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Tuesday, 26 October 1971
Page: 2489

Mr MARTIN (BANKS, NEW SOUTH WALES) - My question is directed to the Prime Minister. Is the right honourable gentleman aware that his former Cabinet colleague and the former Treasurer, the honourable member for Wentworth, acknowledged last Thursday that inflation had 'largely passed beyond the power of the Government to do anything decisive about it'? Did Sir James Vernon tell the New South Wales Institute of. Management last Thursday that the Government's current deflationary restrictions on demand were irrelevant to the current inflationary situation and would fail to contain inflation even if carried to the point of 'gross unemployment'? Does he recall that on 15th September the 'Sydney Morning Herald' summarised 'the whole underlying strategy of the Budget' as 'creating a pool of unemployed to moderate wage demands and price increases'? Will the Prime Minister now acknowledge with the former Treasurer and the former Chairman of the Committee of Economic Inquiry that the Budget strategy was misconceived and should now be changed?

Mr McMAHON - I have read the first statement. I read part of the second statement and only today I have written to Sir James and pointed out to him that some of the figures in his statement- are wrong. I have not read the third statement.

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