John Howard (Bennelong, Liberal Party, Prime Minister) Share this | Hansard source

Can I just pick up the reference made to interest rates. What I promised, and what I repeat here today in front of this dispatch box, was that in Australia interest rates will always be lower under a coalition government than under a Labor government. It ought to be reinforced by the fact that the Labor Party has policies—namely, a return to a centralised wage-fixing system—that guarantee that there will be more upward pressure on interest rates under a Labor government than under this government. I would remind the member for Ballarat that, throughout the debate in 2004, that was the principal forward argument that I put in advance of the argument that interest rates would always be lower under us than under Labor.

I pointed to Labor’s record in government. They do not like this, but my argument about interest rates—and I am very happy you asked me this question—is based on: Labor’s performance when last in federal government, when interest rates hit 17 per cent for housing; their behaviour at a state government level; the fact that the government was left with a very large amount of debt in 1996; and a comparison of our industrial relations policy with that of the Labor Party. Those who sit opposite want to go back to the days of a centralised wage-fixing policy—where, if you paid a big wage increase over here, it flowed through to the rest of the economy, it put upward pressure on wages everywhere and therefore upward pressure on inflation and, thereby, interest rates. We have broken that connection. The only thing that threatens to reconnect those two things is the election of a Labor government.

I am fascinated that the opposition should ask me about people who do focus group work, because I am reminded of something that somebody said about those who advise the Leader of the Opposition about the attitudes of the Australian public. I do not normally draw on this source, but I will make an exception on this occasion because the comment was so good.

See this speech in context