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Transcript of question and answer session - National Press Club, Canberra

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JOURNALIST: Tony Wright from the Canberra Times. Prime Minister, although your decision to reduce tariffs fairly drastically has received the general approval of commentators, Professor Ross Garnaut's recommendations would've taken it even further to zero tariffs by the year

2000. Could you explain why you stopped short of this target and can you see the day when zero tariffs will actually be reached in Australia?

PM: You will notice that in Ross Garnaut's piece in today's Age, which was the best part of the Age, I might say, the Professor warmly congratulated the Government on its decisions and he pointed out the great benefits that would

flow from it. I suppose Tony, we could've put on our most macho suit of clothing and said well, if it's going to zero why should we wait for 2000? Why not try it next year or the year after? You only have to put the answer that way to

know that there's got to be time, you've got to give people time to adjust. I said that the important point is you've got to change attitudes. I don't believe that you would get the right attitude of understanding and cooperation either

from employers or from the trade union movement if we put on that most macho suit of clothing. It therefore would be counter-productive. I truly believe that on the timetable and the rates of change that we've implemented as from our decision yesterday that we will receive the cooperation of

the relevant sections of the trade union movement, of employers, the community generally. And that will mean that if you do your bottom line analysis, cost benefit analysis, we've made the right decision.

JOURNALIST: Julie Flynn, Radio 2UE. You've defended the Government's record on micro-economic reform but are you personally satisfied with the speed of that reform or do you

agree with Senator Button's comments yesterday after the statement that the Government will have to do more in the months ahead on other areas such as lowering transport

PM: Julie, there's no conflict between Senator Button, myself and the Government on this issue. I will obey the injunction Mr President, of making all my answers short

accept when I get into this area of micro-economic reform ... this question. I trust that you will excuse me if I spend a little bit of time on it. Because you will notice



that while there was a general degree of approbation of my statement yesterday in all other areas, there was this mindless parrot cry about not fast enough in micro-economic reform. So I want to nail it. I've nailed it to a

considerable extent in the speech that I've made to you. But I do just want to spend a little bit of time on it Mr President, because of this -PRESIDENT: I can hardly say no.

PM: And as you say, you can't say no. Now my friends, I've given you the list of the micro-economic reform which is underway. Let me emphasise again, it was us who put micro­ economic reform on the agenda. We put it there, we started

it from '83 and then in Ballarat in '87, I delivered the micro-economic reform agenda that for third term of Government and we've delivered of everything that we promised then. And without - I certainly will not abuse your generosity, your enforced generosity Mr President, by

reading that list. But there's the list. You can all have it afterwards. -PRESIDENT: Table it.

PM: I'll table it, as he says. The areas of micro-economic reform. So the achievement is there but I must just spend a little bit of time in dealing with the position of the Opposition on this because in the end this society if it wants micro-economic reform has got to make the decision well, on the record who's delivered and who is most likely

to deliver? That in the end is the question. So what I put to you in terms of achievement is not simply a question of pride and saying there's our score sheet full of achievement, there's in a generation nothing on the board. But you've got to look at them. See, what are they saying? Now I referred to the statement by Dr Hewson and I referred

to the incredible comment of Mr McLachlan. What are some of the areas? They talk about the waterfront. Well let's just look at the waterfront and see what the quality of the analysis is from the Leader of the Opposition. We're not going back into history on this, hot off the press. Dr Hewson today - it sounds like Gough, didn't it? Have to watch myself, comrade. Now on the waterfront I've told you what Sharp, the Member for Gilmour, has said about shipping

but he also said the approach of the Liberal and National Party's has been to support the Interstate Commission's recommendations. 'We recognise that they're not perfect

however, we do believe that they are a good basis for fundamental structural reform'. So there's the Opposition in '89 about the waterfront saying well, the Interstate Commission has provided the framework. We embraced that, they supported it and we have delivered under that

arrangement. But what does Hewson say this morning? When Maxine McKew put it to him about waterfront reform, what had we done and the great achievement on Conaust, out of which on the waterfront as a result of that and associated deals,

1500 people are going from the waterfront by the end of this year with productivity increases up to 70%, he's asked about


that, he says, well, I'm not sure about that. I don't know where that comes from. But the Conaust deal, it's rather novel he claims credit for that. They went outside WIRA Agreement in order to get that. Absolutely false. Absolutely false. He simply doesn't know what he's talking

about. You have the history of no achievement and an Opposition which simply doesn't know the facts or misrepresents them. The Conaust deal was achieved precisely within the framework of the WIRA Agreement. On the front page of the WIRA Agreement it indicates that as part of that

process there can be recourse to both conciliation and arbitration under the Industrial Relations Commission. And that is precisely what was done. Precisely what was done. The parties negotiated within the framework of the WIRA Agreement and under it went to the Commission and achieved by conciliation and decision there this outcome. But the

Leader of the Opposition knows so frantically little about this, that he doesn't understand the process of what's going on. That achievement which is leading to 70% increase in

productivity was done precisely within the framework of the Agreement. Now he gets better. Maxine went on with him, she couldn't have been really persuaded by that. He's asked about further change and he said in other cases sure it would be more difficult on the waterfront to stay with your example, it does involve cooperation with the States so you would need the State Premiers to be part of the process in

putting enterprise bargaining into place and developing competition between the ports. Some of those will need the cooperation of State Governments, he's discovered. Some of those will need the cooperation of State Governments. It's why our Shadow Minister is speaking with some of Nick

Greiner's people to try and be quite specific about how that might be done. Well have you ever heard anything more pathetic? He doesn't understand what the processes have

been which produced 70% increase in productivity and then but some of my people are talking to Nick Greiner. Well good on them. I hope they do a bit more talking to him. But while he's wasting his time talking with some of Nick's

people what we've done is to initiate with all the State Premiers, not just with Nick who's contributions in this area you know I respect. But we are working with each of the State Governments under the processes that I've set up

so that we can now go to the next stages of micro-economic reform on the waterfront. We have made the changes in what was put by everyone as the litmus test, what can you achieve on the waterfront? We've got this 70% increase in productivity under those processes, which the Opposition doesn't understand, and we're recognising that it doesn't

finish there. You've got to keep moving. But we're not waiting to have a talk to some of Nick's blokes, we're talking to all the Premiers because the next stage is going to involve the cooperation of the States and the way they run their port authorities. We have done what we can do, massively reduced employment on the waterfront, getting

enterprise agreements on the waterfront so that you get out of this unproductive, counter-productive pooling system, get enterprise agreements, 70% productivity improvement, in the area of our responsibility where we can act directly and


we’ve now got the process going with the States to try and get those changes in the way the port authorities operate so that you can extend these processes. So my friends, here you have it, achievement, record, nothing from the Opposition and McLachlan saying, well you'll either have

trust us or vote Labor. You couldn' t have put it better Ian, because (a) you're going to look at that scoreboard, see that massive list of achievement, the commitment to ongoing reform, see nothing on that scoreboard, look at an Opposition which doesn't understand what's happening and say, oh, trust them, not them. I hope that's the way they'll look at it.

PRESIDENT: Now I know how Leo McLeay feels.

JOURNALIST: David Barnett from the Bulletin, Prime Minister. The Minister for Immigration and the Minister for Education put out a statement which -

PM: Could you speak up please, David?

JOURNALIST: The Minister for Immigration and the Minister for Education have put out a joint statement accompanying your statement yesterday which suggests that the intake of skilled migrants will be increased, that migrants can't find

jobs and will need training when they get here and that they'll be told overseas about job prospects to discourage them from coming. Could you reconcile those different points? Where does immigration policy fit into current

economic strategy? What' s the target for this year and does the target include 14,000 people displaced by the Gulf war?

PM: I thank you for that question, David. It is obviously correct that immigration policy is one of the significant parts of overall planning, not just for the immediate future but for the longer term future. We have as you know David,

in this last year where we set a target, as I recall, of 125,000 approximately we brought that down from what it had been in the previous year of about 137,000, I think. We had recognised that in conducting our immigration you must adjust to the immediate economic circumstances and that if

there is a lessening of economic activity it makes sense to adjust. So we've done that. Now in regard to the specifics of your question, at all points we have regarded getting in as many skilled people in areas of relative shortage as a very, very important part of our program and we will

continue to do that. Obviously in regard to some of the people who come here who are entitled to come under the other elements of our immigration policy and the elements of course are as you know, include family reunion, which is a very important part of any humane and decent immigration

policy. Some of the people that come particularly under that area will not have either the skills or the full literacy standards that you would hope that they will acquire. So we're going to see within Australia we provide the assistance that we can there and certainly in our

overseas posts we will be quite directly stating the position as far as this economy is concerned and what are


the most particular areas in which we require immigration. On the two last points, what is the level going to be? That's not decided for the next financial year yet but all I can say to you David, that in setting that we will take into account all the relevant considerations that we have in the past and which I think the Australian community appropriately wants us to do. As to the particular figure

about the number that would be available from the Gulf, let me say this; that the expectations of the international community as to the number of people who come into that refugee category has not anywhere near reached the figures

that we thought it would but we, Australia, as we always have done in the past under governments of both political persuasions, let me say I don't claim particular credit for this, I pay tribute to the fact that our predecessors had an

appropriate humanitarian element in their policy. As they and we have done, we will help to play our part as part of a concerned international community to deal with that problem.

JOURNALIST; Pilita Clark from the Sydney Morning Herald. Mr Hawke can you tell us precisely what commitments you gave to the conservation movements in regards to resource security legislation. Did you ever promise that no

legislation would be introduced? If you didn't make that promise is Phillip Toyne lying?

PM: Good question. There are some lies being told in this area but not by me. It is being said that I gave a commitment in the last election there'd be no resource security legislation. I made no such commitment. It is however the fact that I had a meeting, indeed it was a rather pleasant breakfast at The Lodge on the 6th of December of last year at which I graciously and with the assistance of Hazel entertained Peter Garrett and Phillip Toyne, together may I say and this will be no surprise, Graham Richardson. At that meeting I indicated to them that

I thought they should have no concern about the introduction of resource security legislation and that I had no intention of introducing it. That was not in the election and you see I've been accused of saying I made a commitment in the election. I didn't. I did that, I said those words at that meeting at The Lodge on the 6th of December. I did that in

totally good faith because it was my understanding that it would not be necessary if we were going to be able to provide resource security that we would have to have legislation. Not only did I say that to them in the privacy

of The Lodge on the 6th of December of last year I went public on this just three weeks ago in Tasmania. I was asked a question and I said then I didn't think that legislation was necessary. I said that because, on the advice available to me at that stage, I thought that was the case. When I said that Premier Field met me and he said you've said this and you've said it on the basis that your

advice is that legislation is not necessary. I said yes, that's right. He said, well our advice is different, you can't do it without new legislation. So responsibly I said to myself well I'd better sort that out. So I did. I

instructed that there should be advice obtained from the


Attorney-General's Department on this. This is the relevant section of the letter I received on the 3rd of December - 3rd of March, the 3rd of March this year, I'm sorry - after seeking this advice after the meeting with Field. I'll just read the first two paragraphs. Totally unqualified. You have asked whether - the letter is actually addressed to the Secretary of my Department who I asked to get the advice -

you have asked whether without new legislation the Commonwealth could make legally binding agreements with a state with commercial enterprises of the kind that's described. The answer is no. Such agreements could be made

legally binding only by means of new legislation. So as I said briefly last night on the 7.30 program, 7.30 Report. The facts I was faced with, and my colleagues were faced, were simple, uncomplicated and not subject to challenge. The relevant facts are these, I repeat them; the green movement has said consistently that it is appropriate that

there be value-added projects in our forestry industry - very sensible, we all share that view - fact one. Fact two; the advice to me, unqualified, that there cannot be a

binding guarantee of resource security without new legislation. Fact three; we're told, and understandably told, by State governments and potential proponents for such projects that they will not undertake such new projects without resource security. Now when you take those facts

together no responsible government in those circumstances could do other than what we've done. But importantly fact four; we have entrenched into the processes which will

trigger for a particular project the advantages of the legislation that we'll enact, the requirements that, our legislative requirements concerning environmental impact statement, our Australian Heritage legislation, our

obligations in regard to World Heritage, our obligations in regard to Aborigines and Torres Strait Islanders. All of those legislative requirements upon us will be undertaken contemporaneously with the state in drawing up the agreement between the state and the proponent and the Commonwealth.

When those things have been done the legislation will be triggered. Now I said to them on the 6th of December I thought they had no reason to fear because I didn't think that it was necessary. I said that to them. On the 3rd of

March with this opinion from the Attorney-General if I was going to discharge my responsibility to the people of Australia to be able to balance development with our responsibilities in regard to the environment there was no way it could be done without legislation. I was not going

to walk away and I will not walk away from that responsibility.

JOURNALIST: Bruce Juddery from Australian Business, Prime Minister.

PM: G 'day Bruce.

JOURNALIST: Not too bad today thanks Bob. Two fairly brief ones.

PM: You always get at least two in Brucie.


JOURNALIST: You've agreed to extend exemptions under the wholesale sales tax exemptions worth about $375 million next year to manufacturing industry which is paying about $5.7 billion in this form of tax. I suppose one would say do you really think that goes far enough. But more to the point doesn't the extension in fact concede the point in favour of

a broadbased consumption tax after all exporters in particular who pay the British VAT type or European VAT type tax can get the entire VAT contribution refunded for anything they export. Our people still can't, our exporters

still can't do that. Far from a level playing field doesn't the retention of the wholesale sales tax system leave a bloody great hole -PM: I've got the question. Yes, I've the question.

JOURNALIST: A bloody great hole in front of the crease line.

PM: I've got the question, Bruce.

JOURNALIST: The second one. A question of definition. The preservation of the research and development tax write-off reduced to 125 per cent. You said it'll be done indefinitely, John Button says permanently. Which is true and what's the difference?

PM: The second one, I think, is dismissed as a semantic. We'll say it's there forever while a government of my leadership and my persuasion is in power. You'd never know what the other mob would do but the way they're going it's

just about the same thing. The first question, first question. Now let's get the figures. The figure is $375 million in 1992-93. That's what the direct benefit, the direct benefit to industry will be from the extension of the exemptions of items going into production which will be

exempt from sales tax, wholesale sales tax. But as I pointed out in the statement that $375 million is the direct benefit but because taxed inputs through the production chain are themselves subject to markup then the full benefit which the - economists are good they always get a bit of new

jargon, the in word now is the cascade effect - from that will mean that the total benefit to industry in 1992-3 will be $700 million, a not inconsiderable benefit. Now it is

true, Bruce, that they would have liked more but I'm yet to meet people who don't want more. They're not going to get more because that will be sufficient to give them the sort

of assistance they need and that they deserve. Now your question was, well doesn't the fact that you've done that really mean that you should have gone the whole way and done the broadbased consumption tax. Answer, no, with a

resounding no, for this reason; that we, doing it this way, will have a deflationary effect. This will reduce costs in the total inflationary structure. It will reduce cost to

business. If you have the broadbased consumption tax you will give a massive boost to inflation. If there's one thing that this community has got to understand and I tried


to hammer yesterday in my statement is that we've got to conquer the inflationary disease. We have done to a very considerable extent and our inflationary rate is now below the OECD average. But if you brought in a broadbased consumption tax you would give an immediate massive boost to

inflation but that would not be the end of it because the trade union movement would then, particularly in the circumstance of a confrontationist government, would then build that into their wages claim and you would have

permanently built in an inflationary spiral. Now interestingly and finally you said; but look the Brits do it. Ok, you look at the Brits, you look at the Brits at their situation, ok, look at them. But you don't have a supplementary question you used Britain. When you see the

weakness of your question you want to change it.

JOURNALIST: I used Britain's - Britain's and the European's I said.

PM: Now I'm simply saying that it's far - now come on Brucie. Mr Speaker, bring him to order.

PRESIDENT: I'd love to. I'd love to.

PM: I am saying that as far as the rest of the world is concerned including Britain you say they've got that particular tax provision. They haven't got, for instance, what we've got in this country, full imputation, a massive benefit to industry. So don't go picking out one thing and

say they've got that, we haven't got it. We've given things in bringing about a more efficient and fair taxation system that would leave much of the rest of the world for dead. In the event, and I won't let you get away from Britain, in regard to Britain we've got a situation that they are in recession, we've got a recession but they've got massive inflation and very, very much higher unemployment. If you take the mix of what we've done including what we've done here then it is a much better mix not just for industry directly but for the community as a whole.

JOURNALIST: Stephen Spencer Macquarie News, Prime Minister. Just to get off the industry statement for a short while. You talked this morning about offering Paul Keating another portfolio after the last election. Doesn't the fact that you felt the need to offer him a portfolio indicate that you

at least thought that it was time for a new Treasurer or that the Treasurer had a new portfolio?

PM: I didn't pay him to put this question, I really didn't. First of all I find it fascinating that someone regards as news something which is exactly one year old, one year old. Isn't it earth shattering? Everyone knew a year ago that

I'd made this offer not because I wanted Paul to shift but do you know Paul was Deputy Prime Minister, when Lionel went, Paul, Deputy Prime Minister. The fact is that a Deputy Prime Minister basically has the right to say what portfolio he'd like, except the Prime Minister's. You've got to have that caveat. I did nothing more and nothing


less than exercised my responsibility, as I regard it, to say to Paul, look Paul if you'd like a shift, you'd like something else it's available. I did that, not with any intention or desire to indicate to him that he should shift from Treasury. It was my normal gracious, conventional self in operation.

JOURNALIST: Matthew Frost from SBS TV News, Prime Minister. In the statement yesterday one of the industry groups that didn't seem to get much of a mention was the service industry area. Given that they account for about 60 per cent of economic activity in this country why weren't they given, if you like, more prominence in the statement?

PM: You should've listened to the statement. I did make a very specific reference to one of the most important sectors of the services industry, tourism. Just look it up. I mean, I'll give you the page reference if you like. We

referred to tourism, you know, one of the most important sectors of the - well I don’t need to do that you can look it up yourself - there it is, I said that and I just didn't

mention it in passing as though we've got a tourist industry, I referred to the measures that we'd taken in regard to depreciation and so on and I said these will be of assistance particularly to the tourism industry. Why did I mention that? You'll see it in the statement. I said here

is a very, very important sector of our industry one which is provided over our period of Government more than an additional 100,000 jobs. The tourism industry will be one of the great beneficiaries from the decisions that we've taken both in regard to the specific decision that I

referred to in regard to depreciation. They'll be one of the significant beneficiaries of that but they will also significantly and obviously be one of the beneficiaries of getting a more competitive Australian economy generally.

JOURNALIST: Laurie Wilson, Prime Minister, from the Seven Network. Do you have any sympathy for a private sector which says look by and large we do agree with bringing down

the walls of protection in this country but then turns around and says we have extreme concerns about the fact that you've laid down timetables for that but no timetables, no precise targets about how you're going to lower the cost

structure in industry to help us cope with that via micro-economic reform. Now you've been particularly disparaging in your criticism of Mr Ian MacLachlan but

aren't you saying precisely the same thing to industry - simply trust us, we'll do it?

PM: No, I'm saying quite the opposite. I'm saying you've got the Hawke Government and you've got this alternative mob. Now I'm saying don't simply say oh Bob Hawke says we'll tackle micro-economic reform. I'm saying look at the

record - and it's not just that - it's looking at the record. And we win that particular contest. It's game, set and match. It's not even a contest, the record. Ok, but I'm saying the fact of the record is not an accident. It's not an accident. Do you think it's any accident my friend


that if you look at the whole of the post-War period of Australia - let's look at since 1949, because we were coming out of the war just after 1945. Forty-two years, forty-two years since 1949, and only Labor Governments have reduced protection, only Labor Governments have reduced protection

and only this Labor Government has tackled micro-economic reform. Now that is not an accident. It's happened as far as this Government is concerned because we are able, not merely to apply the intelligence that collectively we undoubtedly have, not simply that we've got that and we understand economics in this country and internationally, and therefore know what is required, but we also have the capacity which the other mob haven't got, to understand in the Australian context what is required to effect micro-economic change. The reason why they never did it was not just because they were inept in an intellectual sense and in terms of commitment, which they were, but they didn't know how to go about it. They'd make noises. Do you

remember the noises they used to make when they were in government last time, about we'll take on the unions. Take on the unions - strike a light. When the chips were down

there in '82 the Prime Minister had a real tough issue on their hands in regard to wages, which went into the transport industry which is right at the heart of micro-economic reform, he said oh I give in, and went to the wedding in London. They don't know what's involved. You've got to be able to understand employers in this country. You've got to be able to understand the trade union movement. And you've got to be able to effect change without confrontation, but not entirely without confrontation. Because let me say this, that as far as I'm concerned, the record shows that we just don't buy precisely what the trade union movement wants. The trade union movement hasn't wanted the precise pattern of micro-economic

reform that we've brought about. They would have liked things done differently in some areas, and more slowly. But where we have, through our understanding of the economy and the people who make it work on both sides of industry, where we've known that you've got to go that far at least beyond where you want to go, that's where we've gone. Now, these

are all relevant to your question, Laurie, about why should there be seen to be any difference. It's not just a matter of record, important as that is. It's about understanding. It's about being able to work with and get things done. And

that's why we've done it, and they haven't, and will never be able to.

JOURNALIST: John Hewitt from the Triple M radio network, Prime Minister. Given the green reaction to resource security legislation, it's very possible that the environmentally sustainable development process will have to

proceed without any input from the conservation movement. If that becomes the case, can the BSD process have any credibility in the community?

PM: I think the question is can they have any credibility if they regard it as a sensible decision to allow these processes to go on without an input. I think the question


of credibility has to be addressed to them. But let me say this. We have appointed a couple of scientists, particularly we hope will be able to make a contribution in those areas. I am seeing Phillip Toyne later today. I hope that I'll be able to persuade Phillip Toyne of the accuracy of what I've said to you here to you today. He is a man that I'm able to talk with. I trust that it will be the beginning of a favourable response from them. The BSD processes will go ahead. Certainly they will not be as

fruitful, if they have to go ahead without any involvement of the environmental movement. I hope they'll reconsider their position.

JOURNALIST: Damien Smith from Network Radio, Prime Minister. Just a question on the reduction of protection. I wonder if you could quantify the sort of employment dislocation that could be experienced in the TCP sector and

if you could tell us how many car manufacturers you expect by the end of the Century.

PM: Let me make the point in regard to the vehicle industry, that you can test the impact of changes in tariff protection to some extent by the fact that over the period since we've been in government up until '89 there's been more than a doubling of exports from the motor vehicle

sector of manufacturing and without significant loss of employment. So we do believe that there can be the changes that need to be made to make it an even more viable and competitive industry without massive losses. Let me make

this point also, Damien, that in regard to the overall employment impact of the tariff changes, we believe and certainly the modelling suggests - and I am not a person who in my economic judgement relies simply on modelling, I think

that's unwise - but it is an assistance to decision making. It should never be regarded as your mentor, as your decision making, the modelling processes. But it is intelligently used in assistance and the modelling does suggest that overall there'll be both a significant increase in the

nation's gross domestic product and a net increase in employment. Just how it will fall out in the vehicle industry I can't assert. But my belief, Damien, is that what we will have will be a motor vehicle industry which will be more competitive, which will increase its volume of exports and of course we'll get cheaper cars in the process. As to the number of operators, I can't give you the answer

to that. But what I can say, which I think is important, is that John Button reports to me that those who are in the industry are positive about their response. So the actual number that remain, whether it's the same number or less, will be a matter for decision by them. But importantly,

they seem to accept the challenge that we've thrown down to them.

JOURNALIST: And employment in TCP?

PM: Employment in TCP at the moment: there's about 108,000 people employed in TCP. It's very interesting in regard to employment levels over the period of this Government, that


despite all the talk of gloom and doom that was given, there hasn't been any significant downward movement in employment in the TCF industry. There will be some loss of jobs. There will be some loss of jobs. Where it will go from

108,000, I'm not sure. But the important thing is that what we will have remaining in the textile and clothing and footwear industry will be a more efficient and more competitive industry. And secondly, and most importantly as

far as I'm concerned, we have provided the funds to ensure that those who will be displaced will not be asked to bear the burden by their own unemployment. We will provide not only the financial resources for retraining, relocation, but the human resources that are necessary to assist them.

JOURNALIST: Chalmers, Inside Canberra, Mr Hawke. I'd like to ask you about the trans-Tasman shipping route, which as you know has been turned from an international route into an Australia-New Zealand cartel arrangement. Could you tell me why it is that with ANL saying that they are quite happy to end the monopoly because they are internationally competitive, why all Australian shippers want to end the monopoly, why all Australian importers want to end the monopoly, why the previous New Zealand Labour Government wanted to end the monopoly, why the present New Zealand

Government wants to end the monopoly, we continue to provide endless lifetime protection for 1000 Australian and New Zealand seamen?

PM: Well, let me tackle that question head on. Before going to some of the details, let me ask you Rob to get this into proportion. We are told that the savings - and I believe this to be true - we are told that the savings that we can get from reform on the Australian waterfront is of

the order of $1 billion. And that's a figure which has been accepted by WIRA, it's been accepted by the employers, accepted by the unions, I think accepted by the Opposition. It's suggested that the savings that could be involved in addressing this problem - and I'm not avoiding this problem

- in trans-Tasman shipping is of the order of $70 million. Now there's the comparison. $1 billion on getting our waterfront right, about $70 million in trans-Tasman shipping. We have made the judgement, and I think you'll

find it pretty difficult to argue with it, that it's most important to get the waterfront reform into shape here, get that saving. It would have complicated in an unnecessary way, which would have, I believe, stopped the achievement of the $1 billion reform that will be flowing on the Australian waterfront, if we'd introduced at this stage the trans-Tasman. If it had been of the same dimension as what

I ’m talking about well then we would have had to look at that. What I'm concerned about is getting the Australian waterfront right and we will move onto the other issues sequentially. But as I say in regard to shipping generally, we have got to remember that we 've now brought about a

situation where by the end of this year we'll have OECD average levels for Australian manning. And also, while not in any way, Rob, seeking to denigrate the importance of the trans-Tasman trade - I mean let's get it into perspective.


The population of New Zealand is just over three million. The trade there, when you're talking about trade, with the equivalent of Melbourne or Queensland. Now please understand - don't misrepresent what I'm saying. I'm not therefore saying well don't let's give a damn about the trans shipping. We've got to look at that. We will. But in terms of the $1 billion saving on the waterfront and the $70 million that's involved there and the necessity not to prejudice reform on the Australian waterfront, it was appropriate that we put our concentration on the Australian waterfront.

JOURNALIST: Paul Kelly from News Limited, Mr Hawke. In this whole debate about micro-economic reform, do you agree that the criteria of measurement has got to be our pace of change against the rest of the world, not the opposition in this country or our previous past performance? If so, did you hold any talks or make any effort to get a faster pace of waterfront reform in the prelude to your statement?

PM: It is obviously correct, if we're going to improve our competitive position, we have to be going faster than the rest of the world. And I would simply assert that the rate of reform in micro-economic reform generally, and in regard

to the waterfront in particular, under this Government, particularly in recent years, has been greater than anywhere else in the world. I'd like to see any other government which has had the range of micro-economic reform in general or what we've done on the waterfront in particular in this period. So your point is right. We need to compare ourselves with the rest of the world if we're going to

increase our competitive advantage. But I say by that test we win very well. But it's very interesting, if I could just throw in in that respect Paul, the figures that I think

as Australians, not just me as Prime Minister and my Government ought to be proud of, but if you look at what's happened in manufacturing between 1985 and 1989, I just ask you to take note of these figures. On a base of 100, in

regard to export volumes, manufactured export volumes, on the base of 100 in 1985, the OECD has moved from 100 to 131. That is a 31 per cent increase in the volume of exports of manufactured goods. Australia 79 per cent against the OECD average of 79 and of all the OECD countries, exceeded by only one, the United States, at 81 per cent. So the issues that you're talking about, Paul, haven't operated to stop us having an outstanding record of achievement. Now, I've answered therefore that it does appear that the rate it does appear that the rate of reform and the rate of change that we're making generally is not only not inhibited export growth but in fact we've had outstanding volume growth in this period. Coming to the second part of your question, obviously I had a lot of discussions, a lot of discussions

in the period prior to my statement, because I wanted to see these reform processes working. I mean, this is not only simply because I wanted it ... making a statement or not, I

still would have been trying to do what I could to get these changes as quickly as possible. So I have had personally some discussions with people involved. But most


particularly and most importantly, Senator Bob Collins has done a magnificent job in this respect.

JOURNALIST: Michelle Grattan, The Age. Mr Hawke, you explained to us how you came to change your mind on resource security legislation, but could you tell us on what basis you first gave that undertaking to Mr Toyne? Had you taken

legal advice at that stage and why was it different second time round? Or if you hadn't, do you think you should have before being so strong in what you said?

PM: What we were faced with Michelle in that general period was indications were given to us by people concerned that it could be done this way. I hadn't found it necessary in the veiw of what was being said, yes you could do it this way.

I'd accepted that it could be done. And frankly, I'm a lapsed lawyer, I admit, but I am a lawyer, and it did seem to me that it would be possible to do it this way. I had, there was no indication that that was not the case. I mean in all the discussions that were going ahead, everyone was saying yes it can be done this way. So I'd proceeded on that assumption. It was when we had this dogmatic position put to us that that was not the case well it seemed that one

should get that advice.