GARETH PARKER:
The Treasurer joins me on 6PR Breakfast. Good morning.
JOSH FRYDENBERG:
Good morning, Gareth, and nice to be with your Western Australian listeners.
GARETH PARKER:
So it’s sort of a snapshot in time, isn’t it, but the figures you announced yesterday don’t reflect the reality today?
JOSH FRYDENBERG:
Well, certainly the September quarter that we’re in right now will see a contraction in the economy. Treasury expecting it to be at least 2 per cent, and that reflects, as you say, Gareth, the lockdowns in our two largest states – New South Wales and in Victoria. With respect to the June quarter that came out yesterday, 29 days out of that quarter saw at least one part of Australia in lockdown, including our four largest states. We saw economic growth of 0.7 per cent, which was ahead of market expectations, and 9.6 per cent through the year. And what was particularly pleasing about that result yesterday is it did show the resilience in our economy but also households were spending more an cafes and restaurants and transport and tourism services, including off the back of our tax relief. We saw machinery and equipment sales were up by more than 20 per cent since the October budget last year, which is the fastest rate of growth in that category in some 20 years. And we’ve also seen housing investment really jump up off the back of programs like HomeBuilder. And that good for jobs across the construction industry and the broader supply chain. So there was some good news in what is obviously a very difficult economic time.
GARETH PARKER:
Okay. You’ve been adamant that if states don’t stick to the plan to reopen at 70 per cent and 80 per cent then you’re going to withhold further federal assistance if states choose to lockdown beyond that point. Mark McGowan, I think, couldn’t be clearer in terms of what he intends to do – that is, to continue to keep borders closed until at least 80 per cent vaccination rates. Is this going to be a political winner for you, to say to West Australians, we’re going to leave you high and dry if you get locked down?
JOSH FRYDENBERG:
Well, my job as Treasurer is to do what’s in the best interests of the national economy, and that is that we stick to our national plan. And it was a plan that was agreed by Mark McGowan. It was a plan that was agreed by the other Premiers and Chief Ministers through national cabinet, and it’s a plan that is based on the best medical advice that we have from the Doherty Institute. And I’d put it to your listeners that if it wasn’t 70 to 80 per cent that we open up, what is the vaccination rate in which we open up? When can people move more freely across the country? And in the case of Western Australia, there are real issues about labour force shortages in your booming mining sector and your important construction sector. And we know that tourism businesses in Western Australia are doing it tough right now because of the border closures and the lockdowns. And that’s why we agreed with Mark McGowan recently to provide financial support to some three and a half thousand tourism businesses across Western Australia that had seen declines in their turnover impacted by COVID. So not every business in Western Australia is doing well at the current time. There are businesses that are heavily impacted by the border closures. I have, Gareth, a broader point, which is that every country and, indeed, every state has to learn to live with COVID. That’s the international experience that other countries are doing right now. And we saw in Victoria just yesterday a recognition that they can’t defeat the Delta variant; they have to learn to live with it. So I would say to the Premier in Western Australia and, indeed, Queensland, you can’t delay the inevitable. You do need to stick to the plan, and that’s going to be in the best economic interests of your state.
GARETH PARKER:
Well, here’s what Mark McGowan said yesterday.
MARK MCGOWAN:
Why are they on this mission to bring COVID into Western Australia, to infect our public, to ensure that we shut down parts of the economy, that we lose jobs, people get sick and some people die? Haven’t they seen what’s happening in New South Wales? I can’t understand why they’re doing this.
GARETH PARKER:
Is that the mission you’re on, Josh Frydenberg?
JOSH FRYDENBERG:
Well, I think that’s unfortunate language, because we’re not seeking to infect someone. What we’re seeking to do is take Australia forward in accordance with the national plan. And there is a reality here that is slowly dawning on some Premiers – that you have to learn to live with the virus. You can’t eliminate it. Now that’s an honest conversation with the public, which means that there will be illnesses, there will be hospitalisations, there will be more cases, and in some tragic situations there will be more deaths. But the alternative is not sustainable in the long term. And that is why we need to stick to the plan.
GARETH PARKER:
So do you think that Mark McGowan is being dishonest with West Australians about that reality?
JOSH FRYDENBERG:
I wouldn’t use that language. And I’m not, you know, seeking to get into an argument with Mark McGowan per se. What I’m seeking…
GARETH PARKER:
You’ve got one. I mean, there’s one every day. We keep having it every single day. You guys say something, he says something. You guys say something, and it goes around in circles.
JOSH FRYDENBERG:
Well, Gareth, as you know, the tone I’ve taken in this interview – and I’ve got a working relationship with Mark because he’s also the Treasurer as well as the Premier and we have partnered to support the people of Western Australia, as I was saying, recently in terms of that economic support. What I’m seeking to do is have an honest conversation with the Australian people, including Western Australians. And as Treasurer I can see the impact that either border closures or lockdowns are having on state and federal economies. And that means on labour force numbers, that means on economic growth numbers, that means on business confidence, on consumer confidence. And it’s not about forcing anybody to do something that’s not in their best interests; it’s about saying the national interest is about everyone sticking to the plan.
GARETH PARKER:
Okay. Yesterday the Attorney-General, Michaelia Cash had this to say.
MICHAELIA CASH:
When we do get to that 80 per cent, and the rest of Australia, based on comments made by other Premiers, has lessened their restrictions, what is that plan for Western Australia at 80 per cent?
GARETH PARKER:
So she’s echoing pretty much what you’re saying there but the other thing that she was talking about yesterday was the prospects of another High Court challenge to border closures once those vaccination rates are settled. And many West Australians, ordinary West Australians, interpreted that as the federal government again trying to mount a High Court border challenge and, of course, that opened the door to the Premier to invoke Clive Palmer again. The politics of this just seem to be so tricky for the federal Liberals?
JOSH FRYDENBERG:
Well, I wouldn’t interpret those comments about there’s going to be a High Court challenge, because we have no plans for such actions. What we do have plans for is to see the economy open up consistent with the plan agreed at national cabinet. And I point out to your listeners that very prominent and influential Western Australians like Kerry Stokes, like Rob Scott as the head of Wesfarmers, have called upon all states and territories to stick to the plan because they can see the impact it’s having on your economy in Western Australia but also the broader national economy. And that is why the vaccination program gives us real hope. And if you look at the vaccination rates, in Western Australia first doses are just over 50 per cent. In Victoria it’s approaching 60 per cent. In New South Wales, around 70 per cent. So it is important that people listening to your program this morning protect themselves, protect their family, but also contribute to the national effort to open up the economy by going to get the jab.
GARETH PARKER:
Treasurer, thanks for your time.
JOSH FRYDENBERG:
My pleasure.