LUKE GRANT:
Treasurer, good morning.
JOSH FRYDENBERG:
Good morning. Nice to be with you, Luke.
LUKE GRANT:
Nice to talk to you, Josh. I was watching Question Time through the week and we will get to COVID in a moment or two, but the Treasury figures, firstly, the growth of the economy, and, I think, am I right in saying that we now have more Australians in a job, that is today, than we did have before the pandemic? That’s extraordinary.
JOSH FRYDENBERG:
It is remarkable. And it’s a sign of the very strong recovery we’ve seen right across the country. And we’ve done so ahead of any other advanced economy. And, indeed, what the National Account numbers showed just last week is that our economy, too, is bigger than it was going into the pandemic ahead of any major advanced economy. And while Europe has gone into a double-dip recession and while Germany and France, the United Kingdom, Japan all contracted as an economy over the March quarter, the Australian economy expanded. So this is really a sign that the momentum is building, even though we’ve had the biggest economic shock, Luke, since the Great Depression.
LUKE GRANT:
Yeah, gosh, it does say so much about Australians, doesn’t it, Josh? And, I have to be honest, it says a fair bit about the economic management of the Federal Government during this.
JOSH FRYDENBERG:
Well, we have put in an unprecedented amount of economic support, and, as you know, we kept the foot on the accelerator during the Budget period and we’ve provided tax relief to more than 10 million Australians. We’ve provided the ability for businesses to write off new machinery and equipment all in year one, despite the value. We’ve also put in place new skills programs, rolling out infrastructure programs. And the really good news, Luke, about the numbers that we saw last week is that it’s a private sector-led recovery. It’s businesses backing themselves, investing in their future and hiring more people. It’s people buying a house. I mean, the number of first home buyers in the market today is the highest in more than 10 years. It’s the agriculture sector getting back on its feet with a strong winter crop after what has been a terrible and demoralising drought. And then, of course, you’ve seen household consumption pick up because people are feeling more confident and can move more freely across the country. So they’re going out to hotels, cafes, restaurants and spending. So it’s a private sector-led recovery which is really driving this rebound in both jobs and growth.
LUKE GRANT:
You came to the conclusion through this week, you and the PM, that probably there had to be some further financial support for Victorians. And you’ve gone through there a list of very good things the Government has done all involving spending. How do you rein it in and repay debt at some point, Josh, and how do you now stop the next Premier who might have a lockdown to come knocking on your door asking for support?
JOSH FRYDENBERG:
Well, as you know, Luke, going into this crisis we got the first balanced Budget in 11 years. And we did so by getting welfare dependency down to a 30-year low. So the key was to get more people in work which gets you increased tax receipts but lower welfare payments as well. And just by getting 200,000 extra people in a job than Treasury were anticipating at the end of last year, that’s worth $5 billion to the Budget bottom line. So the key to repairing the Budget is to repair the economy. So that’s why we’re doing what we’re doing. But a lot of our spending is temporary, it’s targeted and it’s obviously proportionate to the challenge we face. But if you look at the Victorian lockdown, it’s a reminder, a very painful reminder that the virus is still with us. So we can’t be complacent. We can’t think that we’re out of this yet. We’re certainly in a better position than any other country, but we’re not out of it yet.
LUKE GRANT:
Yeah. I think last night there were images in one of the car parks in a CBD building in Melbourne, there were images of I think clothing or sheets or towels or something that were marked as highly infectious. We’ve seen the lockdown now extend for another week. We’ve had false positives who they’ve factored into counting just how serious this may or may not be. I know you and the PM have been reluctant to criticise Victoria, but every time there seems to be an issue it seems to be there and it always seems to be so clumsily handled. Is that too unfair?
JOSH FRYDENBERG:
Well, these are very difficult times for Victorians, and the numbers bear this out. If you take the period since the first national lockdown last year, Victorians have been through 140 days of lockdown and the average across the other states and territories has been just six days. I mean, it’s quite remarkable, isn’t it, 140 days of lockdowns in Victoria and just an average of six days across the other states and territories. Take New South Wales, for example. Kids have been out of school for around 29 days. In Victoria some kids have been out of school for 21 weeks. And it breaks my heart to know that these kids are not in the classroom. Young kids, primary school kids not getting the education and the contact with their friends and the engagement with the teachers face to face. For me this has been a massive casualty of the pandemic. And many people in Victoria are asking the very questions that you’re posing, why us? Why have we been through a fourth lockdown when other states have not experienced it?
LUKE GRANT:
Yeah.
JOSH FRYDENBERG:
It’s the same virus. It’s the same hotel quarantine. It’s the same technology like QR codes that are available in New South Wales as they are in Victoria. Why has Victoria had these four lockdowns when other states have not? And they’re the very questions people are asking in Victoria. You can’t blame the Federal Government…
LUKE GRANT:
No, but they tried to yesterday, Josh. I mean, they were, I couldn’t believe what I was hearing from the Acting Premier. But just back to kids, there’s a mental health issue here as well, is there not?
JOSH FRYDENBERG:
Big time. And, in fact, there’s a very comprehensive report from the Murdoch Children’s Research Institute with the best professors who have analysed this and said that more than 50 per cent of kids are experiencing some sort of mental health impact from last year’s lockdown. That’s what the survey results were showing.
LUKE GRANT:
Gosh.
JOSH FRYDENBERG:
And, you know, this is very profound, and we’ve got to be very conscious of the impact. But I want to reiterate, these are not decisions the Federal Government takes about lockdowns; these are decisions that only state governments take. Where does the lockdown apply to? Does it apply to schools? Does it apply to construction sites? Which sectors are impacted? Which regional areas are impacted? I mean, one of the questions that have been asked in Victoria is that Mildura…
LUKE GRANT:
Yes.
JOSH FRYDENBERG:
…which is a regional city of more than 50,000 people and it’s more than 500 kilometres out of Melbourne, it was subject to the same lockdown restrictions in week one as inner Melbourne even though in Mildura they haven’t had a case for 13 months. And people in Mildura are asking that very question, why us?
LUKE GRANT:
Yeah, yeah. This idea of building a quarantine or dedicated quarantine facility in Victoria, I think you and the Prime Minister have agreed to go 50-50 or something like that. It’s a lot of money, isn’t it, $200 million for 500 effective places. We worked that out to be $400,000 per place. A lot of money, isn’t it?
JOSH FRYDENBERG:
We have put an MOU back to the Victorian Government and there’s been close consultations over the recent weeks since the application was made by the Victorian Government. I think there’s a recognition that these facilities will be helpful going forward, bearing in mind that in the Budget I put $500 million dollars for the expansion of the Howard Springs quarantine facility in the Northern Territory. But it’s also important to underline to your listeners, Luke, that this is over and above the existing hotel quarantine facilities that are in operation. And it’s about having a long-term solution.
LUKE GRANT:
So you look at the other states and you then come to that question, why them? Have you been able to sit down with the Acting Premier or anyone else in the Victorian Government and just try and sort it out? I mean, it’s an answer most Australians would like to hear, isn’t it? Why always Victoria?
JOSH FRYDENBERG:
Well, again, they’re questions for the Victorian Government. I have a constructive relationship with my equivalent, the Treasurer there, Tim Pallas. I spoke to him last night and obviously have been speaking to him in recent days about what we have put forward yesterday about a COVID payment that would apply to lockdowns where they occur beyond seven days. Because our position for the first seven days is that states have the financial capacity to respond, as they should. And then if it’s a longer term lockdown then the Federal Government is willing to provide additional support. But the Victorian Government knows that the Morrison Government has been there every step of the way. Again, the numbers tell a very powerful story. We have provided $45 billion already delivered to families and businesses in Victoria since the COVID crisis began. That’s around three times what the Victorian Government itself has delivered to Victorian families and businesses. So we have very much done the bulk of the heavy lifting.
LUKE GRANT:
Do you like being Treasurer?
JOSH FRYDENBERG:
Well, it’s a challenge. It’s a privilege. It’s an opportunity. It’s a responsibility. And I’m very proud of what more than 25 million Australians have achieved over the course of the last year. Luke, we are better placed than any other country around the world to get to the other side of this crisis both in economic terms and in health terms. And to see us outperform other nations both in employment and in growth is very, very pleasing. And let’s not forget the abyss, the economic abyss, that we were staring into last year when Treasury said to me that they feared unemployment could reach as high as 15 per cent, more than 2 million Australians unemployed. Today it’s 5.5 per cent. I feel very much that we have avoided putting a generation of young Australians into long-term unemployment.
LUKE GRANT:
Yeah, absolutely. Thanks for what you’re doing. And appreciate your time very much.
JOSH FRYDENBERG:
Thank you very much, Luke.