VIRGINIA TRIOLI:
Josh Frydenberg, good morning to you.
JOSH FRYDENBERG:
Good morning, Virginia, nice to be with you and your listeners.
VIRGINIA TRIOLI:
Treasurer, how does it feel to no longer have to worry about debt and deficits?
JOSH FRYDENBERG:
Well, we’re always focused on ensuring that our spending is disciplined and what we saw in last night’s Budget is that net debt compared to the size of the economy has actually come down each and every year from what was forecast at last year’s Budget just last October. So, we’ve seen a strengthening in the economy since then, particularly around the labour market with around half a million new jobs being created. Last night was our economic plan to create another 250,000 jobs, to drive the unemployment rate below five per cent with investments in infrastructure, with skills, with tax relief for families and more incentives for business to invest and, of course, Virginia, there was also significant new spending with respect to aged care, disability support, mental health and women’s safety.
VIRGINIA TRIOLI:
But on that score, and I think you’ve actually pulled out there in your discussion of how the economy is going. If the recovery is going so well, then why do you need to spend so much?
JOSH FRYDENBERG:
Well, the recovery is not locked in. And this Budget is being delivered in the midst of a global pandemic which is still raging around the world–
VIRGINIA TRIOLI:
I just want to jump in there, Treasurer, it might not be locked in, but all the assumptions in your Budget are based on the fact that it will keep roaring back to life in the way that it has been doing. So, I don’t know if you can have it both ways because your Budget and your projections really do assume that it is locked in.
JOSH FRYDENBERG:
Well, there’s a lot of uncertainty out there and those assumptions are based on the best advice to us today, but we don’t know what’s around the corner.
VIRGINIA TRIOLI:
Sure, but if your spending goes with those assumptions, your spending goes with the assumptions that it keeps roaring back to life, hence the question about whether you need to spend so much.
JOSH FRYDENBERG:
And we’ve just seen Europe go into a double-dip recession. We’ve seen more than 800,000 new COVID cases around the world and-
VIRGINIA TRIOLI:
There’s no evidence of that happening here, Treasurer.
JOSH FRYDENBERG:
Well, Virginia, just a couple of weeks ago we saw Western Australia go into statewide lockdown-
VIRGINIA TRIOLI:
But there was not 800,000 cases, Treasurer. That’s the parallel you’re drawing. It was one person and then the lockdown was brief, so it’s not really comparable. So, I return to my question. Given that you don’t have any risk of a double-dip recession here whatsoever, why spend so much?
JOSH FRYDENBERG:
Well, Virginia it’s nice to know that you’re the new secretary of the Treasury Department or the new Treasurer with your very hard and fast prediction that we do not risk going into a double-dip recession. I can tell you-
VIRGINIA TRIOLI:
I’ll take you to lunch if we do!
JOSH FRYDENBERG:
Well, I can tell you that we do face a risk of losing the gains that we have made over the course of the last year if we don’t consolidate them, if we don’t secure the recovery. What we have seen, even just weeks ago, was Western Australia go into a statewide lockdown. What we have seen is new cases. Our ability to suppress the virus with good contact testing and tracing and a proportionate response from the states with respect to lockdowns is obviously going to be critical in helping the economy recover. But in last night’s Budget a number of the measures to consolidate those gains were temporary, like the tax cuts for more than 10 million Australians on low and middle incomes, like the business investment incentives, like the infrastructure programs that are rolling out across the country. And then, of course, there was structural spending, new spending on aged care in response to the Royal Commission and other social programs.
VIRGINIA TRIOLI:
I want to dig into the aged care money. We’ve only got a few minutes left this morning, Treasurer. Why haven’t you considered or did you consider doing the real and major reform that the aged-care sector needs, and that is its over-reliance on the for-profit sector where cost-cutting is always going to be the business model? Did you consider looking at reform there?
JOSH FRYDENBERG:
Well I think there is a role for both the for-profit and the not-for-profit sector in aged care-
VIRGINIA TRIOLI:
My word there was reliance and that’s the reliance and, as we know, cost-cutting and delivering to investors, that’s the business model.
JOSH FRYDENBERG:
I do not think that that is at the heart of the challenges that we’ve seen in the aged-care sector. What has been indicated by the Royal Commission is that there’s been a phase of covenants, a phase of safety, not enough accountability. Of course, there are workforce challenges with an ageing population and the base funding for the residential-care sector as well as the need for more home-care packages. They’ve all been addressed in last night’s comprehensive response, which is not just about extra funding. It is also about reform. 33,000 new training places for carers, a $10 per resident per day boost to the base funding in residential care, a minimum standard for the number of minutes that are spent each day with residents from both carers and nurses. We’ve got special respite services for carers. We’ve got retention bonuses for nurses and we’ve got 40,000 new home-care packages from this year and another 40,000 next year, largely level three and four packages which will help meet the growing need out there.
VIRGINIA TRIOLI:
I want to very quickly get to an important issue here in the state, which is, of course, actually have air-spaced, air-gapped proper quarantine built here in this state. This is the health minister Martin Foley speaking at yesterday’s press conference.
PLAYED EXCERPT
“Which is why this evening’s national Budget is a golden opportunity for the Commonwealth to step up and do its constitutional duty and fund, with the states, broadacre quarantine facilities such as that proposed by Victoria out at Mickleham.”
VIRGINIA TRIOLI:
When will the Federal Government step up and do its constitutional duty on this?
JOSH FRYDENBERG:
Well, again that’s the claim of the Labor Health Minister. What we do know is that they’ve put a proposal to the Commonwealth and we’re properly getting that consideration, as you would expect us to do, and we will have more to say about that in due course, but it was agreed through National Cabinet, the states would take primary responsibility for the hotel quarantine process. In New South Wales, it’s been a huge success-
VIRGINIA TRIOLI:
I’m sorry to jump in, but there've been leaks out of hotel quarantine in every state. That’s why you have to keep international borders closed until mid-next year because you don’t have, and the Commonwealth hasn't built that air-spaced quarantine system, so you’re delaying your own full economic recovery by failing to build it, aren’t you?
JOSH FRYDENBERG:
Well, actually in most states they’ve been very successful with the quarantine. Victoria has been an outlier–
VIRGINIA TRIOLI:
No, sir. No, sir. There’ve been outbreaks of infection from hotel quarantine in every state.
JOSH FRYDENBERG:
I can tell you, Virginia, that no state has experienced the disaster that unfortunately we saw in Victoria–
VIRGINIA TRIOLI:
No, sir, we actually haven’t had as many leaks out of hotel quarantine as other states have. The figures simply don’t show that. But on the point of building it, will the Commonwealth do that?
JOSH FRYDENBERG:
Well again, we’re giving it due consideration. We have our Howard Springs centre that we’ve obviously been expanding. But our focus has been to ensure that we give the states the support through the contact testing and tracing and the respiratory clinics and the GP services that we spend the money to procure the vaccines. There was $3.4 billion in last night’s Budget to do exactly that to continue the health measures like Telehealth which have been so successful. We are not out of this virus yet, we are not out of this crisis yet. The measures last night will go a long way to securing our recovery.
VIRGINIA TRIOLI:
Always good to talk to you Federal Treasurer. Thank you for taking the time.
JOSH FRYDENBERG:
Thank you, Virginia.