LEON BYNER:
Believe it or not, there's some good news financially that is good for the whole country. It does appear that economic recovery has cut the nation's Coronavirus induced budget deficit by $23.1 billion, with more than 2.8 million people coming off welfare and wage subsidy payments since the peak of this pandemic and that's got to be good news. In fact, ahead of the JobKeeper wage subsidy ending at the weekend, and we'll talk about that in a moment, Simon Birmingham has released updated financial statements showing that a surge in tax revenue, which we're all paying of course, and a greater than expected number of people moving off welfare, has boosted the budget bottom line. So when all the jobs lost during the pandemic now restored, Government payment forecasts have been reduced by - listen to this - $12.3 billion, fueled by $4.4 billion in lower JobSeeker dole payments, and a drop in demand for grants and other subsidies, including the JobKeeper scheme and cash flow. So this is a very optimistic set of numbers. And of course, the bloke I love to talk to in fact, I have a lot of time for this bloke, as a politician and a person, Josh Frydenberg, because he shoots from the hip. Josh, good morning.
JOSH FRYDENBERG:
Good morning. Nice to be with you, Leon.
LEON BYNER:
Now, this is a good set of numbers. What do we attribute to this?
JOSH FRYDENBERG:
We're getting more people back to work faster than we originally thought. At the height of the pandemic, Treasury thought the unemployment rate…
LEON BYNER:
Your mobile is breaking up again. Listen…
JOSH FRYDENBERG:
You there Leon? Okay. What we’re seeing is more people coming back to work and they’re coming back to work faster…
LEON BYNER:
You're still breaking up. I do know, just on another subject. So you know, I think there is a problem at the moment with the actual mobile network itself. And that is something that the telcos haven’t admitted. But I have it on very good authority that there is an issue. So where we are able, we are going to use landlines. And if we can make the mobiles work, that's all good. So Josh, where to from here, given that this is a good set of numbers?
JOSH FRYDENBERG:
Well, thanks, Leon. Well, more people are coming back to work faster than we originally thought. That is a positive sign for the economy, including for the economy of South Australia. More people in work means more people paying taxes and lower welfare payments. So we’ve still got a lot of work to do, there’s still some challenging times ahead…
LEON BYNER:
You're going to have to either face your phone in the other direction to see if we can get better coverage. This has been an issue for two or three days. I know there is a problem in the networks I know there is.
JOSH FRYDENBERG:
Leon we will ring you back if that's okay?
LEON BYNER:
Yeah. Do that, Josh. Because I know, it's interesting. People tell me all sorts of stuff, as you know. And there is a problem in the networks at the moment. I'm sure that it's not only us that are experiencing it. But there's a lot of other people as well. Now, I don't know whether there is a fault or it's just the fact that there are so many people on mobiles that the communications towers just can't handle the amount that's coming through, which I suspect could be the case, could well be the case. But with all the jobs lost during the pandemic now restored payment forecasts have been reduced by $12.3 billion. So Josh just that's a good story, isn't it?
JOSH FRYDENBERG:
Well, thanks, Leon and maybe take two, on a better phone. But certainly more people are coming back to work faster than we originally thought. The unemployment rate is at 5.8 per cent. At one point Treasury were advising me that could reach as high as 15 per cent, which would have meant...
LEON BYNER:
15?
JOSH FRYDENBERG:
15. Which would have meant more than two million unemployed. So Australia's economic recovery has been better than nearly any other country in the world. What was the particularly [inaudible] about the job numbers, the most recent ones for the month of February, were that jobs were created in every state territory. The 88,700 new jobs were all full time jobs, more than 80 per cent percent went to women and more than 40 per cent went to young people. So we know that there will be sectors across the economy, like tourism, like aviation, like international education, indeed, a lot of businesses in our CBDs around the country will continue to do it tough. But, we are seeing a light at the end of the tunnel, and the Government is moving to more targeted economic support. With JobKeeper coming off we've already put more than $9 billion into the state of South Australia. You've had a 78 per cent fall in the number of people in South Australia relying on JobKeeper as of the end of January. So the numbers are telling a story of people coming back to work and we know they're not just numbers on a page. They are your workmates, they're your family members, they’re your friends who are getting back on their feet.
LEON BYNER:
Can you let me know whether and this is something that I reckon people would be interested in, is GST revenue up?
JOSH FRYDENBERG:
GST revenue is picking up as a result of more household consumption. But it is still lower than what would have otherwise been the case without COVID. Employment levels are back to where they were pre-COVID. So that's a positive sign. But we still have some challenges getting young people into work. But it does look like our economy is really strengthening, as restrictions are eased and people are more freely travelling across the country.
LEON BYNER:
Which sectors are feeding this the most? Because we know that aviation got hit really hard and they're coming back, albeit slowly. So which of the sectors Treasurer, have really contributed to this?
JOSH FRYDENBERG:
Well programs like HomeBuilder have really helped the construction sector. You can speak to builders today and they struggle to get tradies. There's been a huge demand through that program for people to buy and build a home. So the construction sector is starting to pick up because it did get hit hard, as well. We've also seen, you know, retail starting to come back, more online shopping, of course, as opposed to the local mall or shopping strip, but retail is picking up because money is in people's pockets. The business investment incentives that we put in place with what is called immediate expensing, when any business with a turnover Leon, of under $5 billion a year can actually write off in year one, any piece of machinery, or equipment that they put into their business, whatever the value, that's boosting and the sales of machinery and equipment quite substantially. So there are some positive signs across the economy. But there are also some challenges to.
LEON BYNER:
Alright, I've got to ask you this, though, because I think the view from the public is that you've done a pretty good job as Federal Treasurer. And I know you're intensely loyal to your PM and one would expect that, but is leading the party, is that something that you would relish if the opportunity presented itself?
JOSH FRYDENBERG:
Look Leon, I'm not going to take the bait on such a question. You're right. I've always been loyal to the leader. I was to Tony Abbott, when he made me his parliamentary secretary, I was to Malcolm Turnbull and I am to Scott Morrison. It's a privilege to serve as the deputy Liberal Party leader and to be the deputy to Scott Morrison, as Treasurer, together with Michael McCormack as the deputy prime minister. I think we have a very strong team. We have a united team. Yes, we've had some challenges in the last few weeks Leon, but people are focused on getting to the other side of COVID. That's what the Government's focus is on. It's on jobs, it’s on rolling out the vaccine. When you look at our performance as a nation, compared to Canada, Japan, Germany, France, the United Kingdom, indeed the United States, we stand tall. That's something that 25 million plus Australians can be very proud of, because they've all contributed to that outcome. So yes, it's been challenging, but there is a light at the end of the tunnel. We've got a budget in six weeks’ time and that's what my focus is.
LEON BYNER:
Yes. Because, again, do you think that and I'm not going to expect you to give us anything that's already not even fully planned yet. But given your prognosis of the future, would that not necessarily mean that the budget might be a little better than otherwise what we'd hoped?
JOSH FRYDENBERG:
Well we saw some numbers today about where the sort of headline deficit numbers are at and they are better than expected. Because as more people get to work, you have more people paying taxes, and you have lower welfare payments. But we're still got a big hole to fill because we committed $251 billion in direct economic support. That's the equivalent of 13% of GDP. We're only able to do that because our economy was in good shape coming into this crisis. We've committed more than twice what all the states and territories have committed combined. So we've done the bulk of the heavy lifting and Scott Morrison has led from the front. He has shown enormous strength and perseverance and he can take a lot of credit for how Australia is coming out of this pandemic.
LEON BYNER:
What's your biggest task, next on your agenda?
JOSH FRYDENBERG:
My immediate task is obviously the preparation of the Budget, it’s keeping the momentum in the economy. I'm going out this morning to a truck manufacturing site in Victoria, to celebrate the fact that it's now making its 70,000th truck in this plant. Now that's about jobs. A lot of people wouldn't know that we make the Kenworth trucks here in Australia, they employ directly 1200 and another 10,000, indirectly, through the various component parts of the source. So we have a vibrant manufacturing sector, including in track manufacturing. I'll be out there today talking about jobs, jobs, and more jobs. So that is my focus.
LEON BYNER:
When do you think you might be coming to SA?
JOSH FRYDENBERG:
Well, I hope to come post Budget. I'm going to be locked down in Canberra for the next few weeks. So we'll probably be after that where we can eyeball each other in the studio, Leon.
LEON BYNER:
That'd be good. Well, listen, thank you for coming on today. I reckon the public are pretty happy with what you're doing and how you're doing it given all the challenges we faced.
JOSH FRYDENBERG:
Well, thank you Leon. I don’t know if they would like me so much if they knew I was a one-eyed Carlton supporter in Adelaide Crows territory or Port Adelaide territory…
LEON BYNER:
When you got to the football do you really get passionate, not just yelling and barracking but do you go even further, do you lose it at all?
JOSH FRYDENBERG:
I lost it at the umpires a bit last night but that's a bit unfair because decisions go both ways. You should never blame the umpires but we were a bit stiff to lose last night. I thought the Blue were showing some good form but so are your teams in South Australia and I was in touch with my South Australians friends last night, we were talking about getting together for the Carlton-Crows game mid-year. So I'm looking forward to that.
LEON BYNER:
Josh, thank you for coming on today. That's the treasurer, Josh Frydenberg.