ALI MOORE:
Welcome to the program. Josh Frydenberg, are you there?
JOSH FRYDENBERG:
I’m here, good morning Ali, nice to be with you.
ALI MOORE:
Excellent, I’m glad we haven’t lost you so early in the piece. So this legislation will pass today?
JOSH FRYDENBERG:
We are confident it will. There’ll of course be the necessary debate, but this is certainly in the national interest and I think today is one of the most important days in the history of our Parliament. It’s a day that we come together across the political divide to save millions of Australian jobs and at $130 billion, the JobKeeper program is unprecedented in its scale and its scope and it will, Ali, keep millions of Australians in a job, but also thousands of Australian businesses in business.
ALI MOORE:
And it was heralded when you announced it as starting on the 30th March, but do you actually know any business which is already paying it because the application processes are incomplete, the details aren’t known, the legislation’s not through and if you hop on to the ATO website it just simply says no further updates are available at this time?
JOSH FRYDENBERG:
Well the ATO website allows businesses to register. And what they have done is, in their hundreds of thousands, is follow that advice and taken up that opportunity. And once the legislation passes the Parliament the ATO can go to the next step which is to issue the necessary documentation where businesses will have to show that their turnover has come down by the requisite amount and what we have said is that the payments will start to flow from the first week of May. We’ve also heard from the Australian Banking Association who we’ve been working closely with, that they’re prepared to bridge the finance required from employers between now and when they get their payments in the first week of May so that so many Australians can actually get paid under this scheme.
ALI MOORE:
So once the legislation is through, hopefully that will happen, the issue obviously being that there seems to be quite a lot of, well, lack of clarity from many people about whether or not they qualify. It’s obviously a very difficult and complex area, but if we can just go through some of the questions. The first one is, what is the age cut off for JobKeeper?
JOSH FRYDENBERG:
There is no age cut off at the top level, it’s sixteen…
ALI MOORE:
At the bottom level?
JOSH FRYDENBERG:
Sixteen
ALI MOORE:
Sixteen. And for JobSeeker?
JOSH FRYDENBERG:
JobSeeker again, at the top level, if you’re over 65 then you’ll move to pension arrangements, but at the lower level I think it’s the same that applies.
ALI MOORE:
So it’s still 22? It’s 22 years old for Newstart, is that what it will be for JobSeeker?
JOSH FRYDENBERG:
I’ll double check that and get back to you on that.
ALI MOORE:
Okay. How many hours do you have to have worked for your employer to pay you this?
JOSH FRYDENBERG:
It’s actually not specified, that’s one of the strengths of the system is that it provides that flexibility so if you fall within the definition of what a casual worker is under the Fair Work Act who’s been consistently tied to a business for 12 months or more, then you’re eligible for this scheme. If you’re a part time worker and you’ve been on the books as of the 1st of March and you’re linked to the particular employer there’s no limit at both the higher and the lower thresholds for the number of hours you’ve worked. And of course if you’re a full time worker you’re eligible. If you’re a sole trader, as long as you met the turnover test, you’re eligible. But again, this scheme is going to affect around six million Australians, it’s very broad in its scope. The ATO will obviously be implementing it and I think it will make a real difference in saving millions of jobs.
ALI MOORE:
It is broad in its scope, but there is still an estimated more than one million workers who are not going to fit under it and we’ll look at some of those areas in a minute, but given that there’s no minimum number of hours, could you have actually saved yourself some money and put that towards helping other people, given that you might end up with people who only did ten hours a week now getting $750?
JOSH FRYDENBERG:
Well we’ve worked on creating the fairest possible system and also using our existing tax and transfer system and the most efficient and effective way to get money to the public at this time is to have a flat payment. We’ve gone for $1,500 because that’s about 70 per cent of the median wage, but in the sectors that are most affected, Ali, like retail, tourism or hospitality, $1,500 a fortnight could be around 100 percent of effectively the median wage in those sectors. So you’re right, you could be a casual worker who normally earns less than $1,500 and in this case you will get that $1,500. But we’ve decided to go for this system because we didn’t want people on higher incomes to be getting a different amount to people on lower incomes.
ALI MOORE:
Okay, now obviously that, if you’re a casual worker, would only work if you’ve had a single employer, is that correct? If I’ve had multiple employers over the past 12 months, what happens to me?
JOSH FRYDENBERG:
If you’ve been linked with multiple employers for that 12 month plus period, you have to identify your preferred employer, your major employer. And that will be up to that particular casual to identify that worker, and there’s provision for that.
ALI MOORE:
So, if I’ve got five employers over a period of a year, I choose one of them and I go to them and I say, ‘could you give me the JobKeeper subsidy’ and they agree, what about the rule that I had to have been with them for a year?
JOSH FRYDENBERG:
No that absolutely still applies, that’s the condition precedent, and that’s set out in the Fair Work Act, that you have had to be regular and systemically tied to that particular employer for 12 months or more in the case of being a casual. So that’s the condition precedent. But as you say, you could be a casual worker who has been tied to more than one employer for that period of 12 months or more.
ALI MOORE:
Regular and systemically applied, where does that leave artists and actors?
JOSH FRYDENBERG:
Well, in some cases they may have been attached to a particular employer for that period of time…
ALI MOORE:
…more often than not though, you’re well aware, they won’t have been.
JOSH FRYDENBERG:
Look, of course not everyone comes within the scheme and no one has pretended that it will. What I can tell you though, at $130 billion, it’s an enormous amount of money, it’s a generous scheme, it’s a broad scheme, and it will apply to around six million Australians. We had to draw the line somewhere, as you can understand, this is a major call on the public purse. It’s different to the UK system, it’s different to the New Zealand system, it’s very much an Australian system to deal with the Australian challenge.
ALI MOORE:
So what’s your advice to artists and actors? Where do they go? I understand you had to draw the line somewhere, but these people have still got up to six months where they’ve got to feed themselves, keep a roof over their heads.
JOSH FRYDENBERG:
Well as you and your listeners would be aware, we’ve doubled the safety net. What was previously known as Newstart is now known as the JobSeeker payment, has been combined with a new JobSeeker coronavirus supplement of $550. Now that payment will mean that someone will at least get $1,100 through that welfare system, but also there’s a provision that you can earn up to $104 a fortnight through that process, and that is enabling somebody to work, even that lesser amount, but also to receive the welfare payments. So there are going to be two alternatives for some people, but obviously we’re hoping that the people that are eligible for the JobKeeper, take up the JobKeeper payment.
ALI MOORE:
There are going to be people, and I’m just trying to answer some of the questions of our audience…
JOSH FRYDENBERG:
Sure.
ALI MOORE:
I get that this is incredibly complicated and that you had to draw a line somewhere.
JOSH FRYDENBERG:
…and there are detailed fact sheets, by the way, at treasury.gov.au and on the ATO website there’s also details.
ALI MOORE:
We had a caller yesterday who works for a drug counselling service. They operate on grant funding so it’s very difficult for them to prove a drop in revenue as such, and they’ve had to stand down their staff. So the staff can’t get JobKeeper because the employer can’t prove a drop in revenue, nor can they get JobSeeker because they still in theory have got a job, or at least that’s what they’ve been told, by I understand it was the ATO that they spoke to.
JOSH FRYDENBERG:
Well again the specifics of individual firms that you raise I can take that offline. But people who aren’t receiving a certain amount of income are eligible certainly for the JobSeeker payment.
ALI MOORE:
Okay. Exemptions for some visa holders, what about temporary visa holders? We have a number of, I mean, for example, if we just simply look at foreign or international students.
JOSH FRYDENBERG:
Sure.
ALI MOORE:
200,000 students from 170 countries in Melbourne alone.
JOSH FRYDENBERG:
Well in fact there’s more than half a million across the country. There’s 2.2 million Australians who are on temporary visas and as you would be aware, there’s all types of temporary visas. There’s those on working holiday making visas, there’s those on skilled visas, there’s, as you say, international students, there’s also a large number of New Zealanders who are on a 444 visa, those are eligible for the JobKeeper payment because there’s a reciprocal arrangement with New Zealand. But as for international students, you may be aware that in order to access an international student visa, you had to demonstrate that you could support yourself completely in the first year. And so obviously we’re calling on those who are in their first year to do as they had committed to and support themselves but also for those who have been here longer than 12 months, we’re providing access to their superannuation because that’s their money and it should be able to be used to sustain themselves during a very difficult period.
ALI MOORE:
Treasurer, yesterday we saw the medical modelling, if I can call it that, that’s been underpinning some of the Government’s decisions. If we look at the economic modelling, the Reserve Bank yesterday talked about a very large economic contraction, how bad do you think this could get?
JOSH FRYDENBERG: Well neither you, nor I, nor the Reserve Bank, nor Treasury actually know when the coronavirus will end because ultimately, this is a health challenge and it’s going to be solved by the scientists, the medical researchers, the doctors, not by the public servants or not by the politicians or the radio announcers. And so until we get a vaccine or the use of antivirals, it’s going to be, you know, very, very difficult to come back to life as normal. But we’ll continue to take the best possible medical advice, but there’s no doubt that those health restrictions that have followed the medical advice are creating a severe economic impact.
ALI MOORE:
Is it possible though, I know that the Prime Minister has made the point that Government funding is finite, you’ve also made the point that you have to draw the line somewhere, but down the track if this keeps going, could there be more help?
JOSH FRYDENBERG:
Well look, we obviously want to get to the recovery phase as quickly as possible, and that’s why all our measures have been temporary, targeted, scalable, using existing mechanisms. And the legislation that we introduced has sunset clauses on it for that very reason. We don’t want to be spending more than we have to at any point in time, but we recognise the major call that’s on us at this point, and that’s why we’ve responded the way we have.
ALI MOORE:
And a final question, of course we will have to pay the bill at some point, we can’t avoid that, will we be looking at a coronavirus levy like the Medicare levy?
JOSH FRYDENBERG:
Look, I’m not going to speculate on the period after the coronavirus other than to say there will be a significant debt burden from the decisions that have been taken during this period. We did come into this crisis with a lower debt to GDP ratio than many other countries, about a quarter of what it is in the United States and the United Kingdom, about one seventh of what it is in Japan. As you may be aware Ali, we delivered the first balanced budget in 11 years and we got the country living within its means. That gave us the financial flexibility to respond when the country needed it most, which is right now, and that’s why today’s legislation is going to be so important to saving millions of Australian jobs.
ALI MOORE:
Alright, paying it back is a conversation for another day which I’m sure that we will have.
JOSH FRYDENBERG:
Thank you.
ALI MOORE:
Josh Frydenberg, thank you very much for joining us.
JOSH FRYDENBERG:
Bye-bye.