MICHAEL ROWLAND:
The Treasurer Josh Frydenberg joins us. Good morning, Treasurer.
JOSH FRYDENBERG:
Good morning, Michael.
MICHAEL ROWLAND:
What does this say about how worried the Government is about the impact of the virus on businesses not just in Victoria but around Australia?
JOSH FRYDENBERG:
We're deeply concerned about the economic blow to the national economy and particularly, the Victorian economy from the coronavirus spread. The reality is as Treasury have forecast, it will hit the economy by between $10 to $12 billion in the September quarter and we'll see between 250,000 and 400,000 Victorian employees either stood down or stood down to zero hours or who lose their job as a result of these stage 4 restrictions. So this is a really difficult time for Victorian families and for Victorian businesses.
MICHAEL ROWLAND:
Ok so how easier under these changes will it be for businesses to get hold of JobKeeper?
JOSH FRYDENBERG:
Well Michael, the Morrison government is committing an additional $15.6 billion to expand the JobKeeper program. Around $13 billion of that will go into Victoria. We'll see hundreds of thousands of more Victorian workers now using the JobKeeper program. We're making two major changes. One is to the business turnover test. The other is to the eligibility employee test. When it comes to the business turnover test previously in order to be eligible as a business for the December quarter, you needed to be down in both the June and the September quarters. We're now saying that you need to be just down in the September quarter. This will take into account those businesses that were doing okay through April, May and June but have obviously been subject to lockdown now. The second change is around the employee eligibility. In order to be eligible for the JobKeeper program, the employee needs to be on the business's books as of 1 July. Previously, it was 1 March. And again, this change means more people can access the program because as businesses were starting to open up, as progress was made on the health front, more employees were coming on the books of businesses. Now of course, they're being subject to lockdown. So this will allow the JobKeeper program to cover them.
MICHAEL ROWLAND:
Okay, you're clearly concerned about the fate facing many businesses and a lot of businesses will I'm sure welcome this extension. Did you give any consideration though to keeping JobKeeper at $1,500 per fortnight beyond September?
JOSH FRYDENBERG:
Well again it does go, as you say, at $1,500 to the end of September. That's beyond the six-week lockdown period that Daniel Andrews has announced...
MICHAEL ROWLAND:
Yes, I'm asking will you extend it beyond September at $1,500 at all?
JOSH FRYDENBERG:
Look, our focus has been to have a payment that transitions, remembering that this is a national program not just benefitting Victorian businesses. It benefits businesses right across the whole country. And in some sectors like aviation and tourism, they'll continue to do it tough well into next year. So, we've always believed that at $1,500 it was a significant payment equivalent to the minimum wage. At $1200, it's about 80% of the minimum wage and it steps down to $1,000 dollars in the March quarter. But this program, JobKeeper, is now going to be supporting around four million Australian workers, more than a million Australian businesses, and at over $100 billion Michael, it's the most significant and substantial, and expensive, government support program in Australia's history.
MICHAEL ROWLAND:
Just a couple of questions before we go. You've been involved in various, I guess you'd call them, crisis talks this week regarding supply chains particularly as they relate to supermarkets, not just in Victoria but around the country. What assurance can you give to viewers around the country about the safety and the security of supply chains?
JOSH FRYDENBERG:
Well, I met with the Business Council of Australia and their membership, the Victorian Chamber of Commerce and more than 500 of their business members, as well as with the Australian Industry Group, and the message was similar, that when these restrictions were put in place you have to take into account those national supply chains. I'm pleased that some of those concerns have been taken into account. I was speaking to the head of Woolworths last night. They have around 4,500 people in their Victorian distribution centres. They're going to be able to now work that through and they're confident that they can avoid some of the challenges that they were previously concerned about under the initial changes that were announced. I continue to talk to my Victorian counterpart. We've heard some good news on steel as a permitted area where business can continue. Again, that's very, very important to these national supply chains. A business like Bunnings for example, will distribute paint and drilling equipment and IT and computer equipment nationally out of Victoria. So taking into account the implications of these restrictions on national supply chains not just for food but for other goods is absolutely critical.
MICHAEL ROWLAND:
Before we go, we've been reporting this morning that Victorian MPs like yourself who want to go to Parliament later in the month will have to quarantine for 14 days before you get inside Parliament House. Are you making plans for that?
JOSH FRYDENBERG:
I am. I will be quarantining for that period of two weeks in Canberra. Obviously, there can't be one rule for politicians and another for everyone else. We've got to absolutely be focused on following that medical advice and ensuring that we keep the community safe. I'm working day and night, as is the Prime Minister, the Health Minister, and all my colleagues to support the Australian community through this once-in-a-century pandemic. I need to be there for Parliament. We've got important legislation to introduce and of course, we will abide by the medical rules as required.
MICHAEL ROWLAND:
Treasurer Josh Frydenberg, thank you for joining us on News Breakfast.
JOSH FRYDENBERG:
Good to be with you.