Pearls and Irritations

Was this a spoof?

There are ‘claims’ that the following speech appeared on the websites of the Liberal Party and the Department of Prime Minister and Cabinet on the day that Tony Abbott gave his speech to the National Press Club, but it was taken down as soon as it was found that the Prime Minister was delivering a different speech – presumably one prepared entirely in his own office.

For delivery National Press Club – 2 February 2015

Let me start with a “thank you” to the people of Queensland.

My gratitude may surprise some. As leader of the Federal Coalition I am naturally disappointed to see one of our own lose office. But last weekend the people of Queensland sent us a loud wake-up call.

It wasn’t our first wake-up call. We have had many since we were elected 16 months ago, but each time we have lazily reached for the “snooze” button.

We have been too cocksure, too ready to believe our own propaganda, too ready to read the columns of sycophantic journalists, too ready to take plaudits from people of our own tribe.

Each political setback – failures of Coalition parties in elections in South Australia, Victoria and Queensland, the Senate’s rejection of our education and health bills, a string of poor opinion polls – we have put down to an inability to get our message across.

It didn’t occur to us that the electors may have heard and understood our message all too clearly, and that they have rejected it.

It didn’t occur to us that they could see through the accounting tricks of “asset recycling” and “leasing”.

It didn’t occur to us that they rejected the idea that everything that’s good for the private sector is necessarily good for Australia.

In short, we have been saying, paternalistically, “we know what’s good for you”.  Our side of politics has often accused parties of the “left” of paternalism, but we have been blind to our own transgressions.

Paternalism, I need to remind myself, and my Parliamentary colleagues, has no place in the Liberal Party.

I take the brunt of responsibility for these failures. I have made too many “captain’s calls”.  When I have consulted it has been with my hand-picked colleagues, particularly a cabinet which, I now realise, is not even representative of the views of the members of the Coalition parties.

I have ignored those who spend time in their electorates listening to the views, ideas and aspirations of the Australian people.

I have been too ready to listen to those who agree with me, and to disregard my critics – to assume that those who disagree with us are our enemies rather than people of good will offering sound advice.

My appointment of a Commission of Audit, bypassing the established policy processes of government, I now acknowledge was a grave mistake.

When people criticised our budget we accused them of short-sightedness, of a failure to understand the need for fiscal responsibility. We didn’t realise that people may be ready to make sacrifices for the public good, provided the pain and effort are shared fairly.

I have been too ready to blame the previous Government for the nation’s problems. They did a reasonable job in reacting to the financial crisis and its aftermath. I do criticise them, however, for failing to attend to our weakened public revenue base. The last years of the Labor Government saw many promises – including excellent initiatives in education and disability services – but there was no plan to raise the revenue to fund them.

We made the mistake of dealing with this fiscal gap through cutting expenditure rather than raising revenue.

We listened only to those who stood to benefit from privatisation, forgetting that people legitimately expect their governments to do what the private sector cannot do, or cannot do so well, and are willing to pay for public goods and services.

We made the fiscal task harder for ourselves by repealing and reversing plans to raise taxes, most significantly the tax on carbon emissions. We failed to appreciate that these taxes, besides contributing fiscally, were designed to help Australian industry adjust.

I now realise that we have let down many of Australia’s most energetic and creative entrepreneurs, who, in times past, would have been strong supporters of the Liberal Party.

Those who had plans for renewable energy investments.

Those who had intended to build businesses around high speed broadband.

Those who had drawn on publicly funded research in universities and the CSIRO to develop new products and processes.

We didn’t listen to them.  Rather, we were too ready to give an ear to established businesses, the big donors to our party.

It would be tempting to use an occasion like this to announce a few populist sweeteners – tax breaks for small business or handouts for families.  But that’s the very policy on the run that has characterised Australian politics for far too long.

Rather, I want to announce the general policy directions we will be taking.

First, we are taking proposals for health and education back to the drawing boards to be subjected to full community consultation, with more considered proposals ready for next year’s election. In the meantime we will restore funding to ensure these sectors, particularly the universities, are not disadvantaged.

Second, we will review all funding cuts made since we came to office and in Labor’s last year in office. Most of these were made with too little consideration or appreciation of the economic benefits of public services.

Third, we will do this in a fiscally and economically responsible way.

That means repairing our revenue base.

To this end I call on those Australians who have benefited so much from public spending – defence, infrastructure, education, health care – to contribute more. Our budget to be handed down in May will have measures to close holes left by successive governments’ tax concessions for superannuation, short-term capital gains, investor housing, family trusts and corporate perks.

That means the task of fiscal repair will not fall on those who have most rather than least capacity to pay. We are also mindful of the risk to consumer confidence and demand when the purchasing power of the least well-off is diminished.

Once we have completed our Cabinet re-shuffle, our to-be-appointed Treasurer will announce more details.

One certainty is that we will restore a carbon pricing mechanism. It will be more comprehensive that Labor’s half-hearted scheme, covering transport fuels and exported coal. And, in keeping with the principles of our Party, it will be market-based.

Also in keeping with the principles of the Liberal Party to provide business with stable policy, I announce that there will be no change to the Renewable Energy Target.

Our infrastructure plan remains intact; in fact we will expand it, but I am pleased to announce that “asset recycling” is now dead, cremated and buried. We will consider privatisation only when there is no longer a benefit in public ownership.

It would be economically irresponsible not to take advantage of our credit rating to borrow at the low rates available to us to invest in rail, road, public transport, research, environmental repair and other public goods, so badly neglected by past governments. Handing these to the private sector, whose cost of capital is so much higher than the government’s, is simply wasteful, and can result in higher national debt than if the government is to fund these projects.

That means there will be an increase in our already low public debt, but we will raise the taxes to service that debt.

Our focus from here on will be on the public balance sheet, compensating for years of neglect of our public assets. I bear some personal responsibility for allowing fiscal policy to crowd out all other aspects of economic policy, but I also ask journalists here today to lift the quality of economic debate beyond “gotcha” attacks on failures in budget projections.

That is our economic agenda, but I have several other announcements relating to political donations, Australian honours, refugees and ……..

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