2005 speaker: Richard Pratt AC

Richard Pratt AC delivered the Australia Day Address at The Conservatorium of Music on 19 January 2005.

Biography

ambassador 2005 richard pratt

Richard Pratt, AC, is Chairman of Visy Industries; a privately owned Melbourne based packaging and recycling company employing almost 8000 people in Australasia and the USA. Visy’s total manufacturing sales exceed $3 billion. In 2000, 2001, 2002, 2003 and 2004, Visy was named Australia’s leading company for environmental performance in a national survey of Australia’s top 100 companies. In 2004 Visy received Australia’s most prestigious environment award, the Gold Banksia Award and the Banksia Foundation’s Business Environmental Excellence and Leadership award.

In recent years Richard has focussed his attention on finding ways for Australia to address the challenge of better managing its scarce water resources.

Transcript

The Honourable David Campbell, Mr John Murray, Mr Paul Salteri, distinguished guests ladies and gentlemen …

Anniversaries and birthdays are always times for celebration and reflection.

But this year, perhaps more than any other, we approach Australia Day with significant opportunities for both.

As we celebrate our achievements as a nation, we also give thanks to our good fortune. We give thanks for living in a free and democratic society which is amongst the most prosperous in the world. And we give thanks for being stable, secure and comparatively trouble free.

Yet at the same time, we live in a part of the world which is still in shock and mourning. As Australians, we understood at once that the Asian tsunami’s destruction and havoc happened in our own backyard.

And so, as good neighbours do, we pitched in. the generous response by Australian individuals and by our government, has reflected our sense of shared humanity.

We displayed the same generous spirit in the wake of the recent South Austrlian bushfires. Like most of us, I think this does Australia proud. and like most of us, I too think it’s brought out the best of what we instinctively feel it means to be an Australian.

And so, given it’s timing, the tsunami disaster has set this Australia Day apart.

Which is why, I’m both honoured and apprehensive that Bob Carr invited me to give this year’s Australia Day Address.

I’m honoured because I came to this country as a child, the son of refugees.

It was the generous and far-sighted response of the then Australian Government that enabled my parents to escape the gathering storm in Europe on the eve of World War 2. Even though I was only four years old when I arrived here, I will never, ever forget how extremely fortunate I was to have come to this particular country in 1939.

This is especially so because in a sense, my parents didn’t choose Australia. It chose them. In their desperation to flee pre-war europe they were looking for passage to any friendly country which was far enough away.

They applied for visas to several places and Australia was the first to hold out the welcome mat. Not surprisingly that’s an approach I’d like to see more of today.

My parents were always grateful for the opportunities that Australia gave them. And so while I grew up as a Dinky Di Australian, I always had a slight outsider’s perspective of just how special this country is.

Knowing what my parents came from gave me an appreciation of Australia which means I have never, and will never, take it for granted.

I’m sure this has helped me see Australia as a land of unlimited opportunities for those who are prepared to pursue their dreams.

Even now I can see more opportunities in Australia than I’ll ever have time to pursue.

At the same time this gratitude and sense of perspective has helped instil in me a strong desire to show my appreciation to Australia for everything I’ve been able to achieve.

Having benefited in so many ways from what Australia has to offer, it means a great deal to me to be asked to share some of my ideas about who we are as nation. And about what we may yet become.

I say “what we may yet become” because I believe that, attached to our collective pride and good fortune, comes a collective responsibility to ensure that future generations feel just as proud and just as fortunate as we do to be Australian.

But as well as being honoured by trying to express some of those hopes, I’m also apprehensive.

I’m apprehensive because between the time I accepted the invitation to speak and getting up here tonight, our world has changed.

The tsunami that hit our neighbours has not only shaped their destinies for the next decade, it has also shaped ours.

Yet while we know this to be true, we still don’t know exactly how it will shape us. It’s still too early to grasp fully the enormity of what happened and what it will mean for the region. So In that sense I’m apprehensive about saying too much other than that what defines nations in history is not the tragedies that may befall them. What defines them is how they respond -- and what they learn in the process.

In the hope that we can indeed take some lessons to heart, I’ll offer a few thoughts on Australia’s response to the Asian tragedy towards the end of my remarks.

But for most of this address, I want to share with you some of my own long-standing pre- occupations about our country and its future.

I want to look ahead not just a decade, but 50 years or more.

That’s a tall order. But as Bob Carr once said about me, I’m certainly not lacking in chutzpah.

As most of you know, chutzpah is a Yiddish word for which the polite translation is “cheek”. But others, including me would say that “unmitigated gall” comes closer to the true meaning.

So notwithstanding my chutzpah, I’m putting forward my ideas not as absolute prescriptions or solutions, but as topics which I think are at least worthy of extensive debate.

Because if i’ve learned anything in my 70 years of living, it’s that progress only comes from continually challenging the staus quo. Not doing so leads to complacency and ultimately, ossification.

Or to quote George Bernard Shaw:

The reasonable man adapts himself to the world; the unreasonsable one persists to adapt the world to himself. therefore all progress depends on the unreasonable man.

Ladies and Gentlemen, not surprisingly, I do not think My ideas are unreasonable. But they are inter-related. and they come under five headings:

They’re about:

  • People…

  • Water…

  • Infrastructure,

  • Education and …

  • Social investment, or philanthropy.

In each of these five areas I want to offer two main proposals. That makes a total of 10. But in case anybody worries that Pratt offering 10 commandments is taking chutzpah just a little too far, I’ve come up with an 11th, separate proposal. I’ll offer it at the end. That should avoid any immodest comparisons.

Let me begin with People and Water.

For quite a few years now I’ve been talking about these two foundation stones upon which I believe Australia’s future rests for the next 50 years.

As a way of dramatising the importance of population planning, I’m on record as advocating a population target for Australia of 50 million by 2050.

I continue to believe that this goal is attainable and that it would be good for Australia. Good for the economy as a whole, for employment, for defence and security, the environment, and our social and cultural development.

To put it simply, I think the waves of immigration which transformed Australia for the better in the 20th century have to be renewed if we’re to compete and prosper in the 21st century. My views, and those in business and other circles who share them, have received a fair bit of flack over the years.

Yet just last week Immigration Minister Amanda Vanstone announced that over the past year we’ve taken in the largest number of migrants and refugees in a decade.

More than 110,000 people settled here, up by 20,000 on the previous year, and an increase of 60 per cent over the past 10 years.

And despite gloomy predictions, we haven’t all been ruined. Last time I looked the economy was booming.

So I welcome the growth in immigration. But I argue the figure is still too low. We should lift the numbers to an annual rate of something over 200,000.

That would enable us to achieve one percent population growth from immigration, and one percent from natural increase.

Australia has done it before and most would agree it was worth it. I believe We have to do it again and that in 50 years time most will agree again that it was worth it.

So I’d like to offer two proposals to help population planning, in the broadest sense.

The first is about the Australian diaspora - the estimated one million Australians who live more or less permanently abroad.

Many of these Australians are amongst our best and brightest.

As part of our stepped-up immigration program, I’d like to see us set ourselves a national goal of winning back 250,000 of them over the next 10 years.

Winning back those who still call Australia home is clearly not always all about money, jobs, or schooling. It’s as much about opportunity.

We have to turn our best minds towards creating the sort of environment and incentves that will encourage some of our best overseas minds back home.

It may sound strange to pay to repatriate Australians who’ve made it overseas.

But as someone who advocates spending to attract more immigrants from other countries, I believe we should make the effort to include our own “sons and daughters spinning round the world”, amongst them.

My second population proposition is that the Federal Government should create a senior cabinet post to be known as the “Minister for Population Planning”.

Obviously the portfolio should include the Department of Immigration.

This would help send a message that with proper planning, having more Australians does NOT threaten our environment or our quality of life. Indeed it can help to sustain and enhance them.

Right now I expect Bob Carr is thinking to himself “why on earth did I ask Dick Pratt to give this speech.”?

But I happen to agree with bob that Sydney is too crowded already and lacks the infrastructure to support higher population growth.

But if Sydney is over-crowded, the rest of New South Wales and most of the rest of Australia is not.

Which is why getting our water supply and infra-structure investment right, matters so much.

We can’t plan for a sustainable population of 50 million in 50 years time unless we decentralise our people into regional Australia.

And we can’t do that without water and infrastructure.

My mantra about water in the driest continent remains the same:

Australia doesn’t have a water shortage problem. Per head of population we have plenty of water. What we have is a water management and distribution problem. And we can solve it. Two years ago my own company joined with the nsw and Federal Governments to investigate water savings and efficiency opportunities in the Murrumbidgee Valley. I’m confident we’ve demonstrated that a great deal is possible.

The study, handed up to both governments late last year, provides a series of practical, achievable reforms that can help revolutionise our regions, and through our water. Our nation, by world-class water management.

The study shows that properly managed, there is more than enough water to enable continued urban and agricultural growth while ensuring our rivers are restored to health. But we have to work hard and spend big to achieve that outcome.

There are enormous opportunities for governments and business to invest to improve water use efficiency. We can create water savings and utilise those savings for the environmental and economic good of Australian communities, both urban and regional.

But to do that we need to manage all water on a rigorous and transparent “balance sheet” basis which reflects its true value. We need to establish unambiguous objectives and known costs and benefits.

In practical terms that means private business and governments will have to forge pro- active alliances.

In those alliances we’ll have to embrace some business-sector ideas, technologies, networks and people to stop wasteful water losses and improve production and environmental quality.

Most importantly, we have to consider the environment as a prime and legitimate customer for water consumption.

Governments must account for environmental flow provisions accordingly. While I believe the road ahead is more or less clear, i’m by no means talking about a quick-fix

The time-scale must be measured out in decades and paid for in the billions, and probably in the tens of billions, over the century ahead.

Yes, we’ve made a start in some critical areas.

But you’ll forgive me if I say it’s just a drop in the bucket.

We have no choice but to move ahead, much faster, and along a new road.

We must move now. and our political leaders must put the electoral cycle aside and start thinking about the long term national interest.

Which, in turn, brings me to infrastructure development.

Say infrastructure to a business audience and you’ll get a lot of nodding around the room. In fact in most rooms, Everybody’s for it.

But what are we really doing about infrastructure that corresponds to what will be needed in 2050? On almost any comparison Australia is lagging way behind on infrastructure spending.

Unless we address it now, we’ll see major blockages and failures in our ageing infrastructure in the very near future – and i’m not just talking about the occassional power blackout on hot days.

So today I have two proposals on infrastructure development.

My first proposal involves winning a battle of ideas.

I think We urgently need to drop the all too narrow obsession with “no new Government debt.”

On the whole Australian Governments have done a fantastic job on debt reduction. But surely the time has come to take on new debt to help secure our nation’s future.

Debt is good. At least the right kind of debt is good.

The financial markets, treasury officials, and the economists are all very capable of distinguishing between unproductive debt and wealth-generating debt that builds national infrastructure and pays for itself through job creation and economic stimulation.

My second proposition relates to much of our existing manufacturing, mining and public utility infrastructure and more.

I say to the Federal Government: “Let’s get with the program and ratify the Kyoto Accord as soon as possible.”

I say this not just because it’s the right thing to do. and not just because we’d derive environmental benefits from fewer emissions.

But because we’d also derive great infrastructure benefits.

It would force many of our older resource industries to modernize, to use greener technology, and to become more productive as a result.

Continual re-investment in new technology leads to lower costs, better environmental performance and long term competititve advantage. Tolerating so called smokestack industrial performace does us all a disservice in the long run.

Ladies and Gentlemen, when most of us speak about infrastructure we’re thinking about large-scale investment in roads, railways, airports, seaports, and the like.

But there’s another kind of long-term infrastructure investment which is just as important: And that is our spending on education, research and development.

IN other words, our knowledge infrastructure……..

On the latest figures, the Australian Government ranked ninth amongst OECD countries in its R&D spending.

The same figures showed that r&d spending by Australian business ranked 18th among OECD countries.

Australia can do better.

Of my two proposals in this area, one is based on a Canadian initiative, and the other on an American scheme.

But I believe both are relevant to Australia.

In 2000, aware that it had lost ground in R&D investment, the Canadian Government set aside one billion dollars to establish the Canada Research Chairs program.

The aim, was to establish 2,000 new research professorships across 73 Canadian universities over five years, and become one of the five leading nations in R&D.

With more than a year still to go, Canada has established more than 1,300 of these research positions. The program has already had a major impact.

Australia has 37 universities, just half the number of those in canada’s program. So we can be more modest and still make an enormous difference.

A joint venture by Australia’s Government and business sector to establish 500 new research chairs over five years here, would resonate dramatically and beneficially.

My idea is that the Federal Government would fund the chairs, and business, acting through a body such as the business council of australia, would provide the entrepreneurial mentors. They could help the researchers with such matters as finding venture capital markets and commercialisation.

If such a scheme cost us a billion dollars over five years, it would still be money well spent. My second proposal is directed towards helping Australian families to contribute towards the cost of a tertiary education.

As the cost of tertiary education continues to rise, we need to find inventive ways of ensuring that eligible Australian students don’t miss out because they can’t afford it.

Which is why I’m attracted to an American idea of designating some treasury savings bonds as education bonds. When these bonds are cashed in and used to pay for University and College, the interest they’ve attracted is tax free.

Such a scheme would also promote savings, an area where Australians need to lift their game.

So much for population, water, infrastructure, and education.

My final proposal relates to social investment or philanthropy, particularly corporate philanthropy.

Recently it’s been the subject of some discussion that In contrast to the immediate outpouring of generosity from individual Australians, and the government, Australia’s corporate sector, with notable exceptions, was slow to respond to the tsunami disaster. While they later backed away from it, the Australian Shareholders Association rolled out an all too familiar argument still heard in many board rooms.

Basically the argument goes that the only obligation a public company has is to maximise profits for its shareholders.

It says that public companies are dealing with other people’s money and have no right, let alone any obligation to give money to charity without shareholder approval.

Philosopically and in a very broad sense, I actually agree with that argument. but what I can’t agree with, and what for the life of me I can’t understand, is why so very few public companies have actually asked their shareholders for their views on community involvement and support.

Public company boards seem to have little trouble finding ways to win shareholder approval for increasing directors fees and executive pay packages on a regular basis.

If they took the trouble to regularly put it to a shareholder vote, I’m sure many directors would find their shareholders happy to approve community giving programs.

My thoughts in this area have been well documented. I believe the business case for corporate philanthropy is very clear and has been amply demonstrated.

Apart from it being “the right thing to do“ most companies that are active in philanthropy can point to the many advantages it brings them.

These include increased recognition by customers and consumers, better employee recruitment and retention, higher staff morale and innovation, wider networking possibilities, better access to Government investment funds and increased community support for local development.

But given that only about half of the top 100 companies in Australia seem to be persuaded that it’s in their enlightened self-interest to be more charitable, I’ve suggested the others may understand the language of incentive.

So my two proposals on social investment echo something I first mooted on Australia day last year.

The first is a form of community compact between the Government and business designed to encourage more social involvement from the corporate sector.

For example, while still complying with due process and best practice, governments could use their purchasing decisions to reward those companies who do the right thing.

Right now at both Government and consumer level, there is far more talk than action about this sort of idea.

The second “carrot” entails a return to tax incentives of the sort that once applied to research and development.

Despite the well-documented flaws and some rorting - which more determined governments could have tackled - the basic idea was sound.

An additional tax rebate for those companies which donate say at least 1% of their annual profits to community groups would send a clear message that the Government is serious about our corporates playing a much wider role in the community.

Perhaps the Government could focus this rebate on getting more companies to engage with our indigneous communmities. that would be a wonderful gesture towards reconciliation, which is another issue we must address before we can be fully mature as a nation.

At this stage I should point out again that these proposals are not meant to be absolute or exhaustive.

Indeed, anything we can do as a society to build a greater culture of philanthropy in Australian business over the next decade would be a major contribution to community development.

Ladies and gentlemen,

That makes a total of 10 Australia Day propositions.

That’s real chutzpah for you. I even foreshadowed an eleventh.

And so I’d like to conclude by going back to the beginning.

I began by saying that how we and our asian neighbours react to the tsunami tragedy has the potential to define our relationships in the region for a long time to come.

In our immediate response, Australians have reacted magnificently in raising and giving urgently needed relief funds.

But it’s clear that many, particularly younger Australians, want to do more. many want to give themselves as volunteers to the great tasks of reconstruction that lie ahead.

This presents us with an historic opportunity which I would like to translate into my eleventh proposition.

I’ll call it: “The Australia Plan”.

Approached in the right way, we could develop it into a kind of Colombo Plan in reverse. Just over 50 years ago, in the aftermath of World War 2, Australia was a leader in establishing the far-sighted Colombo Plan. it was the first important long-term initiative this country took to engage with South East Asia.

In the years that followed, the Colombo Plan brought more than 50,000 students from the region to our universities -- and helped to change Australia.

In fact, the Colombo Plan was one of the greatest people-to-people schemes anywhere. it has returned dividends to Australia many times over throughout the region.

So through The “Australia Plan” let’s find ways to encourage and support a new generation of young Australian volunteers to engage productively with the region.

I noticed at the weekend that the Government is considering something along similar lines. let’s hope we can make it happen.

Because it will help rebuild what’s been destroyed, not just in the weeks and months to come, but for decades ahead.

Because while our nation’s reputation has certainly been enhanced by our response in the short term, our nation’s character will be built by our actions over the long term

And On this Australia Day 2005, I hope you agree that it’s a worthy vision to pursue. Thanks for listening.

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