MICHAEL ROWLAND:
Good morning to you.
JOSH FRYDENBERG:
Nice to be with you, Michael.
MICHAEL ROWLAND:
Your mea culpa session begins now. How could the Government get this so wildly wrong?
JOSH FRYDENBERG:
Well two things have happened, Michael. The first is that Treasury, in the midst of the height of the pandemic here in Australia, forecast that 6.5 million Australians would be covered by the JobKeeper program at a cost of $130 billion. But as you know, we had great success in flattening out the curve and we went from having a rise in the number of daily cases at 22 per cent in the week leading up to the announcement of the JobKeeper program, to now having 35 days straight where the number of new cases has increased by less than half a percent per day. So that health miracle has had a real economic benefit, hence the lower number of people who are going to be using the JobKeeper program as a result. The second thing that’s happened is that when around 1,000 businesses of the nearly one million businesses that formally enrolled for JobKeeper, they incorrectly filled in a form where they were supposed to put the number of eligible employees in their business for the JobKeeper program, but ended up putting the dollar amount they thought that they would be getting for the JobKeeper program…
MICHAEL ROWLAND:
And why wasn’t it picked up? Why didn’t someone at the ATO pick that up? It’s been running, for what, eight weeks or so? Weren’t suspicions raised when all of these small businesses and sole traders magically had 1,500 employees?
JOSH FRYDENBERG:
The ATO has explained that and apologised for that because what they saw from about 1,000 businesses was that instead of putting the number ‘2’, for example, in that box for eligible employees, they put ‘3,000’. Now that data was then collected and informed the ATO’s estimation that the number of people covered by the program was around 6.5 million. Now, of course, we now know that is incorrect. Importantly, that incorrect data was not used to pay anyone under the JobKeeper program. Other verifiable data like Tax File Numbers and other declarations by businesses were. So, the good news for the taxpayer is people weren’t underpaid or overpaid based on those incorrect submissions into the JobKeeper program and the good news for the taxpayer is that the Government will now have to raise $60 billion less in debt to pay for the various initiatives that we have announced during the global pandemic.
MICHAEL ROWLAND:
I want to talk about that in just a moment, will you front this Senate Committee Inquiry investigating coronavirus to explain this in detail?
JOSH FRYDENBERG:
Well, Michael, you know that this is just a political stunt from the Labor Party. When they were last in Government, they accepted a convention which is that House of Representative Ministers do not appear before Senate Committees…
MICHAEL ROWLAND:
Scott Morrison appeared before a Senate Committee when he was an Immigration Minister.
JOSH FRYDENBERG:
And Julia Gillard, Greg Combet, Peter Garrett, Kevin Rudd didn’t appear before Senate Committees. So this is just, again, a Labor stunt. Treasury officials, Ministers from the Government go before those committees and those estimate processes…
MICHAEL ROWLAND:
But the buck stops with you, Treasurer. The buck stops with you as the Minister.
JOSH FRYDENBERG:
And of course I take responsibility for the estimates variation. I’m accountable in the House of Representatives for my Department and for my portfolio, and will continue to do so. And I continue to have great confidence in the work that is done by my wonderful Department. But, you have to understand that we are facing a one in a century pandemic, and the ability to forecast accurately the number of people that were taking up the JobKeeper program was inherently difficult and that is something that the Labor Party knows full and well but is obviously seeking to make a political point out of this situation.
MICHAEL ROWLAND:
Forecast aside, one thing we do know is you have this $60 billion, as you say. You may not need to borrow it, but also on the other side of the coin, would you consider spending that money, or giving that money to people who currently can’t get the JobKeeper allowances? People like staff at universities, casuals, migrant workers?
JOSH FRYDENBERG:
Well we have said that we’re not planning to make wholesale changes to the eligibility criteria or any…
MICHAEL ROWLAND:
So that’s a no, you’re not expanding it?
JOSH FRYDENBERG:
Well, we’ve got no plans to make wholesale changes to the eligibility criteria. When it comes to universities, what the Government has done is guarantee their grant funding based on the number of domestic students pre-COVID, to ensure that they’re going to continue to receive that money. When it comes to shorter term casuals, as you know, we have the JobSeeker payment, and that was effectively a doubling of the old Newstart Payment and the safety net at $1,100. When it comes to the arts sector, we’ve already made $27 million worth of announcements for indigenous artists, for regional artists and organisations, and also for a group called SupportAct, to help artists in difficult times. When it comes to the tourism sector…
MICHAEL ROWLAND:
Ok, would you consider, I want to ask you about the tourism sector. On that, would you consider for the tourism sector and, for that matter, other sectors of the economy really struggling, extending the JobSeeker payment for those sectors once it expires. JobKeeper, sorry.
JOSH FRYDENBERG:
Well, again, when it comes to JobKeeper, we’ll be undertaking a review in the month of June, Michael, and obviously we’ll look at how it’s being implemented, we’ll look at what’s happening in various sectors. And you’re right, the tourism sector could be one sector that’s going to be in need of further support, and that’s what we will look at in the context of the economic situation at the time. Because with the tourism sector, you’re going to continue to see our international borders closed for some time, whereas with the hospitality sector, or with the arts and recreation sector, we’re going to start to see the easing of the restrictions as agreed to by National Cabinet, and it’s estimated that some 850,000 people will be back in work as a result of those three stages of restrictions being lifted. So, that’s the way to get people back into a job; easing restrictions, following the medical advice.
MICHAEL ROWLAND:
We’re just about out of time, Treasurer. Are there any circumstances in which the Government would consider extending the supplement for the JobSeeker recipients and perhaps making it permanent? Or, do you still plan on returning the old Newstart payment to $40 a day?
JOSH FRYDENBERG:
Well we’ve always been very consistent in announcing our programs that were in place for a temporary period of time to deal with the impact of the coronavirus pandemic...
MICHAEL ROWLAND:
Okay, so you won’t extend Jobseeker?
JOSH FRYDENBERG:
We’ve been very clear that when it comes to JobSeeker, JobKeeper payments, the other initiatives, they’re temporary, they’re targeted, they’re proportionate to the challenge we face.
MICHAEL ROWLAND:
Treasurer Josh Frydenberg, thank you so much for joining us on News Breakfast.
JOSH FRYDENBERG:
Always good to be with you, Michael.