PETER STEFANOVIC:
Joining me to discuss is the Treasurer Josh Frydenberg. Treasurer, good morning to you thanks so much for joining us.
JOSH FRYDENBERG:
Good morning Pete.
PETER STEFANOVIC:
So a bit of admin here first of all, so who qualifies for this payment?
JOSH FRYDENBERG:
Well there are veterans, pensioners, those on carer’s payments. Around five million Australians who are on income support will get $750 from the Federal Government starting from this week. It will cost about four billion dollars. It builds on the earlier $750 cash payment that went out just after March and this is obviously reflecting the challenging times that many Australians find themselves in, and those who are on income support are doing it particularly tough.
PETER STEFANOVIC:
And how do they get it?
JOSH FRYDENBERG:
It just happens. Their details are with the appropriate government agency and the money will be paid out as it was with the first payment.
PETER STEFANOVIC:
Okay, I know you made plans for these two payments but given how fluid things are at the moment Treasurer, and especially what’s going on in your state of Victoria at the moment, are there any plans for a third payment?
JOSH FRYDENBERG:
Well right now our focus is on announcing the future of the JobKeeper, the JobSeeker programs and giving a fiscal and economic update on the 23rd of July and as you know that’s been foreshadowed for some time. We recognise that the economy is starting to open up in some states, whereas in Victoria it’s obviously going through a particularly difficult time and our announcements on the 23rd will reflect that reality.
PETER STEFANOVIC:
So, may pensioners receive a third $750 payment, is that possible?
JOSH FRYDENBERG:
Well right now we’re focused on the second payment. We’ve only made provision for two payments in the $260 billion worth of announcements to date. We’re very conscious though that this $750 payment will help go and meet the daily bills of Australians who are doing it tough, and that may meet their rent, that may meet their food and grocery bills, that may meet their travel expenses.
PETER STEFANOVIC:
Ok, not ruling it out though?
JOSH FRYDENBERG:
Well we’ve only got plans for two payments as we’ve announced.
PETER STEFANOVIC:
Okay, well you’ve got childcare which stops today, Treasurer. Labor says it’s going to leave parents with a really tricky decision to either pay childcare or having to pull kids out of childcare. Is that an accurate description?
JOSH FRYDENBERG:
No it’s not, it’s just politicking as usual from the Labor party which is very unfortunate at this time when we actually need the country to be coming together, they seem to be looking for every opportunity for crass political opportunism. The reality is we’ve announced a transition plan that involves the childcare subsidy coming back on. We’ve provided $8.3 billion in childcare support to families. It also involves more than a $700 million transition payment based on the revenue of these service providers in that pre-COVID phase. As well as easing the activity test which means that those who need support can get up to 100 hours a fortnight of subsidised care. Now in Victoria we’ve even made further arrangements that the service providers can waive the gap fee for those who are in the affected areas which will give the parents the confidence that they can maintain their enrolment, ensure that the parents are not out of pocket, while it’s also good news for the service providers because they continue to get paid.
PETER STEFANOVIC:
You just talked about your economic report that you’re still working on that is coming up and it’s due soon. I don’t know if you can answer this but I’m wondering how much fire power, financial fire power, does the Government have left? I mean surely you can’t keep affording to pay all of these different sectors while states keep getting shut down. So you’ve got this kind of stop-start measure that’s in place that the business community, I note today in the papers, is very critical of.
JOSH FRYDENBERG:
Well the first thing to say is that we entered this economic crisis from a position of economic strength, Pete. We had a debt-to-GDP ratio of around 20 per cent, which is a quarter of that in the United States and the United Kingdom, one seventh of what it is in Japan. We also had the first balanced budget in 11 years and we had economic growth that was rising in the back half of last year and unemployment fell in February to 5.1 per cent, bearing in mind when we came to government that unemployment was 5.7 per cent. So we had got the books in a good shape to be able to get us through this crisis. Now since that time we’ve announced $260 billion of economic support, a record 13.3 per cent of GDP. And that has helped stabilise the economy, it’s given not just an economic boost but also a psychological boost. Now we’ll continue to spend as required but we’re also going to be disciplined. I mean again, the Labor party is saying go and buy an airline, go and spend on this, go and spend on that, we’re much more focused on ensuring support gets to the people who need it most, and you’ll see that reflected in our announcement on the 23rd because we’re going to have another phase of income support which will be targeting those most in need.
PETER STEFANOVIC:
And can you give us any idea on what that will be and where that will be going?
JOSH FRYDENBERG:
Well you’ll just have to tune in at that time, but I can tell you Pete that it will be consistent with the principles that have governed us well going into this crisis, namely spending that is scalable, targeted, proportionate to the challenge we face as well as using existing systems.
PETER STEFANOVIC:
Well the unions said it’s not going to support those tax cuts that you talked about last week. Is that a concern to you?
JOSH FRYDENBERG:
Look I’m not focused on what the unions have to say about tax because they’ve never seen a tax hike that they don’t like and never seen a tax cut that they didn’t dislike.
PETER STEFANOVIC:
Can I just ask you, Helen Clark said on the weekend, and she’s of course steering this investigation into China and the origins of COVID-19, she reckons it will be at least two years before there is a vaccine. Is that the kind of timeframe that you’re working towards?
JOSH FRYDENBERG:
Well the reality is nobody knows when those wonderful scientists and medical researchers who are working on a vaccine will come up with it. What we do know is we have to learn to live with the COVID pandemic and to ensure that our lifestyle is changed accordingly. And that’s why we need to practice the social distancing requirements, that’s why we need to be quarantining those who come in from overseas. But what it is a reminder of is that this is a really difficult time, a once in a century pandemic that started off as a huge health crisis, remains a huge health crisis, but with very significant economic consequences.
PETER STEFANOVIC:
Just, the Prime Minister went to the football on the weekend Treasurer. He’s received some criticism from some parts of the community about going to the football. As a Victorian, you’re in lockdown at the moment, did you have any problem seeing those pictures?
JOSH FRYDENBERG:
Good on him, I mean the Prime Minister is passionate about his country and he’s passionate about his footy. I would love to go and watch Melbourne Storm or the Carlton Football Club, I just have to travel interstate to do it. But Pete, what it reminds us of is that we have one country and two stages. We’ve got New South Wales which has been opening up and we’ve got Victoria which has been closing down and this is the unfortunate reality of the spike in cases in Victoria. I note that the Labor party leader Anthony Albanese didn’t criticise the Prime Minister and I can tell you if he thought there was an ounce of political opportunity in that he would of, and I think it’s a reality where most people across the country are at. They understand that the Prime Minister is spending some time with his family, he’s going to enjoy the footy as he can do in New South Wales, while here in Victoria we’re obviously going through a much more difficult period.
PETER STEFANOVIC:
Treasurer Josh Frydenberg, appreciate your time this morning, thanks for joining us.
JOSH FRYDENBERG:
Good to be with you.