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Tuesday, 20 September 1983
Page: 969

Mr SNOW —My question is directed to the Prime Minister. What is the Government's approach to the protection of Australian industry? How is this linked to the Government's concern regarding unemployment growth?

Mr HAWKE —As is well known, I think, the Government has given a very clear commitment to maintaining existing industry assistance arrangements in the economic climate that we have inherited. Quite clearly, this Government does not wish to do anything at all which would exacerbate the pressures which are already operating on industry from the collapse of the labour market which took place under the previous Government. As I have tried to point out to the House on previous occasions, it is also very important that there be a degree of confidence and stability in the investment climate so that the prospects for economic recovery can be enhanced. That is a commitment that we have as part of the prices and incomes accord. I may say that all Ministers support that commitment.

Those references are made in regard to the immediate situation which we have inherited and within which we have to operate at this time. At the same time, Australia's long term future undoubtedly lies in Australia developing and maintaining a dynamic and competitive economy. The issues involved in that obviously require a long term perspective. They include: Encouraging new industry development and marshalling all the great resources of this great country so that we can in fact capitalise on our great resource base. We would also need-I think this would be common ground across the chamber-to overcome gaps in the capital market which, in our judgment, have prevented an efficient flow of resources to high technology industries. We have attempted to do that.

Mr Moore —That is the capital market approach.

Mr HAWKE —I would hope that this would not be a matter for cheap interjection but that it would be recognised at all points of the House that the actions of the Government in regard to venture capital and to extending the capacity of the Australian Industry Development Corporation would be relevant to achieving that objective and to encouraging also an indigenous, industrially relevant research and development base. Once we take that longer term view and recognise those things that have to be done, it can be seen that protection is only part of the picture. In the judgment of this Government, we will certainly need in that longer term perspective a gradual and predictable reduction in protection. It should come as no surprise to any honourable member of this House that I should say that because it is well known that I was appointed by the previous Labor Government to be a member of the Jackson Committee to Advise on Policies for Manufacturing Industry and by the Fraser Government to be a member of the Crawford Study Group on Structural Adjustment. We made those positions quite clear in the reports we handed down.

We believe that those sorts of approaches in the longer term will be necessary to achieve long term economic growth for Australia and, most importantly, to see that Australia has the maximum opportunity of employment growth through participation in the growth in world trade in general, and in the economic growth of our region in particular. Future protection reductions will be gradual and will be planned in the context of stable and predictable industry policy, and in the context of renewed growth and economic activity. I must say that one of the problems bedevilling Australian industry in the past has been that there has been too little predictability in relevant economic policies. If we are to restore growth it is necessary to have that predictability of policy and also the re-creation of an atmosphere of optimism in the Australian economy.

Let me say finally that those who share this view-I trust that it is shared by those on the other side of the House as well as on the Government side-will recognise the fundamental responsibility that lies upon the Government and on the community. If in fact we say that there is a need in the longer term for a gradual reduction in protection in that overall framework because such reductions in protection will be necessary in the community interest, then there is a responsibility upon the community as a whole to share that burden so that it is not left simply to displaced labour or displaced capital. I put those short term views and long term views in a way which I trust will receive the approbation of both sides of the House.