LEON BYNER:
Josh Frydenberg, thanks for joining us today.
JOSH FRYDENBERG:
Nice to be with you, Leon.
LEON BYNER:
Can I start by talking about what our Treasurer, Rob Lucas, has said. He is claiming that this state, SA, is missing out on $1.3 billion of GST. But is it not the case that you’re funding a whole lot of other areas which mitigates that loss?
JOSH FRYDENBERG:
Well, the impact on the GST is a result of COVID-19 and the fall in household consumption. But there are a lot of extra measures in this Budget which will significantly support people across South Australia. There’s obviously land, transport, infrastructure projects, over $600 million. There’s health and hospitals funding to SA which increased by more than $150 million compared to the previous Budget. There’s also initiatives that are designed to help first home buyers, initiatives that are designed to help pensioners and others on income support with two $250 payments, a big boost to business investment incentives that will allow them to purchase the equipment and machinery that they need for their business. There’s our loss carry-back provision, so if you are a business in South Australia that was previously profitable but because of COVID-19 you’ve made a loss, instead of waiting until you now turn a profit to use that loss you can then, you can now take that loss and offset it against previous profits in the past and receive a tax refund from the Australian Tax Office. So, there are great benefits from what we’ve seen in the Budget last night.
LEON BYNER:
What do you make of the comments by Labor this morning that if you’re over 35, male or female, or even over 45, you miss out, there’s not much for you. In fact, they talk about the fact that if you’ve got a subsidy of $200 for somebody much younger in the workforce then it is going to be harder for anybody who’s older to compete for a job.
JOSH FRYDENBERG:
Well, two points I’d make. The first is that young people and women have been particularly impacted by this crisis, and we’ve seen that with the loss of jobs earlier this year. And the experience of previous recessions in Australia in the 1980s and the 1990s is that those who have been on the unemployment queues tend to be there for some time, and we obviously want to get people back to work as soon as possible. So we have provided this additional incentive for young people to be employed. But we’ve also got other programs that are designed to help seniors and provide incentives to businesses to take them on. We’ve also got the JobTrainer program, which is creating 340,000 new training places for people of different ages. We’ve got the 50,000 new online courses that will help in reskilling and retraining people, and then we’ve got the whole suite of measures that are designed to boost aggregate economic activity across the economy, including the infrastructure projects, the investment incentives, the tax cuts. That will create jobs for people of all ages. So you shouldn’t see one item in the Budget in isolation, you should see it as part of a broader economic ecosystem that will see the creation of jobs.
LEON BYNER:
There has been a call, and the background of this is that our unemployment rate, latest data, 7.9 percent, and when you look at Victoria that’s been shutdown, 7.1, there have been calls for SA to do something outside the square and get rid of payroll tax. What do you think of such an idea?
JOSH FRYDENBERG:
Well payroll tax, Leon, is a tax on jobs. The more people you hire, the more tax you pay, and it goes all to state governments. Now, I can understand why state governments don’t want to see their revenue eaten away by tax reductions. But the fact of the matter is many of those businesses that are paying payroll tax are now doing it really tough. So I’d say to the South Australian Government, I’d say to other state governments from around the country, that don’t just defer payroll tax, see if you can waive payroll tax obligations and look to reduce that obligation over time. Let’s not forget that the Governor of the Reserve Bank, Phil Lowe, has called on states to spend some 2 percent of GDP or around $40 billion in additional measures to support the economy. We, as a Federal Government, have pulled out all stops to support the economy with extra spending. Some of the state governments need to do more, and that would be my message to them.
LEON BYNER:
Look, I want to just nail down a couple of specifics. There is a $5.6 billion fund for national rail. We don’t get one dollar from that. Why would that be?
JOSH FRYDENBERG:
Well, we have a major set of initiatives around rail infrastructure and rail programs, and they’re not designed to, you know, to keep one particular state out of that support. It’s designed to boost specific projects in specific areas of need, and if there is a specific project in South Australia that is to be brought to the Ministers’ attention I’m sure he’ll give it due consideration.
LEON BYNER:
That’s the Treasurer, Josh Frydenberg.