KARL STEFANOVIC:
The Treasurer joins us now. Good morning to you, Treasurer.
JOSH FRYDENBERG:
Good morning, Karl.
KARL STEFANOVIC:
Thank you for your time. The first Treasurer since Paul Keating to lead the country into a recession, I can’t imagine that’s something that sits well with you?
JOSH FRYDENBERG:
Well, look, we’re working every day to get people back into work after a one in a hundred year global pandemic, and what we saw yesterday was the economy contract by 0.3 per cent, much better, dare I say, Karl, than other countries around the world, like the United States, Germany, France, Japan and China. But this was the economic consequence of the health restrictions that were put in place over that March quarter, including the social distancing rules, but also the travel bans, particularly with China, that came in from the first of February.
KARL STEFANOVIC:
As the Treasurer, do you take it to heart, though?
JOSH FRYDENBERG:
As the Treasurer, I’m very concerned to see people doing it tough as a result of this pandemic. But we have saved lives with the measures that we’ve undertaken. I mean, we went out and bought 5,500 ventilators in the expectation there was going to be a surge in demand as a result of coronavirus cases. As of yesterday, there was just one patient in an Australian hospital on a ventilator as a result of the coronavirus, and as you know, the death toll in the United States has been more than 100,000, in the United Kingdom around 40,000 whereas in Australia, tragically, 102 people have lost their lives.
KARL STEFANOVIC:
The next set of numbers, Josh, will probably be the worst since the Great Depression, right? You may as well prepare us for that.
JOSH FRYDENBERG:
Well, the next set of numbers will be much worse than what I announced yesterday, and that’s because of those restrictions being in place and people working from home and not going out to cafes, to restaurants, using transport, and going to their shopping centres with friends. What we accepted was a normal day pre-COVID was certainly not a normal day during the pandemic’s height. But we’re getting back to normal, and the restrictions are being eased, as agreed by National Cabinet, and that will see 850,000 people back at work, including many of the tradies who work at building sites like the one behind me.
KARL STEFANOVIC:
OK, on that, is the housing grants package too early and, at $700 million, is it enough to save the construction industry?
JOSH FRYDENBERG:
Well, it’s a demand-driven program. We’re expecting between 20,000 and 30,000 new builds and significant renovations. The new home has to be less than $750,000 and the renovation more than $150,000. But it’s designed to fill a gap in the market that’s going to open up over the back half of this year as a result of people putting on hold their plans because of their concerns about the economic impact of the coronavirus. So it’s $25,000 Karl…
KARL STEFANOVIC:
So, yep, I was just going to say, it’s contracts June 4 to December. You still have to get finance, which is not easy at the moment, a lot of people don’t even have income. You have to get building approval and you have to find a tradie before the year’s end. None of that’s easy.
JOSH FRYDENBERG:
Well, people are determined, I think, to build their home, particularly when they’re going to get Government support, such as this. And $25,000 is a significant amount of money and it’s complementary to the other programs that are being run at a state level. And we do want to see the more than 100,000 tradies, the sparkies, the plumbers, the painters, the carpenters, we want to see them back at work, off the income support and this program is designed to do exactly that.
KARL STEFANOVIC:
September is going to roll around pretty quickly. Can you give businesses out there certainty this morning on JobKeeper? I think they deserve it.
JOSH FRYDENBERG:
Well, there’s a review at the midway point of this program. That will be undertaken in June and I’ll announce the outcomes of that review in July when I provide a broader economic and fiscal update, together with the Finance Minister. But we do recognise there are going to be some sectors that are going to be slower to recover than others, for example tourism, as a result of the international borders being closed. But we also want people to get back to work, and that’s why lifting those restrictions, Karl, are so important. 850,000 people will be back in a job as a result of stages one, two and three of those restrictions being lifted, as agreed by National Cabinet.
KARL STEFANOVIC:
Can we afford to keep handing out money, Josh? Restaurants and hotels have done it, some would argue, far worse than construction, can we keep handing out cash?
JOSH FRYDENBERG:
Well, I was at a pub the other day, for the opening of first drinks after the restrictions in Victoria, and there were 11 people who were on the JobKeeper program at that pub, but now they’re getting back to work, and that’s exactly what we want them to do. Because the restrictions are being eased, customers were coming through the door and the staff were really, really happy to be back at work, whether it was in the front bar or in the kitchen. So that’s the key to the recovery; easing the restrictions in accordance with the medical advice, and we’ll ensure that income support is being provided as the transition is being made.
KARL STEFANOVIC:
Thanks so much for your time, Treasurer, on a busy day, appreciate it.
JOSH FRYDENBERG:
Always good to be with you, Karl.