BROOKE CORTE:
Good evening Treasurer.
JOSH FRYDENBERG:
Nice to be with you, Brooke.
BROOKE CORTE:
It’s a big spending Budget, the biggest spending spree in Australian history. The numbers are massive yet I still wonder and hope whether this is big enough to pull ourselves out of this recession.
JOSH FRYDENBERG:
Well our starting position going into this crisis was one of economic strength. Unemployment had come down from 5.7 per cent when we came into Government to 5.1 per cent in February. We delivered the first balanced budget in 11 years. That allowed us to respond the way that we did and Brooke that helped save 700,000 jobs. But as you say, the challenge that we face now with a global pandemic is the most significant economic shock the world has seen in a century or more. And the impact on unemployment saw 10 percent of Australia’s workforce either lose their job or their working hours go down to zero. So we will continue to provide the necessary support into the economy but our measures have also been designed to boost the long term productive capacity of the nation, and those investment incentives for business are going to be really important. The loss carry-back measure is going to help keep businesses in business and that’s going to be important and obviously the tax cuts is going to put more money into people’s pockets, so that can create jobs with their spending.
BROOKE CORTE:
As they spend their tax cuts it helps local businesses keep their door open, it helps them hire more staff, but that’s only if we spend it. Because Australians spending the money instead of saving it is what actually drives growth and jobs. Do you expect it will all be spent?
JOSH FRYDENBERG:
I expect Australians to spend that money and you can see that in the forecast for consumption, lifting by 7 percent next year. What we have seen is the savings ratio go up considerably and that is because of the health restrictions that are in place, you can’t go down to your local pub, you can’t holiday at your local tourist spot, and so, as a result, people have had to save more money than spend it. Those restrictions are easing as the virus is suppressed, and as the virus is suppressed, and people get back to work, more spending will be undertaken.
BROOKE CORTE:
Have you forgotten about self-funded retirees? What’s in this Budget for them?
JOSH FRYDENBERG:
Well again self-funded retirees benefit from a stronger economy and, as you know, at the last election they were going to be slugged with the retirees’ tax and we were successful so they didn’t get Labor’s retiree’s tax and I think that’s a pretty significant development as well. But obviously they, like so many others, benefit from having a stronger economy. Self-funded retirees have shares, have other fixed interest investments and all of those returns are a function of the strength of our local economy.
BROOKE CORTE:
Now term deposit rates paying half a percent ain’t cutting it anymore. I think the self funded retirees feel they were the forgotten people. From the look of our text line and the emails I think they still feel like that. Can I ask you as well about women, you have decided to put out a Women's Economic Security Statement, and we know in this crisis women lost jobs at four times the rate of men. Now you have announced a $240 million package, some I think it looks like some cadetships in science and STEM, some kind of entrepreneurial stuff. What about a childcare overhaul? Don’t we know by now that fixing childcare and making it affordable is what helps women get to work?
JOSH FRYDENBERG:
Well we significantly boosted childcare funding in previous budgets so it is at a record high right now. What we...
BROOKE CORTE:
It’s unaffordable. It’s unaffordable.
JOSH FRYDENBERG:
What we saw is the women in the workforce lost a large number of jobs but right now as the jobs have come back they have been disproportionately getting those jobs that have come back so in the last three months, Brooke, 458,000 new jobs have been created, 60 percent of those have gone to women, 40 percent have gone to young people. The measures in this Budget, not just in the Women’s Economic Security Statement, whether it’s the initiatives around the hiring credit, whether it’s the business incentives and the loss carry-back, that’s going to help women also across the employment market and that will be good news for job creation.
BROOKE CORTE:
Ok we have only got a minute left and you have got plenty of interviews to do so just a final question, we’ve been pondering this evening about the international borders being open because in all of this, surely, migration being able to start up again, and foreign tourists coming to our shores, surely that’s going to give us the biggest boost of all. So when is that coming?
JOSH FRYDENBERG:
Well again, borders can open internationally when it is COVIDSafe to do so. Now there are some assumptions there that you will see pile-up programs, international students start to come next year, and then later the next year the numbers may start to build up. But again, it’s just that question goes to the great uncertainty that we face as an economy during this crisis, and we don’t know when a vaccine is going to arrive, we’ve made an assumption in the Budget that it will be able to be provided across the country by the end of next year and we’ve also made an assumption about state borders being lifted by the end of this year. It’s a very difficult climate to make forecasts in. But we believe that this economic plan will get people back to work and up to a million new jobs will be created over the next few years.
BROOKE CORTE:
Treasurer, Josh Frydenberg, thank you for your time here for our special edition of Money News.
JOSH FRYDENBERG:
My pleasure.