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Living standards- challenge to Mr Willis



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J*. AUSTRALIA

■ i

TREASURER

EMBARGO

NO. 133

STATEMENT BY THE TREASURER, THE HONOURABLE JOHN HOWARD, MP

LIVING STANDARDS - CHALLENGE TO MR WILLIS Mr Willis' statement today that research carried out by the .

Parliamentary Library confirmed that there had been a dramatic

fall in living standards for the "vast majority" of Australians

during the five years of Fraser Government was itself misleading.

The Library study is by no means as emphatic in its conclusions .

as Mr Willis would have us believe. . For example, although it

concludes that wage and salary earnings "appear" to have suffered

a decline, the study admits that "...it is difficult to satisfactorily

quantify the extent of this decline".

The study does not substantiate the claims being made by the Labor Party that living standards have fallen by $16 a week.

If there is any conclusion to be drawn from this study, it is that . .

"It is in fact very difficult to make any real estimate of changes in living standards since -so many variables are involved. In particular, it * ’

is impossible to attempt to compare changes in

living standards without undertaking a detailed .

investigation of changing patterns of income ' distribution."

As I made clear in my statement of 5 September, the most satisfactory

broad measures of changes in living standards are real per capita

increases in private consumption expenditure and household disposable

income. By these measures, there has been an increase in living standards during the period in; question. .

2.

It is true that these measures do not take account of income

distribution but they are, nevertheless, the best measures available

The comparison which merely involves measuring income and taxation changes, adjusted for certain selected factors, does not provide the whole picture. As I demonstrated in my earlier statement, much

depends on periods chosen. That is borne out by the Library's study. .

Moreover, the study itself points out that there have been increases

in social security and other benefits to households and that

" it is not possible to assess how this has affected living

standards for the majority of income earners without having any

information as to the distribution of such assistance."

But the ultimate question in this whole debate is about economic

management and whose economic policies would be more appropriate

to Australia's needs in the years ahead.

That is the crux of the debate - the debate which Mr Willis is now attempting to confuse.

I would be prepared to meet Mr Willis to clarify that debate and.

to demonstrate that the Labor Tarty's policies, far from increasing living standards, would, in fact, reduce them. .

I challenge Mr Willis to such a debate before the end of this campaign. .

CANBERRA

24 SEPTEMBER 1980