MICHAEL ROWLAND:
Let’s take you to Canberra now for more on the changes the Government is bringing in surrounding foreign investment in Australian businesses. We can bring in the Federal Treasurer Josh Frydenberg. Treasurer, good morning to you.
JOSH FRYDENBERG:
Good morning, Michael.
MICHAEL ROWLAND:
How strict is this clamp down?
JOSH FRYDENBERG:
Well, obviously, these are very strict and unprecedented measures. We’re abolishing the threshold for foreign investment proposals from $1.2 billion, effectively for countries with whom we have a free trade agreement, to $0. This is a precautionary measure, this is a temporary measure, this reflects the extraordinary times that we’re in, and obviously it’s going to give the Government greater visibility and scrutiny of foreign investment proposals to ensure that they remain in the national interest.
MICHAEL ROWLAND:
As a result of this, all foreign investment proposals no matter the value will be weighed against the national interest. Is this, Treasurer, aimed at China?
JOSH FRYDENBERG:
This is not aimed at one particular country, in fact, China last year was the fifth largest foreign investor in Australia with investments of around $13 billion. This compares to the United States which was the leading foreign investor with about $58 billion of foreign investment. But what is very clear to us, and also the European Union and other countries around the world, have actually said very clearly that they need in these extraordinary times to more strictly assess the foreign investments that are coming into Australia. Let’s also bear in mind, Michael, that foreign investment has served Australia very well. One in ten Australian jobs are with businesses that have benefitted from foreign investment, so we want to continue to capitalise on those opportunities but we also want to ensure that proper scrutiny is undertaken.
MICHAEL ROWLAND:
On that front, there is concern in some quarters about two Chinese owned property developers that started this crisis here in Australia buying in bulk hand sanitisers, face masks and the like, and shipping them in bulk back to China, meaning there are fewer of these things available to Australia. It may have been right legally, but what’s your view of that sort of behaviour morally, Josh Frydenberg?
JOSH FRYDENBERG:
Obviously, I want to see these sort of products used for Australians, there is no doubt about that. But as you say, they didn’t break the law but…
MICHAEL ROWLAND:
But was it morally right?
JOSH FRYDENBERG:
It’s not for me to pass moral judgments. What it is for me to do is to enforce the law and right now I’m talking to you about a change to the law, a legislative change, that sees that all foreign investment proposals get scrutinised by the Government to ensure that they’re in the national interest. Now when it comes to assessing the national interest, David Irvine, the Chairman of the Foreign Investment Review Board, has previously spelled out that issues such as the character of the investor, tax implications, competition implications, and of course, national security implications are all being assessed.
MICHAEL ROWLAND:
Okay. To the looming announcement about wages help for employers to keep employees on the books in this so-called hibernation period, a figure of $1,500 per fortnight is being bandied about. Is that what Australian workers who lose their jobs can expect?
JOSH FRYDENBERG:
Look, I’m not going to confirm the number but there will be an announcement today, Michael. And what Australians have learnt through this crisis is that the Government has their back. Whether it was yesterday’s announcement of over $1 billion of new measures for telehealth and mental health and domestic violence, whether it’s the $189 billion of measures that the Government has already announced to back small business and keep workers in their jobs, or whether it’s the doubling of the safety net, effectively with the doubling of what was previously known as Newstart and now is known as the JobSeeker payment. What we have always sought to do is to get Australians to the other side of this crisis, recognising how extraordinary it is and that we’re facing two wars at the same time; a health crisis and an economic crisis. So, the announcement today is all about providing additional income support and keeping employees connected to their employer because once we get to the other side of this, we want the recovery to be as speedy as possible.
MICHAEL ROWLAND:
How quickly will these wage subsidies flow through to businesses?
JOSH FRYDENBERG:
You’ll have to turn on later today.
MICHAEL ROWLAND:
Okay. Why hasn’t the Government decided to go down the UK route of subsidising 80 per cent of a workers wages?
JOSH FRYDENBERG:
Well the UK have a system for the UK and their Chancellor of the Exchequer, my equivalent, has made it very clear that he is starting from scratch, he’s building a new system. We’ve consistently sought to use our existing systems, namely the tax and the welfare system, to get support to people as quickly as possible. Today’s announcement will build on our previous announcements which are all about cushioning the blow for Australians who are doing it really tough right now.
MICHAEL ROWLAND:
Treasurer Josh Frydenberg in Canberra, thank you so much for joining us on News Breakfast.
JOSH FRYDENBERG:
Good to be with you, Michael.