Australia is the only country in the world, outside of Israel, where Jewish people have been Chief Justice, Commander in Chief of the Army, and Head of State.
It’s to Australia’s credit that there’s been so little discrimination on the basis of faith and culture; it’s to the credit of Australia’s Jews that they have made the most of the opportunities that this country has offered to them.
Jewish people have excelled in all walks of life – especially in philanthropy – but it’s in business and commerce that their success has been most remarkable, as a quick glance through Who’s Who so abundantly confirms.
Jewish people have succeeded because they’ve never taken anything for granted. Better products, new services, more effective salesmanship, and above everything, relentless curiosity have been the hallmarks of Jewish people in Australia, especially business people, and we have not held their success against them, but honoured them for it.
Complacency has never been a Jewish characteristic – but, unfortunately, it has sometimes been an Australian one.
Now, I am confident that Australia’s best days are ahead of us. Our people, our institutions and our readiness to have a go, at least as much as our geography make us uniquely placed to take advantage of the opportunities of Asia but we won’t succeed by resting on our laurels.
We’ll only succeed by making the most of our natural advantages, under I hope a Government with a clear plan, with Real Solutions, to build a strong and prosperous economy for a safe and secure Australia.
Now, until quite recently, a quarter century of economic reform, had helped to make Australia one of the world’s standout economies.
The Howard/Costello Government reformed the tax system, improved the welfare system, transformed the waterfront and promoted trade with, amongst others, a free trade deal with the world’s largest and most dynamic economy.
It turned a $10 billion budget black hole into surpluses averaging one per cent of gross domestic product and had turned $96 billion of gross Commonwealth debt into $70 billion of Commonwealth assets. It presided over what now seems like a golden age of prosperity – that’s been lost.
To give credit where it’s due, the previous Hawke/Keating Government deregulated financial markets, cut tariffs and began the process of workplace reform. The Hawke/Keating Government understood in a way that no other Labor Government really has that a strong economy was the foundation of a more egalitarian society. I want to assure you that the next Coalition government will be a reforming one that’s learnt the right lessons from its best predecessors.
By contrast, the Rudd/Gillard Government has not just failed to continue this bipartisan legacy of reform; it’s reversed it.
After the four largest surpluses in our history from Peter Costello, it’s delivered the five largest deficits in our history with no end in sight, despite terms of trade on average 60 per cent higher than under the Howard Government.
Each year’s deficit adds to Commonwealth debt, now rocketing past $300 billion with state debt on top. Each year’s deficit adds to the repayment burden, currently $8 billion a year, that’s money not available to spend on schools and hospitals.
The Rudd/Gillard Government has not only undone the workplace relations changes of the Howard Government, but also those of the Keating Government too.
GDP growth per head has been just one third of the Howard era. Multifactor productivity is fully three per cent less now than in 2007 and private savings are at once-in-a-generation levels at least in part because people have no confidence in the current Government’s capacity to save rather than to spend.
Australia’s fundamental strengths owe far more to the reforms of previous governments than to the spending spree of the current one.
Australia’s debt position is better than that of some other countries – not because we’ve done better, but because we started better.
In fact, at about six per cent of GDP, our global financial crisis-associated fiscal deterioration was of the same order in this country as that of the United States and the United Kingdom – even though we never had a domestic banking crisis. Sure, our economic position is stronger than that of the United Kingdom and much better than that of Greece and Italy and Spain, and France; but so was Ireland’s until quite recently.
As Adam Smith observed, there’s a lot of ruin in a nation; but no economy, however naturally strong, is impervious to waste, incompetence, and poor judgement by the people who run it.
As Reserve Bank Governor Glenn Stevens famously noted, everything comes back to productivity. We have to be generating more wealth from similar economic inputs than the countries we compare ourselves with and against our own previous best practice.
It’s good that Mr Rudd acknowledged this at the National Press Club recently and committed the Government to a new effort to boost productivity.
Unfortunately, we’ve heard this from Mr Rudd before, indeed on numberless occasions since 2007 but he’s never actually taken the steps needed to convert aspiration into achievement.
That is why the Business Council of Australia says that we have, “taken our eye of the ball,” When it comes to our fundamental economic challenges. For some time now, The BCA has been warning that Australia urgently needs a responsible fiscal strategy, more infrastructure investment, more productive workplaces, less regulation, more affordable energy, a functioning federation, and a more employment focussed education and training system.
I want to assure you that these are precisely the issues that the Liberal-National Coalition’s overall economic policy will address.
Ladies and gentlemen, the essential tasks of government are to maintain national security, to strengthen the economy and to promote social cohesion. Good economic management is not everything, but it’s arguably the most important challenge of all, because it make everything else so much easier. In a country such as ours, everyone should be looked after, but people who are prepared to have a go need to be rewarded if our economy is not slowly to grind to a halt.
Again, Adam Smith was close to the mark when he said that little else is required for prosperity than peace, easy taxes and a tolerable administration of justice. All the rest being brought about by the natural course of things.
Of course, tax reform is one of our key challenges and tax reform starts with abolishing the carbon tax and the mining tax, which have done so much to spook investors, threaten jobs and hurt every family’s cost of living. The carbon tax will go because you don’t improve the environment by clobbering the economy.
And the mining tax will go because you don’t speed up the slow lane by slowing down the fast lane.
By cutting unnecessary spending, we will be able to keep the carbon tax compensation without the carbon tax, so people will enjoy real tax cuts and real pension and benefit increases and households’ weekly budgetary situation should be better under the Coalition.
The Coalition has already announced $15 billion worth of savings over the forward estimates.
We will trim 12,000 from the Commonwealth public sector payroll by natural attrition. We will discontinue the school kids bonus because it’s a cash splash with borrowed money that has nothing to do with education and we will delay the increase to the superannuation guarantee levy because this is a hit on business which is already doing it very tough indeed.
Two areas though have been quarantined from the search for overall savings: defence and also medical research, because this is one of our areas of comparative advantage where a dollar of investment generates far more in long-term payoffs.
There will be a once in a generation commission of audit to review the size, scope and efficiency of government.
There’ll be a one stop shop for environmental approvals and at least a billion dollars a year in new red tape savings, especially for small business.
There will be a root and branch review of competition policy so that businesses large and small can compete on a level playing field.
The Australian Building and Construction Commission will by fully restored to boost construction industry productivity to the tune of some $6 billion a year.
The Fair Work Act will be improved by restoring the right of entry provisions that the current Government previously promised to keep and by making greenfield agreements easier.
And we will ensure that dodgy union officials face the same penalties for the same offences as dodgy company directors.
Ladies and gentlemen, tax reform starts with abolishing the carbon tax and the mining tax, but it certainly doesn’t end there.
Within two years, an incoming Coalition government will publish a White Paper on comprehensive tax reform and we’ll take proposals for lower, simpler, fairer taxes to a subsequent election.
There’ll also be a White Paper prepared in cooperation with the states, on reform of our federation so that each level of government comes closer to being sovereign in its own sphere to reduce duplication, overlap, and buck passing.
We’ll make public schools and hospitals more efficient by working with the states to make them more responsive to community needs, with independent boards and councils choosing the CEO and principals and one line budgets rather than detailed bureaucratic controls.
There’ll be a new focus on Northern Australia with better infrastructure and more sensible environmental regulation so that our north can become a food bowl for Asia as well as a tourism destination and mining powerhouse.
Under the Coalition, there’ll be a new, two way street version of the Colombo Plan, sending our best and brightest to study in the region as well as bringing their best and brightest here.
There’ll be no unexpected changes that are detrimental to peoples’ superannuation.
An incoming Coalition government will build the national infrastructure that Australia needs – like the East West Link here in Melbourne and much faster but still affordable broadband – but we’ll do so on the basis of published cost benefit analyses. And we’ll have Infrastructure Australia prepare a national infrastructure plan to give our country the road, rail, port and power network that a 21st century first world economy needs.
Our fair dinkum paid parental leave scheme will boost participation, productivity and population and we intend to introduce it with a company tax cut so that businesses won’t pay more tax overall and many will actually save money.
Based on previous experience we are confident that these changes will produce a million new jobs within five years and two million new jobs within a decade, unlike the anaemic job creation record of the past six years.
We’re confident that these changes will give our manufacturing sector the fair go that it needs to remain a pillar of our economy along with services, education, agriculture and resources.
Unlike our opponents, the Coalition understands in its DNA that you can’t have a strong society without a strong economy to sustain it and you can’t have a strong economy without profitable private businesses.
We understand that you need wealth creation before you can have wealth redistribution.
That’s why you’ll never hear from the Coalition, gratuitous attacks on business people because we know how many of them have put their houses on the line so that their business can invest and employ staff.
You’ll never hear from the Coalition, a tax on skilled migration because we understand that people who come to this country on 457 visas and work and pay taxes from day one aren’t stealing our jobs but are building our country.
The Coalition doesn’t think that the global financial crisis gave the state a chance to save capitalism from itself – as Mr Rudd does.
We think that the global financial crisis, at core, was a function of too much debt and deficit – and that you can never save yourself from the consequences of too much debt and deficit with yet more debt and deficit.
At the Press Club recently, Mr Rudd declared that the mining boom was over and that Australia needed to be ready for life afterwards.
What had obviously escaped him was Labor’s role in bringing the mining boom to a premature end with the mining tax, the carbon tax, less freedom to manage, sovereign risk issues and a jungle of red and green tape that means a typical mine that took under 12 months to approve in 2007 can now take over three years.
Ladies and gentlemen, history never exactly repeats itself, but there’s no reason why Australia can’t again be the world’s premier destination of mining investment once uncompetitive taxes and regulations are removed.
Also at the Press Club recently, Mr Rudd claimed credit for saving Australia from the global financial crisis – almost single-handedly apparently. He saved Australia from the global financial crisis. Apparently he thinks that installing batts that caught fire in people’s roofs and building school halls for twice the normal price was good economic policy – even though as Keynes himself recognised, wasting money is never justified, no matter what the crisis.
By spending too much, too soon, too wastefully, Mr Rudd didn’t save Australia from the global financial crisis, he simply left us more exposed to the next economic shock.
Given Australia’s historically high terms of trade throughout the life of the Rudd/Gillard Government, the Budget should be in surplus right now – right now. Not merely forecast to be in surplus in four years if nothing goes wrong. To illustrate the impact of better fiscal management, in 2004/5 with unemployment at about five per cent, the previous Coalition government delivered a surplus of 1.5 per cent of gross domestic product despite terms of trade 40 per cent lower than in 2011/12 when the Rudd/Gillard Government produced a deficit of 3 per cent of GDP.
Mr Rudd says he’s changed, but last week’s increases in fringe benefits tax on business cars suggests that the Kevin Rudd who gave us the first version of the mining tax is once more in charge of our economy.
There was no consultation; no understanding of how government policy works in the real world; and quite possibly yet another example of a tax that actually costs money because it kills economic activity.
Mr Rudd has just proudly announced that the people smugglers have lost their business model, but so far his government has been better at damaging honest businesses, such as the live cattle exporters of Northern Australia and Tasmanian foresters.
And then there’s the carbon tax which Mr Rudd pretends he has abolished when all he’s done is propose to bring forward a floating version of the carbon tax by 12 months – and also to bring forward by 12 months the role that European bureaucrats under an emissions trading scheme will play in shaping economic policy here in Australia.
Today, Mr Rudd is seeking to change the Labor Party’s rules, to prevent his colleagues from removing him in the future without a 75 per cent majority.
Rather than make it easier for leaders to be unaccountable to their own parties, I would prefer to make it harder for Governments to damage Australian businesses.
So, today I announce that an incoming Coalition government will restore due process to decision making. For major policy changes, the Coalition intends to follow the Green Paper/White Paper process that under Westminster systems has been used to ensure that decisions weren’t derailed by unintended consequences.
Other than in the most unusual circumstances, all Cabinet submissions will be required to have regulation impact statements which should mean that decision makers actually appreciate the ramifications of what they’re doing.
Except in emergencies, policy decisions will be subject to Cabinet process on the clear understanding that the more critical the scrutiny of the decisions have to withstand, the better they are more likely to be.
Now ladies and gentlemen, I am confident that Australians can succeed in competitive world markets; our miners, big and small, our health and medical companies such as CSL, Cochlear and Resmed. Service businesses like Westfield and LinFox and even manufacturers like R.M. Williams and Akubra have a demonstrated ability to take on the world and win. We don’t need bigger Government so much as stronger citizens. We don’t need a bigger state apparatus so much as more cohesive and nurturing communities. We don’t need more handouts so much as more initiative and more reward for people who are prepared to have a go. That’s why the coming election is the clearest choice in a generation. Our country needs change but it must be change for the better.
I’m not trying to persuade you that an incoming Coalition government will never make mistakes or will never implement a policy you disagree with.
I am offering you the reassurance that an incoming Coalition government will take business seriously and that the next three years need not resemble the last six.
That, I’m confident, would be change for the better; even change worth barracking for.
Ladies and gentlemen, it is a great honour to be here.
It’s very unusual for any person, even a Leader of the Opposition to have such a large and distinguished gathering.
Again, I thank Leon Kempler and everyone associated with the Australia-Israel Chamber of Commerce for such a gathering, you are here, all of us are here, because in the end, we are Australian patriots and that’s what we must work for: a better country – a country that is everything we know we can be.