, then make sure that you get as many converts as possible over the next two weeks. We need not only to keep all our seats in Western Australia

- there is a new lot we intend to win - and Noel Crichton-Brown has got to get up as the third Senator in Western Australia. We are relying on three seats in Western Australia to keep control of the Senate, and we will not be able to protect the

interests of the small States unless we keep control of the Senate, because we know quite well how the Labor Party will use its powers in relation to the less populous States, and the Democrats have indicated that they are sympathetic with that aspect

of the Labor Party's policy.

The Democrats do not represent a soft way of voting Liberal - what the Democrats do do is to present an easy way of voting Labor, . because 8 out of 10 votes they have cast in the Senate have been with the Labor Party. In addition to that, I think they are a.bit erratic. Don Chipp was saying one day how much he hated Malcolm Fraser and what a terrible person he was. He must have got a bad reaction from that because two days later he said how much he loved me. I am not sure which statement made me more worried. Either way around I do not think it was a very

good basis on which to try and claim the right to control the Senate and to influence the affairs of this nation.

Thank you for coming here this morning. Thank you for all your support, which I am sure is going to be forthcoming over the next couple of weeks to make sure that the resounding and adequate majority that we do have in Canberra is maintained,

and so far as this State is concerned, improved.

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