Tony Abbott’s address to the Menzies Research Centre

The text of Tony Abbott’s address, 21 September 2010, – “We are the party of ideas”:

The last federal election to produce a “hung” parliament was in 1940. On that occasion, the incumbent government limped on but the prime minister of the day faced growing party dissent. The opposition, previously in disarray, looked increasingly like a credible alternative government. Eighteen months later, after a parliamentary vote of no confidence, the independents changed sides and the new government won a landslide at the next election, held at the normal time.

In her Chifley lecture on the weekend, the prime minister invoked this 1940 to 1943 parliament as one of Australia’s finest. One detail she failed to mention, though, was the mid-term baton change to a new government. Less surprising was the kinship she claimed with Ben Chifley himself given the resemblances between bank nationalisation and the current government’s National Broadband Network.

What matters, regardless of the state of the parliament, is the government’s preparedness to address the country’s problems. In this respect there’s a fundamental difference between the Gillard government and other governments (such as Bob Hawke’s in 1984 and John Howard’s in 1998) that lost seats in their first bid for re-election. Unlike the current one, those governments had embarked on culture-changing reforms in their first term. They weren’t poor governments that had been judged harshly but reforming governments that were prepared to risk a backlash against policies that they believed were right for Australia.

It’s possible that the Gillard government could follow the trajectory of Hawke or Howard rather than that of Sir Robert Menzies in 1940 but only if it changes its character. Symbolism aside, it’s hard to recall any big achievements from the current government’s first term. Australia avoided the worst impact of the global financial crisis but this owed far more to the reforms of previous governments than it did to the spending spree of the current one. If government spending really is the remedy to every downturn, the United States, to name only the most obvious example of a problematic stimulus package, would not be in so much economic trouble. Building overpriced school halls in a programme lasting as long as the First World War can hardly be credited with saving Australia from a financial crisis that the Reserve Bank governor thinks was only truly global for about six weeks.

It’s too early to declare that Julia Gillard will be a worse prime minister than Kevin Rudd but the government’s performance certainly went from bad to worse after it changed leaders and has deteriorated further in the four weeks since the election. The revised mining tax began to unravel almost as soon as it was announced and is now subject to the Greens veto. The East Timor asylum seeker processing centre will never be built because the prime minister neglected to ask the East Timorese before she made her announcement and it’s now been superseded by the new onshore processing centres that, during the campaign, she categorically denied would happen. The citizens’ assembly that she announced during the election has subsequently been dumped in favour of a parliamentary committee pre-programmed to support a carbon price, most likely the carbon tax that the prime minister also specifically ruled out during the campaign. The prime minister’s decision to execute her predecessor now seems like confirmation that she lacks judgment because the government almost lost the election in Queensland alone.

Everyone who wants the best for Australia is hoping that it will be better government this term than last. For Australia’s sake, it’s important that the government has learned from its near-death experience. Unfortunately, it’s hard to see any new-found attention-to-detail in the 10 changes to the ministry made between its announcement and its swearing in. It’s hard to see re-discovered respect for the public in the declaration that election commitments don’t need to be kept by a minority government. It’s hard to discern even basic honesty in last week’s bold-as-brass announcement that the Curtin detention centre would be expanded and that a new detention centre would be opened on Cape York notwithstanding explicit prime ministerial denials just prior to polling day.

Cobbling together a majority by the skin of its teeth seems to have persuaded the Labor Party that there’s almost nothing that it can’t spin away. There’s been fake Julia and real Julia; make-promises-Julia and break-promises-Julia. The government thinks that it can win the next election by lowering expectations but voters won’t be satisfied by spin. A trophy surplus, if it’s ever delivered, on its own won’t impress them. Over the coming term, they’ll expect real tax reform to ease the burden on families and small businesses, serious job creation in viable industries, significant progress on long-term environmental problems such as water, a more assured future for regional towns and overdue infrastructure improvements in outer-suburbs. Political management skills won’t save the government if it can’t address these problems.

For our part, though naturally disappointed, the Coalition accepts the election result as the outcome of a system of government that we profoundly respect. We rededicate ourselves to the task of opposition and are determined to be even more effective in the coming parliament than we were in the last one. Where the government delivers for the Australian people, we will give credit where it’s due. Where it fails, we will be unrelenting in holding it to account because that’s what people expect of an opposition. We are determined to be the party of ideas and of policy innovation against a government that’s trapped by its alliance with the Greens and in a fiscal strait-jacket because it’s incapable of cutting its own spending.

Against a government that’s afraid to take risks, a strong opposition is more vital than ever. Under these circumstances, the opposition’s job is not to wait patiently for government to fall into its hands like ripe fruit. The more the government makes excuses for itself, the more exacting the scrutiny that’s required. Paradoxically, the less that’s expected of a government, the more that’s expected of the opposition. An even more effective opposition is needed against a minority government than against a majority one, but that’s a challenge we can rise to. Our task is not just to be an effective opposition for the nine months before an election but to sustain effective opposition, if necessary, for a full three years.

Only twice in 100 years, has an opposition been good enough to deprive a first term federal government of its majority. Over the coming term, the unity of purpose and strength of political character that’s been abundantly on display will doubtless be tested. Regardless of the result, after an election, smart political parties rethink aspects of their campaign. Unlike the Labor Party, the Coalition won’t be caught out boasting about how clever we’ve been while dumping campaign commitments that are no longer to our immediate political advantage. Reopening climate change policy, for instance, or having serious second thoughts about broadband policy is not a trap that this opposition is about to fall into.

When a government lacks authority and has no mandate, a strong opposition can help voters to keep their faith in the political process. Someone has to have positions that can be relied upon when the government doesn’t. The Coalition will continue to oppose the mining tax because it threatens the goose that keeps laying golden eggs for Australia. We will oppose a go-it-alone carbon tax because it won’t help the environment but will inflict enormous damage on our export industries. We will oppose the National Broadband Network because there are better, cheaper ways to improve telecommunications services. Unlike Labor, the Coalition’s instinct is not to see bigger government and more public spending as the answer to every problem. Government’s job is to empower individuals and communities not just to take on more responsibilities itself.

During the election campaign, the government angrily dismissed the accusation that its secret preference deal with the Greens meant that there would be a carbon tax if it won the election. Now that the head of BHP has supported a carbon tax, the pressure is supposed to be on the opposition to defend its policy rather than on the government to justify a statement that has turned out to be yet another lie. BHP could be right to prefer a transparent and upfront carbon tax to the stealth tax of an emissions trading scheme. Arguing that we need a price on carbon because the low carbon economies of tomorrow could become the low cost economies of the future ignores the fact that a carbon tax means a massive, immediate hit on people’s cost of living and on the cost of running a business.

As things stand, Australia’s prosperity fundamentally depends on the higher energy exports that are necessary to fuel rising living standards in China and India. Without an enforceable carbon price in China, India and the United States, a go-it-alone carbon tax in Australia would be an act of economic self-harm. The notion that Australia should henceforth treat coal as it has long treated uranium – as something that’s alright to be exported elsewhere but too environmentally suspect to be used here – is more environmental snobbery than serious analysis of our national interest.

Although the introduction of the GST demonstrated that it’s possible to have a new tax without an increased tax burden, the idea that a tax is not really a tax if the proceeds are given back is laughable. In any event, the current government can’t be trusted with a new tax. As the mining tax debacle demonstrates, for Labor, new taxes are not substitutes for old ones. New taxes mean new slush funds to provide new handouts to buy new election victories. Only an opposition unsure of its principles as well as lacking will-to-win would cooperate in such a scheme.

Similarly, only an opposition that had lost its bearings – in the way that this one certainly hasn’t – would support the recreation of a nationalised telecommunications monopoly in preference to a more competitive telecommunications market. The creation of government owned business enterprises can only be justified if there is serious market failure, a need to supply services below cost, or some unique potential vulnerability. Plainly, there is no deficiency in Australia’s telecommunications services that can’t be rectified by targeted intervention rather than the creation of a new nationalised broadband network.

Everyone is in favour of better broadband services but it’s hardly sensible to spend $43 billion (or $5000 per household, mostly in added debt) without a serious cost benefit analysis. Because the government is buying and switching off Telstra’s existing network, all Australians who want fixed line access will eventually have to use the new system regardless of whether they want it, need it or can afford the costs of connection, let alone the charges necessary to provide a decent rate of return on the upfront investment. Till then, the National Broadband Network’s take up rate will be the indicator to watch, along with the level of subsidy needed to keep it affordable.

Everyone is in favour of faster broadband speeds but that’s not achieved by running fibre optic cable into every home and simultaneously hitting the internet with a great big new filter on everything. Everyone is in favour of the latest technology but that doesn’t mean that they want their computers tied to a cable. The National Broadband Network symbolises the current government’s tendency to solve every problem with more government and more spending. In an instructive contrast, the Coalition’s broadband proposal is to spend just $6 billion filling the gaps that the market can’t address.

It’s true that “oppositions don’t win elections; governments lose them”. Still, an opposition that’s only a couple of by-elections or two independents’ change of heart away from government has to be more than just a critic. The Coalition took strong policies of its own to the election and will outline more change for the better in the months ahead. Almost the first task of government is to respect taxpayers’ funds hence our determination is to return to surplus by the high road of reducing wasteful spending rather than the low road of imposing new taxes. We want direct action to improve the environment rather than new taxes dressed up as environmental benefits. We support community control of schools and hospitals. Above all, we want to foster an opportunity society rather than a welfare state by providing incentives to seniors and young people to move off welfare and a fair dinkum paid parental leave scheme to help families and to keep mothers in the workforce if that’s their choice.

If there’s one policy that demonstrates that the Coalition “gets it” when it comes to the nitty-gritty of modern families, it’s paid parental leave. These days, very few families can survive on just one income. Unless mothers can have children without destroying the family budget there’s no real choice for women and no real freedom for families. Paid parental leave is properly a workplace entitlement, not a welfare one, which is why it’s appropriate, at least for the foreseeable future, for it to be funded through a modest levy on large businesses.

The Coalition’s paid parental leave commitment is an example of how values endure but policies evolve. In the circumstances of modern society, it’s the best way to promote choice and to support families. In this case, the rights of women and the needs of families override the Coalition’s instinct to maximise business freedom. Another example of how enduring values sometimes require changing policies is the Coalition’s commitment to overturn the Queensland Wild Rivers Act locking up Aboriginal land in Cape York. In this case, the rights of Aboriginal people and the need to permit environmentally sensitive development override the Coalition’s usual predilection not to interfere in the work of the states. A sign of the times was Noel Pearson’s recent intervention with the independents to support a change of government because, he said, the Coalition could unite the community on Aboriginal issues in a way that Labor wouldn’t and was serious about rights and responsibilities in a way that Labor couldn’t always be.

Support for small business, for families, and for the opportunity to succeed is in the Liberal and National parties’ DNA. Against the “big battalions”, we support Burke’s “little platoons”. Against those with powerful interests on their side, we support Menzies’ “forgotten people”. As liberals, our preference is for lower taxes, smaller government and greater freedom. As conservatives, our instinct is to strengthen families and values that have stood the test of time. As Australians, we want policies that work and which build an even better future for our country. How these preferences should play out in contemporary circumstances is necessarily a matter for judgment. Still, people can rely on the Coalition to respect these values and to trust these instincts in coming to terms with the issues our country faces.

It would be easy enough to decide on high what’s best for Australia and to socially engineer the country to reflect that vision but the Coalition has never believed in the infallibility of politicians. We would prefer individuals and communities to realise their own objectives than those that the government has chosen for them. We don’t start with the notion that there’s something fundamentally wrong with our country that needs to be changed. Our instinct, rather, is to count our blessings, to preserve them and to build on them. Our preference for lower taxes, for instance, stems from our understanding that individuals and families usually have a better idea of what’s in their own interests than government does.

Tax reform means restoring to individuals and to families more control over their own money but it’s been largely off the agenda for the past three years because of the government’s spending spree. Higher taxes aren’t tax reform. Introducing a new mining tax is not reform. Bigger government is not economic reform either. The NBN is not reform. To be worthy of the name, tax reform has to mean lower, simpler, fairer taxes and economic reform has to mean lower unavoidable costs and more scope for creativity from individuals and businesses. That’s why expenditure restraint by government is the prerequisite for meaningful reform. Without expenditure restraint, talk of reform is invariably a smokescreen for a tax grab.

Now that the impact of the global financial crisis has well and truly passed, reform is more needed than ever. Australia won’t remain one of the world’s best performing economies if it stays on auto-pilot. In the coming term of parliament, it will be essential to consider how businesses can be made more productive and how their costs can be reduced. The Coalition is deeply sceptical of ways to help business that depend on government becoming more involved in the economy but that seems to be the only reform that Labor knows. Of course, we’d participate in any tax summit but as a guardian of economic orthodoxy, not as an apologist for fiscal sleight of hand.

Under Andrew Robb, the Coalition will shortly consider how our election policies could be fine-tuned. This evaluation will be helped by a series of forums that the Menzies Research Centre is holding over the next 12 months including on tax, the problems of regional and rural Australia, the pressures on family life in outer metropolitan areas, reconciling environmental concerns with economic development, and developing a broadband network that’s affordable for taxpayers as well as for consumers. These forums won’t set Coalition policy but will lead to broader expert and interest group input into the issues that matter for people.

As well, the Coalition is determined to stay engaged with the communities that brought us to the edge of government. Over the next 12 months, the Coalition intends to arrange a series of community forums, similar to the successful campaign events at Rooty Hill RSL and Broncos Leagues Club, in the seats that we won or almost won at the recent election. Reaching out to the public can’t be a once-every-three-years event. It should be the core business of a political movement and it should start now.

The hung parliament is a difficulty for the government but an opportunity for the opposition. Already, the government has been forced to agree to give private members bills the chance to become law. The Coalition certainly won’t treat this as a parliament that’s paralysed because no one has the numbers. We won’t assume for a second that only uncontroversial legislation has the chance of success. Unlike the government, our intention is to strengthen our arguments rather than to water down our policies in the expectation of a fair hearing from the crossbenches.

As our first priority, we intend to work with the independents to overturn Queensland’s wild rivers legislation: far better for the national parliament to restore to the people of Cape York control of their own land than to inflict on them a new detention centre for asylum seekers. In coming months, the Coalition aims to demonstrate its credentials for government through constructive work in the new parliament.

Members of parliament don’t have to disagree on everything but nothing is ever likely to be improved if achieving consensus is the only way to change. The Coalition’s objective is to be ready to form a government, perhaps after a vote on the floor of the parliament but certainly after the next election. We are unlikely to replace the government by agreeing with it. We have to pick our battles carefully but we shouldn’t try to avoid them. After all, a contest of ideas is more likely than anything else to produce the new insights that our country needs to keep its competitive edge.