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Friday, 19 April 1985
Page: 1515

Mr BURR —My question is directed to the Prime Minister. In view of widespread interest and concern, can the Prime Minister clarify whether or not the Government intends to advocate before the Australian Conciliation and Arbitration Commission the discounting of wage increases for inflation caused by currency fluctuations?

Mr HAWKE —Both the Treasurer and I have addressed ourselves to this matter at length. I content myself with saying these things: Firstly, it should be understood that the first case that will be coming before the Conciliation and Arbitration Commission will be in approximately September which will cover the March and June quarters. There will be no impact of the devaluation in the March quarter figures. So all that will be before the Commission will be the figures in respect of the June quarter. It is the expectation that that will be a very low element in any move in the consumer price index figures for the combination of March and June. Nevertheless, the Government will be looking at these figures and will be formulating the position that we should put before the Commission at that time. What should be really understood is that it is 12 months away. It will be April of next year before this matter will be before the Commission in any possibly substantive way involving a reflection of the devaluation effect in the consumer price index.

As I have said-I give the Australian community the reassurance that the Treasurer and I have given-this Government will not allow the very substantial benefits that will flow to the Australian economy from the current devaluation to be dissipated by an inflationary spiral. With respect to the wages area, that matter will not be substantially before the Commission for almost 12 months. While those on the other side, on their past record, have given no evidence of their capacity in economic management, I will just give them this lesson: It is an exercise in futility to make a decision about a situation, the elements of which one does not know, 12 months in advance. All the people of Australia need to know, and they will accept our assurance, is that when the time comes the appropriate decisions will be taken which will ensure that those benefits of devaluation will be maintained for the whole of the Australian people.