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Thursday, 5 May 1994
Page: 322

Senator HILL —I address my question to the Leader of the Government in the Senate. I remind the minister that Mr Keating last night had the arrogance to compare his efforts with the Chifley white paper of 50 years ago. Indeed, Mr Keating even went as far as to say that Chifley's document was modest compared with his own statement. I am not sure whether the minister has ever read the Chifley white paper, but if he has he will know that it was entitled Full Employment in Australia, in contrast to Mr Keating's paper, which accepts that there will remain substantial unemployment in this country, perhaps half a million unemployed. I also remind the minister that the Chifley white paper made this statement:

There will be no place in this full employment policy for schemes designed to make work for work's sake.

Why has the Labor Party given up on Chifley's noble goal of achieving full employment?

Senator GARETH EVANS —Before Senator Hill starts to get cheeky about anything in the government's policy, I think it would be useful to remind ourselves about some of the contributions he would have made to the unemployed under his party's Fightback policy. Some $790 million worth of savings, as I recall, were to be achieved at the expense of the unemployed. Fightback would have reduced spending on labour market programs by one-quarter, as I recall. Does he? Under the opposition's Austrain proposal unemployed people would have been paid as little as 70 per cent of the award wage with no obligation to train at all.

Senator Alston —On a point of order, Mr President, Senator Evans knows full well that he is trying to get in as much as he can before you sit him down. That answer is clearly non-responsive, utterly unrelated to the question and you ought to call him to order.

Senator McMullan —If I may respond to the point of order, Mr President: it seems to me quite clear that Senator Hill's question relates to credibility about employment policy and Senator Evans is directly relating his answer to that policy. What those opposite do not like is that Senator Evans is exposing effectively their lack of credibility as well as espousing ours. The question was about credibility on employment policy and that is the matter to which the minister is addressing himself.

The PRESIDENT —I do not believe there is a point of order.

Senator GARETH EVANS —I am indebted to all of you, Mr President—

Senator Kemp —On a point of order, Mr President, I submit that if Senator Evans is to debate the issues in the last election, could he also indicate the promise made by Mr Keating that Labor would not raise taxes?

The PRESIDENT —Order! There is no point of order and Senator Kemp is fully aware of that fact.

Senator GARETH EVANS —I am indebted to Senator McMullan and everyone else for their help in this matter but I had finished making the points I wanted to make. I intended to go on to say that the white paper is not about creating jobs for jobs sake or non jobs or artificial jobs or temporary jobs. The white paper is about creating real jobs—indeed, 1 1/2 million of them at least by the turn of the century, by the year 2001. The reason that will happen is that the white paper is not only about social policy; it is about economic policy. It is not only about equity; it is about economics. It is not only about training; it is about the implications of that training for the creation of new jobs over a period of time.

  If those opposite knew anything about economics, not to mention anything else, they would appreciate the significance of these particular proposals in that context. Bringing the unemployed, especially the long-term unemployed, and the possibly unemployable, back into the work force with enhanced skill levels and enhanced employability makes a direct contribution to growth in the economy as a whole. Having a bigger pool of trained and motivated human resources increases business investment and business decision making options. Investments can be made, new business activities can be undertaken which might otherwise go offshore or would require products to be imported rather than produced.

  It is the functional equivalent of skilled migration. The economic contribution to the work force of skilled migrants has never been underappreciated or misunderstood, and that is what is being done by training and creating a new capacity to contribute to the economy with people who might otherwise have totally lost that capacity if they had been left to themselves by the kinds of policies that Senator Hill is so strongly advocating.

  Reducing unemployment is essential in itself to achieving sustained and stronger growth because it harnesses the productive potential of the unemployed, which is otherwise lost, because having a pool of job-ready and better skilled workers prevents the re-emergence—

Senator Hill —Mr President, on a point of order: this is very interesting but I put it to you that it is answering a question that Senator Gareth Evans may have been anticipating. It is not answering the question he was asked. He was asked: why has the Labor Party given up on Chifley's noble goal of full employment? Why does the Labor Party now accept a goal of half a million unemployed as full employment?

The PRESIDENT —There is no point of order.

Senator GARETH EVANS —I am answering that question by saying that of course we have not given up on that goal. And, of course, every element of this white paper—not just the social policy dimensions of it but the economic policy dimensions of it—is directed explicitly to achieving that particular goal, not just by meeting the equity needs of those who will otherwise become a kind of depressed underclass but by meeting the economic needs of the nation. No point is worth making more strongly than that in the context of replying to that kind of question.

  I conclude on that point by saying that having a pool of job-ready and better skilled workers of the kind that will be produced by this particular paper has an economic significance in addition to those I have mentioned already by preventing the re-emergence of inflationary pressures that would otherwise inhibit strong and sustained growth. It helps increase national savings by reducing budget outlays and increasing income tax revenue, which again implies lower budget deficits, which again is a major contribution to macro-economic objectives.

  In addition to all the other specific initiatives in the white paper which will assist investment decisions to be made—and if I had the time I would go through them: the cut in the tax rate for the pooled development funds; the change in the tax treatment of infrastructure bonds; the funding for capital works projects; the regional headquarters; the trade policy matters; all of that kind—in addition to all those other measures which are directly and sharply targeted towards improving the viability of investment decisions, and in addition to all the other initiatives which we have introduced over the last few years and have created the conditions in the economy which exist at the moment for enhanced business activity, with these training measures one has something that is of a very direct and immediate economic significance.

Senator HILL —Mr President, I ask a supplementary question. I might press it further because there seems to have been a lapse of memory on the part of the minister since yesterday. The green paper referred to full employment. Chifley's white paper referred to full employment. Yesterday, the minister said that full employment in the Labor government's terms is about five per cent unemployment or approximately half a million unemployed—half a million unemployed being a satisfactory goal. How does the government, therefore, justify that new goal that relegates so many Australians to the scrap heap of unemployment, in the light of Chifley's advice 50 years ago?

Senator GARETH EVANS —Of course the objective remains to create a situation where everybody who wants a job can get one. Of course that is the objective of every government in every country in the world. The question is: in this day and age, given the current organisation of economies like ours, what is an achievable one on the best possible assumptions about appropriate job conditions, appropriate employment and economic conditions and appropriate government strategies to maximise the chances of getting that?

  Economists' views about that, as I said yesterday, differ quite a lot. But there is a realism about the sense in which one does have to target in this day and age less than the one per cent or two per cent figures that were common as assessments of achievable full employment in societies like ours a generation ago. Nowhere in the world are assessments of that being achievable being made by any other country like our own—in the OECD or anywhere else. So it is a matter of understanding what the objective is, working like hell to try to achieve that objective, and putting in place policies which, unlike the opposition's, will get us one hell of a lot closer to that objective than anything the opposition would be able to manage or would even care to try doing.