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Member of Parliament discusses payroll tax and a book he has co-authored on unemployment

MICHAEL CAVANAGH: We've had a solid fill of the White Paper on unemployment since its release yesterday afternoon, but it is a crucial document, not least of all to the one in four young kids in Canberra who can't get a job. John Langmore, of course, is the Federal Member of the Canberra seat of Fraser, but more than that, he's taken a close interest in unemployment and has co-authored a book with ANU academic, Dr John Quiggin, on how to get Australia back to work. Mr Langmore is also chair of the Caucus Social Justice Committee and he joins me this morning. Good morning.

Here on the program, eight days ago, talking about your hopes for the White Paper, were they met?

JOHN LANGMORE: I think it's a very valuable paper. It'll do a lot to increase training opportunities and work experience for the long-term unemployed and it makes some very valuable changes to income support measures, and that's very useful. There are also some initiatives for industry policy but it doesn't have a ringing statement about a goal of full employment and nor is it really a comprehensive employment strategy in the way that the 1945 White Paper was.

MICHAEL CAVANAGH: Is that because, though, there is just no chance of full employment?

JOHN LANGMORE: No, not at all. I mean, there are plenty of possibilities that should be adopted to maximise growth of employment and most of those are not in the paper at all. It's an attempt to improve the capacity of the long-term unemployed to get back into the workforce, and to support them while they're doing that. But what we need as well is a comprehensive strategy which sets a goal of full employment by the end of the decade and then sets out the scores of policies that would all contribute to achieving that. But if we did that, it would be quite possible to achieve it.

MICHAEL CAVANAGH: Is it a little bit of gilding the lily then?

JOHN LANGMORE: No, no. It's very useful. It's a fine statement as far as it goes. But the sorts of additional policies that are required are, first of all, the strong commitment to full employment, and then the identification of all the areas where permanent work is desperately needed and services have to be improved, and then the ways of linking the people who could provide those services with the jobs that need doing. And there are many of those. Let's just take one very obvious example. Two-thirds of Australians work in the services sector; many of those work in human services like education and health and care for the aged, the young, the environment and the arts, and all of those areas desperately need additional people working in them because there are lots of unmet needs.

There are waiting lists in hospitals and nursing homes; 150,000 people Australia-wide couldn't get into TAFEs last year; 5,000 people in Canberra couldn't get into TAFEs last year, but they're not being enabled to because there isn't adequate funding for the TAFES, and that's because - in large part - the Commonwealth has cut the funds available to the States and the Territories. Now, part of the answer to the unemployment problem is to link those desperate needs with the people who could meet the needs by better funding for those sorts of organisations.

MICHAEL CAVANAGH: So did the Prime Minister and the Ministers closely involved in this lack a little bit of political will or did they also think that parts of Australia wouldn't also come to the party?

JOHN LANGMORE: I think that there is still a large element of what you could call economic fundamentalism which rejects the proper co-operative relationship between public and private sectors. We seem to have forgotten that. Through most of Australian history, the public sector has worked co-operatively and productively with the private sector, in part, for example, by developing the national infrastructure which allows the private sector to be productive and earn a profit and improve efficiency. But, at present, we're investing less in the national infrastructure through the public sector, as a proportion of national income, than in any year since the war. And yet we know that when you build up public investment, you also stimulate private investment; and yet we also know that private investment is very low. So that one of the answers to the present unemployment problem, as well as the answer to stimulating private investment, is to build up public investment. And there was a derisory $10 million for regional infrastructure in the White Paper. I mean, that was just pathetic. And so I think there is a lack of vision amongst these economic fundamentalists about what works in practice around the community.

MICHAEL CAVANAGH: So the pointy heads have still got a few hands on the levers?

JOHN LANGMORE: I'm afraid so, and I think there's now a reaction against that around the community, but still not in the senior levels of the public service, and we must urge those senior public servants and the Ministers, too, of course, to look at what works in practice; what our history tells us, what the evidence from other countries tells us. Let's look at East Asia, for example, where they've got massive infrastructure programs under way at present, and where they're growing strongly; where they're not only not selling-off their AIDC but they're increasing the finance available to investment banks so as to contribute to productive private investment; where they're spending enormous amounts on training their skilled workforce and we're still not spending enough. I mean, it's fine to provide training programs for the long-term unemployed but we want people to be able to go straight from school into TAFEs if that's what they want to do, rather than turning them away at the door. There are large numbers of very obvious, very practical things to do, which are still not being done.

MICHAEL CAVANAGH: I'm talking to John Langmore, Member for Fraser, on his views on the White Paper and, in particular, what it may mean to the ACT. And if anyone does have a view after I've finished talking to Mr Langmore, if they want to give us a call on 2754666. Mr Langmore, do you know whether Cabinet gave any serious thought to abolishing the $6 billion a year State payroll tax as one way of creating jobs?

JOHN LANGMORE: I don't know, but I've got no evidence that they did. That is a major proposal; I think it's one that should be very seriously considered. But of course, it would have to be replaced by an alternative tax of some kind.

MICHAEL CAVANAGH: Wouldn't that just be robbing Peter to pay Paul?

JOHN LANGMORE: No, it wouldn't be. It's perverse to tax employment at a time when our highest priority is to build up employment. There are obvious ways of replacing it. If it were abolished, company tax would automatically rise; that would be part of the alternative revenue source, but we'd need another revenue source, and a greenhouse gas emission tax would be a very obvious type of tax to look at instead. And, in fact, the environment committee of the House which I chair has just commissioned a paper from two excellent environmental economists about investigating the possibility of introducing some kind of greenhouse gas emission tax because that's ...

MICHAEL CAVANAGH: So, you're hoping that still will be alive then?

JOHN LANGMORE: Well, we're certainly going to investigate what would be involved. It may be too complex, it may be too difficult, but we're studying the issue and if, after we've read their paper, we judge it to be responsible, we will recommend to government formally, through the parliamentary committee, that they examine that possibility more closely.

MICHAEL CAVANAGH: The big issue on unemployment here in the ACT is just the high rate of youth unemployment. Where do you see the paper flowing through and helping and impacting fairly quickly in that area?

JOHN LANGMORE: Well, it does increase training programs and work experience programs, and I haven't any doubt at all that that will have a direct benefit to young unemployed people, and that's very invaluable indeed. But surely it would be also valuable simply to allow those young people who want to, to go to TAFE, and they're being turned away in droves.

MICHAEL CAVANAGH: Mr Langmore, thanks very much for your time.

JOHN LANGMORE: Thank you very much.

MICHAEL CAVANAGH: John Langmore, Federal Member of the Canberra seat of Fraser, and also the Caucus Chair on Social Justice.