National Archives of Australia

January 2012

1982 and 1983 Cabinet records release: transcript

Narrator:

On 1 January 2012, the federal Cabinet records of 1982 and 1983 were opened and released to the public for the first time. These documents provide interesting insights into the inner workings of government and reveal much about the social, political and economic debates of the time. Historian Dr Jim Stokes told journalists about those records in a special embargoed media briefing in early December 2011. Former Prime Minister Bob Hawke also spoke to the press.

The early ’80s was a time of both triumph and struggle for Australia. 1982–83 saw the worst drought of the 20th century hit countrywide, success at the Commonwealth Games in Brisbane, a deep recession, the Ash Wednesday bushfires and Australia’s victory in the America’s Cup yacht race. The population tipped over 15 million and Countdown celebrated its 10th anniversary on television.

In the international arena, relations with Indonesia continued to be fraught following the annexation of East Timor in 1976. Argentina invaded the Falkland Islands in April 1982, and Britain went to war to defend its southern outpost. The Soviet Union’s war in Afghanistan continued to rage on.

For Malcolm Fraser’s Liberal–National Party Coalition government, 1982 was a difficult year. Having survived three elections, there was a sense of an ageing Ministry that was losing cohesion and determination. Ideological differences were compounded by personal rivalries, and the media reported heated exchanges at some Cabinet meetings.

Following the Liberal’s loss of 27 years of government in Victoria, tensions between Fraser and Andrew Peacock came to a head.

Andrew Peacock:

What is required now in my view is a change in direction, a new sense of purpose and a confident but sensitive style of leadership. I will therefore stand for the leadership.

Narrator:

Fraser brought on a vote for the Liberal leadership and defeated Peacock 54 votes to 27.

In early 1983 Fraser was focused on an early election in which he would face the newly appointed leader of the Australian Labor Party, Bob Hawke. As the former President of the ACTU, Hawke had a high degree of public recognition, a reputation as a problem solver and formidable skills in the workings and theatrics of politics.

The March 5 election gave the ALP a majority of 75 seats to 50 in the House of Representatives. Fraser resigned, and Andrew Peacock took over the Liberal leadership.

Malcolm Fraser:

First I’d like to congratulate Mr Hawke and the Australian Labor Party on winning this election. I will not contest the leadership of the Liberal Party.

Narrator:

Both Fraser and Hawke faced major budget problems. The 1981–82 Budget deficit blew out to $548 million, and a rapid decline in the economy threatened a far worse result for the following year. Unemployment rose to 6.6 per cent in May 1982 and would reach 10.3 per cent in ’83. Many of Australia’s problems flowed from the prolonged international recession, but they were exacerbated by a major wages breakout in the second half of ’81 and an inflation rate of over 10 per cent.

The 1982–83 deficit proved to be far worse than predicted, as the cost of unemployment benefits and drought relief rose and tax revenue fell. As soon as the Hawke government took office, Treasurer Paul Keating and Finance Minister John Dawkins unleashed a barrage of bad news on Cabinet. The economy was in deep recession and unemployment was still rising.

Wages policy was a crucial issue for both Fraser and Hawke. The establishment of a Prices and Incomes Accord was central to Hawke’s election strategy. The process began with a national economic summit in April 1983, which brought together leaders in politics, business, finance and the unions.

Bob Hawke:

I’ve got to put the summit there as the highlight because without any doubt this was unique, the first time all the strands of the Australian economy and society had been brought together with a view to doing the best thing for Australia. And there is no doubt that it was upon that we were able to build the range of economic decisions that turned the fortunes of Australia around.

Narrator:

It was agreed that there would be a return to central wage fixing, unions would accept reduced wage increases, mechanisms for price surveillance would be examined, financial restraint would be shared by all and welfare should be focused on the most needy.

Hawke told Cabinet the most satisfying aspect of the summit was the willingness of all parties to accept their shared responsibility for addressing the current economic problems.

On 21 April 1983 the Director-General of the Australian Security Intelligence Organisation, Harvey Barnett, told Cabinet that Valeriy Ivanov, First Secretary at the Soviet Embassy, was a KGB officer whose relationship with lobbyist and former ALP National Secretary David Combe was moving into a clandestine phase.

Cabinet decided that Ivanov should be expelled from Australia and Combe placed under surveillance and banned from undertaking consultancy services for ministers. On 17 May Justice Robert Hope was appointed as a royal commissioner to report on the Combe–Ivanov affair and to review the Australian security and intelligence agencies. Hope reported in December of ’83 that Combe’s relationship with Ivanov had had serious national security implications, but that with Ivanov’s expulsion there was no longer any reason to limit Combe’s access to ministers.

The Hawke government agreed to ratify the UN Convention on the Elimination of All Forms of Discrimination against Women, subject to reservations that the private sector could not afford paid maternity leave and women would not be permitted to take combat roles in the armed services. It also agreed to proceed with a Sex Discrimination Bill (later enacted in 1984) on the basis of a bill introduced into the Senate in 1981 by Senator Susan Ryan.

Aboriginal affairs continued to be an issue of concern for the Hawke government, as it had been for Fraser’s. In September 1981 the National Aboriginal Council had presented the government with a list of 24 demands, including substantial land and resource rights, self-government in ‘tribal territories’ and 5 per cent of gross domestic product for 195 years.

In April 1982 Aboriginal Affairs Minister Peter Baume prepared a Cabinet submission recommending the rejection of the demands because of their poor drafting and extravagant claims, but indicating a willingness to pursue the concept of a treaty. However, the submission was subsequently withdrawn.

The proposed Franklin dam in Tasmania was a significant issue throughout 1982 and in the ’83 federal election. In May 1982 the Tasmanian Liberal Party, led by Robin Gray, defeated the ALP government and began work on the dam – an act in opposition to the wishes of 45 per cent of Tasmanian voters and the Commonwealth.

Prolonged discussions within federal Cabinet and with Tasmanian ministers made it clear that Tasmania was determined to build the dam and the Commonwealth would not agree to Gray’s request to withdraw the World Heritage nomination, which had been put forward for much of south-west Tasmania in 1981.

The dam became a major national issue, with a blockade of the Gordon River by conservationists that began in November 1982 and saw more than 1000 people arrested. In December ’82 the World Heritage Committee accepted the nomination, but asked that south-west Tasmania be placed on the list of World Heritage sites in danger.

The ALP undertook to stop the dam and moved quickly after it had gained office in March 1983. The Tasmanian government refused to stop work and the issue went to the High Court on 31 May. The court ruled in favour of the Commonwealth on 1 July and Cabinet’s attention turned to delivering a large compensation package to Tasmania.

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