ALLISON LANGDON:
Treasurer Josh Frydenberg joins us now from Canberra. Treasurer, thank you so much for your time this morning.
JOSH FRYDENBERG:
Good morning.
ALLISON LANGDON:
This is your home state. Is it tough seeing it going backwards?
JOSH FRYDENBERG:
Certainly is. This is a serious failure of quarantine that has really put lives and livelihoods at risk and it's really important that the testing and the tracing and the effective quarantine measures are put in place quickly. We're talking about 10 post codes, around 310,000 people out of a state of 6.4 million people, but we don't want to put at risk the real gains we've made across the country in suppressing the number of new cases and ensuring that the economy can open up, because ultimately, we want to get people back to work and keep businesses in business.
ALLISON LANGDON:
Whose stuff-up is this?
JOSH FRYDENBERG:
Well, again, the Premier's made it very clear there's been a real failure in the quarantine system there and no doubt, he will conduct and his government will conduct the appropriate inquiries and hold the people who are responsible accountable.
ALLISON LANGDON:
We now have 36 suburbs in lockdown again. Yesterday we saw passengers fly into Sydney from Melbourne, with zero questions asked. It's hard to believe we won't see further outbreaks. How will that impact the nation's economic recovery?
JOSH FRYDENBERG:
Treasury did some modelling and found that if those three stages of restrictions are eased in accordance with the decision of National Cabinet, then that will see 850,000 people get back to work and about $9.4 billion dollars added to the Australian economy each month. And so we don't want to put that at risk, and clearly, in Victoria, recent developments does hurt confidence, and it does create real problems for local communities. So we're very keen that Victoria and indeed, more broadly the country, can get on top of these new cases and ensure that the outbreak is stemmed.
ALLISON LANGDON:
You have got to think that this second lockdown is going to be the nail in the coffin for many businesses in those areas?
JOSH FRYDENBERG:
Look, I think it will be tough for businesses and it's going to be tough for families and communities but we are going to see more cases over time, and it's how we react to those cases that is absolutely key because we don't want to compromise the gains that have been made to date. We want to ensure that the economy continues to open in accordance with the timetable agreed by National Cabinet and we are faring so much better than other nations around the world, both on the health front and on the economic front.
ALLISON LANGDON:
We're about to spend $270 billion on defence, so clearly there is a money tree in Canberra.
JOSH FRYDENBERG:
No, there is no money tree. Ultimately, it's you and your fellow Australians who through their taxes are paying for the necessary defence expenditure, the necessary income support through coronavirus, as well as the other essential services that the Government is providing. But clearly there is a need in a very complex and increasingly tense geostrategic environment for Australia to invest more in defence. That is a priority for the Government, just as investing in education and health is too.
ALLISON LANGDON:
Can we afford it?
JOSH FRYDENBERG:
Yes, we can. And we have no choice.
ALLISON LANGDON:
Now, it is 1st of July so I guess it’s happy new financial year to you, Treasurer. Got any presents for businesses?
JOSH FRYDENBERG:
Yes, we do. Company tax is coming down to 26 per cent for businesses with a turnover of under $50 million. That's about 3.5 million Australian businesses that are getting this tax cut five years earlier than originally intended. So if you're a pub or a supermarket, this could be worth $7,500 a year to you and next year, it's going to come down from the 26 per cent rate down to 25 per cent, and that could be worth over $12,000 to your business, to allow you to grow, to invest and to hire more people. So we're focused both on income tax cuts, as well as company tax cuts, and ensuring that families and businesses get more money in their pockets.
ALLISON LANGDON:
We know we're expecting a decision on JobKeeper and JobSeeker July 23. Are you close to finalising that plan? Do you know what you're going to do?
JOSH FRYDENBERG:
We are close, and we are going to announce it on the 23rd of July. We recognise that there are some sectors of the economy that are going to be slower to recover than others. We've spoken publicly about the challenges in tourism, in aviation, in the construction sector. We've made a number of specific sector announcements like the recent arts package that the Prime Minister and the Minister for Arts announced. But we also recognise that our programs are temporary and targeted and we want people to get back into work and we don't want to dull those incentives for them to move flexibly through the economy and through the labour market. So we'll get the balance right. We'll continue to support people, as required because we recognise that while we have made gains, there is still a long way to go in this pandemic.
ALLISON LANGDON:
We're desperate for clarity, so we look forward to getting that July 23. Treasurer, thank you for your time this morning. We appreciate it.
JOSH FRYDENBERG:
Good to be with you.