JOSH FRYDENBERG:
I welcome reports today of significant progress between the digital giants and the traditional news media businesses. Today it’s about Nine Entertainment and Google, on Monday it was about Channel 7 and Google and it’s my understanding that the other media businesses are making very significant progress and that we will have more announcements in the coming days. This is a historic moment; a world first. The digital giants entering into negotiations and agreements with Australian news media businesses to pay for original content. This will help sustain public interest journalism in this country for years to come. It is leading the world and a critical micro economic reform. I want to pay credit to the Prime Minister who, when Treasurer, initiated this process with the ACCC, to my colleague, Minister Paul Fletcher for his outstanding work, and to Rod Sims and his hard-working team at the ACCC, who put together a framework which has formed the basis for the legislation that is now before the Parliament and it is the Morrison Government's intention to pass through the Parliament. I also want to pay credit to the stakeholders. The digital giants and the news media businesses for the good faith in which they have entered into these negotiations and how they are working to mutually beneficial agreements. Are there any questions?
QUESTION:
Do these deals make your bill somewhat redundant if they’re already happening without the legislation?
JOSH FRYDENBERG:
The first thing to say is none of these deals would be happening if we didn't have the legislation before the Parliament. This legislation, this world leading mandatory code, is bringing the parties to the table and is helping to pave a way forward where news media businesses are getting paid for generating original journalistic content. With respect to the code, it is our intention to make it law and, as you know, the code has a number of fundamental features. Namely, it is mandatory. Secondly, it is based on two-way value exchange and, thirdly, that there’s a final offer arbitration model. This code has succeeded where others have tried and failed. It is a framework, a lasting legal mandatory framework, which is obviously the reason why the parties have come to the table.
QUESTION:
Are you considering now not designating Google under the code in any capacity, either in search or Showcase or any other (inaudible) of services?
JOSH FRYDENBERG:
The first thing to say is, when we’ve talked about designation, we have talked about Google and Facebook. I don't want to pre-empt any decisions that I may or may not take as the Treasurer to designate a particular digital platform under this code. But what I have said is if commercial deals are in place, then it changes the equation. Because we have always sought a number of objectives here. Firstly, to get commercial agreements to be struck between the parties. That is work that is currently underway and is looking very promising indeed. The second objective has been to legislate the code. Again, that is our intention in the coming days. Thirdly, we have sought to keep the major players in Australia, as you know, Google had talked about leaving Australia. We never wanted that to be the case. They are an important part of the digital landscape here. But at the same time, we knew that the Code was in Australia's national interest and that is why the Prime Minister, Minister Fletcher and myself were absolutely committed to it.
QUESTION:
Treasurer, you said last week you welcomed the fact the Senate committee recommended no changes to the legislation. On Monday you announced technical changes (inaudible). Have you not bowed to defeat to these tech giants after (inaudible) on the weekend?
JOSH FRYDENBERG:
We have held the line and held it strongly. And the digital giants have been left in no doubt about the Morrison Government's resolve.
QUESTION:
Then why did you make changes?
JOSH FRYDENBERG:
Well we worked through these changes with the ACCC, with Treasury, within Government, because they helped clarify the code. For example, with respect to advance notice of algorithms, they are going to remain with respect to the listing of items on search. That has always been the intention around the advance notice of algorithms. With respect to the arbitrator taking into account the cost of generating original content, we put a reasonable test around that. But also, the two-way value exchange always intended there would be an understanding that you would also take into account the cost to the digital platforms of providing that service for the news media to be registered on it. We are making that explicit. With respect to the ACCC, the ACCC was never to be arguing on behalf of one party or another in the arbitration. The ACCC is an honest broker who is providing the information that is relevant to that arbitration, so that will continue to be the case and we’re making that clear. With respect to lump sum payments, we never intended that if the arbitrator was overseeing a deal between a television station and one of the digital platforms, that they would make that digital platform pay two cents, for example, for every click over the forthcoming year. That was not the intention; always the intention was to have a lump sum payment and that is again what we have made explicit in the code.
QUESTION:
The big organisations like Nine, Seven, News, may well be able to strike deals with Google, but a lot of the suffering has been in regional and suburban newspapers. What will the deals be to make sure that that kind of journalism continues?
JOSH FRYDENBERG:
The first thing is you will see, we hope, and my understanding is a series of deals; deals with the bigger players and smaller players. As you know, we set a threshold for who was eligible under the code and deals are being worked on between the parties. Secondly, we have made it clear to Google and to others that having a default offer in place for some of those smaller players is important as well. I know they are working constructively and in good faith on that. Chris, just to answer your question very directly, there are negotiations going on with all the major players and the minor players at the moment.
QUESTION:
Treasurer, what is it this week about you walking back the requirement for these deals to reflect their value around articles that come up in search? Do you think there are Google deals being done now (inaudible) for publishers and their articles appearing in search?
JOSH FRYDENBERG:
Let's wait and see the detail of those negotiations as the news media businesses make them public and Google make them public in the period ahead. Everything I have heard from parties, both in the news media business and in terms of the digital platforms, is that these are generous deals. These are fair deals. These are good deals. These are good deals for the Australian media businesses and these are deals that they are making off their own bat with the digital giants. Of course, they are complex. They are varied and will be of different length and they are obviously going to be of different quantum. But as I understand it, they are fair deals and they are good deals.
QUESTION:
Treasurer, once the legislation passes Parliament, by regulation, you have to choose which platforms are designated. At the moment, we’re see Google striking deals, so far Facebook has not struck any deals. Will you be looking more favourably upon which companies, whether Google or Facebook, have struck a deal when you determine that designation? And is it possible, for example, that Google could avoid designations and Facebook could get it?
JOSH FRYDENBERG:
Again, I don't want to pre-empt the outcome of these commercial negotiations as currently on foot. Also, the legislation is yet to be passed through Parliament but it is certainly our hope and intention for that to be the case. Last weekend was a busy weekend. I was heavily involved in discussions, both with Sundar at Google and with Mark Zuckerberg at Facebook and, obviously, in very close contact through the weekend with the Prime Minister and Minister Fletcher, and the ACCC, and Treasury. What became clear to me in those discussions with Google and with Facebook is that they do want to enter into these commercial arrangements. That’s their preference. Their preference is to see these commercial arrangements in place and that’s why I back the speed of these negotiations has picked up. So let's wait and see where these negotiations go, but everything is pointing in the right direction.
QUESTION:
Treasurer, if a sexual assault occurred in your…
JOSH FRYDENBERG:
Any more questions on Google, Facebook?
QUESTION:
Did you say that those changes are informing publishers with algorithm changes weren’t (inaudible) to Facebook?
JOSH FRYDENBERG:
No, I didn't say that. I said there is standard provision in the code about notice of changes in algorithms, and they relate to the listing on search.
QUESTION:
On the code, there’s no requirement in the code for news businesses to spend money they obtain under the code negotiations in the newsrooms. Is that a flaw or oversight of the code?
JOSH FRYDENBERG:
Well again, speaking to people and, who run these news media businesses, certainly that is their intention to reinvest in journalism and I think when you look at the ability of your employers to continue to operate, having this extra revenue stream is going to be very important for the sustainability of public interest journalism. When it comes to the public broadcaster, the ABC, in our conversations with its Managing Director, he has made very clear that the money received in any deals that they strike with the digital platforms will be spent on regional journalism.
QUESTION:
Have you got the Press Gallery pay rise then Treasurer?
JOSH FRYDENBERG:
No, well look, I’m not going to jump the gun, John. What I’m going to say is that everything I'm hearing and seeing so far is positive for your sector but more importantly positive for the country. This is a significant micro-economic reform. We have gone where others have failed to go and that is putting in place a workable, a binding mandatory code, which we hope passes through the Parliament as quickly as possible, with bipartisan support. And in the process, we’re going to see journalists and their proprietors paid for generating that content.
QUESTION:
Treasurer, can I ask a question about disclosure laws, just briefly?
JOSH FRYDENBERG:
Sure.
QUESTION:
Are you permanently weakening obligations with the company directors to keep their shareholders informed against the advice of ASIC, which wrote to you last year warning that continuous disclosure is fundamental and particularly important during times of market uncertainty and volatility?
JOSH FRYDENBERG:
Well we’ve followed the recommendations out of the Parliamentary Committee that looked into class actions and litigation funding. This is a very important reform and you would have seen today that it has been welcomed because what it does do is it ensures that there is still a basis to bring civil actions for breach of the continuous disclosure laws, but there has to be fault. It has to be reckless. It has to be negligent or fraudulent. And that is really important. There is a fault requirement. But we have also left in place the existing law where ASIC can issue infringement notices on a no fault basis and that sees Australia adopt similar position to the US and the UK regulators. So it’s really important that we have a balance here where the regulation provides the opportunity for transparency, for accountability, for actions to be brought, but, at the same time, it doesn't create an undue burden on the corporate sector.
QUESTION:
The no fault system that was in place previously, capital players overseas state that made Australia a more competitive and compelling place to invest, are you concerned that by watering down those measures, that you are making Australia a less competitive place for overseas capital to invest?
JOSH FRYDENBERG:
Not at all.
QUESTION:
Giving first home-buyers access to their superannuation for a deposit, won't that push up house prices?
JOSH FRYDENBERG:
Well again we have done a lot in the home space in terms of giving first home buyers an opportunity to enter into the market and so we’ll continue to roll out those measures, measures that have been very successful. With respect to super, I introduced into the Parliament some very significant reforms today, reforms that I announced at Budget time, but reforms that will see the super funds held to account for underperformance, reforms that will ensure that there is a statement of people’s superannuation accounts as they move jobs or move industries. People are paying $450 million a year in unnecessary fees and charges because they have got duplicate accounts. These reforms that we’ve introduced to super today, build on the other reforms, like the opt in requirement for younger people with protecting insurance in super, and getting rid of some of the fees, putting a cap on fees for low balance accounts for example, banning the exit fees. Our reform agenda, when it comes to superannuation, has very much been a practical reform agenda and it might surprise people to know that Australians pay $30 billion a year in superannuation fees. $30 billion a year. That is more than household electricity and gas bills and our reforms have been designed to reduce the fees in super for Australians, the 16 million Australians who have their super accounts and the $3 trillion that’s in Australian super.
QUESTION:
Does that reform possibly include allowing people to access super to buy in?
JOSH FRYDENBERG:
Again, the super space is a very complex one. There are lots of issues that we are looking at. We’ve obviously got the Callaghan Review as well, which talked about when it came to superannuation, a lot of people who were tragically passing away with big balance accounts. So there is a lot of thinking that we are undertaking with respect to super but we do have significant reforms before the Parliament and with respect to first home-buyers, we have a lot of practical programs that we have rolled out.
QUESTION:
Treasurer, this economist I've been speaking with this morning is worried that there’s a pattern of rolling lockdowns that’s emerging in Melbourne and that this will damage the state and city's ability to rebound in the coming 12 months and it will mean that the state and the city lag in the national recovery. Do you share this concern and (inaudible)?
JOSH FRYDENBERG:
Well this is great news that Victoria is coming out of lockdown. More than six million Victorians have been subject to a statewide lockdown and its hit people pretty hard and my family, like so many others that have gone through this. So I welcome the news from the Premier that Victorians are coming out of lockdown. When it comes to the economy, yes, this dents confidence, there’s no doubt about that. Yes, it costs businesses and households a lot of money. I was speaking to one restaurateur recently, he told me as a result of this recent lockdown, he lost $50,000 in food, 120 dozen oysters he had to throw out. He was expecting a bumper weekend, he had hundreds of bookings, he’s had Valentine's Day, Chinese New Year, people going to the tennis and tens of thousands of dollars he spent on wages of chefs that were cooking in the days leading up to weekend when trade was cancelled. So, you go into lockdown, a statewide lockdown, it has a massive economic impact, not to mention the emotional effect and emotional impact on people and all those kids who couldn’t go to school over the course of this week. I welcome the news out of Victoria, I welcome zero cases and when it comes to our economic support, it’s ongoing. Yes, JobKeeper is coming to an end in March but as we saw in the recent economic data, there are 2.1 million fewer Australians and 520,000 fewer Australian businesses that are on JobKeeper in the December quarter compared to the period prior and we have a whole lot of other economic supports that are rolling out.
QUESTION:
Do you support the Barnaby Joyce amendments?
JOSH FRYDENBERG:
No I don’t.
QUESTION:
How’s the Government going to deal with the CEFC bill and do you sympathise with Angus Taylor dealing with a Nats revolt on Parliament?
JOSH FRYDENBERG:
I support a reliability fund and I don't support those Members.
QUESTION:
Treasurer, Labor’s calling for an independent review of the culture of Parliament House and what we’ve just heard about this week, is that something the Government will consider, can we expect Labor and the Government to work together on this, and if not, what’s the issue with having an independent review separate from the party?
JOSH FRYDENBERG:
Well the Prime Minister made a very clear statement to Parliament yesterday and he pointed out that obviously we have got our own internal processes under way and Celia Hammond, a colleague of mine, has been Vice Chancellor of the University of Notre Dame and has experience with dealing with a number of workplace issues in the institutional setting, is going to be working with colleagues. We’ve got the Deputy Secretary in the Department of Prime Minister and Cabinet, Stephanie Foster, who will also be conducting a review. The Prime Minister was positive about what he heard from the Leader of the Opposition yesterday and we will be taking that further, with not just the Leader of the Opposition but also with the other leaders of the other parties. But these allegations are very serious. They are very serious allegations. And that’s why the Prime Minister has put forward a number of new processes. I think there is a recognition on both sides of the political divide that the culture in this place has to improve and improve fast. We want to help that happen. By working across the political divide, taking any politics out of this matter, I think we can make progress, but at the end of the day, we are all here in Australia's Parliament House and the rest of the country looks to our example. So, we have to meet the highest standards in this place because if we don't meet the highest standards in this place, then that is not a good example for the rest of Australia.
QUESTION:
Treasurer, you were going to answer the question about, you’re not going to answer the question? Did you tell the Prime Minister about...?
JOSH FRYDENBERG:
Well again, these are very serious issues Peter and you've heard yesterday from Senator Reynolds that she made an apology in the Parliament and she said that at every stage she thought she was providing the support to Brittany…
QUESTION:
But for you, if a sexual assault occurred in your office, would you tell the Prime Minister?
JOSH FRYDENBERG:
Again, if there was a serious allegation like that, I would make sure the authorities knew. Thank you.