GARETH PARKER:
The federal Treasurer of Australia is Josh Frydenberg. He’s talking up tax cuts today. He joins me on 6PR Breakfast. Treasurer, good morning.
JOSH FRYDENBERG:
Good morning, Gareth.
GARETH PARKER:
Hey, before we get into the serious stuff, your reaction to the discovery – rescue, really – alive and well of Cleo Smith?
JOSH FRYDENBERG:
Well, what a result. You know, like so many Australians and so many of your listeners, Gareth, I feared the worst as the search extended beyond a second week. But to see her found, to her the little smile and to know that her family is whole again is such a relief. And I think there was a collective sigh of relief across our country. It was a case that really gripped the nation. And, you know, I’m a dad with my own four‑year‑old, and like so many other parents and grandparents and others around the country, we were so happy to hear that news yesterday.
GARETH PARKER:
It was just amazing how it really did take off nationally, even internationally. There’s something about the nature and the details and the facts of this story that I think connect with everyone.
JOSH FRYDENBERG:
Absolutely. And congratulations to the Western Australian police and I thank the Western Australian government for putting that reward up as well, all of which is, you know, helped contribute to this amazing result.
GARETH PARKER:
Now, this morning, Treasurer, you are talking up the impact of tax cuts. You reckon Australians have got more money in their pockets?
JOSH FRYDENBERG:
Well, we know they’ve got more money in their pockets. In fact, over that September quarter, Gareth, more than $10 billion has been delivered to more than 11 million Australians, and it’s the biggest tax cuts that have been delivered over a quarterly period in more than two decades. And in the case of Western Australia, nearly $1.2 billion has been delivered to nearly one and a half million people across your state. So it is very good news, and it’s a sign that we’re getting on with the job of rewarding effort, encouraging aspiration and legislating significant tax relief. And it’s part of a broader plan, Gareth, that will see a whole tax bracket abolished – the 37 cents in the dollar tax bracket abolished. And that means that 95 per cent of Australian taxpayers will pay a marginal rate of no more than 30 cents in the dollar. So, if you’ve got a teacher or a nurse earning $60,000 a year and they’re listening to your program today, this year they’re $2,160 better off as a result of the tax cuts that we’ve passed in recent budgets.
GARETH PARKER:
Do you reckon that taxpayers might be well-advised to hang on to those tax cuts to pay for future interest rate rises, which all of the big banks, if not the Reserve Bank, seem to be saying will be shifting upwards next year?
JOSH FRYDENBERG:
Well, the first thing I’d say is this is your listeners’ money; it’s not for me to tell them how they spend it. They will also choose whether it’s taking a domestic or an international holiday when the Western Australian borders come down or whether it’s going and buying, you know, something new for the family or for the house. That will be their decision. But with respect to the housing market and interest rates, obviously we’re seeing very strong growth in housing prices. But on Tuesday the Reserve Bank Governor came out and said that the board had taken the decision to leave the cash rate at that historic low of 0.1 per cent. There were some comments about inflation and the like, but overall, the view was that the cash rate needed to remain where it was until we started to see some of that spare capacity in the labour market eaten up.
GARETH PARKER:
It does seem to many listeners – I’ve had emails about this, and I think they’re right – that when the Reserve Bank was cutting interest rates the big banks were very slow to cut their rates commensurately, but now the Reserve Bank’s saying, “Oh, we’re going to keep the cash rate low,” but the banks are saying, “Oh, we need to increase them.”
JOSH FRYDENBERG:
Well, the best advice I can give you listeners on that is to shop around because there is obviously a number of options available to them when it comes to borrowing. But we have seen historically low interest rates, and that’s probably been the principal driver between – behind the higher house prices. And it’s not just here in Australia; it’s also globally a phenomenon that we’ve been seeing. But certainly, people need to be conscious that interest rates don’t stay where they are today forever. And obviously, you know, they need to plan accordingly.
GARETH PARKER:
Treasurer, you touched on taking an interstate or an international holiday, and you’ve been outspoken in your view that WA needs to open up quicker. Mark McGowan, the Premier, says he’s going to outline his road map for reopening on Friday. I’m sure that you welcome that. But what should that road map include, in your opinion? Should it drop requirements, for example, for things like 14‑day quarantine for the fully vaccinated?
JOSH FRYDENBERG:
Well, let’s wait and see what the Premier announces. But what the other states have shown is that you can effectively live with the virus. You can’t effectively eliminate the virus. And what that obviously means is that there will be some people who get sick and, unfortunately and tragically, some people who die. And there will be at times an increase in cases. But the alternative is to either stay closed to the world or to lockdown large parts of your population. And I don’t think they are reasonable solutions to what is an ongoing challenge, which is, you know, the pandemic. So I’m very pleased with the increased economic activity we’re seeing in New South Wales and Victoria following the easing of restrictions – an extra $150 million has been spent a day. You would have seen the airlines – Qantas and Virgin have announced very strong demand for their ticket sales. Qantas alone has sold 500,000 tickets in the last two weeks compared to just 20,000 tickets over a two-week period in August. And Jetstar has sold 75,000 international seats in the last 72 hours. So that is a very good result for both Qantas, Virgin and Jetstar. So, you know, let’s hope people can make their way to Perth more freely sooner than later.
GARETH PARKER:
I know that the Prime Minister wants us all to move on from this, but the rift – well, it’s more than a rift; it’s really an all-out argument with the French – has been particularly untidy and unfortunate. Is the French Ambassador correct when he’s basically – his comments at the Press Club yesterday effectively saying that Australia’s completely double-crossed France. Has any sustained damage been done to this relationship?
JOSH FRYDENBERG:
Well, obviously I don’t accept those allegations, and the Prime Minister has refuted them. But what I do know is that the decision to enter into the new AUKUS arrangement with the United Kingdom and the United States is in Australia’s national interest. It helps secure us, Gareth, as a country. The most up-to-date, the most advanced weapons systems, nuclear submarine technology, artificial intelligence technology, cyber technology, all of which can help protect Australia’s national security at a time that our strategic environment is increasingly challenged and sometimes volatile. So this is a long-term agreement. This is also in Australia’s long-term national interest. And, yes, the French are upset about it, disappointed to say the least. The relationship will take some time to get back on an even keel. But we’re thinking about how we can do that.
GARETH PARKER:
All right. Treasurer, thank you very much for your time this morning.
JOSH FRYDENBERG:
My pleasure.