PETER STEFANOVIC:
Treasurer, good morning. Good to see you.
JOSH FRYDENBERG:
Nice to be with you.
PETER STEFANOVIC:
First of all, can I ask, as a Melburnian, how are you feeling?
JOSH FRYDENBERG:
I’m devastated, and so too are my fellow Victorians, that it’s come to this. I mean, last night’s news, that we would be hit with stage 4 restrictions, curfews, further school closures, more constraints and restrictions on people’s movement, is going to really hit Victorians very hard. I mean, we are, Pete, at war, and every Victorian is on the front line. We can’t afford holes in our defence, and that’s why everyone needs to follow these new rules, because just a few people can endanger many, and that’s the harsh reality of what we find ourselves in, in Victoria.
PETER STEFANOVIC:
You said on this program, a couple of weeks ago, Treasurer, that, you know, you wear the big V on your chest as a Victorian, but a big T on your chest as the Treasurer. Just to be clear, do you actually support the measures that are being put in place by the Premier, Daniel Andrews?
JOSH FRYDENBERG:
We understand that they’re necessary. I mean, yesterday Victoria had 671 new cases. Across the country there were 687 new cases. So, Victoria has made up around 98% of Australia’s new cases yesterday. What we’re seeing in Victoria is a second wave. We’ve seen constantly and consistently high numbers of new cases. The Premier has spoken about these so-called mystery cases, people who you cannot trace the origin of their contraction of the coronavirus. So, clearly, there are real challenges for our medical health professionals. They’re working under extremely difficult circumstances, and fortunately we haven’t seen a repeat of this Victorian experience more broadly around the country.
PETER STEFANOVIC:
Ok, well, it’s going to be another blowout to the Budget. What is this going to cost?
JOSH FRYDENBERG:
Well, as you know, in the update I provided just a few days ago, we saw that the impact from these restrictions in Victoria would see a contraction of about $3.3 billion in the Australian economy in the September quarter. Now, that wasn’t based on stage four restrictions, nor was it based on restrictions being across the whole state. So, clearly, that number will be higher. We’ll provide an update in the October Budget, or beforehand, as Treasury work through those numbers, but clearly the impact on the Victorian economy, which makes up a quarter of the national economy, will be very significant.
PETER STEFANOVIC:
$9 billion has been suggested this morning, Treasurer. Is that correct?
JOSH FRYDENBERG:
Well, again, the number will be significant. We’ve yet to see from the Victorian Government, they’ll be making announcements shortly about the impact on various industries. Obviously that is important. Industries that will be hit hard include, obviously, retail, and a lot of people won’t be going to work that previously were. So, how those industries are prescribed, and how the economy continues to work even at a reduced pace will have an impact on those numbers.
PETER STEFANOVIC:
Yeah, I just want to get some clarification because we’ve reported that as well. Is that incorrect, $9 billion?
JOSH FRYDENBERG:
Again, I’m not going to put that number on it. What I’ll say is that Treasury are still working through it, and it’s a very fluid situation, Pete. I mean the businesses that will be allowed to continue to operate have not yet been outlined in clear detail. That will obviously happen in the coming period.
PETER STEFANOVIC:
How many jobs are at stake here?
JOSH FRYDENBERG:
Well, we already know that 975,000 Victorians are on JobKeeper, and JobKeeper, together with the cash flow boost, has been putting around $14 billion into the Victorian economy, and JobKeeper alone will continue to put around $3 billion a month, or $100 million a day, into the Victorian economy. Now, we are expecting that the vast proportion of that 975,000 Victorian workers will continue to be on JobKeeper in October and beyond, and so that is our working assumption, but, again, it will depend on the clarification about which industries are allowed to continue to operate and how.
PETER STEFANOVIC:
You’d have to assume, though, that more businesses are not going to survive this latest shutdown?
JOSH FRYDENBERG:
This is a massive kick in the guts to Victorian businesses. We all want to get to the other side of the coronavirus. No one wanted to see the further, the new cases increase as they have. So everyone recognises that we must try to do everything to get this under control, and that’s why last night’s news was very tough. But, you know, Victorians are tough as well, and everyone is now going to apply themselves to try to stem the tide of new cases.
PETER STEFANOVIC:
Ok, well Victoria is going to need some extra financial help. Should the rate of JobKeeper and JobSeeker come down, as planned, next month?
JOSH FRYDENBERG:
Well, it’s very important for your viewers to understand that JobKeeper and JobSeeker will remain at their levels until the end of September. Now, the end of September is beyond the extended period of restrictions that was announced by the Premier yesterday. So, that’s really important. The income support that the Morrison Government is providing Victorians continues to go out, and it goes out at that elevated rate of a flat $1,500 payment, and right now that’s supporting 975,000 Victorian workers. When it comes to other support, we’ll obviously work with the Victorian Government, we want them to share the load, it’s got to be matched support, but we do recognise there will be an ongoing need in Victoria and that’s why we’re having those conversations; myself with the Treasurer, and the Premier with the Prime Minister.
PETER STEFANOVIC:
So, if there is ongoing support, there’ll be, you know, let’s say JobKeeper, the $1,200 that will be coming after September that the Federal Government is going to chip in, it’d be up to the Victorian Government to chip in extra, maybe, to take it back up to $1,500 a fortnight, am I right?
JOSH FRYDENBERG:
Well, there are opportunities for Victoria to make those additions, if they deem fit. They’ve already made some announcements about support for businesses, and I’m sure they’ll make further announcements into the future. But, obviously the situation is very difficult and the Federal Government wants to work closely with the Victorian Government to ensure that Victorians get the support that they need through this very difficult crisis. We’re obviously focused, primarily, on the health response. That’s why, Pete, we’ve deployed more than 400 Defence Force personnel, we’ve got hundreds of Commonwealth public servants, we’ve funded 28 respiratory clinics in Victoria that have conducted more than 100,000 tests, we’ve released some 7 million masks from the national stockpile into Victoria, and we’re doing a lot of other things in Victoria to help on the health front. But at the same time we’re continuing to provide that economic support, and already around $14 billion has gone from the Federal Government into Victoria in just two programs alone; JobKeeper and the cashflow boost.
PETER STEFANOVIC:
So, will you be providing another economic update before October 6?
JOSH FRYDENBERG:
October 6 is the Budget, and obviously that’s where we’ll provide four year numbers, and obviously it’s a very fluid economic environment, hence the need to provide those regular updates. But, as the numbers come to hand about what Treasury thinks the impact of these latest restrictions are on Victoria, I’ll make that available.
PETER STEFANOVIC:
Ok, and just finally, I mean, we had Michael McCormack, well clips of him from last night, you know, there’s a lot of frustration in regional areas, Treasurer. You know, they didn’t have anything to do with anything that’s relating to what’s going on in Melbourne at the moment. So, how do you assuage those concerns of people living in regional areas that didn’t have anything to do with this latest shutdown?
JOSH FRYDENBERG:
Well, this is going to be very tough for all those school students, for all those people living in regional Victoria, as it is in the Melbourne metropolitan area. We’re all Victorians, so we’re all in this together. No one wanted to be in this position, and that’s why we need to adopt these very stringent measures, and it’s only going to be successful if everyone follows the rules.
PETER STEFANOVIC:
Treasurer, Josh Frydenberg, appreciate your time this morning. Hope you’re all doing okay, yourself and the rest of Victoria too. Thanks for coming on the show.
JOSH FRYDENBERG:
Thanks, Pete.