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Monday, 11 November 1985
Page: 1898

Senator FOREMAN(4.24) —The matter of public importance before us today suggests that somehow or other South Australians have been disadvantaged since the election of the State and Federal Labor governments. This proposal is, indeed, a curious one. It is contrary to the facts and it is probably based on the philosophy that anything will become believable if it is stated often enough. Such a philosophy is not new to the Senate. The constant debates mounted by the conservatives in this chamber which fly in the face of reality are a daily occurrence. However, this one will no doubt take the record for the one removed the furthest from reality. The editorial in this morning's Adelaide Advertiser actually sums up the situation very well. It states:

It will be an important election. The economy is on its soundest footing for a decade and the party winning government faces stability, even prosperity, with such developments as Roxby Downs coming on stream.

As the editorial rightly suggests, the runs are on the board for the Bannon Government. The economy is indeed on its soundest footing for a decade and South Australians can rightly look to a future of increased opportunities and employment. Let us look, however, at what the Opposition in South Australia did when it was in government and what it has promised in the three years since South Australians passed judgment on it. The Tonkin Liberal Government in South Australia presented Budgets which reshuffled all the accounts. In 1980-81 $37m was transferred from the capital works account to shore up the funds for the day to day running of the State. In 1981-82 that somewhat questionable accounting procedure saw a further $44m go from public works to the daily running expenses. The same formula was used in 1982, when the Liberals intended to use a further $42m from the capital account to balance the books. The economic management of the Tonkin Liberals was described by John Bannon as:

. . . like using the rent and mortgage money to pay your groceries-in the end it catches up with you.

In this case the economic mishandling was never addressed by the Liberals. It took the Labor Government of John Bannon to make the hard decisions and balance the books-something which this hard working Government has continued to do ever since.

The Tonkin Liberal years in South Australia also saw a steady drift to unemployment, the migration of South Australians to other States to find work and chronic shortages of investment and housing. Not all the blame can be put on the State Liberals for those destitute years; quite a large proportion has to be put on the Fraser-Howard Federal money managers. South Australia's misfortune actually started before 1979. For those who are not aware, they started on 11 November 1975, when the Fraser Government came into being under questionable circumstances. The South Australian Government contained the worse of the disastrous Federal policies which followed until 1979, when South Australia got an even closer view of supposed good Liberal economic housekeeping.

When the Bannon Labor Government was elected in 1982 a series of natural disasters also was shaping events. The nation was experiencing a severe drought which directly affected the South Australian economy. The Ash Wednesday bushfires on 16 February 1983 did immense damage to South Australia, especially to State resources such as the pine forests. The first priority for the Bannon Government was the creation of a secure future-not the rhetoric of the Tonkin Liberals in 1979 that promised a great deal and delivered nothing, but an environment in which jobs would be created, housing shortages overcome and policies put in place to pull South Australia out of the economic rut it was experiencing.

The situation at the end of 1982 required boldness and imagination. The steps that the Bannon Labor Government immediately took had five broad objectives. The first objective was to use government action to prime the economy by an immediate and significant boost to the housing and construction sector. The second objective was to face up to the underlying weakness in the State's finances and get the Budget out of the red. The third objective was to seek out new investment to strengthen the State's economic base and expand long term employment opportunities. The fourth was to establish the ground work for a new phase of economic development in the 1990s with major emphasis being given to high technology industries. The fifth objective was to get out and sell the State's advantages to put South Australia back on the national and international map. Some of the decisions that followed were hard. For example, some charges had to rise-a fact which even some Liberals testified to. The Liberal Premier David Tonkin went on the record to say in his submission to the 1982 Premiers Conference:

Quite frankly, we are facing an enormous Budget problem. We face major increases in taxation and charges, over and above the cuts that we have already very successfully made.

John Olsen, the Liberal Leader of the Opposition in South Australia, also conceded in May 1983:

Tax increases were needed to cover some of South Australia's Budget blowout.

The hard decisions that were made in the early days in the Bannon Labor Government set the pace for economic recovery in South Australia in concert with the Hawke Labor Government in Canberra. Since 1983 there has been no increase in the rate of State taxation. The increase in tax revenue has followed from more jobs and hence more payroll tax and the great resurgence in the housing industry. In an article entitled `South Australia is low tax high growth State', Randall Ashbourne on 11 October 1985 in the News wrote:

South Australia's leading academic and corporate economists believe the State's recovery is about to hit a new stage of growth.

The half yearly report of the prestige Centre for South Australian Economic Studies makes bullish predictions for the State's financial outlook over the next year, despite clouds over the vehicle and housing industries.

The report gives high marks to the Bannon Government's handling of the economy, demolishing point by point every major criticism made by the Liberal Opposition over the last two years.

It says South Australia has become a high growth, low tax, low deficit State.

The Olsen Liberal Opposition states that South Australia is the inflation capital of Australia. The reality is that under the Liberals from 1979 until 1982 the consumer price index rose 35.4 per cent. Under the Bannon Labor Government the figure for its first term was 23.1 per cent. In two out of the three Tonkin years inflation in Adelaide was equal to or exceeded the national average.

On the employment front the Bannon Government also has the runs on the board. Twenty thousand jobs have been created this year and the job vacancy rates in the Adelaide Advertiser are at their highest since September 1974. The overall employment level has remained stuck between participation rates of 540,000 and 560,000 jobs since 1977. The Centre for South Australian Economic Studies reported that employment has now broken through the 580,000 level. Unemployment benefit recipients have fallen 8 per cent over the last year compared with a national average fall of 5.8 per cent. A survey by the South Australian Chamber of Commerce and Industry and the State Bank of South Australia in the June quarter of 1985 showed few respondents expected anything but higher levels of employment in the coming year. Much of the strong job growth is centred on small business. The Olsen Liberal offering can be summed up by a quote from Mr Olsen himself when launching the Liberal economic plan:

Unemployment cannot be solved by government.

That statement by Mr Olsen shows clearly the level of humbug which is offered up by the Liberal Party. It has no idea how to do anything to an economy other than to wreck it.

Other features of the Bannon Labor Government's vision for the future in terms of employment involve, firstly, the hosting of the inaugural Australian Grand Prix in Adelaide; secondly, the vast improvement in the housing industry, where new dwelling approvals for 1984-85 were almost double those in the Tonkin Liberal years; thirdly, tourist promotion overseas and interstate; and fourthly, new competitiveness in the State's industrial and primary base. One area of special interest to me is the car industry. The motor vehicle industry, which is crucial to South Australia, is enjoying one of its best periods for a decade because of the policies put in place at the Federal and State levels.

Senator Hill —What about the fringe benefits tax?

Senator FOREMAN —It is a funny thing that Senator Hill should mention that. One of the major manufacturers in South Australia supports it. We are told that high interest rates are also destroying South Australia. High interst rates will certainly do a lot of damage to South Australia if the Liberals are elected. The Olsen Liberal Opposition has not as yet seen the tarnish on Mr Howard's obsession with privatisation and deregulation. For instance, let us take a long hard look at the implications for country voters if the Olsen and Howard Liberals have their way on this issue.

One of the less savoury elements of this Liberal policy is the call to end the 13.5 per cent interest rate ceiling on home loans. The Howard Opposition recently called for an end to this barrier and Mr Olsen seems to like the policies advocated by Mr Howard. The effect of removing the ceiling would be devastating to home buyers. Even if there were only a 1 per cent increase on a $40,000 loan, a further $480 per year would need to be paid out. The Muldoon Government in New Zealand deregulated interest rates and found that they almost doubled.

The Bannon Labor Government realises the importance to the South Australian housing industry of the ceiling remaining in place. Consequently, the Bannon Government has urged the Federal Government to retain the ceiling. The Premier has also supported the State Bank's current freeze on home loan rates and has encouraged the State Bank to renegotiate loan conditions for customers dissatisfied with the loan market rate. The Bannon Labor Government has also subsidised, in the short term, building societies loan increases until the overall position on interest rates becomes clear next year. What the Bannon Government has achieved in its three years in office is nothing short of a complete turnaround in the State's potential. Since 1982 and the election of the Federal Labor Government in 1983 the tide has turned towards higher employment. The higher level of job creation has meant a significant drop in unemployment.

The Bannon Government does not and never will accept that governments can do nothing about such problems. Such a remark from Mr Olsen clearly shows the hypocrisy of the Liberal Party which says that governments can do nothing. We will use this as an issue if we can. The State Labor Government led by Premier John Bannon has shown imagination and boldness in its ventures. The new railway development is the biggest project in Adelaide's history. The Grand Prix and the revival of the housing industry are just two of the achievements of a government that has been in power for only three years. Now that the decision to go to the polls has been made after the successful completion of Premier John Bannon's first term in office, the people of South Australia can judge the alternatives.

Under the Liberals there would be a return to roulette. What would happen to employment would not concern the government. Funds from one account or another would be used to balance the books and when all the indicators were bad and the economy deep in recession, the Liberals would call an election and hand over the problems for the Labor Party to sort out. Under a new term of the Bannon Labor Government, South Australia can look forward to a future that has real promise. The Advertiser clearly stated:

The economy is on its soundest footing for a decade.

On 7 December I am sure the South Australian people will remember who achieved that and vote accordingly.