LEIGH SALES:
Thank you for being with us Treasurer.
JOSH FRYDENBERG:
Nice to be with you Leigh.
LEIGH SALES:
Is your March 29th Budget next year going to be about starting to recover the balance sheet and pay down debt? Or will you be able to resist taking the nation further into debt because you want to splash cash around because you are heading into an election?
JOSH FRYDENBERG:
The Budget next year will be about locking in the recovery and also building for the future. Our first priority is to keep Australians safe from COVID. We are still in the middle of this pandemic as we have seen with the new Omicron variant. It is also about creating more jobs. We have avoided the scarring of the labour market that was characteristic of the recessions in the 1980s and 1990s. Indeed we have an opportunity now Leigh, to drive unemployment to historically low levels with the RBA expecting unemployment to have a four in it, to be sustainably in the fours for only the second time in the last 50 years. The Budget...
LEIGH SALES:
On that point about unemployment and creating more jobs you go and talk to anyone in hospitality or retail at the moment and they are really struggling to get workers. They actually cannot get workers to fill existing jobs.
JOSH FRYDENBERG:
Workforce shortages are real. In fact, job ads are 30 per cent higher today than they were going into the pandemic. More than 250,000 jobs are available.
LEIGH SALES:
So what is the problem?
JOSH FRYDENBERG:
Well, one issue has been is our borders have been closed and a number of the workers in the hospitality sector, for example are not available because of those closed borders. But we are investing in new skills. We announced over 450,000 new JobTrainer places, 250,000 of them have already seen enrolments. We’ve got a record number of Australians, 217,000 in trade apprenticeships. That is the highest number since records began in 1963. So we are looking for opportunities to invest more in skills, while at the same time, in a COVID safe way we will reopen the borders and bring in those skilled workers.
LEIGH SALES:
You said in your first answer you are looking to lock in the recovery. Is that code for more fiscal stimulus, i.e., more fiscal spending rather than starting to try to pull back spending?
JOSH FRYDENBERG:
Firstly the emergency support that we put in place during this pandemic has been wound down and we got some criticism for that when we brought JobKeeper to an end after its 12‑month period. And we also got criticism when we ended those COVID disaster payments and the business support payments once we reached those vaccination rates of 80 per cent. We are now moving to the next phase of our economic recovery plan and obviously tax relief is a part of that. Infrastructure spending is important. We’ve got more than 5,000 jobs created by Snowy 2.0. More than 10,000 jobs created by the Western Sydney airport. More than 20,000 jobs created by the inland rail project. What we are investing in is infrastructure, skills...
LEIGH SALES:
Sorry to interrupt, but anyone can spend money and invest. The challenge now isn't it for you to show your budget repair credentials and start trying to reign that in.
JOSH FRYDENBERG:
Well firstly we went into the pandemic having the first balanced Budget in 11 years and we did that by having the lowest real growth in spending in some 50 years. Now that was an achievement before the pandemic hit. The way to repair the Budget from here is to strengthen the economy and that is why investment in skills, business investment incentives are important, tax relief and infrastructure, the digital transformation, deregulation and obviously energy investment are all important as part of that broader productivity mix. But I point out to you Leigh that we have seen an $80 billion improvement in the budget bottom line from what I forecast in the Budget last October to what was the final budget outcome as early as July. The reason for that was more people in work, less on welfare. That is the secret sauce.
LEIGH SALES:
You mention though that the Omicron factor and how that can throw things. On this the new variant, so far the evidence is that Omicron doesn't make people sicker, vaccines are still effective. What do we imagine we are protecting people from at this stage by closing borders and imposing 14 day quarantines on some people in a nation which has 90 per cent of people over the age of 16 vaccinated?
LEIGH SALES:
It was a prudent, sensible course of action, based on the medical advice, as we needed to know more about this new variant, about its transmissibility, about its severity and whether or not the vaccines that have been widely taken up across Australia are a real defence against this new variant. So that is what the two‑week pause is all about. We are looking to reopen those borders once we have the all‑clear from the health officials. We want to see the economy get back on its feet and obviously we want to enjoy the freedoms that are now being enjoyed with the Delta lockdowns having come to an end.
LEIGH SALES:
Coalition MPs Christian Porter and Greg Hunt have announced they will not stand at the next election. In light of the Jenkins Report this week outlining the need for political reform and a change in the way that Parliament operates, should women pre‑selected for those two seats?
JOSH FRYDENBERG:
Well I’ll leave that to the local pre‑selectors but I can talk about my own state.
LEIGH SALES:
Actually, I’ll just keep you on that point there because you are one of the leaders of the party…
JOSH FRYDENBERG:
Sure.
LEIGH SALES:
…and there needs to be leadership on this issue, as Kate Jenkins made clear.
JOSH FRYDENBERG:
Well, I understand that there are strong female candidates who may put their hands up in both seats. One of whom I know well, in the Flinders electorate. But I will leave announcements about Greg's future to Greg and obviously Christian has made his announcement today and commend them both on their outstanding careers. But our focus is getting the best possible people and there are more women who are coming to take winnable seats and indeed safe seats. And in my own state of Victoria, both in Dunkley and Corangamite, we’ve got outstanding female candidates.
LEIGH SALES:
I wanted to ask you about your colleague Bridget Archer who crossed the floor last week to vote in favour of a Federal ICAC. A photograph was taken of you with her, which she clarified was you being nice and enquiring about her welfare, but she also told the journalist, Samantha Maiden, she said you took her to the Prime Minister's office where she didn't want to go and she felt ambushed by that. What’s your side of the story? So she has gone to your office and then what has happened?
JOSH FRYDENBERG:
I Firstly, Bridget and I are good friends, and you’re right, she did put out that tweet where it was very kind of her and she thanked me for checking on her welfare and we'd had dinner earlier that week with some fellow colleagues. It was a big call for her to make on that particular matter so I was indeed checking on her welfare. We went back to my office. I thought it was a good idea that we meet with the Prime Minister just, by the way, as the Prime Minister and I had met with our Senate colleagues, who happen to be male who had done a similar thing.
LEIGH SALES:
So was that a spontaneous decision you made when she was back in your office or had you and the Prime Minister pre‑planned that you would take her around there?
JOSH FRYDENBERG:
As you know, in that Samantha Maiden article, it also pointed out that the Prime Minister was keen to catch up with Bridget. But it was my view, Leigh, that it would be a good idea after such a significant decision to have a conversation with the Prime Minister.
LEIGH SALES:
Sorry to interrupt, you didn't quite answer the question. Had you and the Prime Minister made that plan before you had Bridget Archer in our office or did you spontaneously decide to take her around?
JOSH FRYDENBERG:
I did speak to the Prime Minister before. I obviously spoke to Bridget and I can tell you, having been in that conversation with Bridget and the Prime Minister, it was, I think a very constructive discussion and certainly I had the best of intentions to ensure that Bridget, the Prime Minister and I, and in that case, Marise Payne, had an opportunity to discuss recent developments. Because Bridget is not only a valued colleague and friend, she’s a very important part of the team and she’s discussing important issues to her electorate and indeed to the country.
LEIGH SALES:
Treasurer, thank you, we will talk to you around the time of the economic forecast in December. Thank you.
JOSH FRYDENBERG:
I look forward to that.