LEON BYNER:
I want to ask you a few things about where we stand now and, of course, where we go in the new year. I was really surprised to read Australians conduct 55 million digital transactions every day worth $650 billion. That’s very high, isn’t it?
JOSH FRYDENBERG:
And rising. Gone are the days of cheques, cash is in quick decline and buy now pay later, digital wallets, digital currencies are becoming the new normal, Leon. And, unfortunately, with all this digital change you need a regulatory system to keep up to date with it. And that’s what we’re seeking to do.
LEON BYNER:
Yeah, so how will things change given the fact that cash is just not what it used to be? It’s still worth every damn cent of it but, of course, we don’t carry much on us, we use cards all the time.
JOSH FRYDENBERG:
Well, our focus is in three key areas. Firstly, about modernising the payment system so the types of products and services that are covered by regulation will be broadened to take into account some of these technological changes. That will help ensure that we have a level playing field for new entrants. This will also ensure that consumers get a better deal by greater transparency around fees. The second is we’re seeking to license those businesses that buy and sell cryptocurrency. We want to take this out of the shadows and put it into a sensible, considered regulatory framework. And that’s going to be very important for consumers to have more certainty about the parties that they’re dealing with when they’re buying and selling cryptocurrency. And thirdly, we’re going to work with the Reserve Bank of Australia to investigate the feasibility of having a central bank digital currency. And that would be world leading and that would obviously be a reflection of, you know, the great movement that we’re seeing in our financial system.
LEON BYNER:
But it’s taken us 25 years to upgrade regulations, and you kind of wonder, well, why didn’t we anticipate that there would be changes to the way we do business?
JOSH FRYDENBERG:
Well, we have made some changes around things called the consumer data right and we’ve made changes around research and development in this space. We’re also obviously investing heavily in the NBN and 5G. All of those changes are helping our economy become digitally enabled. And we have a very, I think, effective and broad-ranging digital transformation agenda. But this is ensuring that our payment system, the plumbing of the financial sector, is up to date. And the changes that we’re making are world leading. There’s no country that’s got this absolutely right. Things are very fast moving. And our focus is on ensuring that the consumer gets the best possible deal and that it’s in Australia that we’re making the laws that affect Australians, not in Silicon Valley.
LEON BYNER:
For those people who aren’t sure, you’re in the best position to do this, explain to people what is cryptocurrency?
JOSH FRYDENBERG:
Well, it’s a form of digital value. And it’s obviously a new form of currency where people can exchange cryptocurrencies, one example is Bitcoin, and in return, it’s a form of value. So it’s growing very quickly and it’s been taken up by more than 800,000 Australians according to the tax office. So it’s really a digital form of value, Leon, that can be exchanged between parties. It uses what is called a digital ledger technology, which is a record of transactions. That’s what block chain is all about. It can be quite a volatile investment. So anyone who’s listening to your program this morning, I’d say make sure you do your research, get the appropriate advice and be pretty careful because the prices can fluctuate very rapidly. You can be on the winning end of that or you can be on the losing end. But it's up to you individually to hedge your bets.
LEON BYNER:
All right. So if anybody is thinking of dabbling or using cryptocurrency, what’s your best advice as Treasurer?
JOSH FRYDENBERG:
Well, firstly, I’m reluctant to give people individual financial advice or specific financial advice about their own individual circumstances because it will always differ. But more than 800,000 Australians have been dabbling in cryptocurrency, and that number has been rising very rapidly. So it’s a digital form of value. It’s exchanged between the parties. It uses what is a complex term, again, but digital ledger technology, which is a record of transactions. And it’s growing in popularity all the time.
LEON BYNER:
I know that you’re looking at the booming buy now pay later sector. You have concerns about that?
JOSH FRYDENBERG:
Well, it’s obviously very convenient for people and it does provide a different form of payment, and that’s, therefore, greater choice to the customer. Obviously they’ve got their financial obligations, though over a different time period. And, again, 5 million-plus Australians have a buy now pay later account. And obviously the best known of them is Afterpay which is a great Australian success story.
LEON BYNER:
Now, just quickly before I let you go and wish you merry Christmas or happy Hanukkah…
JOSH FRYDENBERG:
Thank you.
LEON BYNER:
In terms of the budget, what might we expect?
JOSH FRYDENBERG:
Well, obviously our intention is to deliver a budget at the end of March, and it’s all about locking in the recovery, building for the future. Australia has done remarkably well, Leon, through this pandemic. Our economy is growing strongly into next year. The unemployment rate is now lower than when we came to government. We have an historic opportunity to keep unemployment in the 4s for only the second time since the 1970s. We have one of the highest vaccination rates in the world, one of the lowest mortality rates in the world. And so we don’t want to take any of that for granted. There’s no room for complacency. And so next year’s budget will be ensuring that Australians remain COVID safe with the right investments in health, but also that our economy will continue to grow strongly with investments and skills and infrastructure, cutting red tape, the digital transformation you and I are talking about this morning, all of which are designed to ensure that more jobs can be created and our economy can lock in its very strong recovery.
LEON BYNER:
That’s the Treasurer Josh Frydenberg, just giving us an idea of the blueprint for next year.