CHARLES CROUCHER:
Joining me now is Treasurer Josh Frydenberg, who is in Sydney. Treasurer, Russia and China have fired these missiles already. Why are we playing catch‑up?
JOSH FRYDENBERG:
Well, we're investing heavily in defence, as we need to, Charles. Whether Australians like it or not, the region is less stable and in the Ukraine, Russia is challenging it international rules‑based order in a way that we haven't seen since the end of the Second World War.
When we came to government, Charles, defence spending under Labor fell to its lowest level since 1938. It was a disgrace. We have since then invested very significantly in defence, building air warfare destroyers here in Australia, building – looking after our combat reconnaissance vehicles and maintaining them in Queensland, making parts for our joint strike fighters here in Western Sydney, planes that are now in the air. And the AUKUS arrangement with two great allies and friends – the United States and the United Kingdom – will help secure Australia's future.
And it's a broad‑ranging agreement. It's everything from nuclear‑powered submarines to also having artificial intelligence and cyber security preparedness and also accessibility to these hypersonic missiles, which go at least five times the speed of sound, can travel 2,000 kilometres‑plus, and help secure Australia in a pretty uncertain international environment.
CHARLES CROUCHER:
So just to go back to my question – you've been in power now for nine years. Disruptions in our region isn't anything new – China's been rising for all nine of those. Why are we playing catch‑up?
JOSH FRYDENBERG:
Charles, these are the most latest and high‑tech missiles we're talking about. It's not like they've been in operation for a decade or so. What we have done is secure an agreement with the United States and the United Kingdom where we can access this technology. What we've been doing ever since we've come to government is putting more money in defence after the Labor Party failed to do so. And, as I say, we have been building ships that are now in the water. We have been ensuring Australia get access to the latest planes that now in the air, and we've been repairing and maintaining our combat vehicles that are now in service. This is what a government that is focused on national security does. And it's a very stark contrast to our political opponents.
CHARLES CROUCHER:
Okay, let's move to your portfolio, because your political opponent Jim Chalmers rekindled Kevin Rudd's line about this wasteful spending must stop – it's a line that Tony Abbott rolled out for that 2013 campaign as well. Debt is about to hit a trillion dollars. There is some fat to trim, isn't there?
JOSH FRYDENBERG:
Well, Jim Chalmers knows all too well about Kevin Rudd's waste because that was $900 cheques to dead people. You didn't see that occur on our watch during this crisis, which was some 30 times bigger than the global financial crisis. You also saw the pink batts fiasco under Labor, which was Wayne Swan, Kevin Rudd and Jim Chalmers himself. So, he's got no credibility when it comes to these issues. Jim Chalmers said the single biggest test of the Morrison government's management of this pandemic‑induced recession would be what happens to unemployment. Unemployment today is at 4 per cent. Under Labor it was 5.7 per cent. There are nearly 2 million more Australians, Charles, in work today on the Coalition's watch compared to the Labor Party. And we know the economy is strengthening. We know that wages are strengthening and we know that the unemployment rate is expected to fall even lower to the lowest level in some 50 years. That's our record, and our budget set out our plan for the future.
CHARLES CROUCHER:
You brought up wages. That's really important, because the RBA has kept interest rates on hold for now. We know there is a rate rise coming. New data shows that one in seven Aussies won't be able to pay their mortgage when it eventually rises. What are you going to do to help?
JOSH FRYDENBERG:
Well, firstly, Australians are about 36 months ahead on mortgage payments if you take into account offset accounts. And what the Reserve Bank said yesterday, Charles, was that household budgets were in a strong position. And as you know, we have been providing expensive economic support during this crisis to Australian households. When it comes to wages growth, we upgraded our forecasts every year in the Budget and the Reserve Bank has pointed to upward pressure on wages. But the best way to lift wages is to get a tighter labour market to drive down unemployment. That's what we're doing.
CHARLES CROUCHER:
Yeah, Treasurer, the fuel excise comes back on in six months. Interest rates are going up. There's inflation that has been stimulated by your budget. Even your most optimistic of wage growth outlines sort of 3, 3 and a half per cent, it says that that won't come for years. It simply won't keep up with the rise in the cost of living. Can you admit now it's going to get harder to make ends meet before it gets easier?
JOSH FRYDENBERG:
Well, just to correct you, Charles, what the Budget numbers show is that wages is ahead of inflation next year and then the year after. What the Budget also showed that the cut to it fuel excise will actually reduce according to Treasury inflation by about a quarter per centage point. And what the Budget –
CHARLES CROUCHER:
That's for six months, though, Treasurer. Then it comes back on before wages go up.
JOSH FRYDENBERG:
And also in the Budget, Charles, is the expectation by Treasury that the barrel of oil price will come down to around $100 – from 115, $120 around this time to about $100 by the September quarter when that fuel excise ends. The other key point, Charles, to bear in mind is that we have provided some $40 billion of tax relief to Australians since the pandemic began. Labor stands for higher taxes. They went to the last election promising $387 billion of higher taxes. Jim Chalmers was the co‑architect of that. He said he was proud and he was pleased. Anthony Albanese said Labor had a strong mandate for taxes on retirees, for taxes on housing, for taxes on superannuation. They are now trying to hoodwink the Australian people, sneak into government and not come clean with the Australian people about their plans for higher taxes. Yesterday at the Press Club Jim Chalmers had a chance to tell the Australian people that he would a tax‑to‑GDP cap, meaning he would put a restriction on the amount of tax that he took. He failed to do so. Why? Because he's addicted to higher taxes. Labor's addicted to higher taxes, and you have in Anthony Albanese someone who's proposed everything from death duties to a congestion tax, a carbon tax to a mining tax.
CHARLES CROUCHER:
Treasurer, that feels like you're working on the election lines that have been sort of road tested for a while now. Really quickly, the PM's already in full campaign mode, which means taxpayers are paying for that campaign trip while he hasn't called it. Election called Sunday?
JOSH FRYDENBERG:
Well, again, that will be a time of his choosing. But we're on the road talking to Australian families and businesses, Charles, about the Budget that we just handed down. That was our economic plan. Labor gave us sweet nothings whispered into the ears of 26 million Australians when they deserve to hear more. All they got from Jim Chalmers yesterday was just a rant, not a plan. Our plan has seen Australia come through this pandemic in a stronger and better place than every major advanced economy in the world. That's really important not to lose sight of. We've done well to date as a country and that belongs to 26 million Australians. Now we have a plan to be even stronger in the future.
CHARLES CROUCHER:
Treasurer, appreciate your time this morning.