DAVID KOCH:
The Treasurer joins us in the flesh. Josh Frydenberg, good morning to you.
JOSH FRYDENBERG:
Nice to with be you, Kochie.
DAVID KOCH:
Treasury Secretary says the big spending can’t last forever. How long can it last for?
JOSH FRYDENBERG:
Well, Steven Kennedy in an important speech yesterday, did talk about the strength of Australia’s economic recovery being better than we expected. He did say that our debt levels were sustainable, that we could withstand not just this pandemic but another one if it was to occur and it would be too early to pull back that fiscal support to the economy because it could have a long-term cost. But he talked about restraint in government spending and, as you know, half of our spending that we announced the last Tuesday’s budget were temporary measures designed to get more people into jobs, to do the things that work, like the tax cuts for families, like the business tax incentives to get more investment, like the skills and the infrastructure programs. And then there were some additional structural spending, like aged care, like disability support, like mental health and women’s safety initiatives, all of which your viewers would expect the Government to be delivering.
DAVID KOCH:
Right. So the rationale is always keep people in work, keep businesses profitable because they’re your biggest asset as an economy, aren’t they, because we pay tax to repair the budget down the track?
JOSH FRYDENBERG:
Exactly right. And I gave a speech ahead of Budget night where I outlined our fiscal strategy, and I pointed out that there were 200,000 more people in work today than we were expecting as recently as last December. Now, the net benefit to the budget bottom line of that was around $5 billion because that was higher tax receipts and lower welfare spending. And, as you know, we went into the pandemic having balanced the books for the first time in 11 years, off the back of the lowest welfare dependency in 30 years.
DAVID KOCH:
So 200,000 people in work is the equivalent of $5 billion to the budget?
JOSH FRYDENBERG:
That’s the Treasury analysis, and that is because you’re getting more income tax receipts and lower welfare payments.
DAVID KOCH:
The issue of government debt, it’s going to rise 50 per cent to almost a trillion dollars. But you’re not paying much interest on it, are you?
JOSH FRYDENBERG:
Well, the interest bill today is lower than it was a couple of years ago when debt was lower. But let’s not overlook the fact that Australia has just gone through the biggest economic shock since the Great Depression. Last year, 1.3 million Australians either lost their jobs or saw their working hours reduced to zero. You remember looking at the images of hundreds of thousands of our fellow Australians lining up outside Centrelink, reminiscent for many of images of the Great Depression. We responded with JobKeeper. We responded with the CashFlow boost. We responded with doubling of the JobSeeker coronavirus supplement, the impact of which is Australia is now better placed than any other nation in the world for the economic recovery. There are more Australians in work today, Kochie, than before the virus first hit.
DAVID KOCH:
How much of that economic recovery is dependent on us opening borders? We’re a trading nation. We depend on migrants to come in to fill jobs. All of that’s locked down at the moment. And then we have this poll out saying that a huge percentage of people - no rush to get vaccinated at all. Extremely unlikely and they’re just going to hold off.
JOSH FRYDENBERG:
Well, Kochie, the key to maintaining the momentum of our economic recovery is actually to suppress the virus, and when there are new outbreaks to respond proportionately, not to have state-wide lockdowns if they can be avoided.
DAVID KOCH:
Right, so no lockdowns.
JOSH FRYDENBERG:
No state-wide extended lockdowns. That’s what we’re seeking to achieve. And obviously here in New South Wales, Gladys Berejiklian has been the gold standard because you’ve had outbreaks - whether it was on the Northern Beaches or elsewhere - but you haven’t had a state-wide lockdown. So that’s going to be the key going forward. Obviously the borders will open when it’s safe to do so. We’ve got an assumption - it’s not a policy decision - but an assumption that the international borders will gradually reopen from the middle of next year.
DAVID KOCH:
How much does that depend on us getting vaccinated, getting to that herd immunity level?
JOSH FRYDENBERG:
Well, the vaccine rollout is one factor. The other is the new variants of the virus around the world. More than 800,000 new cases of the virus are being found and people have contracted the virus each and every day. And we know, for example, out of India those terrible images of what is happening there. So we’ve got to put Australia’s safety and the health of Australians first. We make no apologies for that. You may remember last year when Scott Morrison closed the international borders he was criticised for that with China and then with other countries. But it turned out to be a key reason why we’ve been able to suppress the virus.
DAVID KOCH:
Yep. Just on you personally, you’re in a big job, lots of decisions. Last year you admitted you sort of like a lot of people in COVID - you let yourself go. What have you done to change that?
JOSH FRYDENBERG:
Well, personally, I’m trying to get a bit more sleep and also got a bit of an improvement to the diet, although yesterday was an aberration - a bit of Toblerone and a beer and a few doughnuts - but generally doing a bit more exercise, eating a business more healthily, and any chance I can get to spend with my family I do.
DAVID KOCH:
You seem really fit. How many kilos have you lost?
JOSH FRYDENBERG:
I don’t know; I haven’t been on the scales.
DAVID KOCH:
You do. Oh, you do. Are you still…
JOSH FRYDENBERG:
I can say to your viewers I haven’t been on the scales for some time.
DAVID KOCH:
Right.
JOSH FRYDENBERG:
But if you’ve got a spot at centre half forward, can you get me on?
DAVID KOCH:
Look at this. Look at this. Do you recognise yourself as a young fella?
JOSH FRYDENBERG:
Well, you know, photoshop can do wonderful things.
DAVID KOCH:
Yeah. Well, I was going to say, have you taken tennis back up?
JOSH FRYDENBERG:
I do, when I can. But, as you know, putting a Budget together, Kochie, has been a hard slog. And last year was an even harder slog. But it’s not about me; it’s been about the Australian people. And I’m really proud of the fact that 25 million Australians can begin this year knowing that we’re in as much a better position than any other country in the world.
DAVID KOCH:
Yep, no. Well, that’s a fact. All the figures in the world show that. Josh Frydenberg, good to see you.
JOSH FRYDENBERG:
Great to be with you, Kochie.