VIRGINIA TRIOLI:
Josh Frydenberg, thanks for joining us. Good morning.
JOSH FRYDENBERG:
Nice to be with you, Virginia.
VIRGINIA TRIOLI:
Let me just ask a couple of quick questions just about what the Prime Minister announced yesterday and also what were amplified just then by the Premier of Victoria. New physical separation rules and the rule of two of us out in public at the one time unless you're in a family group. It's another little step on the way to social shutdown but not completely. You will be aware that many on this program and elsewhere have been saying for some time just shut it down, shut it down completely. Why not that complete step yet?
JOSH FRYDENBERG:
Because we continue to take the best advice of the medical experts. As you know there's a Chief Medical Officer at the Federal level as well as at the State level and they meet every day and make recommendations through the National Cabinet and the National Cabinet have accepted the recommendations for further restrictions. That's what we're now seeing in place, and people should obviously follow those new rules because we're all in this together and if people embrace the social distancing obligations then we'll be a lot safer for it.
VIRGINIA TRIOLI:
We've all seen the charts and the graphs that show the rate of infection and that incredibly low line that relates to countries such as Singapore and South Korea where their response was much more hard and fast. Why have those scenarios and those outcomes not persuaded the Government or, indeed, persuaded our Chief Medical Officer?
JOSH FRYDENBERG:
Well, again, they're looking at the Australian scenario. We've had over 211,000 tests, there have been 4,000 people who have contracted the coronavirus. Most of those situations are from people who have either returned from overseas as Australians or have got it from a visitor from overseas. The rate of increase has been slowing but we're still seeing the numbers increasing in terms of the number of cases. And obviously we're seeing sustained community transmission in Melbourne and Sydney. So we'll continue to take the best possible medical advice, try to test as many people as possible, try to get as much equipment as necessary as well, and, you know, we're in for some tough days ahead.
VIRGINIA TRIOLI:
So tell us how this wage subsidy will work, being paid to big and small businesses?
JOSH FRYDENBERG:
Well, you will have to tune in for the full details later this afternoon. But what we are seeking to do is to make it easier for employers to keep their employees on the books because there's going to be the other side to the coronavirus, Virginia, and it's important when we bounce back that there is that connectivity between employer and employee and obviously it's been heart breaking to see the queues outside Centrelink and if people are receiving money through their employer, and being kept on the books, that's going to be a lot easier to stay in work on the other side of this.
VIRGINIA TRIOLI:
So, but this, I know I have to wait for the full details, but just as I understand it, or as the information has been trickling out, it will be paid to employers, it won't be a direct payment to the employees, say through the ATO?
JOSH FRYDENBERG:
Well, what we're seeking to do is use the existing systems, namely the tax and the welfare systems, to adopt something which is different to the UK and different to New Zealand, but which suits the Australian circumstance and obviously build on our previous announcements to date which include effectively a doubling of Newstart with the coronavirus JobSeeker supplement, as well as the up to $100,000 cash grants to small businesses in order for them to meet their wages bill as well as other fixed costs.
VIRGINIA TRIOLI:
Re foreign investment, the scrutiny now of the Foreign Investment Review Board will apply to any attempted purchase by a foreign interest in Australia, no matter the value. Have you detected evidence of attempts to buy up Australian assets and companies under the cover of COVID-19?
JOSH FRYDENBERG:
Well, this is a precautionary measure and it's a temporary measure and it reflects the extraordinary times that we're in…
VIRGINIA TRIOLI:
Just to jump in there to clarify, so it doesn't come about as a result of noticing that there have been some attempts in the last little while?
JOSH FRYDENBERG:
It's about what behaviour we're seeking to prevent and we do know that many Australian companies are distressed, their market capitalisations have fallen, they're engaged in extensive discussions with the banks and what we're trying to do is reduce the possibility of predatory behaviour by certain purchasers from overseas that are not in the national interest. Now when it comes to assessing the national interest, we look at the character of the investor, we look at the tax and the competition implications and we also look at national security grounds and what I want to do here is be able to run the ruler over every application that comes through the door regardless of the amount and that's why I've abolished, planning to abolish, the thresholds that currently exist.
VIRGINIA TRIOLI:
Is it possible that elements of this new regime might actually stay in place once we get to the other side of this?
JOSH FRYDENBERG:
Well, again, that would be a conversation for that time…
VIRGINIA TRIOLI:
What do you think? I mean a lot of people for some time, particularly on this program, have been saying, look, foreign interests and in particular, let's call it out, a lot of people say here, Chinese foreign interests, they've had it too easy when it comes to purchasing and investing. So what does your gut tell you about whether some elements of this new regime might need to stay in place?
JOSH FRYDENBERG:
Well, my instinct tells me that there should be temporary measures because we have entered into free trade agreements with a number of countries which are of mutual benefit, which means easier access both in terms of the export of goods and services but also investment. That's a regime that's served Australia well. One in ten Australian businesses have benefitted directly from foreign investment and we know that one in five Australian jobs are connected to free trade and as a country of 25 million people, with billions on our doorstep through the region, there are great opportunities for us from having a very sensible and considered approach to foreign investment and free trade. But that being said too, Virginia, we're in uncertain times and other countries are also tightening up their foreign investment rules and I think, you know, Australia should do that as well.
VIRGINIA TRIOLI:
You've seen all the conspiracy theories out and about that this is constructed by China to try and get hold of some investments here in Australia. Do those conspiracy theories persuade or concern you?
JOSH FRYDENBERG:
Well I don't believe them. I think this is obviously a health crisis that, unfortunately, started in the Wuhan province and quickly spread around the world and no country has been immune to it. But when it comes to China, last year they were our fifth largest foreign investor, about $13 billion worth of investment. This compares to our number one foreign investor which was the United States at $58 billion. After the United States you had Canada, Japan and Singapore and then China. So this is not directed at one particular country. What it is directed at, is preserving and enhancing the national interest.
VIRGINIA TRIOLI:
I'm being asked here on text to ask you, and I think it's a good point actually, Gerard in Fitzroy has raised this, about casual workers and gig workers, the support that might be offered to them, that might not have the ongoing employer that you're talking about here in relation to the wage subsidies. What about them?
JOSH FRYDENBERG:
Well, obviously you will have to wait again for further details later this afternoon but...
VIRGINIA TRIOLI:
Well that sounds like good news, Josh Frydenberg?
JOSH FRYDENBERG:
Well you can interpret my comments in any way you like…
VIRGINIA TRIOLI:
I'd like to. I'd love to interpret it as good news.
JOSH FRYDENBERG:
But what I would say is casual workers did benefit significantly, as others who tragically lost their job, from the JobSeeker coronavirus supplement, which was a $550 addition to what was previously known as Newstart. And so there has been effectively a doubling of that safety net and it's temporary and it's designed to support the people through very difficult times. You would have seen yesterday's announcement about residential tenants as well as retail tenants not being able to be evicted for a period of six months because of their inability to pay due to the impact of the coronavirus. This is all about the hibernation strategy that the Prime Minister's been articulating, whether it's the agreements with the insurance companies or the energy companies, this wage subsidy, the prevention or moratorium on evictions or the work that we've done with the banks to ensure that no interest and principal is paid for the next six months for small and medium-sized businesses. All of that is important to getting households and businesses to the other side of this.
VIRGINIA TRIOLI:
Good to talk to you this morning, Treasurer, and thanks for joining us.
JOSH FRYDENBERG:
Good to speak to you and your listeners need to know that the Government has their back at this difficult time.