LEON BYNER:
Josh Frydenberg, thanks for joining us today.
JOSH FRYDENBERG:
Nice to be with you.
LEON BYNER:
Before we get to the Small Business Package, I want to get to a very important issue which is tourism and the fact that the US State Department only recently warned tourists of very severe cautions in coming to Australia, in fact they put us on the same level as Hong Kong and Papua New Guinea. Now here we are spending money encouraging people to try and come and only a few days ago the American Government said hang on a minute you might want to reconsider so are we going to try and deal with that?
JOSH FRYDENBERG:
Well as you know the Prime Minister has spoken to the Trump Administration and changes were made as a result of that and we announced just yesterday a $76 million package to encourage tourists into those areas that have been damaged by fire and no doubt people around the world have seen the graphic images of the fires across Australia and we want them to know that there is still wonderful tourism opportunities here in Australia and we’ll be encouraging people to come.
LEON BYNER:
Now in terms of the distribution of assistance, there are two levels of this Treasurer, there is the fund that you’re dipping into very significantly to offer some very generous loans where for the first two years if you borrow there’s not any repayments and even when there are it’s about 0.3 of a per cent which is a very low rate. But I want to get to the fact that we don’t seem to have been that effective more recently in delivering services on the ground in a timely manner when they’re needed, are we going to get better at that?
JOSH FRYDENBERG:
Well there’s already been $58 million that has been distributed to over 48,000 Australians. We’ve had millions of dollars as well go to the state governments to make its way to local governments in order to support bushfire relief efforts and as you know the Prime Minister has also announced packages to deal with mental health, packages to support wildlife that has been injured by the fires and packages today to support small business.
LEON BYNER:
Alright, I want to ask you a typical question here, let’s say you got ravaged in the Adelaide Hills in the Cudlee Creek fires which affected a lot of areas, or indeed on KI, let’s first of all talk about businesses who’ve had massive drops or they’ve lost their properties all together, either way they’re in dire straits. How easy is it for them to access assistance, what do they have to do?
JOSH FRYDENBERG:
Well there is a number of different components to the assistance that we’re announcing today. There is a grant of up to $50,000 for small businesses that have been directly damaged by the fires and we will be delivering this through the states. Then there will also be loans of up to $500,000 and up to ten years duration with two years interest free and then interest after that at half the ten year Commonwealth bond rate which as you say is actually about 0.6 of a percent so it’s very low in comparison to what people could borrow money at from a bank. This money will help people not only repair their businesses that have been damaged, but also provide them with the working capital to repay their suppliers, to ensure that they can meet their wages bill, to lease new premises if that is required. There’s a whole lot of things that will be required by small businesses that have been both directly but also indirectly affected by these fires. And as you know Leon, whether it’s the butcher, the baker, the clothes shops, the newsagents, the cafes, the hairdressers, the mechanics, they are all part of not only the economic aspects of these communities but they’re part of the social fabric of these communities and we heard firsthand at a round table that the Prime Minister, myself and Small Business Minister Michaelia Cash convened just last week about the challenges being faced by small businesses in South Australia and beyond.
LEON BYNER:
Now you’re not going to have to fill out three hundred pages of forms are you to get any of this help?
JOSH FRYDENBERG:
No we are obviously ensuring that that process is as streamlined as possible and also for the BAS statements - the quarterly BAS statements, they won’t now be due to the 28th of May which is a number of months after when they otherwise would’ve been due and we’re also talking to the insurers about the work that we can do there to, to ensure their money can be made as quickly as possible to those who are affected.
LEON BYNER:
Josh is it a fait accompli that we’re going to have a Royal Commission into these bushfires?
JOSH FRYDENBERG:
Well the Prime Minister is right to, to day that there are a number of lessons that need to be learned and foremost among them, how do we get the coordination between the Federal and State Governments and the proper rules in place so that we can quickly respond. As you know there has been an unprecedented call out of ADF reservists in this particular bushfire response.
LEON BYNER:
Yeah.
JOSH FRYDENBERG:
There’s also work that needs to be done around adaptation and resilience, Leon. I mean we are going to be facing hotter, dryer summers and longer bushfire seasons and that may require changes to zoning laws and planning laws where people live but also to the amount of burn off that is done in an organised way ahead of the bushfire season. So I think there is a lot of work to be done, there’s a lot of lessons to be learned and obviously the Prime Minister has foreshadowed a Royal Commission to do that.
LEON BYNER:
Alright, one other point. Have you any idea as to how broadly this bushfire cost will hit the federal budget?
JOSH FRYDENBERG:
We announced this $2 billion Bushfire Recovery Fund. Now, that was predicated on spending probably around $500 million in the rest of this financial year and then the rest over the balance of the coming period. But what is a bit hard to tell, Leon, is the broader impacts, not necessarily Government spending, but what is the broader impacts on the public’s consumption? How many holidays have been cancelled? How many businesses haven’t been able to open their doors? How long will it take to get the rebuild effort up and running? These are all issues that will become clear over time. But there’s no doubt they’ve had a significant economic impact and that’s why we’ve been very clear that our bottom line is not the budget surplus, our bottom line is delivering the response and the recovery for the people who need it.