CHRIS SMITH:
Now, have you noticed your bank balance growing over the last six months? Well – it’s gone, I think – new figures show tax cuts and concessions have put $7 billion in the pockets of nearly 8 million Australians – 7 billion. It’s not all good news. Our government debt is spiraling towards $1 trillion and we’ve got to arrest that. And the economic recovery hinges on restrictions easing and state borders reopening as quickly as possible. But no matter which way you vote, we need Scott Morrison and Josh Frydenberg to succeed economically and put the nation back on the road to recovery. The federal Treasurer, Josh Frydenberg, joins me on the line right now. Happy new year to you, Josh.
JOSH FRYDENBERG:
Good morning to you, Chris. I hope you’re getting a good break. And if that’s the only hiccup you’ll encounter, then life is not too bad, mate.
CHRIS SMITH:
Have you ever walked to the dispatch box at any stage and you developed a case of hiccups and you realised you’re in deep trouble?
JOSH FRYDENBERG:
Not hiccups, but you may remember I was giving a ministerial statement in the midst of COVID and I had that coughing fit and people mistakenly thought that maybe I had the virus. Definitely I didn’t, and fortunately for all those around me I didn’t, but it certainly was one uncomfortable spot that I encountered at the dispatch box.
CHRIS SMITH:
Yes, it was. A very untimely period in our history, yeah. Eleven million people are expected to be better off this financial year. You’ve done a little bit more than filling the gap of loss – you’ve actually played Santa Claus.
JOSH FRYDENBERG:
Well, $7 billion has made its way into the pockets of Australian families over the last six months and more than a billion dollars a month will make its way into their pockets over the next nine months. This is part of a whole suite of economic support measures that the government has put in place. As you know, we’ve not only provided income tax cuts but we’ve also provided significant incentives to small business to immediately expense new acquisitions to have a loss carryback provision in case they have done it really tough through COVID, that they can use the tax system to develop the working capital to get through it. But when it relates to income tax cuts if you are a person on $60,000 a year, you will pay $2,160 less tax this financial year compared to 2017-18 as a result of the coalition government’s tax cuts. So it’s a very significant reward for effort. It’s helping to encourage aspiration and allowing Australians to rightfully keep more of what they earn.
CHRIS SMITH:
Sometimes when we receive a tax cut as a nation it’s not often used as well as it should be. You know, depending on the economic times or where we are at that point in a year, people tend to keep that money in their pockets or they go off and pay debt. But I get the feeling that there’s a propensity to spend at the moment. What are your thoughts about that and do you think that this tax cut will be more effective on than what other tax cuts have been?
JOSH FRYDENBERG:
Well, obviously with the health restrictions, particularly that were in place across Victoria but in other parts of the country early on in pandemic as well, people weren’t able to get out to the cafes, to the restaurants, to take the local trip to a tourist destination, so they didn’t spend as they normally would. And you overlay that with the uncertainty around COVID and people started to save more than they otherwise would. And we saw that in the economic numbers. But you’re right, Chris, household consumption has had a big lift directly as a result of the restrictions being – coming off, but also with the confidences coming back. Consumer and business confidence is now back at its pre-COVID levels, and that’s a very positive sign. And that should give those retailers out there listening to this morning’s interview some confidence for the month ahead.
CHRIS SMITH:
It doesn’t help when Mark McGowan says, “Oh, we must shut our borders tight because there’s one infection they’ve found in Brisbane,” and it didn’t help anyone’s confidence when Brisbane shuts down, Greater Brisbane shuts down or locks down at 6pm on Friday night for three days when they’ve got one infection, and I just think they’re classic knee-jerk reactions to a situation that New South Wales has proven can be handled differently but successfully.
JOSH FRYDENBERG:
Well, New South Wales has been the gold standard, best in class, because they have had a number of new cases but they haven’t shut down the whole state. They’ve adopted a very proportionate and targeted response and they’ve had a world-class testing and tracing system. So all credit to Gladys Berejiklian and her health team for the work to date. But we haven’t got rid of this virus. You can’t eliminate it. What you have to do is successfully manage it, try to reduce risk as much as possible and that’s why having social distancing and other COVID-safe measures are important. Obviously anyone who engages in an area that is a known hot spot needs to get tested, particularly if they’re also developing symptoms as well, and people just need to follow the medical advice because, Chris, while your listeners are out there getting back to life as normal, in the rest of the world they are seeing their health systems overwhelmed. In the United Kingdom 50,000-plus cases a day. In the US, nearly a quarter of a million cases. Around the world, 750,000 new cases in just one day, whereas yesterday Australia had 13 cases and not one person on a ventilator or in an ICU unit. So that’s a real credit to our health professionals and once we get the health crisis under control, the economic recovery does gain pace.
CHRIS SMITH:
But my point was, state premiers could do a whole lot better for the economy and stop being single-minded about the pandemic itself.
JOSH FRYDENBERG:
Well, it is a health crisis so we have to accept the medical advice. But when it comes to border closures you’ve got to stick to your principles. And those principles are that it needs to be considered action, it needs to be common sense and, of course, it needs to be compassionate, because we’ve seen on those border towns, you know, some real challenging situations as a result of the border closures. So every decision-maker needs to be mindful of those principles, I think, when they’re making decisions around such big issues as border closures.
CHRIS SMITH:
The federal government has reduced the cap on the number of travellers returning home and also we’ve got new rules in place whereby – and I think this is a fantastic rule – show us your certificate of negativity on COVID-19 before you jump on the plane. Both of those have got to be helpful at this time?
JOSH FRYDENBERG:
Well, that negative test before departure I think is very sensible. The air crew testing, the masks on domestic and international travel, the daily testing of workers in quarantine and, of course, in some states we have reduced the passenger caps by half. That hasn’t been the case in Victoria, for example, or South Australia. What we’re dealing with as well internationally now is this new strain of the virus, and we’ve heard from the Chief Medical Officer about how it’s more infectious, and it’s around 30 countries – not just the UK as some people think. And so the reduction in the caps is going to allow more capacity and more space for our health officials to work through these challenges, because it is certainly a new challenge that they’re facing with the new strain.
CHRIS SMITH:
And vaccines finally, it will change significantly the fear and the danger that a lot of older people feel through a pandemic. But the rules and regulations we’ve been told to follow, that won’t change, will it?
JOSH FRYDENBERG:
Well, certainly the social distancing and the COVID-safe practices are going to be with us for some time. But when it comes to the vaccine, as the Prime Minister has rightly said, this is no silver bullet. But the TGA – the Therapeutic Goods Association – has been working very hard to expedite this process. And I heard Professor Murphy say recently that would normally would take months in terms of approvals and registration is now being done in weeks and days. So we’re looking at a rollout in February, and the Prime Minister and the health minister have been talking about 80,000 vaccine doses a day. And that is a similar timetable that we are adopting as Japan, Korea, New Zealand and other countries, with an initial focus on those frontline workers. And the vaccine is obviously free, it’s voluntary. It’s going to be universal in the approach. And Australia has had a very good track record when it comes to vaccines. So maintaining that public confidence in the system is critical. We don’t have a similar situation to the US and the UK where the virus has infected such large numbers of people, and so we’ve gone about this in a very deliberate and considered way taking the best possible medical advice.
CHRIS SMITH:
Good to chat, hopefully more often during 2021. All the best.
JOSH FRYDENBERG:
Chris, all the best to you and your listeners, and have a great day.