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South Australian Division [of the Liberal Party] lunch, Hyatt Regency Hotel, Adelaide, 5 July 1996: transcript


Thank you very much Dean, the Premier of South Australia; to Martin Cameron, the State President of the South Australian Division; and to my many State and federal Parliamentary colleagues; ladies and gentlemen.

I should start by extending my grateful thanks as Federal Parliamentary Leader of the Liberal Party for the absolutely magnificent result turned in by the South Australian Division at the last federal election.

I used to think it would be pretty good when the Liberal Party held eight out of 14 seats. I then thought it was quite remarkable that that rose to 10 in 1993, and it really was quite extraordinary that it rose to 12 out of 14 at the last federal election. And without any doubt, on a proportionate basis the strength of the Liberal Party here in South Australia projected federally is greater than it is in any other part of Australia. And I'm very, very grateful to the South Australian Division, to you Martin, and to all of the other people who have worked so very hard over the years to build the organisation here in South Australia.

There are many remarkable things about what happened on the 2nd of March. One of them, of course, is the geographic spread of the result. Some of you may not know that outside of the capital cities - and you include in that definition the Sydney-Newcastle-Wollongong (inaudible) - outside of those areas our opponents do not hold one single seat in the Federal Parliamentary Party, in the Federal Parliament, which is quite remarkable. And if you think historically of the mining and industrial towns of Australia - think of Newcastle and Wollongong, and Ipswich and Whyalla, and Kalgoorlie and Broken Hill - it is only Newcastle and Wollongong now that lie within Labor Party seats. So it is a very comprehensive expression of support. And it is, in part, an expression of alienation particularly from people outside the Sydney-Melbourne-Canberra triangle, and I'm very conscious of that. And although I'm very proud to say that we won a lot of seats in New South Wales and in Sydney, reversing a period of decline in that part of Australia for the Liberal Party federally, I am particularly conscious of the need for the Federal Government to be seen to be a government for all Australians and a government for all parts of Australia and not just a government pre-occupied with Canberra or with the Canberra-Sydney-Melbourne triangle. And it is important in the decisions we take and the relationship that we establish with the Australian people, that we be seen in those terms.

I said on election night and I repeat it here today that I regard, above everything else, that what happened on the 2nd of March as being the conferring of an enormous privilege on me and my colleagues. And to be in government is to recognise that it's something that is a continuing gift of the people. It is not there because of some kind of divine right; it is not there because of some kind of inspired collective genius on our part; it is there because after reflection the Australian people decided that we would do a better job than the group of people we replaced. And it is our responsibility to keep our feet on the ground, to maintain a proper sense of humility and dignity and to understand that in a democracy, particularly a robustly and on occasions cynical democracy such as Australia, it's important to maintain contact with the Australian people.

Ladies and gentlemen, we set ourselves a number of goals when we came into office. We inherited an economy which I have described in other places as something like the "curate's egg." It is good in parts. Along with most of the industrialised world we now enjoy very low inflation. We have had rates of growth that are better than many. I must say, I found the rate of growth recorded in the March quarter a little hard to believe. It didn't seem to correspond with the anecdotal evidence that I was getting around Australia. But I hope I'm wrong and I'm sure all of you will hope on this occasion that I'm wrong too - and if the rate of growth is really as strong as those figures indicated.

So we do have fairly strong growth. We have fairly good price stability. We of course have a stable political environment. We have a well educated workforce, and we live cheek by jowl with the fastest growing economic region in the world. Now, that's the good side of it. On the bad side we have a chronically bad current account deficit. We were reminded last month and last week that in May our current account deficit was over $2 billion and that's a problem that's been with us now for a very long period of time. It is in fact just over 10 years since my predecessor, then Treasurer, made his famous declaration on the John Laws programme that Australia was in danger of becoming a Banana Republic if it did not do something drastic about its current account deficit.

Ten years went by and the current account deficit problem remained, and it is still a very severe problem. We also have a bigger than desirable budget deficit. Now there will be argument in the community; there will be argument amongst professional economists, there will be argument amongst business men and women, about what is the appropriate stance of budget policy. But I think it is unarguable that that deficit is too high. And one of the responsibilities that we have is to bring about a significant reduction in that deficit. We have set ourselves the aim of achieving an underlying balance over a period of two years. To do that is quite a mammoth task, and I'm very conscious if there were certain core commitments that I made to the Australian people at the last election and I want to say to you very bluntly that I have no intention of earning myself the reputation of being a Prime Minister who walks easily away from electoral commitments.

It is important that we re-establish trust between the public and the people who are elected to government. And it's very important that when governments and political leaders say things and say them seriously and say them deliberately and say them repeatedly, that they are held accountable for those commitments. So we do face a difficult balancing act in working towards our aim of reducing the budget deficit and at the same time keeping faith in relation to the core commitments that we made before the last election.

I want to say to you and perhaps some amongst you who may wonder why it's necessary to reduce the deficit, that we're not engaged in that as some kind of blind ideological exercise. We want to do it because it will deliver real benefits to the Australian economy. I have a sense ladies and gentlemen in which if we can, over the next year or two, get the budget right and if we can achieve progress in relation to labour market reform, further privatisation and further progress with competitive policies - a la the 'Hilmer Report' - then we do have the hope of going towards the turn of the century with the Australian economy in as good a shape as it has been for years. Because the signs around the world are not all bad. Our own region continues to grow very strongly. The signs are that the Japanese economy, after a period of sluggishness, is coming back and that's always very good news, particularly for our commodity exports. The American economy continues to perform very strongly. And the west seems to have entered a new period of price stability, of anti inflation maturity, where central banks have been generally quite successful in controlling monetary pressures that have led to high inflation. Now, in those circumstances we would be crazy indeed if we didn't attend to those things in our economy that need attending to. Some parts of it are very good, other parts need some attention. The budget needs attention and heaven knows...and this is, I suppose, the passion of my political life for the last 10 years, doing something about our arthritic industrial relations system on a national level. That certainly needs a lot of attention.

But of all the things that I really have been committed to over the years, none has been more emphatic than my belief that of all the reforms we need for the Australian economy, fixing the labour market is by far and away the most important. Good things have been done at a State level here in South Australia, in Victoria and in Western Australia and in Tasmania. But until the reforms are made at a national level you're not really going to see the full benefits of it. We committed ourselves to that, and I report to you today that all the legislation to give effect to our commitment to reforming Australia's industrial relations system, all of that legislation has gone through the House of Representatives. And if we had control of the Senate it would now be law. By now Laurie Brereton's stupid, job destroying unfair dismissal law would have been swept aside. You would have had nationally a prohibition on compulsory unionism. You would have had Australian workplace agreements without the compulsory injection against the wishes of employees and employers of trade unions. You would have had a restoration of the effective secondary boycott provisions of the Trade Practices Act which operated very effectively for a period of about 17 years. You would have had all of those things if the legislation were not now gathering dust in the Senate.

I have to say to you my friends, it will be a very interesting moment of truth on the 20th of August when the report of the Senate Committee on that legislation comes back, and people will then know whether or not the Australian Democrats and the Australian Labor Party are going to obstruct the issue above all issues on which we obtained the mandate on the 2nd of March. I mean, if we didn't have a mandate to reform the industrial relations system, that word should be stricken forever from the English language so far as Australian politics is concerned because we've talked about it, we advocated it, we disclosed in detail what we were going to do and the people voted for us. And it is very important. It's not an ideological binge. It's very important to small business, and you know how important small business is in our scale of priorities. And I was reflecting this morning as I put the finishing touches to the Sir Thomas Playford Memorial oration that I'll give in the Adelaide Town Hall tonight, that of the great goals that I've set my government in its first three years in the economic area, the two things above all that I want to achieve is a comprehensive reform of Australia's industrial relations system and a lasting improvement in the conditions in which small business operates in Australia.

Now, if after three years I can look back and say that we have achieved our goals in those two areas alone - there will be many other goals I'd want to achieve - I will believe that that three year period in government has been truly useful and truly successful.

This country over the last 10 years has seen a number of important economic reforms. When they have been at the behest of my political opponents, I've never been reluctant to support those reforms or to give credit where credit is due. But the great unfinished piece of economic business in Australia - the thing that really does have to be tackled before anything else - is of course reforming our industrial relations system. And I want to say to you again as strongly as I possibly can, that fixing the industrial relations system remains our top economic priority and we'll continue to prosecute the cause because we believe in the long run that if that change is not made, if that reform is not accomplished, the Australian economy will remain unnecessarily diminished and enfeebled in the years ahead. And one of the other very important commitments that we made straddled both the economic area and a non-economic area. And that was our combined commitment to sell one-third of Telstra and to use $1 billion out of the proceeds of that sale to fund the establishment of the Natural Heritage Trust of Australia. And out of the Natural Heritage Trust we intend to fund such desperately needed capital projects such as the Murray-Darling restoration and all of the environmental projects that flow from that. And this was an investment in what I might call bread and butter ongoing environmental projects.

This is not the glitz of the environment, these are the hard yards of environmental restoration; tackling the problems of solidity, of soil erosion, of ocean outfall, of river pollution. They are the sort of things that are very important for people who live in Adelaide and elsewhere in South Australia. And the commitment of my government to acting upon the Murray-Darling Commission recommendations is very strong, but we need the resources from the sale of one-third of Telstra. We can't finance it in any other way, we simply don't have the resources available given the other commitments that we have. And that's what we said before the 2nd of March and it remains the reality.

It seems a very strange thing to me, ladies and gentlemen, that a political party, namely the Labor Party that could so compromise its history and overturn its prior principles to sell the Commonwealth Bank - not one-third of it, but 100% of it - finds it impossible to agree to a sale of one-third of Telstra. I mean, I can remember Bob Hawke saying 10 years ago when I advocated the privatisation of the Commonwealth Bank - and I've been utterly consistent on that - and we voted for the privatisation of the Commonwealth Bank...isn't it ironic, the former Labor Government would never have got the privatisation of the Commonwealth Bank through the Senate if we hadn't voted for it because the Democrats opposed it. And now you have the situation - when we're trying to sell a third of Telstra, and with their great lasting impressive political consistency, they're opposing that. And I can remember 10 years ago Bob Hawke said that - when I advocated the sale of the Commonwealth Bank - he said that it was absolutely outrageous, it was akin to burning down the gum tree and that Ben Chifley would spin in his grave if he knew that anybody was advocating the sale of the Commonwealth Bank. Well of course nine years on, notwithstanding what Ben may or may not have been doing, the Labor Party did complete the sale of the Commonwealth Bank with our assistance and against the votes of the Australian Democrats. So I have to say in relation to that as well, that is a very strong and continuing commitment and it's a commitment that we intend to see to the best of our abilities and capacities, this commitment that we intend, is honoured.

Ladies and gentlemen, as I said a moment ago, we have some very important goals so far as the economic future of this country is concerned. The Government is not just bound up with sensible economics. Government is a balance of pursuing and achieving economic goals and it's also about pursuing and achieving other goals. It's about emphasising the things that bind us together as Australians, rather than has happened too often in the near past, focusing on those things that push us apart.

I've said on a number of occasions since the election that I think one of the benefits of the change of government is that some of the neo-McCarthyist tactics that we used to denigrate particular points of view on sensitive issues, that some of those tactics have now been put behind us. I think people do feel a little freer to speak their mind on difficult issues and that is how it should be in a proper, mature, functioning democracy.

I think we had far too much political correctness in this country before the 2nd of March. And whilst I don't know if making that remark gives you any kind of implied invitation to those who would use intemperate, unbridled, prejudicial or unprincipled language. I think it is the case that we had reached a situation in this country that it was impossible to speak one's mind about certain subjects without some quite unreasonable smears being put upon the person who did speak his or her mind. And I have said that one of the important goals of the new government will be to discharge its obligation to govern for the mainstream of the Australian community.

By that I don't mean to denigrate or criticise the role of minority groups or pressure groups in the Australian community. In a free society any group of people, however large or small, has the right to bind together and to put a case to the public and to put a case to the Government. I don't criticise the minority groups for pressuring governments. I criticise governments for needlessly caving in to that minority group pressure. It is only natural that a group of people feeling strongly about an issue will lobby a government. And on some occasions it will be just a fireball for the Government to exceed to the wishes of that minority group. On other occasions it will be to neglect the national interest for the Government to do so.

Over the past few days we've announced some changes in the structure of Australia's immigration policy. They have been criticised by some. I suspect that they are widely supportive in the community. We have done I think quite sensibly, something that should have been done a while ago, and that is to begin to shift the balance away from an undue reliance on the family reunion component of the programme towards a greater reliance on skilled migration. We haven't destroyed the family reunion component, it will still comprise slightly over 50%. We have honoured our commitments in relation to refugees in the humanitarian programme. But we have placed a slightly greater emphasis on English language skills. The policy remains absolutely non-discriminatory so far as the racial or national origins of the migrants coming to this country are concerned. But the changes do recognise that amongst people who come to this country within the preferential family category, even after the three years, unemployment rates are as high as 30 and 31 per cent in many of those groups. And that is a state of affairs that we do not believe should be allowed to go on completely unattended to and completely unchecked.

Ladies and gentlemen, there are many other things that I could speak of today but time and your commitments will prevent it. Can I just draw together what I've been trying to say to you in a few words. We were given on the 2nd of March a huge vote. We were given the great privilege of presiding over the leadership of the Government of this country. We took to that election certain core commitments. They related to economic reform, particularly industrial relations reform; they related to improving the conditions for small business, and in the social area they centred around improving and strengthening the role of the family unit in our community. Four months on we have made a good deal of progress in implementing those commitments. But final progress in many areas remains stalled in the Senate. And it's important that that be understood and it's important that some of the legislative constraints under which the new government is operating be fully understood and absorbed, particularly by those who have been so kind to support us over the last few years. I see the Australian economy as being on the cusp of enormous opportunity for steady, sustainable, job producing growth, provided - and it's a very important proviso - those areas of weakness in the economy are addressed; the budget weakness, the structural reform weakness particularly in the area of industrial relations.

Most importantly of all, I have tried over the last four months to fulfil a style of government commitment that I gave to the Australian people in the campaign, and that is that we would be a group of people who regarded ourselves as not only governing for all Australians but a group of people who regarded ourselves as being very much part of the Australian nation. There is no sort of divine wisdom that resides in 15 people who sit around a Cabinet table. They are a group of men and women who are endeavouring to do a positive, good job for the future of the country. They need your continued help. They need your continued advice. They need on occasions your criticism when that criticism is justified. And it's very important that the channels of communication remain open. It's very important we have occasions such as this because it enables me to speak as frankly as I can about our plans, where we think we've been and where we hope to go.

And finally ladies and gentlemen, can I conclude by expressing my thanks to you for the support and understanding I know that many of you gave to the Liberal Party in the years in which it languished in Opposition. They were long, uncomfortable, on occasions very frustrating and soul destroying. But it was the support of people like you who kept us going, and it was the persistence of many of us who believed that if you kept working, you kept punching your way and you kept persisting, ultimately the wheel of political fortune would turn. Well it turned in a big way and that made us very happy and we don't intend to squander the opportunity and I'm very grateful indeed, more than you will, I think, understand for the tremendous loyalty and support that all of you have given us over such a very long period of time.

Thank you very much.