SABRA LANE:
Treasurer, good morning and welcome.
JOSH FRYDENBERG:
Nice to be with you, Sabra.
SABRA LANE:
How do you think Australians will regard the promise of lump sums of cash in their bank accounts just weeks after an election?
JOSH FRYDENBERG:
Well we, the Liberals and the Nationals Parties, we want Australians to earn more, and we want Australians to keep more of what they earn, so returning people their money through tax cuts is an important philosophy for us. The Budget’s in good shape and we’re delivering the first surplus in more than a decade, but importantly, this money into people’s pockets will help ease the cost of living pressures
SABRA LANE:
20 bucks? A week? That’s not even a schnitzel and a beer.
JOSH FRYDENBERG:
Well actually $1,080 is actually very substantial, for someone who’s earning between $48,000 and $90,000.
SABRA LANE:
But that’s how much it is a week.
JOSH FRYDENBERG:
But it’s very significant, if you’re a couple; a tradie and a teacher each earning $60,000, you’ll have an additional $2,160 in your bank account in 13 weeks’ time when you put in your next tax return. That’s money, Sabra, that will go towards your monthly mortgage payment, your quarterly energy bill, your yearly car insurance.
SABRA LANE:
Yeah, its 10 million tax payers who’ll get a cash payment come July after lodging a tax return. Nearly $4 million will get some sort of energy supplement as well. 14 million people get something in about 13 weeks, that is an awful lot of money being doled out very quickly.
JOSH FRYDENBERG:
Well the government acknowledges that people are dealing with cost of living pressures, and the government also acknowledges that we need to lower taxes at every opportunity. You see, we have an internal discipline which is a tax to GDP ratio of 23.9 percent, it’s our tax cap and we stay below that. Now, we would have hit that tax cap midway through this decade if we didn’t take this action. The Labor Party doesn’t have that discipline, they’ve abandoned all pretence of lower taxes, they’ve got $200 billion of higher taxes and no tax to GDP cap.
SABRA LANE:
You’ve talked about Labor, you’ve trumped Labor’s promise of tax cuts to low and middle income earners, you matched a commitment on Medicare, boosted incentives by half a billion dollars on apprenticeships, how much of this Budget is actually just about neutralizing Labor?
JOSH FRYDENBERG:
Well it’s actually about delivering a better outcome for all Australians and growing the economy…
SABRA LANE:
Really? Every ounce of it you and Mathias Cormann gave in the press conference yesterday, you either referenced Bill Shorten or Labor.
JOSH FRYDENBERG:
Well there’s going to be a contest at the next election, that’s very clear, between the Liberals and the Nationals for lower taxes, and Bill Shorten who’s for higher taxes. That’s the contrast. But also this first down payment on Labors debt of $7.1 billion with the surplus the first in over 12 years is a very significant achievement. It’s no accident, it doesn’t happen overnight. It’s because of the decisions that we’ve taken, over the last 6 years we’ve brought spending growth down to half of what it was when we came to government. We’ve got the number of people of working age on welfare at the lowest level in 30 years, and we’ve got the spending growth of the government being the lowest of any government in 50 years.
SABRA LANE:
Let’s talk about those on welfare. For those on NewStart, it’s nothing extra. They’ve had nothing for nearly 3 decades.
JOSH FRYDENBERG:
Well a couple of things; firstly the energy supplement will be extended to people on NewStart…
SABRA LANE:
It will be?
JOSH FRYDENBERG:
It will be…
SABRA LANE:
Is that a last minute decision?
JOSH FRYDENBERG:
That is something that the government has taken as a decision and there will be other people who also receive payment…
SABRA LANE:
But that wasn’t announced on the weekend, so that’s something new?
JOSH FRYDENBERG:
That’s something new. What is important here, Sabra…
SABRA LANE:
And that’s a tacit acknowledgment that you haven’t done enough for them?
JOSH FRYDENBERG:
No, what we have done is ensure that people can have their cost of living pressures- see people who are on a disability support pension or people who are on an aged pension, or a parenting payment or carers payment or veterans payment; they’re the ones who were targeted with this $125 for couples, with the Energy Supplement. Now we’re extending it to NewStart and others, but they’re different types of payments. You see, the vast majority of people on NewStart move into a job and off that plan within 12 months, NewStart’s also indexed twice a year, and the people who are on NewStart tend to also be on other government payments, whether it’s the Family Tax Benefit, or a parenting payment or something.
SABRA LANE:
On NDIS; there’s 1.6 billion not allocated, the Government says the uptakes been really slow, but we keep hearing stories about people finding it really hard to get a plan in the first place?
JOSH FRYDENBERG:
Well the first thing to say is the Government will meet every cent of its obligation to the NDIS; that an absolute commitment, it’s a bipartisan commitment, and this Budget fully fund the NDIS, but it is a program…
SABRA LANE:
Well that’s what you said last year and now there was more money committed over the weekend and still there’s the $1.6 billion that’s being held back.
JOSH FRYDENBERG:
Well actually, what was committed over the weekend, the $850 million, was to providers to give them a lift in the money that they’re receiving. But what is important here, is that the Budget fully funds the NDIS. It’s a program in transition, currently Sabra, there are 250,000 people who are on it, 78,000 of whom have never received the disability support before. It grows to 460,000, and of course, as more people go on it, more people receive those payments. But just as there was, as you say on the NDIS because it’s a demand-driven-program, less money going out than originally expected, there was more money going out on public hospitals. We’ve had to find an extra $1.9 billion to go to public hospitals. So, it really is these demand driven programs, they equal themselves out.
SABRA LANE:
When will Treasury publicly report the final Budget outcome from 2019/2020?
JOSH FRYDENBERG:
I assume that will be after an election is called.
SABRA LANE:
Well the 2019/2020 financial year, it will be September next year?
JOSH FRYDENBERG:
Well in terms of pre-election fiscal outlook, will be after the election is called, final budget outcome will be after that period.
SABRA LANE:
Isn’t that when, possibly, you can claim a surplus?
JOSH FRYDENBERG:
No, we’ve got a very credible number of $7.1 billion, a very significant surplus…
SABRA LANE:
It’s just a forecast at this stage.
JOSH FRYDENBERG:
What we’ve seen with all out Budget forecasts is that we’ve actually beaten them, and that we’ve seen a steady trajectory downwards in terms of the deficits over recent years. And now we’re seeing $45 billion worth of surpluses over the next four years. You see, the comparison with Wayne Swan, was that he missed his Budget forecast substantially, $80 billion worth of underperformance. What we have done, for example, in the last final Budget outcome is beat our expected Budget performance by $19.5 billion, so we’re actually outperforming and over-delivering.
SABRA LANE:
How much of this is about erasing the memories in voters of the leadership changes from Tony Abbott to Malcolm Turnbull to Scott Morrison? The energy wars within the Coalition? The dysfunction that we’ve recently seen? You’re trying to lure people back into voting for the Coalition.
JOSH FRYDENBERG:
Sabra, you can talk about the past, I’m focused on the future, and the future is that this Budget delivers a stronger economy, and secures a better future for all Australians. We’re getting the books back into balance, we’re delivering the congestion-busting infrastructure that will get people to work earlier and get them home sooner, we’re guaranteeing the essential services on hospitals and schools. And in this Budget; there are programs for mental health and youth suicide, which are the biggest on record; perinatal support, early psychosis treatment, 30 new headspace centres. You can do those things, as well as add more drugs to the PBS by having a strong economy, and that’s what we’re delivering
SABRA LANE:
Treasurer, thanks for joining the program.
JOSH FRYDENBERG:
Good to be with you.