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Mr Hayden's response to the Budget



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'Jim. A, AUSTRALIA

TREASURER

EMBARGO

ELEASEJ — ■ v

NO.

Ί f vC-

STATEMENT BY THE HON. JOHN HOWARD, M P ,. TREASURER

EXTRACTS FROM ADDRESS TO PERTH PRESS CLUB LUNCHEON

12.45 PM, 6 SEPTEMBER 1979.

Mr Hayden's response to the Budget was vague and non­

specific, Not only did he ignore inflation but he failed

to explain precisely where he stood on the energy issue.

His policy on crude oil conservation and pricing appears

both muddled and contradictory.

He says that a Labor Government would reduce the price

of petrol.

He also says that it would raise more revenue from crude

oil.

Still further, he says his party's alternative policy will

both encourage exploration and conservation.

Would Mr Hayden please explain how these apparently contradictory

policies are to be put into effect?

How does he propose to raise additional revenue from oil

companies when, after taxes and costs, they presently receive

only about 10% of the value of their production?

Does he propose to reduce the price to producers of new oil

by not allowing them full import parity?

Would he freeze the phasing-in arrangements for old oil?

2

Would he reduce the price, per barrel, to the companies

producing the oil?

Each of these options would represent a significant departure

from arrangements which have been the basis for planning by

the companies.

To alter these arrangements would unnecessarily create uncertainty

Upsetting these arrangements would hinder oil exploration

in Australia.

Mr Hayden's crude oil policy is both confused and contrary

to the national interest.

Mr Hayden has a lot of explaining to do on the energy

issue.

It is sheer irresponsibility to hold out the prospect of cheaper domestic prices for petrol in Australia without

explaining how this is to be done.

If his parliamentary statements are any guide, Mr Hayden

thinks that prices have no c li'ect on conservation. .

Apparently he does not accept that if the price of

a scarce resource is artificially held down it will

become scarcer.

Apparently Mr Hayden has found a solution to the energy problem which has so far eluded the rest of the world.

CANBERRA

6 September 1979