'We all know what needs to be done': Frank Lowy on keeping Australia 'at the top end of the ladder'

Sir Frank Lowy doesn’t miss his old business life one iota. “I’ve had business up to here,” the former Westfield mogul says, indicating a point well above the neckline. “For 60 years or so I was in the thick of it, and I enjoy the freedom I have now to do other things.”

Yet the country’s sluggish economy is clearly on his mind. As a former Reserve Bank board member himself, he appears to have heard loud and clear the polite pleas from the current bank governor for Canberra to lift its infrastructure spend.

Frank Lowy in his office at the newly refurbished Lowy Institute building.Credit: Dominic Lorrimer

If Sir Frank had his way, he would be re-designing the nation’s accounts so that there were, in effect, two budgets. One would be an annual budget, for “regular things”, he tells The Sydney Morning Herald and The Age. The other, he says, would be a “national” budget for “extraordinary things … the capital expenditure that we need to keep the country at the top end of the ladder”.

The government, he says bluntly, “needs to spend a lot more on infrastructure to make us current in the 21st century … we all know what needs to be done”.

Sir Frank spoke during a rare interview on the eve of his 89th birthday next week, after returning to Sydney for the re-launch of the building that houses his beloved Lowy Institute.

He set the institute up in 2003 after he and one of his sons, Peter, began talking on a long plane trip about his wish to “do something significant for Australia - an intellectual activity”.

“We decided together that an institute of foreign affairs, which was not that well practiced in Australia, would be a good thing.”

Frank Lowy with then prime minister John Howard at the official opening of the Lowy Institute in 2005. Credit: Jim Rice

Having set his heart on the project, they went looking for premises. He found what he wanted in the heart of the city at 31 Bligh Street, a former “gentleman’s club” from the 1880s with a grand facade in the Italian palazzo style. The businessman was smitten. “I saw it on a Friday afternoon and by Monday night I bought it.”

The building, which has just been refurbished but keeps faith with its heritage, serves as a kind of metaphor, he says – linking the country’s future back to its past.

In its 16 years of existence, every Australian prime minister and foreign affairs minister has walked through the institute’s doors, as well as movers and shakers from around the world. Asked which towers most in his memory, Sir Frank nominates German chancellor Angela Merkel. “She made a profound speech … and it was [here] at an institute function that she for the first time talked about the aggressive Russia ... that speech reverberated around the world”.

United States foreign policy under President Donald Trump worries him. He says actions like the abrupt withdrawal from Syria are “disturbing” and “grating” for “many of us in the free world that depend on United States’ power”. He cites Prime Minister of the Netherlands, Mark Rutte, who visited the institute last week, saying “we need to do [the best by] our countries first, but often the first is for the country to be cooperative, because that’s the best way”.

He is generous, however, about Prime Minister Scott Morrison’s speech to the Lowy Institute earlier this month which controversially warned of “negative globalism”. “He did a very good speech, I thought … he gave a very positive view of Australia to the world.”

Sir Frank is careful on the subject of constitutional recognition for an Indigenous voice to Parliament, saying it's “very complex … there are dug in positions in various parts of the country”. But it is “unfinished business. Maybe one day we will be wise enough that it will not be unfinished”.

He reflects sympathetically on the plight of refugees, though again steps cautiously around political fault-lines: “The government of the day ought to decide who can and cannot come to this country.” But he recalls his own experience as a “boat person”, fleeing post-war Europe for Palestine on a “rickety old ship” designed for 150 people but carrying 700.

“The voyage was dangerous. It was long, it was hard, without much food or drink … I compare [myself then] with the refugees that now want to leave their country for better places ... They seek a better world, they are entitled to, but … they need to be integrated to the country that they come to.”

He is sanguine on Brexit. The British, he says, are “not comfortable where they are now. At the end of the day there will be close cooperation and togetherness [with Europe], they are allies.”

Asked if his hopes for his eponymous institute have been exceeded, Sir Frank says: “I never exceed my expectations. My expectations are very high.”

But he is “pleased and proud” by what its achieved. “It has a function that governments cannot do … it’s people to people, it enhances Australia, within and outside, and people go away from here, I would think, in a very good spirit. [As a country] we have lots of friends, and you can marshal those friends to the advantage of the world.”