LAURA TINGLE:
Treasurer today's jobs numbers are really pretty stunning, but they do predate Omicron. This week, we've already seen also the worst January consumer confidence figures since 1992. And we've just heard in the package that businesses are talking about the current period as a shadow lockdown. Why should we be optimistic that the economy will snap out of the Omicron shock quickly?
JOSH FRYDENBERG:
Well the fundamentals Laura, of the Australian economy remain sound and as you say, quite a remarkable set of job numbers today. The unemployment rate at 4.2 per cent, the lowest in more than 13 years, and in fact, the equal fourth lowest unemployment rate, since that ABS series on a monthly basis began back in 1978. What was particularly pleasing about today's numbers is that of the 65,000 new jobs created, more than half went to young people, and two thirds of those 65,000 jobs were full time. But I understand that the economy is still in the middle of the pandemic. And it's very challenging with real pressure on our hospital system, real pressure on our supply chains. But overall, the economy remains sound. We've seen from Commonwealth Bank real time data that consumer spending is down just 3 per cent early in the year, we've seen from Westpac that the consumer sentiment remains in positive territory. And the National Australia Bank has said that the impact on the economy is not as bad as being reported, or indeed feared, with their spending levels still above pre pandemic. That's not to say there are not sectors across the economy that are doing it very tough right now. And that's why we have a series of measures to support them.
LAURA TINGLE:
Well, rather than simply asserting or hoping that everything will be great, shouldn't you be taking out more insurance to ensure that it is great? Why not consider some more short‑term measures in the interests of boosting economic confidence?
JOSH FRYDENBERG:
Well, for example, with small businesses that do it tough we have a loss carry back measure, which allows them, if they're making losses, to go to the ATO to get a cash refund against taxes that they’ve previously paid. We've also got a small and medium sized business loan guarantee scheme, which can see loans of up to $5 million dollars. The states are also putting in place, in New South Wales and Victoria, relief for commercial tenants due to Omicron. And as we've seen in recent days, billions and billions of dollars making its way into the economy through tax cuts, which will help buffer the economic shock because we know that both businesses and households, Laura, have combined stored up $360 billion on their balance sheets that was not there at the start of the pandemic. This money, once health restrictions start to ease, will be spent and will support the recovery.
LAURA TINGLE:
You've said repeatedly this week that the state of the workforce is the central issue for you. And the Government keeps easing the health restrictions to improve that. But that doesn't really help if people can't access rapid antigen tests they need to get back into the workforce. As the person responsible for the country's economic management, don't you have a responsibility to facilitate the widespread availability of these tests?
JOSH FRYDENBERG:
Well, there's lots in that question. Firstly, reducing the isolation requirements has been very important in helping to alleviate some of that pressure. I was recently at a Coles distribution center in Laverton, where they said it was already making a real difference. I was at a trucking business in Bayswater, as well, where it was making a difference to supply chains. The work the Prime Minister is doing with the states on a plan to open up our schools in term one is going to be really important as well, with respect to the workforce, as well as the booster shots and the vaccines for young people, as well as the changes around migration settings for those who are coming into the country and their working requirements. But with respect to RAT tests, there are two key issues. One is supply, the other is access. With respect to supply, we've got more than 200 million on order. In the last two weeks, seven million RAT tests have come into Victoria, we've provided more than six million to the aged care sector, and we're providing 10 million to the states to be available in those clinics. With respect to access and this was reaffirmed today, Laura, at National Cabinet. Those RAT tests are free if they're provided through a state clinic for someone who is either a close contact or someone who's symptomatic, but they're not endorsed by the medical professionals as some sort of universal screening tool to be used right across the economy.
LAURA TINGLE:
But Treasurer, have you considered the idea of providing them free? Have you estimated the cost of what that might be? I mean, it's going to be an issue for some time to come. Surely the cost is worth it?
JOSH FRYDENBERG:
We are providing those free of charge to concessional card holders, more than six million. That's an equity issue, and that we're doing in partnership 50‑50 with the states. But if you are symptomatic, if you are a designated close contact, you can go to a state clinic and get either a PCR test or a RAT test there and then and get the results very soon after, as well as providing the RAT tests we are at a national level through aged care, which is a more vulnerable setting. With respect to the broader provision of RAT tests across the economy, it's not the medical advice that it's a universal screening tool. And I think that's really important to under underscore.
LAURA TINGLE:
Yesterday, you outlined plans to try to get backpackers and international students back in to help ease shortages in the economy. Were you at all ashamed to be asking them to come and help us when we unceremoniously left thousands of them stranded here at the beginning of the pandemic without any form of assistance and relying on charity to be fed.
JOSH FRYDENBERG:
Well, look, there's a whole series of different challenges that we face now than compared to at the start of the pandemic. With respect to backpackers and with respect to international students, there are some 175,000 who have received their visa approval but have not yet made their way to Australia. So what we're doing is ensuring that they get rebated on those particular charges. And that will be good news for the economy if they decide to come and we expect thousands will. But we're also heavily investing in skilling up Australians. We've got 220,000 trade apprentices now, Laura, in work. That's the highest since records began back in 1963. We've got the JobTrainer program, again, in partnership with the states, which is helping to skill up Australians. So it's about ensuring that Australians have the skills to take the jobs. And right now, even after the recent weeks of Omicron, we know that job ads are more than 30 per cent higher than they were going to the pandemic.
LAURA TINGLE:
You're in the process of preparing the next Budget, which is coming down in March. Last month’s mid‑year review included $16 billion of decisions taken but not yet announced, which provoked accusations you're about to engage in the biggest pork barreling exercise in history. You told Leigh Sales last month that that $16 billion included confidential contracts for vaccines and aviation support. But you must be able to say now, what proportion of the money is not for these purposes?
JOSH FRYDENBERG:
It's about half‑half. About half of that $16 billion is for decisions taken and announced but with respect to the commercial details, they remain confidential. And you mentioned aviation…
LAURA TINGLE:
Well about $6 billion…
JOSH FRYDENBERG:
You mentioned aviation, the others are quarantine and vaccine procurements, which you can understand in a commercial tender process are relevant. There's another $8 or so billion where we have taken decisions but not yet announced. And of course, that all becomes public at Budget time.
LAURA TINGLE:
Can you rule out that any of that funding will be allocated to grants programs for things like car parks, and how much of it will be announced in the election campaign? There’s $6 billion, just out of that $16 billion, just earmarked for the next six months.
JOSH FRYDENBERG:
Well again, we'll make all those programs and investments public when we come around Budget time. That's going to be, obviously, they're important nation building projects that we're investing in, and we will find the appropriate time to announce them. But I don't want to overshadow what has been a very strong day for the economy, even in the face of this once in a century pandemic, this biggest economic shock since the Great Depression. Australians can be proud of what they have achieved with one of the highest vaccination rates in the world, one of the lowest mortality rates in the world and one of the strongest economic recoveries in the world.
LAURA TINGLE:
With respect Treasurer, $16 billion is an astonishing amount of money for you to allocate to things without telling us, the taxpayers, whose money it is, what it is. Why can't you do that, especially in a time when, in 40 years of reporting, it's only been in the last couple of years that allegations of widespread corruption have actually hung around the Federal level of government. And this is tainting you as Treasurer as well as the Government. Is that something that you're prepared to see as a legacy issue for you?
JOSH FRYDENBERG:
Well I completely reject the premise of that question. What we are doing is investing in infrastructure projects, what we are doing is investing in skills programs, what we are doing is investing in job creation. If you look at our response, through this pandemic, we have left no stone unturned, Laura, to ensure that Australians get through in both health terms as well as economic terms. And in terms of employment levels and in terms of GDP output, we have outperformed all major advanced economies in the world. I'm not saying to you everything has been perfect, it can't be, there's no rulebook to this. But if you look at our performance relative to the rest of the world, Australians have good reason to be proud of what they have achieved together.
LAURA TINGLE:
Treasurer, thanks for your time tonight.
JOSH FRYDENBERG:
My pleasure.