EMBARGO:  7.00 p.m.

'Z-iS

PRIME M I N I S T E R

FOR PRESS 23 OCTOBER 1977

ELECTORATE TALK

This,week's announcement of a 2 percent increase in the  Consumer Price Index for the September quarter is good news for  Australia. It is good news for big companies, small companies  for farmers and its, certainly good news for families.

It is the first time in more than four years that the rate of  increase.;.i.has been held below 2.5 percent in each of three  successive quartersÂ» It confirms that Australia's rate of inflation  is now running at an annual rate of around 9 percent - and '

coming down.

The figure confirms - as I pointed out ten, days ago - that we are  beating inflation. There can be no doubt of that. It again  shows up Mr Whitlam’s pitiful attempt to talk the economy, down  in the Parliament.just ten ’days ago when he claimed that inflation  would spurt ahead in the quarter. He was trying to wreck confidence

throughout Australia. He failed then. He will continue to fail.

Clearly, the latest CPI result continues to vindicate our  consistent economic strategy. Surely, there could hardly be a clearer  confirmation of the success of our strategy. It shows above all  else - as we have never stopped repeating - the benefit of firm  control on Government spending, sensible monetary policies and  wage restraint.

This sustained and steady decline in inflation - and in  inflationary expectations - will strengthen the economy in many ways.  It gives business and industry the green light to expand/ with  confidence. Industry can now see that we have broken through iji the  fight to stop run-a-way inflation. It can plan ahead with the  knowledge that the Government will maintain its policies.

Industry can be certain that the Government will keep on with  policies that encourage them to produce and to make profits, in a  stable economic climate. Australia's export and manfacturing  industries will be in a stronger competitive position.

The gains from last year's devaluation have not been thrown away in  higher prices. Exports are strengthening and we can look forward to  a consolidation in this vital area. The economy will also  strengthen as interest rates come down. This will reduce the  cost of borrowing to Australian companies and will certainly

encourage new investment decisions.

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2 .

Our fight against inflation is not being taken in isolation.  Inflation has hurt millions of Australians. Perhaps its most Â· devastating effect has been on the growth of jobs in the community.   There is only one way to effectively increase the number of jobs

in Australia - and that is by restoring growth in our economy. We are growing as a nation if we produce more goods and services.  These goods and services must be sold and the degree to which this  can be done depends on individuals buying and business investing.

Now the great problem in Australia over the last few years  is that inflation has affected people's willingness to make  these decisions - about buying things;they want. This also has  other effects. If people don't spend on the things they want  Australian manufacturers and other producers pull back their  production. This inevitably means that jobs are lost.

That is why w e  need growth to provide;.'those essential jobs for  people now looking for work - and especially for young people  still at school who will be wanting jobs in the years ahead.

That is why we have placed priority in winding down Australia's rate  of inflation. We know that we cannot relax in’ "  policies to beat  inflation. Our determination to keep inflation moving down must be  fully miantained. We cannot afford to throw away the hard won

gains. The Government is completely determined to press on with its  economic strategy. There is no alternative.

The full benefits' of our strategy - consistently applied from our  first day in Government - will soon become even more widely  recognised. There will be a lift in optimism,.in confidence. It will be reflected throughout Australia - in the cities and in  the country. Australia is back on the road to economic health.

There is no question of that.

I and my Government knoxv that our policies are right for Australia.  We know too that Australia will never accept the kind of forlorn  economic thinking still being advanced by the Labor Party. As I said tivo weeks ago - we must never forget what happened

to Australia under Labor. There is no way we could survive that  kind of experiment again.

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