Cabinet papers 1996-97: Keating invited Howard to The Lodge after election defeat

After a tough campaign that ended in crushing defeat, Paul Keating invited John Howard to The Lodge for a “symbolic” meeting.

John Howard and Paul Keating shake hands before a 1996 leaders’ debate as moderator Ray Martin looks on.

After John Howard led the ­Coalition to a crushing election victory on March 2, 1996, the ­outgoing prime minister, Paul Keating, invited him to The Lodge for a cup of tea to symbolise the ­orderly transfer of power.

Mr Howard recalled that for about an hour and a half they mostly discussed foreign policy and trade, including the Asia-Pacific Economic Co-operation forum. Mr Keating also took the opportunity to show Mr Howard around the building and grounds.

MORE: Full coverage of the Cabinet Papers release

“I was absolutely delighted that we had such a big win,” Mr Howard told The Australian. “It was a culmination of a very tough campaign and a very challenging year after I came back to the leadership.

“Keating was no slouch as an opponent; he was a tough operator and he’d been a very successful Treasurer.”

The meeting at The Lodge on March 21 was the first time that incoming and outgoing prime ministers had met since Robert Menzies was invited to Ben Chifley’s office for tea on December 15, 1949.

Mr Keating formally conceded defeat by telephone after the election and packed up his prime ministerial office. He said there was a degree of mutual respect for each other and the office of prime minister.

John Howard meets Paul Keating at The Lodge in 1996.

“I wanted the country to see and witness a generous and healthy change of government,” Mr Keating recalled. “I showed him around, and I said some things to him which I thought were important to say.”

Before voters went to the polls, the Keating government held a final cabinet meeting on January 23. Several decisions on school funding, the environment and human rights were agreed, even though there was opposition among ministers and departments were lukewarm.

A submission from Simon Crean, minister for education, and Ross Free, minister for schools, sought an extension of capital funding for non-government schools by $170 million over four years and professional development training at a cost of $100 million over four years.

But the departments of Prime Minister and Cabinet, Treasury and Finance opposed the ­submission. They found it lacking policy evidence or justification, and with competing pressures for funds, not urgent. Yet cabinet ­“indicated a disposition to agree” with the proposals provided the states met “tighter accountability requirements” including “reporting on student outcomes”.

Paul Keating and John Howard outside St Mary's Cathedral after the funeral of former ALP MP Mick Young in 1996.

Cabinet also agreed to ­Attorney-General Michael ­Lavarch’s proposal to overhaul the Human Rights and Equal Opportunity Commission by changing how it handled complaints, strengthening its enforcement of determinations, creating a full-time president and chief executive, and making the privacy commissioner an independent statutory office.

John Faulkner, minister for the environment, asked cabinet to ­endorse initiatives to create “a world class” system of parks and reserves at a cost of $105 million over four years, establishment of a national pollutant inventory, ­accreditation of state environmental impact processes, and measures to facilitate sustainable resource management at a cost of $70 million over four years.

Bob Collins, minister for ­primary industries and energy, sought increased funding of $287 million over four years to bolster the existing Murray-Darling Basin Sustainability Scheme, Landcare and the Rural Adjustment Scheme.

Lead departments baulked at the cost of the submissions by Faulkner and Collins. But the cabinet took a different view. There was, after all, an election to win.