KIERAN GILBERT:
Treasurer, thanks very much for your time. How much is this going to cost, this Sydney intervention?
JOSH FRYDENBERG:
Well, we’re expecting the cashflow boost to equate to about half a billion dollars a week. Now, that is a cost that will be split 50–50 with the New South Wales Government. On top of that, we’ve got our commitment to provide the disaster payment, which is a payment that’s been elevated to $600 a week and $375 a week depending on how many hours a week have been lost. Already, over 130,000 people from New South Wales have applied for that payment. I expect that number to increase, but we recognise that this is a very difficult and trying time for the people of New South Wales and indeed for the country as a whole. More than five million Australians are subject to lockdown.
KIERAN GILBERT:
Have you got a ballpark figure though, for the total spend?
JOSH FRYDENBERG:
Well again, it’s based on an expected weekly spend, because we don’t know how long this extended lockdown will go for. Our payments will come in in week four. That is next week. And we’re expecting the cashflow boost, which is the signature payment from the announcements today, to cost the Commonwealth around $250 million and given that it’s a 50–50 split with New South Wales, that particular program is expected to cost–around half a billion dollars a week.
KIERAN GILBERT:
To receive that payment, entities, companies, will have to be keeping their staffing level as of 13 July, today, and if they don’t, is there any mechanism by which to get the money back?
JOSH FRYDENBERG:
Well, again the compliance and the penalties are to be implemented and worked through by the New South Wales Government. As you know, we had penalties with the JobKeeper program that would apply to businesses that didn’t participate appropriately or legally in receiving those payments, and we are very keen to ensure the integrity of these measures. It will be implemented though, as you heard in the press conferences, by Services New South Wales. They’ve got an incentive to put in place the appropriate penalties, but at the same time employees have got an incentive, Kieran, to keep on their staff, because they are expecting and hoping that this lockdown is not protracted for weeks on end, that it can be contained and that they can get back to their normal business ways and that’s where they’ll need their staff…
KIERAN GILBERT:
But there needs to be some oversight, doesn’t there, to ensure that the link between the business and the employee is not broken?
JOSH FRYDENBERG:
Well, again, there are two different payments and I think it’s important to understand how they work in tandem. There’s the cashflow boost, which is designed to provide working capital to businesses to enable them to meet their fixed costs which are incurred regardless of whether they’ve got customers coming through the door, rent expenses, maybe their payments to the banks, as well as utilities costs and the like. And then there’s also the income support, which is a separate payment, the disaster payment, at that higher rate now of $600 and $375. But with this commitment from the businesses to keep their headcount as of today, the headcount is as of today, then that will be a requirement to participate in the program. And we expect businesses will comply with that.
KIERAN GILBERT:
Now, the Premier and the Government obviously dealing with this ongoing lockdown. We hope it ends in a few weeks. Did she wait too long to announce the lockdown in the first place?
JOSH FRYDENBERG:
Well, I think Gladys Berejiklian has been magnificent through the COVID pandemic. This is a very difficult lockdown right now, but if you compare the performance of New South Wales to other states, they have avoided to this point in time the significant lockdowns we’ve seen elsewhere and they’ve had outbreaks, like they did on the Northern Beaches, and they responded effectively. So, this is a new Delta strain, which is more dangerous, more contagious, more difficult to contain, and I’ve got great confidence in the health authorities in New South Wales that they will do what is required, including this lockdown, to ensure that the state gets on top of it and you know…
KIERAN GILBERT:
You were very critical though of the Andrews Government. You were very critical of the Andrews Government throughout that lockdown. What do you say to people who would point out to you, Treasurer, that the unvaccinated aircrew driver, the limousine driver, was able to be in that position without a mask, unvaccinated under the public health orders in New South Wales. Why aren’t you as critical of them?
JOSH FRYDENBERG:
Well, when the rules aren’t adhered to, I am critical regardless of which state it’s in. But it’s chalk and cheese what happened in New South Wales with what happened in Victoria. Tragically, more than 800 people lost their lives in Victoria. Ninety per cent of the deaths that we’ve seen across the country have been in Victoria and, as you know, they stem from a hotel quarantine failure, which the State Government undertook a review and the review found that no one seemed to take a decision and no one seemed to take responsibility for that failure even though a couple of senior public servants lost their jobs and a Victorian Health Minister, but no one took responsibility for those failed decisions. So, I don’t think you can compare what has been the experience in New South Wales to what has been the experience in Victoria. And I do point out to you that Victoria has gone through more than 150 days of lockdown, Kieran, over the course of last year and then this year, which pales into comparison to what has been the experience in other states, including in New South Wales.
KIERAN GILBERT:
Can I just clarify a couple of points for businesses and owners watching?
JOSH FRYDENBERG:
Sure.
KIERAN GILBERT:
We heard from Craig Laundy, also a restaurant owner in Sydney, worried about the way you’re going to look at the payroll because at the moment so many of their businesses have sent workers home. That if you judge it on the current cycle, the payroll is zero. Can you give us clarity on how this is going to operate?
JOSH FRYDENBERG:
Well, that payroll is over the 2020–21 financial year. So, if they’ve made some decisions in the last week or two, then that obviously has to be seen in the context of the financial year of 2020–21. So, I think that’s really important. So, that should give that clarity to those businesses. They will be eligible for this payment. This payment will have a minimum of $1,500 and a maximum of $10,000 per week, and it is set at an amount which is the equivalent to an average of around 40 per cent of a business’ payroll. We expect about 500,000 businesses and sole traders to be eligible representing at least three million workers across New South Wales. So, that’s a very substantial number of businesses and sole traders that could apply for these particular programs. Obviously, they have to show that their turnover is down by 30 per cent or more as a result of these lockdowns. So, there’s a turnover test for eligibility. There’s a payment that is determined based on the size of the payroll and there’s a minimum and maximum payment. This is using a system not too dissimilar to what we did through the height of the pandemic with the cashflow boost.
KIERAN GILBERT:
Sure.
JOSH FRYDENBERG:
But the key point, Kieran, is you have a support payment for business and you have an income support payment for households. The two of those have been strongly backed by the Morrison Government and those two programs now form a template that we can roll out in other states or territories if they find themselves in this very difficult position that New South Wales has found themselves in with an extended and protracted lockdown.
KIERAN GILBERT:
And for non-employing businesses, sole traders…
JOSH FRYDENBERG:
Yes.
KIERAN GILBERT:
…you have alluded to them there. The payment is going to be set at $1,000 per week.
JOSH FRYDENBERG:
Correct. Correct. That is correct.
KIERAN GILBERT:
Okay. Now, in terms of the broader, you know, that aim of JobKeeper was to keep the connection between a worker and their employer. Does this, if we, we touched on it earlier, but are you worried that this design doesn’t achieve that outcome as neatly as JobKeeper did?
JOSH FRYDENBERG:
Well, the first thing to say is I think we’re dealing with an economy that is at a different stage than it was when we introduced JobKeeper. I mean, you will remember when we introduced JobKeeper, you had hundreds of thousands of people lining up outside Centrelink around the country. You had fear that gripped the community and there was a lot of uncertainty about what was being faced by the national economy. JobKeeper did its job. Originally it was in for six months. We extended it out to 12 months. We brought in a different tier, a second tier. We also tapered the payment, and it worked very effectively and then it came to an end. And since it has come to an end, the unemployment rate, much to the disappointment of our political opponents, has actually fallen. More jobs have been created since JobKeeper came to an end. So, that was the right program at the right time. We’ve now transitioned, Kieran, to a different phase of our response. We are dealing with a localised outbreak in one state and, therefore, we have worked with the New South Wales Government, in good partnership with them, to provide these two payments to households and to businesses.
KIERAN GILBERT:
Now, when you fixed that Facebook issue, you spoke to Mark Zuckerberg quite a bit on the phone. You don’t have any problem speaking to global business chiefs, so I presume if you were Prime Minister, you would have called the Pfizer global boss to sort out some more vaccines; is that fair to say?
JOSH FRYDENBERG:
Look, that’s a very cheeky question, Kieran. As you know, the Prime Minister has worked very diligently with Greg Hunt, the Health Minister, and indeed the whole Government has been focused on securing the vaccines, delivering them across the country. The good news is more than 9.3 million jabs have been delivered. More than a third of the eligible population over 16 have received a dose and those more vulnerable cohorts like the over-70s have seen more than 70 per cent of people receive a dose and the over-50s…
KIERAN GILBERT:
We could have got more sooner, though, couldn’t we?
JOSH FRYDENBERG:
Well, we adopted a portfolio approach and, as you know, we focused on the domestic production of AstraZeneca and there were issues with that particular vaccine that we couldn’t foresee and indeed that was experienced by other countries. We took the medical advice, mainly from ATAGI, as to the cohorts that it would apply to and we’ve also since that time secured more Pfizer vaccine. But, as you know, I recently sat down with General Frewen and the business community. We are getting more of those mRNA vaccines, those Pfizer vaccines, and we are partnering with the business community to make sure it gets rolled out as quickly as possible.
KIERAN GILBERT:
And just in a word, would you have phoned the global boss if you were PM?
JOSH FRYDENBERG:
Ha! Well again, I think the Prime Minister has done everything possible to get as many vaccines to Australia as quickly as we can.
KIERAN GILBERT:
Treasurer Frydenberg, thanks very much for your time.