LUKE DARCY:
Josh Frydenberg joins us on the back of a $17.5 billion stimulus package that's been announced. Josh, thanks for joining us this morning.
JOSH FRYDENBERG:
Good to be with you, Darce and Eddie.
LUKE DARCY:
This (inaudible) changing very, very quickly, what can you tell us as we sit here now?
JOSH FRYDENBERG:
Well, this is a very difficult time for the global economy but first and foremost this is a health crisis and it will be solved by the scientists, the doctors, the researchers, not by the economists, the bankers or the politicians. But yesterday's announcement was very substantial, $17.6 billion. The money is really front ended. About $11 billion of which will go into the economy before the June 30 end of financial year and the money will go to backing small businesses with their cash flow, supporting 117,000 apprentices with a wage subsidy. There will also be incentives for businesses to invest, like buy a tractor, buy a truck, do a shop fit out and be able to write that stuff off straight away and then there's also the $750 cheques going out to six and a half million Australians, people who are on disability support or people on Newstart or people on family tax benefits or carer's allowance or a whole range of different payments.
EDDIE MCGUIRE:
Right Josh, so we want people to spend money is what we need to do to keep the economy going. What's the main thing, for the people listening on Triple M this morning, can you give us a couple of paragraphs there on how they can access this money, when it's going to start flowing and how to go about it?
JOSH FRYDENBERG:
Anyone listening to your program who is running a small or medium sized business and employs people, they will see up to $25,000 go in as a result of what we're doing with supporting businesses on their cash flow.
EDDIE MCGUIRE:
How do they get that, Josh?
JOSH FRYDENBERG:
That will happen automatically. They don't need to put in a form, that's using the existing tax system. If you've got people listening to your program who have got under 20 employees but those employees include apprentices, so might be an apprentice chef at a local restaurant or it might be a mechanic or a plumber or a sparky, those apprentices will get up to a 50 per cent wage subsidy through the employer. There will need to be an application but, again, that money will start to flow pretty quickly and if you're one of your listeners who are on one of those series of payments, there might be pensioners listening this morning, there might be veterans listening this morning, those people will get a $750 cheque coming to them from the Federal Government.
SCOTT PATE:
Treasurer, Scott Pate here, what about for those people that are listening that are gig economy workers, so they may be driving an Uber or they may be a casual worker, worried about having to self-isolate and worried about how they will keep food on the table, what do you have to say to them?
JOSH FRYDENBERG:
Well look, that's a very challenging situation. What we've done in relation to casual workers who may not have entitlements to sick leave, is that we've got a sickness allowance, Scott, and that's at the Newstart rate and there previously was a one week waiting period on that and we're waiving that one week waiting period. Now obviously it's not an ideal situation because we want people to remain in the work force but obviously people have to put their health and the health of their colleagues and their friends first.
LUKE DARCY:
Josh, just have to go back over it, the $25,000 to small and medium businesses you're saying automatically comes through to cash flow. I didn't quite understand. Is that a tax write off at the end of the financial year?
SCOTT PATE:
I think it happens when you put in your BAS, doesn't it Treasurer?
JOSH FRYDENBERG:
Correct.
SCOTT PATE:
Put in your BAS and you will immediately get a $25,000 discount if you're a small…
JOSH FRYDENBERG:
Up to $25,000 depending on the size of your wages bill.
SCOTT PATE:
It also depends on if you're paying monthly or quarterly but it’s again something you should talk to your accountant about.
EDDIE MCGUIRE:
Josh, you said that we've got to wait on the medical people, but finance keeps the world spinning as we know. We've had the worst drop since 1987 on the Dow Jones and businesses are going to be struggling. There's debt covenants, all sorts of things going on at the moment. It is a very complicated world we live in. I don't expect you to have all the answers because if you did you would probably be sitting in your own island in the Bahamas. So, mate, can you just give us a bit of an insight as a leader, and we look to you guys at the moment. As I said, I was gratified last night to see that all the leaders, State and Federal, are coming together and working this through. Almost got a war council situation coming forward. What is, where do you see things going? We're talking about lockdown, we're talking about in Italy where people have been separated from the community. Are we heading towards that? What should we be starting to get ourselves set for? What's your homework that you're setting for us now, for sensible people not panic merchants, but sensible people to start looking towards?
JOSH FRYDENBERG:
I think everyone needs to remain calm and, you know, I was pretty disturbed to see that footage of people having a scuffle in a supermarket over toilet paper. Firstly, no one's running short of those supplies and, secondly, we make toilet paper here in Australia. But people need to understand that the Government is very well prepared. We're well prepared on both the health side but also our economy is remarkably resilient. We're much better placed than many other countries and we moved ahead of the rest of the world in putting in place those travel restrictions. We're continuing to take the best possible medical advice and the Chief Medical Officer for the Commonwealth, who I did speak to this morning, is meeting daily with his State counterparts. As you say, it's Commonwealth working cooperatively with State and Territory leaders to ensure that the interests of Australians are put first. Yesterday was a major announcement from us on the spending side, no doubt the States will also have their own spending initiatives. But we will get to the other side of the coronavirus, Eddie, and it's really important that Australians understand that we want to be more productive, we want to be stronger, we want to be better after the event and the measures that we announced yesterday, and further measures, no doubt, over the coming period if required, they’re all designed to make our economy and our community stronger on the other side.
LUKE DARCY:
Josh, the Federal Government were pretty supportive of our big banks with the GFC going back and bankrolled the big banks. I saw you sitting around with all the heads of the financial institutions. A lot of our callers ringing through this morning talking about their mortgage payments…
EDDIE MCGUIRE:
…yeah and the energy companies.
LUKE DARCY:
…is there a way to bring in big business? As you said, the fixed costs, people still got to pay their energy bill, they've still got to pay their mortgage, they've still got all these costs that aren't going down. Is there a community way that we can approach this, Josh? Did you get anything positive out of the big bankers?
JOSH FRYDENBERG:
Well, Darce, this is a Team Australia moment. That means everybody does their bit. That means your listeners are out there spending the cheques that are coming to them, it means business is working with their employees to ensure there's flexibility in the workplaces, and I welcome some of the announcements from the Commonwealth Bank and Woolworths about some of their casual workers, as well as, of course, the Federal and the State governments doing their bit. When I met with the banks, I have to say I was heartened by that discussion. They are very conscious of the challenges ahead but they're also in a strong financial fiscal position. They don't need to go out and raise money urgently, which would be very difficult in these markets, as Scott will tell you, but they're well capitalised, they’re well positioned and the work that's been done over recent years to ensure that we're ready for challenges, whatever comes our way, I think will hold us in good stead.
EDDIE MCGUIRE:
Josh, there's only so much you can do. When the President of the United States comes out and closes the borders to Europe, obviously that throws everything into turmoil. One way or the other, whether he's right, wrong or indifferent, it doesn't make any difference, every action has a similar reaction. Where do you see this? I mean there's some talk even in business circles that we should just shut down the world for a month and get through this. Where do we, what are you reading? Are we going to just go to a situation, I mean we've got all the sports, the Grand Prix is probably going to get called off today. We know the AFL are trying to work through what do we do? Do we push the season back? Do we go on? Do we play with no people? What's the vibe around the place as far as which way we move?
JOSH FRYDENBERG:
Well there is, to be honest, a lot of uncertainty and we did put in place those restrictions on countries like Italy and South Korea, Iran and of course, China. We asked our Chief Medical Officer at the Federal level to talk to his State counterparts and look at the question of whether there should be a broader travel restriction on Europe. They came back and said, not at this point in time. So we'll continue to take that best possible medical advice as Australians would expect us to do.
LUKE DARCY:
Thanks to Josh Frydenberg, Federal Treasurer.
JOSH FRYDENBERG:
Good to be with you guys.
EDDIE MCGUIRE:
Now how are you going, Josh? You sound a bit tired. I'm being serious. I've had a phone call from a doctor saying how's Josh going, he sounds like he's a bit crook, are you alright?
JOSH FRYDENBERG:
I'm good. I mean yesterday was an 18 hour day, you know, early morning interviews, late night interviews. Obviously the big announcement taking it through the whole cabinet and expenditure review committee process. But I think this is a time that we all come together and we all support the community and it's a great privilege to be a member of Parliament and even a greater privilege to be in a Government and to be the Treasurer and I see this as an opportunity where I'll just work day and night on behalf of my community, which is the Australian community.
EDDIE MCGUIRE:
Get in the vitamin C, mate, a bit of echinacea.
LUKE DARCY:
And a bit of sleep at some stage as well.
EDDIE MCGUIRE:
And just before you go, mate, a big meeting today with the Premiers, how do you reckon that's going to go? What's on the agenda?
JOSH FRYDENBERG:
Well, they're going to get briefed by a number of senior officials about the developments in relation to the coronavirus, both on the medical side as well as the economic side. I've been talking to my State counterparts, who are the Treasurers, and I think there's a willingness for them to do their bit as well. So hopefully there's some announcements that come in coming days from those State Governments.
EDDIE MCGUIRE:
Good on you, mate.
LUKE DARCY:
Josh, thanks again. The Federal Treasurer, Josh Frydenberg.